Free Proposed Findings of Uncontroverted Fact - District Court of Federal Claims - federal

Case 1:06-cv-00211-VJW

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS

NO. 06-211T (Judge Victor J. Wolski) JAMES R. THOMPSON, Plaintiff, V THE UNITED STATES, Defendant

----------------------------------ORAL DEPOSITION OF MICHAEL D. HOLDERREAD APRIL 23, 2007 Volume 1 ----------------------------------ORAL DEPOSITION OF MICHAEL D. HOLDERREAD, produced as a witness at the instance of the DEFENDANT, and duly sworn, was taken in the above-styled and numbered cause on the 23rd of April, 2007, from 2:07 p.m. to 3:22 p.m., before Diana Pereira, CSR in and for the State of Texas, reported by machine shorthand, at the law offices of WINSTEAD, 5400 Renaissance Tower, 1201 Elm Street, Dallas, Texas, pursuant to the Rules of the Court of Federal Claims.

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A P P E A R A N C E S FOR THE PLAINTIFF: MR. STUART M. REYNOLDS, JR. WINSTEAD 5400 Renaissance Tower 1201 Elm Street Dallas, Texas 75270 (214) 745-5360 (214) 745-5400 FAX FOR THE DEFENDANT: MR. JEFFREY R. MALO MR. STEVE FRAHM US DEPARTMENT OF JUSTICE, TAX DIVISION COURT OF FEDERAL CLAIMS SECTION P.O. Box 26 Ben Franklin Station Washington, DC 20044 (202) 305-7539

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ALSO PRESENT: Mr. James R. Thompson

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INDEX PAGE Appearances........................................... MICHAEL D. HOLDERREAD Examination by Mr. Malo.......................... 2 4

Signature and Changes................................. 37
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Reporter's Certificate................................ 39
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EXHIBITS
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NO.
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DESCRIPTION

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Michael D. Holderread's resume................... 6 Photocopy of my logbook starting at December 18th, 2001, ending February 3rd, 2004... 24

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P R O C E E D I N G S MR. MALO: Good afternoon. My name is Jeff We're with the

Malo, and I'm joined today by Steve Frahm.

Department of Justice, representing the United States in the matter of James Thompson versus the United States. With us this afternoon is Michael Holderread, our deponent. And he is joined by Mr. Thompson and his

attorney, Mr. Reynolds. MR. REYNOLDS: in? MR. MALO: Oh, yes. I'm sorry. Do you want to swear the witness

MICHAEL D. HOLDERREAD, having being first duly sworn, testified as follows: EXAMINATION BY MR. MALO: Q. First, I'd like to acknowledge that this deposition

has been scheduled by agreement of the parties and express our thanks for everyone's cooperation in meeting with us here today. And, second, I'd like to state that this deposition is

being taken in accordance with the Rules of the Court of Federal Claims. Now, Mr. Holderread, have you ever been deposed before? A. Q. I don't understand what "deposed" means. Have you ever given testimony under oath outside of a

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courtroom in a -A. Q. A. Q. little. No. -- in a meeting environment like this? No. Okay. Well, let me explain the process to you a If at any point No?

I will ask you a number of questions.

my questions are unclear, I ask that you not answer the question; instead, ask me to rephrase and I will. know the answer, please tell me. And I don't want you to speculate, but if you have some idea of what the answer is, but you're not absolutely certain, please provide the information that you have and describe the limits on your level of certainty. We can take a break at any point in time. Please, just ask if you'd like to take a break. And If you don't

Mr. Reynolds here may object to certain questions that I ask. If he objects, I have three options. I can either withdraw my

question, rephrase the question, or ask you to answer the question as posed. If at any time during our discussion you remember additional information about a prior matter that we have discussed, please provide that information to me even if we have gone to another topic. If you wish to revise an answer

or believe you are mistaken, please advise me of this fact at any time during the deposition.

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The years at issue are 2002 and 2003.

So all

questions that I ask, unless I specify otherwise, relate to that period. Now, it's our understanding that you were

employed by Mountain Air Charter, LLC from approximately November 2003 through October 2004; is that correct? A. Q. That is correct. Okay. So for any questions that I ask when I refer

to your employer, I am referring to Mountain Air Charter and/or Mr. Thompson. If any answers that you provide to questions of

mine relate to situations where you were performing certain activities or services outside the scope of your employment, please indicate so in your answer, okay? A. Q. A. Q. Okay. You understand all that? Yes. Very good. MR. MALO: as Exhibit 1. MR. REYNOLDS: minute? MR. MALO: Certainly. May we go off the record just a I'd like to have the following marked

(Discussion off the record) (Exhibit No. 7 was marked) Q. (BY MR. MALO) Okay. Mr. Holderread, could you

identify this document for me?

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A. Q. record. A. Q. A. Q. A. Q. A. Texas. Q.

This is my current, as of April 18th, 2007, resume. Thank you. Would you state your full name for the

Michael David Holderread. And your address? 607 Evans Drive, Euless, Texas, 76040. Telephone number? 817-355-1032. Would you describe your educational background? Associate's degree, Mountain View College, Dallas,

And could you describe your formal flight training

background? A. Private instrument, commercial, multi-engine

instructor, instructor -- instrument instructor multi-engine. Q. A. Q. Okay. Where did you learn how to fly?

Arlington, Texas. And did you learn how to fly through private

instruction? A. Q. flying? A. Q. completed? Yes, for the commercial pilot certificate. Can you name those commercial courses that you Yes. Did you ever take any commercial training courses in

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A.

It's just a commercial -- the training for a It's one -- basically one

commercial pilot certificate. course. Q. A. Q. A. Q.

Was there a company that provided this training? No. When did you first begin working for Mountain Air? October of 2003. Okay. Your resume indicates November. Was there a

period of time prior to your employment with Mountain Air that you were in any way, shape, or form associated with Mountain Air Charter, LLC? A. Yeah, that would have been the first flight to kind

of get used to the airplane before I actually did the formal training for that airplane. Q. A. Q. position? A. I don't know the exact date, but it had to have been Do you know when that occurred? That first flight was October 28th, 2003. Okay. When did you begin interviewing for this

mid-October of 2003. Q. So from the period that you first began interviewing,

mid-October 2003, to the period of time when you started working for hire, November 2003, is it an accurate statement to say that two to three weeks had elapsed? A. I don't know. Possibly not that long.

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Q. A. Q.

Possibly less time than that? Yes. Prior to working for Mountain Air, had you ever flown

a Pilatus PC-12? A. Q. A. Q. A. No. Did you fly a similar type of aircraft? I don't know how to answer that question. Okay. Let me --

It's a very -- it's really an airplane that I -- I

don't know if I can compare in a similar fashion with other airplanes. Q. Okay. Prior to working for Mountain Air, were you

qualified to fly the Pilatus PC-12? A. Q. A. Q. As far as the FAA is concerned, yes. Okay. No. In what way were you not qualified to fly the How about for insurance purposes?

Pilatus PC-12 for insurance purposes? A. I had not been through formal simulator training in

an approved school for that airplane. Q. school? A. Q. A. Yes. And what was the school? SimCom in Orlando, Florida. Did you complete simulator training in an approved

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Q. A.

When did you complete that training? I don't know the exact date. I believe it was on

Thanksgiving of 2003. Q. A. Q. Okay. Yes. Prior to completing the SimCom training, had you So the same month that you began working?

flown the Pilatus PC-12 on your own, solo? A. Q. A. Q. A. Q. A. No. Had you flown it at all? Yes. With whom did you fly the plane? With Tom Travis. And what was the purpose of flying with Tom Travis? To become more familiar with the plane in preparation

for training. Q. And how many hours were required for you to train on

the Pilatus PC-12? A. Q. In -- in training or before entering training? Prior to commencing your employment as a solo pilot

on revenue-generating flights for Mountain Air Charter. A. Q. And the question was? How many hours did it take for you to train on a

Pilatus PC-12 prior to commencing flights that you piloted for revenue? A. I don't know.

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Q.

Is it accurate to state that the first time you flew

in a Pilatus PC-12 was on October 28th, 2003? A. Q. Yes. And is it accurate that after completing the SimCom

training, which you believe to be Thanksgiving weekend of 2003, that you began flying as a solo pilot? A. Q. A. Q. Yes. Flying the Pilatus for revenue-paying passengers? Yes. Would you be able to estimate how many hours between

October 28th through Thanksgiving of 2003 you spent training on a Pilatus PC-12? A. Q. training? A. Q. Independent. So 18 hours of actual flight training, plus SimCom Yes. 18 hours.

Is that independent of or in addition to SimCom

training, which I believe is 20 hours? A. The SimCom training is definitely training. The time

that I flew before that was -- I don't think can be considered formal training. training. Q. A. Q. Informal training, would you call it? Yes. Okay. And what was the purpose of the 18 hours of It was a form of training, but not formal

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informal training that you received? A. To become more familiar and comfortable with the

airplane before the formal training. Q. And after 18 hours of flying on the Pilatus, had you

satisfied your own estimation of becoming sufficiently comfortable with the Pilatus to fly independently? A. Q. Yes. What other aircraft had you flown prior to the

Pilatus PC-12? A. Cessna 150 series, Cessna 170 series, Cessna 300 That would

series, 400 series, 500 series, King Air 90 series. have been about it. Q. A. Q. A. Q. A.

How did those aircraft compare to a Pilatus? Totally different. Are they different type? Uh-huh. What's different about them? The Cessna 150 series, 170 series, 300 and 400 are The Pilatus is a turbine --

all reciprocating engines. turboprop engine.

The King Air series, although it was a

turboprop like the Pilatus, it was a two-engine airplane; whereas, the Pilatus was one. is turbojet. Q. In relation to the other aircraft you flew, would you And then the Cessna 500 series

state that the Pilatus was more or less complex than any of the

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other aircraft you had flown? A. Q. Probably more complex. Aside from the time that you spent with Mr. Travis,

did you independently pursue any additional training on a Pilatus PC-12 prior to interviewing and working for Mountain Air Charters? A. Q. No. Since your employment with Mountain Air Charter, have

you flown PC-12s? A. Q. No. And the records indicate that you terminated

employment with Mountain Air Charter in October of 2004? A. Q. A. Yes. And why did you terminate employment? I had a job offer with another company to fly

turbojet aircraft. Q. A. Which make or model of aircraft did you fly? It was a Citation 550, which is the same thing as

saying a Citation 2. Q. A. Q. A. Q. A. And that's another turboprop aircraft? No, this is a turbojet aircraft. Turbojet aircraft. Uh-huh. When did you first become aware of this case? Maybe two months ago. I -- I don't recall for sure.

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Q. A. Q. A.

How did you first learn about this case? By an e-mail from Jim Thompson. And what did Mr. Thompson tell you by e-mail? That he was in a case against the U.S. Government and

would I mind helping him out by giving a deposition. Q. Did he indicate in any way what the topics to be

discussed in your deposition -- deposition would be? A. Q. No. Did you meet with anyone in connection with this

litigation? A. Q. A. Q. A. Q. A. Q. Stuart Reynolds. When did you meet with Mr. Reynolds? It was last week. Is Mr. Reynolds representing you as an attorney? No. When did you agree to testify in this case? When I received the first e-mail from Jim Thompson. Did you review any particular documents in connection

with your preparation for this deposition? A. Q. A. Q. Yes. What did you review? My logbook. Did you do anything else to prepare for this

deposition? A. No.

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Q.

What were your responsibilities as a pilot for

Mountain Air Charter? A. To fly the plane; answer calls or e-mails, if any;

set up hotel and rent car, if needed for myself; and keep track of flight time for Mr. Thompson. Q. Can you explain what you mean by that? Are you

referring to your flight time, Mountain Air flight time, or Mr. Thompson's flight time? A. It would be a Pilatus that belonged to Mountain Air,

the flight time for that airplane. Q. flights? A. Q. flights? A. Q. No. Did you maintain flight time for any flights that you Yes. Did you maintain the flight time for any non-revenue Did you maintain the flight time for all revenue

did not pilot? A. Q. No. Are you aware of any flights that occurred that were

non-revenue flights? A. I know there were, but I couldn't tell you the dates

or anything. Q. Do you know enough about them to say whether these

occurred frequently or infrequently?

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A. regularly. Q.

I would say maybe not frequently, but fairly

Can you maybe estimate how many times per month, how

many times per year? A. Q. A. Maybe once or twice a month. And who piloted these flights? Jim Thompson. MR. REYNOLDS: Mr. Malo, could I get you to be a You have set the boundaries

little bit more precise on dates?

here as involving the years 2002 and 2003, and I think we're hearing about six weeks of relevant time period. MR. MALO: Agreed. So I think the last answer was

MR. REYNOLDS:

maybe spilling over into a non-relevant time period. MR. MALO: Q. A. (BY MR. MALO) I'm sorry. Into 2004. Understood.

When you interviewed --

Going back to the last part of 2003,

which I actually flew for Mountain Air Charter, I can't say for sure if I remember there being a non-revenue flight that -- or that I did not pilot in that last -- and maybe there was, but I really don't know. Q. And during that last portion of 2003, are you aware

of any flights that were piloted by Mr. Thompson? A. Q. I don't know for sure. Okay. During the process -- or the interviewing

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process for your position with Mountain Air, was there any discussion about performing a role as an instructor? A. Q. No. During your employment in 2003 with Mountain Air, did

you provide any flight instruction? A. Q. No. To the extent that you underwent training to fly the

PC-12, you indicated that this training was necessary for insurance purposes? A. Q. A. Q. Yes. Not for FAA regulatory purposes? That is correct. During the course of a regular flight, can you please

describe what the preflight procedures entail? A. Supervise the airplane being pulled out of the hangar

and onto the ramp, doing a thorough preflight inspection via the checklist in the airplane's book, putting ice or newspapers on board, getting the preflight clearance, setting up the cockpit for the flight. Q. A. And can you describe post-flight activities? Cleaning up anything in the plane, trash or whatever, And that's pretty much it.

securing the plane. Q. take? A.

How much time would preflight activities typically

Typically a half-hour or 45 minutes.

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Q. A. Q.

And post-flight? Probably about a half-hour or a little less. And for that portion of 2003 that you were flying as

the pilot for Mountain Air, did Mr. Thompson ever accompany you on a flight? A. Q. A. As the passenger. As a paying passenger? I assume that ORIX Capital Markets was the paying As far as I knew, he was just a

company for the charter. passenger in the back. Q. A. Q. A. Q. A. Q.

Did he ever act as a pilot on any of these flights? No. Did he ever assist you with preflight activities? No. Did he ever assist you with post-flight activities? No. You said you assumed that ORIX Capital Markets was Why

the paying passenger or the paying entity for the flight. did you assume this? A. Because, as far as I knew, the trips were for

Mr. Thompson regarding business for the company that he worked for. I don't know. Q. Was Mr. Thompson ever accompanied by other ORIX

employees on these trips? A. Yes.

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Q. A. Q.

Do you know the identities of any of these employees? No, I don't recall. Do you recall whether any flights -- again, for that

2003 period, do you recall whether any flights were dedicated to ORIX employees excluding Mr. Thompson? A. Q. I don't think there were. Okay. So it's an accurate statement that through the

end of 2003, to the best of your knowledge, Mr. Thompson, either alone or with other ORIX employees, were passengers for Mountain Air Craft -- Air Charters? A. Q. That's correct. Were there any other passengers besides ORIX

employees for 2003? A. Q. A. Q. Yes. Did you pilot these passengers? Yes. Do you know by any chance the names of any of those

individuals? A. Q. A. Q. I had one flight for Tim Gehan, G-E-H-A-N. And where did you fly him? Dallas to Denver to Telluride, Colorado. Is it an accurate statement, then, that from the time

you began employment with Mountain Air through the end of 2003, with the exception of Mr. Gehan, Mr. Thompson and other ORIX employees were exclusive passengers for Mountain Air Charters?

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A. Q.

Yes. And it was your assumption or your belief that ORIX

was paying for these flights? A. Q. A. Q. Yes. And what was the purpose of these flights? Business, I think. Were there any flights that you think were dedicated

to recreational purposes? A. Q. A. Q. A. Q. No. Did Mr. Thompson play any role on these flights? As far as? Aside from being a passenger? No. You mentioned earlier that you would answer calls or Does that mean that you were

e-mails, if there were any.

involved in scheduling flights? A. Involved to the point of if there was a call, I would

have to call Mr. Thompson and discuss it with him, as far as scheduling. Q. But I couldn't just write it on the schedule.

So there was some master calendar or log in which

flights were scheduled? A. Not that I'm aware of. If there was, it was being

kept by Mr. Thompson. Q. So describe to me how that process worked then.

If -- if a call came in requesting a specific flight --

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A.

Then I would call Mr. Thompson and say, We have an

interested party for this date. And he would tell me if it was open on his end or not. Q. A. Were you ever asked to quote fares by customers? In 2003, I believe what I did on that was, again,

went to Mr. Thompson and discussed the -- all the details of the flight, and then he would give -- tell me whatever the price was. Q. And then I would call them back and tell them. So standard procedure would have been for a call to

come in inquiring about availability for a certain flight from a certain point of origin to a certain destination on a certain date at a certain time. You would take that information,

present it to Mr. Thompson, who would make a decision regarding whether or not Mountain Air Charter would take the flight and what the fare for the flight would be. statement? A. Q. Yes. And then you would communicate that information back Is that an accurate

to the customer? A. Yes. I might just add that probably for every call I

received, Mr. Thompson probably received twice as many calls. Q. A. Where would these calls come into? Actually, with me, it was someone that I knew

previously calling me on my phone, or I believe I may have had

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an e-mail from someone I didn't know. Q. Was there a main office for Mountain Air that these

calls were received? A. There was a main office, but it was not manned by

anyone to take calls. Q. A. Could you describe the main office? Small room and a hangar with the basic computer and

office supplies and a little bit of storage space. Q. A. Q. calls. A. And a telephone? Yeah, it did have a telephone. And you say the main office was not manned to take Can you describe what you mean by that? If I was there and not flying, it was manned. But if

I was not scheduled to fly, then I did not go into the office. So it was just basically if one of us was there, that was when we would have been able to take a call on that phone. Q. office? A. Q. as you? A. He already had a -- probably already had a large base I don't know. How is it that Mr. Thompson took twice as many calls Was -- did Mr. Thompson spend a lot of time in that

of people that knew about his plane that he knew. Q. A. So potential customers would call him personally -Uh-huh.

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Q. A. Q. A.

-- to schedule flights? Or inquire about a flight. You described this as a large base of customers? Well, a larger base than what I had. I only had one

or two guys that I know -- that I can think of during the whole time that I worked for Mountain Air Charter that knew me personally. Q. And, to the best of your knowledge, again, through

the end of 2003, at least, what was your understanding of Mr. Thompson's relationship with this large base of customers? A. Well, let me just rephrase that. I don't think it

was a large base. was almost nothing. Q. A. had.

It was just a larger base than I had, which

I'll rephrase. I really don't know how big of a base of customers he

So rephrase the last question for me -- or say again the

last question. Q. Certainly. I'll rephrase as: What was your

understanding of the nature of the relationship between Mr. Thompson and this group of customers? A. I really don't know. Just people that maybe he had

done business with in the past or knew from being at the airport in the past. Q. A. But I really don't know for sure.

Did you know any of them to be ORIX employees? No.

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Q. Number 8.

I'd like the following to be identified as Exhibit

(Exhibit No. 8 was marked) Q. (BY MR. MALO) Mr. Holderread, can you identify this

document for me? A. This is a photocopy of my logbook starting at

December 18th, 2001, ending February 3rd, 2004 -- it started December 18th -- yeah, 2001. Q. Sorry.

And, Mr. Holderread, you sent this log to me

electronically; is that correct? A. Q. Yes. And in the e-mail that you used to send this log to

me, you indicated that the pages should be numbered 1A, 1B, 2A, 2B; is that correct? A. Yes. That was just for the purposes of the number of

pages that I was e-mailing you so that you could know the order. Q. But they are not actually numbered in my logbook. If I could ask you, then, to turn to what we -- we

have identified in our exhibit as Page 17A, which is also October 28th, 2003. A. Q. Okay. And it's my understanding that what you said earlier,

that this entry on October 28th for a PC-12 Tail Number 463JT, that was the first occasion that you had flown a Pilatus PC-12? A. Yes.

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Q.

Mr. Holderread, would you please explain to me how Can you explain how you would fill out

this pilot's log works? entries for flight? A.

Well, the duration of the flight is 1.9 hours.

So

that's what the "1.9" is. Q. A. Okay. The first column -- every flight that I do goes in It's

the column because it's total duration of flight. regardless of any type of aircraft that I fly.

So at the

bottom of that page you can see the amount forwarded, with the last page at 5,989.6. And then when I filled the page up,

totaled it all up, there's my total flight time as a pilot. The second column is single-engine. The And

Pilatus PC-12 was a single-engine, so it was logged there. the airplane multi-engine land column, although I wrote it

there, I scratched it out at the time because I had been used to filling out that column. is for turboprop. jet column was not. TP, the column that's marked TP, And then the

And the PC-12 was a turboprop.

Landings, there were two day landings on

that flight and zero night landings. Q. And as we continue across, you had -- on what is

identified for us as Page 17B, describe the rest of that entry. A. There's a night column. That was a day flight, so no

time was logged there.

Actual instrument is time that the

airplane is flown by reference to instruments because, you

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know, maybe you're in the clouds.

You get a simulated

instrument with a hood, which is typically for training only. There's an instrument approach column, how many you did and what type they were; flight simulator column; cross-country column. Now, that's -- any time you take off one airport and

land at a different airport it's considered cross-country flight. And so that was cross-country flight. Solo is typically reserved for the purposes of a pilot who is training to get their private pilot license and they are flying without an instructor. why that's called a solo flight. And that's typically

And I was with Tom Travis Pilot in command, I

that day, so that was not a solo flight.

was the sole manipulator of the control, so that -- I can log that as pilot in command. We have second in command, dual

received, and as flight instructor. The last column is remarks and endorsements. far as endorsements go, if I was receiving some sort of official required by the FAA-type training, the instructor would need to endorse that column with his signature and say in detail what kind of training I received. Other than that, As

you're really not required to put anything here, but I've always made a practice of putting what company I did the flight for, in this case Mountain Air, and then whoever was sitting in the other seat flying with me. Travis, as in Tom Travis. And in that case, it was

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Q.

Okay.

So your -- your use of the remarks and

endorsements column, it was your personal practice to write down the name of the passenger and the company that the passenger was related to? A. No, it's the company that owns the airplane. And if Or

there was another pilot in the front, I would write that. if -- in a lot of -- in some of these columns I wrote the passenger -- or the lead passenger's name.

I believe I made

kind of a habit out of doing that when I worked for Mountain Air Charter. I would write Jim Thompson's name down because he

was the lead passenger. Q. Okay. So turning to what we have identified as

Page 18A, which is also, for your records in your logbook, the date that begins on November 12th, 2003, there are a series of entries with remarks and endorsements; Mountain Air, Travis, Mountain Air, Travis, and then some additional names. the FAA 135 V-ride Chuck Dawson. is? A. That is the FAA 135 checkride, and Chuck Dawson was And I can't legally pilot a charter plane on We see

Can you describe what that

the FAA examiner.

a charter without having completed this checkride. Q. So this is a regulatory requirement that's satisfied

by this flight? A. Well, typically, yes. But there were two flights on The first one was cut

this page that were 135 checkrides.

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short because of weather, so we finished it up on another day. Q. Okay. Continuing down that column, you have another Can you describe what a "fairy

entry marked as a fairy flight. flight" is? A.

That would be flying the plane empty with no

passengers for the purpose of typically maintenance. Q. A. And then the subsequent entry is "solo"? Yeah. I wrote solo just meaning that there was

nobody on board other than me. Q. Okay. And then we see the flights involving

Mr. Gehan that you mentioned were revenue flights? A. Q. Uh-huh. And the remaining entries on the page are

Mr. Thompson -A. Q. A. Q. Correct. -- and ORIX employees? Correct. And on the final page of 2003, with the exception of

two maintenance flights and the final two entries, all of these flights were -- in fact, the final two entries relate to 2004, I believe. The remaining flights for 2003, with the exception I guess

of the maintenance flights, are all Mr. Thompson. there's just one on that page then. MR. REYNOLDS: garbled.

Is that correct?

That question was a little

There are three entries --

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MR. MALO:

Three entries for 2003. -- for 2003.

MR. REYNOLDS: Q. A. Q. A.

(BY MR. MR. MALO) Two are maintenance flights? Correct. And the final entry was Mr. Thompson? Correct. MR. MALO: Okay. I suggest we take a little

break. MR. REYNOLDS: Sure.

(Break taken from to 1:26 p.m. to 1:40 p.m.) MR. MALO: break. Thank you. We're returning from a

We probably won't need too much more time here,

Mr. Holderread, but I just wanted to follow up on a couple of comments that we had during our first -- first discussion this afternoon. Q. (BY MR. MALO) You mentioned that you spent 18 hours

in actual flight in the PC-12 in what you called not formal training. SimCom? A. Q. Yes. And after completing the SimCom training, you were Did all of that time occur prior to your training at

able to fly revenue flights? A. Q. A. Yes. And the SimCom training was only a simulator? Yes.

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Q.

Perhaps in reference to your log, can you identify

the actual date on which you began employment with Mountain Air Charter? A. Q. A. payroll. Q. Okay. Perhaps with the assistance of your log, can Define "employment" -- "began employment." Were officially on payroll. To be honest, I do not remember when I was on

you define the first revenue flight that you flew for Mountain Air Charter? A. Q. A. Q. A. December 4th, 2002 -- I'm sorry. December 4th, 2003.

Who was your passenger on that flight? Gehan. Do you know who Mr. Gehan was? Mr. Gehan was who I used to work for -- well, not

even a whole year before I started working for Mountain Air. Q. Was Mr. Gehan a customer of Mountain Air that used

Mountain Air services as a result of a connection through you? A. Q. Yes. I'd like to ask you a little more about your prior You mentioned a host of an aircraft type

experience as well.

that you had flown on prior to your employment with Mountain Air. Can you tell me if you flew any of them in a Part 135

operation? A. Yes.

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Q. A. that's it. Q.

Okay.

Which of your former employers were Part 135? And

Ravenair Charters, Lifeguard Aeromed, Zebra Air.

That's it.

What were your remaining employers

identified as? A. Q. Corporate Part 91. In either your experience as a Part 91 or a Part 135

pilot prior to your employment with Mountain Air, did you operate in a single-pilot environment? A. Q. A. Q. A. Q. Yes. Did you ever have a crew? Yes. And what role did the crew play for you? Co-pilot or co-captain. And what activities or what services did they perform

in that role? A. Q. Share the responsibilities of the flight. Was there any allocation of responsibilities in terms

of specific duties to be performed by each member of the crew? A. plane. Yes. The captain typically flies, controls the And both

Co-pilot typically operates the radios.

pilots work together for the safety of the flight. Q. pilot? A. You do everything. And what's the difference when flying as a single

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Q. A. Q. A.

Is this a significantly more complex role? In certain situations, like low weather days, yes. What is a low weather day? Clouds -- low enough clouds that require you to do an

instrument approach to find the runway, or also more of a workload in a high-traffic situation, like flying into a major metropolitan airport. Q. When you began working with Mountain Air through 2003

and, to your knowledge, prior to your employment with Mountain Air, did Mountain Air fly into major metropolitan airports? A. Q. A. Yes. Which ones? Well, San Antonio would be considered one, Denver,

Kansas City, Chicago. Q. And how are you defining that term, "a major

metropolitan airport"? A. Q. A. By the airport having a Class B air space. And what does that mean? It's just a level of control that aircraft are

required to be under entering the air space. Q. A. Q. Is "Class B" an FAA-recognized term? Yes. Is the FAA the regulatory authority that established

those class ratings? A. Yes.

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Q.

You also mentioned earlier that you would

occasionally answer phones or respond to e-mails regarding inquiries for potential flights and potential customers. You

indicated that if a flight inquiry was made, you would relay the relevant information to Mr. Thompson and call him to see if Mountain Air was open or not. Can you define what you mean by

"whether Mountain Air was open or not"? A. Whether the plane was already scheduled for something

that Mr. Thompson had set up or if Mr. Thompson was going to use the plane on one of his personal trips during that time. Q. Can you identify specifically what the potential It sounds --

conflicts could be then for customers inquiring?

if I understand you correctly, you're saying that Mountain Air might have already scheduled a revenue flight with another customer or Mr. Thompson may have had personal intentions for the use of the aircraft? A. Yes. MR. REYNOLDS: weeks in 2003? MR. MALO: Yes, sir. Okay. Are we still talking about six

MR. REYNOLDS: Q. (BY MR. MALO)

And -- and, just to clarify, it was my

understanding that during the period that you were first employed by Mountain Air, you handled this -- phone calls and e-mails and took inquiries about potential flights?

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A.

I honestly don't remember if I had a single e-mail or

phone call other than my former employer, Mr. Gehan. Q. A. Okay. I honestly don't remember. I would guess I probably

didn't have any calls at that time. Q. Then I suppose is it an inaccurate statement to say

that your subsequent experience beyond 2003 is the basis upon which you have developed an opinion as to what would have happened if you had experienced a conflict in those six weeks? A. No. This was discussed when Mr. Thompson first hired

me, of how this was going to work. Q. Okay. So as part of your initial employment, part of

your understanding of your job duties, you're instructed that scheduling of flights were to be approved by Mr. Thompson? A. Q. Yes. And that revenue customer flights would only be taken

to the extent that they did not conflict with either other paying customers or Mr. Thompson's personal use of the aircraft? A. That they would not conflict with other passengers But a possibility was

who have already scheduled something.

that if Mr. Thompson had already made plans to take the plane for his personal use, he would consider changing his plans to accommodate a potential customer. Q. Okay. And during that 2003 period, this situation

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was never encountered? A. Q. No. But, as a practical matter, to the extent you had

paying customers, ORIX Corporation and Mr. Thompson formed a large percentage -A. Q. statement? A. Q. Yes, it is. So it was not likely that there would have been a Yes. -- of those customers. Is that an accurate

scheduling conflict between Mr. Thompson's personal use of the aircraft and paying customers through the ORIX Corporation? MR. REYNOLDS: Q. (BY MR. MALO) Objection; form.

Is it accurate to say that when

Mr. Thompson was a passenger on the aircraft it would not be possible for him to have a conflict with his personal use of the aircraft? A. Q. A. Not to my knowledge. Okay. Whatever conflict there would have been through that,

he would have taken care of himself. Q. Okay. MR. MALO: further questions. MR. REYNOLDS: We'll reserve our questions. Well, sir, I don't think I have any

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Thank you. (Proceedings concluded at 3:22 p.m.)

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CHANGES AND SIGNATURE WITNESS NAME: MICHAEL D. HOLDERREAD APRIL 23, 2007 PAGE LINE CHANGE REASON DATE OF DEPOSITION:

_______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________ _______________________________________________________________

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I, MICHAEL D. HOLDERREAD, have read the foregoing deposition and hereby affix my signature that same is true and correct, except as noted above.

___________________________________ MICHAEL D. HOLDERREAD

THE STATE OF __________) COUNTY OF _____________) Before me, ___________________________, on this day personally appeared MICHAEL D. HOLDERREAD, known to me (or proved to me under oath or through ___________________________) (description of identity card or other document)) to be the person whose name is subscribed to the foregoing instrument and acknowledged to me that they executed the same for the purposes and consideration therein expressed. Given under my hand and seal of office this __________ day of ________________________, __________.

___________________________________ NOTARY PUBLIC IN AND FOR THE STATE OF ______________________ COMMISSION EXPIRES: _______________

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STATE OF TEXAS) I, Diana Pereira, a Certified Shorthand Reporter in and for the State of Texas, do hereby certify that, pursuant to the agreement hereinbefore set forth, there came before me on the 23rd of April, A.D., 2007, at 2:07 p.m., at WINSTEAD, located at 5400 Renaissance Tower, 1201 Elm Street, in the city of Dallas, State of Texas, the following name person, to wit: MICHAEL D. HOLDERREAD, who was by me duly cautioned and sworn to testify the truth, the whole truth and nothing but the truth, of his knowledge touching and concerning the matters in controversy in this cause; and that he was thereupon carefully examined upon his oath, and his examination was reduced to writing under my supervision; that the deposition is a true record of the testimony given by the witness, same to be sworn to and subscribed by said witness before any Notary Public, pursuant to the agreement of the parties; and that the amount of time used by each party at the deposition is as follows. Mr. Stuart M. Reynolds, Jr. - 00:00, Mr. Steve Frahm - 00:00, Mr. Jeffrey R. Malo - 01:01. I further certify that I am neither attorney or counsel for, nor related to or employed by, any of the parties to the action in which this deposition is taken, and further that I am not a relative or employee of any attorney or counsel employed by the parties hereto, or financially interested in the action.

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I further certify that, before completion of the deposition, the Deponent, MICHAEL D. HOLDERREAD, and the Plaintiff, did request to review the transcript.

affixed my seal this ___ day of _________________, A.D., 2007.

Esquire Deposition Services

214.257.1436

AU

t rip sc d . an e gy Tr gn lo si no Ed lly ch PY tifie ica l te O C er ron ga C al c ect lLe TI in el ea EN rig as R TH e o w ing e Th fil us
1.800.852.9737

In witness whereof, I have hereunto set my hand and

____________________________. Diana Pereira, Texas CSR 8129 Expiration Date: 12/31/2007 Firm Registration No. 286 Esquire Deposition Services 1700 Pacific Avenue Suite 4750 Dallas, Texas 75201 (214) 257-1436

1700 Pacific Avenue Suite 4750

Dallas, Texas

75201

214.965.9205

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