On March 16, 2002, about 0821 mountain standard time, an Avian Magnum IX, hot air balloon, N2037U, landed hard, bounced, then touched down again in trees near Sedona, Arizona. The balloon was operated by Northern Light Expeditions, under 14 CFR Part 91, for the local sightseeing flight. A weather briefing was received, however, no flight plan had been filed. The balloon envelope was destroyed. The commercial pilot and five passengers sustained minor injuries. One passenger received a serious injury. The flight departed from a launch site routinely used by the operator near Sedona, about 0655. The pilot reported the balloon drifted north in the prevailing winds for a period of about 25 minutes. The wind velocity was estimated at less than 5 knots. The flight continued northbound after exiting a valley, and remained at an altitude of about 100 feet above ground level (agl). As the anticipated landing site approached, the chase crew was sent ahead to verify wind conditions. In the descent, with the envelope cooled, the pilot planned to drift over a ridgeline oriented west to east to make use of the ridge's wind blocking effect for the landing. About 60 feet above the trees, a west wind accelerated the balloon toward the east about 20 miles per hour. The pilot elected to continue the attempt to land in the vicinity of the clearing he had selected, refrained from applying heat, and continued to deflate the envelope. A downdraft was encountered, the balloon touched down hard, and bounced. The balloon was dragged through the trees with the vent open. The envelope softened, and then spinnakered. With no buoyancy, the balloon descended again, faster, and was dragged through more trees, which resulted in a tree limb penetrating the basket and injuring one passenger. The pilot and the injured passenger were dumped from the basket and the balloon came to rest a few feet away. The other passengers remained with the gondola as it lay on its side. Passengers reported their balloon and three others hovering at almost a standstill over the treetops before the winds picked up. The pilot advised them that they should be landing as soon as they had a location where the chase crew could rendezvous. They should also [hold on and brace for a rough landing]. The pilot had negotiated a ridge and was actuating the parachute line for the descent. This line opened the deflation port to vent the air out of the envelope. He explained to them that the trees would be used to help slow the balloons' speed over the ground. One passenger witnessed the balloon behind theirs land abruptly at the same time that they began violently smashing into the trees. Several passengers reported injuries as the basket was pulled through the brush and branches. A 3- to 4-foot tree segment became imbedded in one passenger's leg. After the remaining passengers had exited the basket, the pilot secured the fuel system and radioed the ground crew, who then arrived on scene in about 20 minutes. Paramedics responded in approximately 30 to 45 minutes when another passenger had dialed 911. The seriously injured passenger was attended to and brought to the hospital by air ambulance. Personal safety gear had not been available to the passengers in the event that the balloon made a hard landing. The flight manual did not require the carriage of such items as a part of the Equipment List. Only a first aid kit had been stowed for the flight. The pilot found the hole in the side of the basket and stated that it was the only damage. He stated the balloon envelope was torn beyond repair.