|
Federal Appellate Court Holds that NTSB Must Defer to
FAA's Interpretation of its Airline Safety Regulations
The United States Court of Appeals for the District of Columbia Circuit
has reversed a decision by the National Transportation Safety Board ("NTSB")
dismissing a safety enforcement order of the Federal Aviation Administration
("FAA") involving its airline safety regulations. The case, Garvey
v. NTSB,(1) involved an FAA enforcement
order determining that a Northwest Airlines pilot had violated airline safety
regulations by failing to follow air traffic controller flight altitude
instructions and by operating an aircraft according to an altitude instruction
issued to the pilot of another aircraft.(2)
The order was initially affirmed by an Administrative Law Judge ("ALJ"),
but, on appeal of the decision to the NTSB, the NTSB dismissed the enforcement
order.(3) The NTSB's decision was predicated
on its own interpretation of aviation safety policy. In its decision, the
NTSB rejected the FAA's argument that the NTSB was required "to defer
to the FAA's reasonable interpretation of its own safety regulations"
as a matter of law. The NTSB held that it was not required to follow the
FAA's interpretation of the law as the FAA had offered no specific regulatory
guidance to support its interpretation of the safety regulations at issue
in the proceeding.(4) The FAA appealed the
NTSB decisions in the District of Columbia Circuit.
The heart of the intra-agency dispute decided in Garvey concerned
an interpretation of the split-enforcement aircraft safety regime established
by Congress in the Federal Aviation Act, delegating, inter alia,
rulemaking and rulemaking enforcement authority to the FAA (49 U.S.C. §§
44701(a), 44709(b)) and adjudicatory authority to the NTSB (49 U.S.C. §
1133).(5)
In Garvey, there was no dispute as to the general principle that
the Congress has directed the NTSB "to defer to the FAA's interpretations
of its own regulations."(6) Rather,
at issue in the case was the NTSB's argument, disputed by the FAA, that
deference to the FAA is not required in instances, such as in the present
dispute, where the FAA's interpretation was not validly adopted or where
the FAA's interpretation was actually a factual finding, and not truly an
"interpretation" of its regulations. The court in Garvey
rejected the NTSB's arguments, overturned NTSB's decision on review, and
remanded the case to the NTSB for further proceedings consistent with its
opinion.
As to the issue of whether the NTSB is required to accord the FAA's interpretation
of its air safety regulations due deference absent the formal adoption of
such policies, the court in Garvey held that the "FAA is not
required to promulgate interpretations through rulemaking or the issuance
of policy guidances, but may instead do so through litigation before the
NTSB."(7) The court held that the NTSB
is obligated to accord the FAA's interpretation "due deference"
-- even where regulatory interpretation is advanced through "'litigation
statements' of counsel," such as those statements made by FAA in the
present case.(8)
Likewise, the court in Garvey rejected the NTSB's argument that
the FAA's position below was not an "interpretation," but rather
a determination of fact with which the NTSB was free to disagree. The court
held that the fact that the FAA had inferred that a pilot had been "careless"
or "inattentive," at best, was a presumption of pilot safety error
which merely shifted the burden to the pilot to produce evidence to explain
his actions, which did not impact the FAA's ultimate burden of proof in
the proceeding.(9) Such a shifting of the
burden of production, concluded the court, is permissible under the law.(10)
The remaining issues considered by the court in Garvey concerned
whether the FAA's underlying decision on pilot safety error was "reasonable"
or "arbitrary, capricious, or otherwise not according to law,"
whether NTSB precedent supported the NTSB's reversal of the FAA's initial
decision, and whether the court was precluded from considering the FAA's
regulatory interpretation arguments when its arguments had not been raised
below until made in the FAA's petition for reconsideration of the NTSB's
decision.
The court in Garvey rejected the NTSB's arguments that the FAA's
enforcement order was unreasonable or otherwise not in accordance with the
law, concluding that even if the result was "harsh," it nevertheless
was in accordance with the law, which requires the FAA, as its "principal
responsibility," to "ensure that air carriers 'provide service
with the highest possible degree of safety in the public interest.'"(11) The court also rejected the NTSB's argument
that its decision below was fully consistent with agency precedent, and
therefore should be upheld. On this issue, the court determined that NTSB
precedent on pilot safety did not necessarily support the NTSB's decision,
and even if it did, "the interpretation of air safety regulations is
an area in which the Board owes deference to the FAA."(12)
In such a case, said the court, it would "be both necessary and proper
for the Board to depart from its prior case law."(13)
Finally, on the issue of issue preclusion for FAA's failure to raise its
position as one of regulatory interpretation until late in the proceedings
below, the court held that while the FAA may have been "inattentive"
or "tard[y]" in asserting its position, no prejudice had been
caused.(14) The court concluded: "unlike
a pilot, the agency -- and, derivatively, the flying public -- cannot be
sanctioned for its inattentiveness through dismissal of the enforcement
order issued in this case."(15)
FHWA Decision Holding that Agency Lacks
Primary Jurisdiction Over Truck Lease Complaints Upheld
A decision by the Federal Highway Administration ("FHWA") holding
that it does not have exclusive authority to adjudicate disputes arising
under "Truth-in-Leasing" regulations has been upheld on appeal
by the United States Court of Appeals for the Eighth Circuit.
The case, Owner-Operator Independent Drivers Association, Inc. v.
New Prime, Inc., involved a determination by FHWA that it did not have
exclusive jurisdiction over complaints involving the regulation of motor
carrier lease agreements. New Prime specifically involved motor carrier
functions transferred to FHWA by law, formerly handled by the Interstate
Commerce Commission,(16) involving the administration
and enforcement of regulations governing lease agreements between motor
carriers and owner-operators of trucks, known as the "Truth-in-Leasing"
regulations.(17)
In New Prime, a group of independent owner-operators filed a class
action complaint in federal Missouri district court against New Prime, Inc.,
a registered motor carrier, alleging that its lease and equipment rental-purchase
agreements violated FHWA leasing regulations and were "unconscionable"
under Missouri law.(18) The district court
dismissed the complaint, holding that FHWA had primary jurisdiction over
the case.(19) The owner-operators filed
a consolidated appeal of the decision with the Eighth Circuit, and also
filed an ex parte petition for declaratory order with the FHWA, requesting
that a declaratory order be issued construing the underlying regulations
in its favor, or otherwise holding that the FHWA lacked primary jurisdiction
over the lease dispute at issue.(20) The
FHWA issued a Notice of Denial, declining to exercise primary jurisdiction
over the carrier's disputes with the owner-operators. New Prime, Inc. appealed
FHWA's decision.(21)
In New Prime, the court first reviewed the legislative history
of the law granting FHWA authority over the Truth-in-Leasing regulations.
The legislative history clarified that it was the intent of the Congress
that DOT not "allocate scarce resources to resolving these essentially
private disputes," and that "private parties may bring actions
in court to enforce the provisions of the Motor Carrier Act," including
Truth-in-Lending.(22) Despite this direct
Congressional language, New Prime, Inc. argued that the applicable law at
49 U.S.C. § 14704 addressing "rights and remedies of persons injured
by carriers" and authorizing "person[s] injured because of a carrier"
to bring civil actions in federal court only applied to suits to enforce
agency orders. New Prime argued that the provision did not authorize the
federal courts to determine violations of the Truth-in-Leasing regulations.(23) After a detailed review of the various
provisions of the statute, the court concluded that private actions in federal
court for damages and injunctive relief for violations of the Motor Carrier
Act were authorized by § 14704, and it rejected New Prime, Inc.'s contention
that FHWA's remedial jurisdiction is primary or exclusive.(24)
New Prime, Inc. next argued that the court should compel the FHWA to
exercise its jurisdiction over the case. The court refused on the grounds
that New Prime, Inc. had cited no authority to rebut the "presumption"
that an agency decision not to institute a proceeding is unreviewable.(25) Finally, the court in New Prime
rejected the argument by New Prime, Inc. that the ex parte application filed
by the owner-operators for a declaratory order and the notice issued by
FHWA in response violated the procedures afforded parties under Administrative
Procedure Act governing adjudications. The court held that no such "adjudication"
had taken place adverse to New Prime Inc.'s interests.(26)
To the extent that the FHWA may have expressed "views that are relevant
to the merits" of New Prime, Inc.'s dispute with the owner-operators,
said the court, Prime would have an opportunity to directly respond in the
case before the district court.(27)
The court remanded the case to the district court for further proceedings
consistent with its opinion.
Hot DOT Spots
- FHWA has received and is reviewing comments on proposed rules revising
the safety fitness procedures of the Federal Motor Carrier Safety Regulations.(28) Under the proposed rules, unsatisfactory
rated carriers would be prohibited from operating in interstate commerce
if operations are not improved within a requisite time period. The authority
for this change was included in the Transportation Equity Act for the 21st
Century, signed into law in June 1998. In response to its proposed rules,
FHWA received 17 separate comments from the public prior to the comment
period closing date on September 15, 1999. Among other parties submitting
comments, the American Trucking Associations, Inc. ("ATA") criticized
the proposed rules, arguing, among other things, that the proposed rules
would fail to properly identify unsafe carriers. ATA has argued that the
FHWA's rating methodology is not properly designed to provide a measure
of the safety of trucking companies, but rather, only "compliance"
with governing safety rules. ATA argues that "FHWA's own research
has shown that there is no linear relationship between compliance and safety"
and that "[t]here are and will continue to be non-compliant carriers
who are safe and, conversely, compliant carriers who are unsafe."
ATA suggests that since "the current safety rating system is fundamentally
flawed," FHWA should amend its rules in another manner to more appropriately
identify and take action against unsafe carriers.
- DOT's Aviation Enforcement Office recently has been involved in actions
against airlines concerning discrimination against passengers with disabilities.
DOT has charged Continental Airlines with violations of federal law and
agency regulations prohibiting discrimination against disabled passengers,
for failure to provide adequate assistance to wheelchair-dependent passengers.
DOT seeks a civil penalty of $250,000 against the carrier for the violations
and an additional $1,100 for each additional similar violation revealed
in the course of the investigation. Also, on September 28, 1999, DOT announced
a settlement with America West Airlines, which was found to have violated
federal law and DOT rules for failure to seat a disabled passenger with
a service dog in her assigned seat. A civil penalty was assessed to be
used by the carrier for training purposes.
- Secretary Slater has announced an initiative by the Federal Railroad
Administration ("FRA") to implement a safety oversight program
targeted at reducing railroad accidents caused by human error. The FRA
is implementing a new "Operating Practices Initiative" to address
safety conditions affecting the railroad industry as a whole, rather than
focusing on individual railroad behavior, which is the traditional method
of assessing railroad safety. The program is an expansion of FRA's Safety
Assurance and Compliance Program which the FRA has touted as leading to
"dramatic improvements in rail safety," including 33 percent
train incidents, 28 percent fewer highway-rail incidents, and 31 percent
fewer highway-rail fatalities since its introduction in the mid-1990s.
1. No. 98-1365, 1999 U.S. WL 731026 (D.C. Cir. Sept.
21, 1999).
2. The order involved alleged violations of FAA regulations
prohibiting pilots from operating aircraft "contrary to an ATC instruction
in an area in which air traffic control is exercised" (14 C.F.R. §
91.123(b)) and "according to a clearance or instruction that ha[s]
been issued to the pilot of another aircraft for radar air traffic control
purposes" (14 C.F.R. § 91.123(e)).
3. Garvey, 1999 WL 731026, at *2. The NTSB
reaffirmed its decision on the FAA's petition for reconsideration of its
initial decision. Id.
4. Id.
5. Under the governing regulations, FAA enforcement
orders are initially heard by an ALJ. See 49 C.F.R. § 821.35(a).
Appeals of final ALJ decisions are made to the full NTSB. See id.
at § 821.47(a).
6. Garvey, 1999 WL 731026, at *5.
7. Id.
8. Id.
9. Id. at *7.
10. On this issue, the court held, "every Circuit
that has considered the issue [] has concluded that a presumption that shifts
only the burden of production does not shift the 'burden of proof' as that
phrase is used in the [Administrative Procedures Act]." Id.
11. Id. at *9 (quoting 49 U.S.C. § 44701).
12. Id. at *11
13. Id.
14. Id. at *13.
15. Id.
16. The Interstate Commerce Commission ("ICC")
was terminated by the ICC Termination Act of 1995, Pub. L. No. 101-88, 109
Stat. 803, and replaced by the Surface Transportation Board. Many remaining
motor carrier functions formerly under the jurisdiction of the ICC were
transferred to DOT and the FHWA.
17. The regulations are found at 49 C.F.R. Part 376.
18. See New Prime, 1999 WL 604433,
at *1.
19. Id.
20. Id.
21. Id. The action by New Prime, Inc. before
the Eighth Circuit was consolidated with other actions involving the same
owner-operators and other motor carriers besides New Prime, Inc. The American
Trucking Association filed an amicus brief in support of the New Prime appeal,
urging the court to reverse the FHWA's refusal to exercise jurisdiction
over the disputes.
22. Id. at *2 (citing H.R. Rep. No. 104-311,
at 87-88 (1995), reprinted in 1995-2 U.S.C.C.A.N. 793, 799-800).
23. Id. at *2-6.
24. Id. at *6.
25. Id.
26. Id. at *7.
27. Id.
28. The proposed rules can be found at 64 Fed. Reg.
44,460 (Aug. 16, 1999). |