Air Transport Association of America, Inc. v. Federal Aviation Administration

United States Court of Appeals for the District of Columbia Circuit · Administrative Law

Administrative Lawagency interpretation of regulationsAPA rulemakinginterpretive rulesFAAFAR 121.471flight crew restAuer-style deference

Facts

FAR 121.471 sets maximum flight-time limits and required rest periods for flight crewmembers, with some flexibility through reduced rest and compensatory rest. In response to questions arising from changes in American Airlines's pilot reserve system, the FAA issued the Whitlow Letter stating that look-back rest must be computed using actual expected flight time and taxi-in time based on conditions existing on the day of departure, not merely the carrier's published schedule. Under that interpretation, if it is known or reasonably should be known before departure that a flight segment will leave a crew with less than eight hours of look-back rest, the flight may not leave the gate. ATA argued that this interpretation contradicted FAR 121.471 and effected a substantive change without APA notice and comment.

Issue

Whether the FAA's Whitlow Letter interpreting FAR 121.471 to require recalculation of look-back rest using actual expected flight time before departure was inconsistent with the regulation's text or purpose. Whether that interpretation was a substantive change, or a revision of a prior definitive interpretation, requiring notice-and-comment rulemaking under the APA.

Rule

An agency's interpretation of its own regulation receives substantial deference and must be upheld unless an alternative reading is compelled by the regulation's plain language or the agency's intent at promulgation. A pronouncement is an interpretive rule exempt from APA notice-and-comment if the duty it announces is fairly encompassed within the existing regulation and does not impose new rights or duties. Notice-and-comment is required for a later interpretation only if the agency significantly revises a prior definitive interpretation, effectively amending the rule.

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The Coastline Transit Safety Bureau administers a regulation requiring bus operators to provide a minimum rest period during the 24 hours preceding the "scheduled completion" of a route. In a guidance letter responding to a carrier's question, the Bureau says that if traffic, weather, and terminal congestion known before departure make it reasonably clear the bus will arrive later than the printed timetable, the operator must calculate compliance using the route's actual expected completion time.

A trade association challenges the letter, arguing that "scheduled completion" can only mean the original published timetable. How should a court most likely rule?

Explanation. When an agency interprets its own regulation, the interpretation receives substantial deference and is upheld unless plainly erroneous or inconsistent with the regulation, or unless an alternative reading is compelled by the regulation's text or promulgation history. A term like "scheduled completion" can reasonably include a completion time adjusted before departure based on actual conditions. The fact that the interpretation reduces some flexibility does not make it invalid where it remains consistent with the regulation's safety purpose. (Derived from Air Transport Association of America, Inc. v. Federal Aviation Administration (n.d.).)