190 F.3d 571 (D.C. Cir. 1999)
Jane F. Garvey, Administrator, Federal Aviation Administration, Petitionerv.National Transportation Safety Board and Richard Lee Merrell, Respondents
No. 98-1365
United States Court of AppealsFOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued April 8, 1999Decided September 21, 1999

[Copyrighted Material Omitted]
On Petition for Review of Orders of the United States Department of Transportation
E. Roy Hawkens, Attorney, U.S. Department of Justice,  argued the cause for petitioner.  With him on the briefs were  Frank W. Hunger, Assistant Attorney General at the time  the briefs were filed, David W. Ogden, Acting Assistant  Attorney General, Robert S. Greenspan, Attorney, and James  W. Tegtmeier, Attorney, Federal Aviation Administration.
Clay Warner argued the cause for respondents.  With him  on the brief was James W. Johnson.
Before:  Wald, Randolph and Garland, Circuit Judges.
Opinion of the Court filed by Circuit Judge Garland:
Garland, Circuit Judge:


1
The Federal Aviation Administration (FAA) issued an enforcement order to Captain Richard  Merrell, a Northwest Airlines pilot whom the FAA determined had violated airline safety regulations.  Merrell appealed to the National Transportation Safety Board (NTSB),  which ruled in his favor and dismissed the FAA's order.  The  FAA petitions for review of that decision, arguing that the  NTSB erroneously failed to defer to the FAA's reasonable  interpretation of its own regulations.  We grant the petition,  reverse the NTSB, and remand for further proceedings consistent with this opinion.


2
* The Federal Aviation Act, 49 U.S.C. §§ 40101 et seq.,  establishes a "split-enforcement" regime in which the FAA  has regulatory and enforcement authority, while the NTSB  acts as an impartial adjudicator.  See Hinson v. NTSB, 57  F.3d 1144, 1147 n.1 (D.C. Cir. 1995).  We begin by setting  forth the facts and procedural history of Captain Merrell's  case, and then describe the nature of the split-enforcement  regime in more detail.


3
* The facts of the case are undisputed.  On June 19, 1994,  Merrell was the pilot-in-command of a commercial passenger  plane, Northwest Flight 1024.  After Flight 1024 took off in  the heavily trafficked Los Angeles area, air traffic control  (ATC) instructed it to climb to and maintain an altitude of  17,000 feet.  Merrell correctly repeated, or "read back," this  instruction to ATC.  About a minute later, ATC transmitted  an altitude clearance to another aircraft, American Airlines  Flight 94, directing it to climb to and maintain an altitude of 23,000 feet.  The American flight promptly and correctly  acknowledged this clearance with its own "readback."


4
Merrell, however, mistakenly thought that the instruction  to American was intended for his aircraft, so he also read the  instruction back to ATC.  Unfortunately, because Merrell  made his read back at the same time as the American pilot,  his transmission was blocked, or "stepped on."  The ATC  radio system can handle only one transmission at a time on  any given frequency;  when two transmissions overlap, both  may become blocked or garbled, or the stronger signal alone  may be heard (i.e., it may "step on" the weaker signal).  ATC  can often detect that a transmission has been stepped on  because, unless the signals overlap completely, ATC will  receive a portion of the stepped-on message, and because a  loud buzzing noise usually accompanies the period of over lap. On rare occasions, however, two transmissions will overlap  completely without creating an identifiable buzz.  This appears to have happened in Merrell's case.  His read back  apparently coincided precisely with that of American Flight  94, and as a result his transmission was entirely blocked. ATC heard neither Merrell's read back nor any indication that  it had occurred.  And because ATC did not hear the erroneous read back, it could not correct Merrell's mistake.


5
Meanwhile Merrell, unaware that ATC had not received his  transmission, proceeded to ascend toward 23,000 feet.  As the  Northwest flight rose from its assigned altitude, the ATC  controller noticed the deviation and directed the aircraft to  return to 17,000 feet.  Before Merrell could comply, he had  ascended to 18,200 feet and lost the standard safety separation required between commercial flights.


6
On November 3, 1995, the FAA issued an enforcement  order against Merrell.  The order alleged that Merrell had  violated FAA safety regulations by, inter alia, (1) "operat[ing]  an aircraft contrary to an ATC instruction in an area in which  air traffic control is exercised," in violation of 14 C.F.R.  § 91.123(b);  and (2) "operat[ing] an aircraft according to a  clearance or instruction that had been issued to the pilot of  another aircraft for radar air traffic control purposes," in violation of 14 C.F.R. § 91.123(e).  Joint Appendix (J.A.) at  7.1


7
Merrell appealed the FAA's order to the NTSB.  At the  outset of the proceedings, the FAA agreed that because  Merrell had filed a timely incident report pursuant to the  FAA Aviation Safety Reporting Program, it would waive any  sanction for the alleged violations.  See J.A. at 11.  It sought  affirmance of its enforcement order, however, arguing that  Merrell had deviated from clearly transmitted ATC instructions, that this mistake was due to his own carelessness  rather than to ATC error, and that the deviation therefore  constituted a regulatory violation.  The Administrative Law  Judge (ALJ) agreed and affirmed the order.  The ALJ found,  based on both the recording and the transcript of the radio  communications, that the ATC transmission to American  Flight 94 had been clear and that the instruction to climb to  23,000 feet had plainly not been intended for Merrell's aircraft.  Id. at 14-15.  Indeed, after Merrell listened to the  tape, he conceded that he had simply "misheard" the instruction.  See id. at 18-19;  NTSB Record (R.) at 145.  The ALJ  concluded that the fact that Merrell's read back was stepped  on did not absolve "Captain Merrell of his responsibility to  hear that [the] initial clearance" was for another flight.  J.A.  at 26.  He explained that:  "[A]viation is ... particularly  unforgiving of carelessness or neglect.  And in this particular  case, the initial mistake was made by Captain Merrell, and  he's going to have to be responsible for it."  Id. at 27.Accordingly, the ALJ held that Merrell "was in regulatory  violation as alleged."  Id.


8
Merrell appealed the ALJ's decision to the Board.  He  argued that under NTSB precedent, a pilot cannot be held  responsible for an inadvertent deviation caused by ATC error. His had been such a deviation, he contended, because he had taken actions which, but for ATC, would have kept him from  leaving his assigned altitude.  He reasoned that because ATC  controllers are required to correct erroneous read backs,2 his  construction of ATC's silence as tacit confirmation had been  reasonable and justified.  In response, the FAA again argued  that because the primary cause of the deviation had been  Merrell's misperception of a clear instruction, his actions had  violated the safety regulations.  The FAA maintained that  this outcome was consistent with Board precedent which, it  contended, absolves pilots only when "ATC error is the  initiating or primary cause of the deviation."  R. at 321.


9
The NTSB accepted Merrell's arguments and dismissed the  enforcement order.  It found that Merrell had made only "an  error of perception," and that there was "no evidence in the  record ... that [he] ... was performing his duties in a  careless or otherwise unprofessional manner."  J.A. at 34.  A  "perception mistake," the Board said, does not always result  from "a failure of attention," and therefore "careless inattention ... will not be automatically assumed in every case" in  which a pilot mishears ATC instructions.  Id.  Moreover,  there was no "failure of procedure" on Merrell's part, as he  had "made a full read back so that the opportunity was there,  absent the squelched transmission, for ATC to correct his  error."  Id. at 35.


10
The FAA then petitioned the Board for reconsideration of  its decision.  R. at 360-81.  The agency argued that the  Federal Aviation Act requires the Board to defer to the  FAA's reasonable interpretation of its own safety regulations. In the FAA's view, 14 C.F.R. § 91.123 obligates pilots "to  listen, hear, and comply with all ATC instructions except in  an emergency."  Id. at 366;  see id. at 362.  "Inattention,  carelessness, or an unexplained misunderstanding," it said,  "do not excuse a deviation from a clearly transmitted clearance or instruction."  Id. at 367.  "When there is an 'error of perception' resulting in a deviation, inattentiveness or carelessness are imputed in the absence of some reasonable  explanation for the failure to comply with the ATC clearance."  Id.  According to the FAA, reasonable explanations  include events such as "radio malfunction" or a controller  error that precipitates a misunderstanding, but "[t]o excuse  [Merrell's] deviation in these circumstances as an acceptable,  though unexplained, 'error of perception' " would be inconsistent with the agency's construction of § 91.123.  Id. at 36869;  see id. at 369, 371.  Moreover, the FAA argued that the  Board's decision would have a "profound" negative effect on  air safety:  "Under the decision, airmen can claim, without  further proof, that they did not hear or that they misperceived safety crucial instructions as a means to avoid responsibility for noncompliance or erroneous compliance with ATC  clearances and instructions."  Id. at 374.


11
The Board denied the petition for reconsideration.  Although it acknowledged its "general obligation to defer to the  FAA's validly adopted interpretation of its regulations," the  Board considered itself under no such obligation in this case  because "the FAA cites no rule it has adopted that stands for  the proposition the FAA urges here."  J.A. at 38.  The Board  further noted that the FAA offered "no evidence of any policy  guidance written by the FAA, validly adopted or otherwise,"  to support its interpretation, and instead offered only "[c]ounsel's litigation statements."  Id.


12
Because the Board determined that it was not required to  defer to the FAA's interpretation, it followed its own view of  appropriate aviation policy.  It stated:


13
We ... disagree with the FAA's underlying belief that our policy threatens aviation safety.  The premise of our approach is this--human beings make mistakes, and there is no regulatory action, remedial or otherwise, that can eliminate all mistakes....  [W]here an inevitable error of perception does occur, the pilot should not face sanction if he has acted responsibly and prudently there-after....


14
Id. Adhering to this principle, the NTSB announced the  following rule:


15
If a pilot makes a mistake and mishears a clearance or ATC direction, follows all prudent procedures that would expose the mistake (e.g., reads back the clearance), and then acts on that mistaken understanding having heard no correction from ATC, the regulatory violation will be excused if that mistake is not shown to be a result of carelessness or purposeful failure of some sort.


16
Id. at 37.  The FAA then petitioned for review in this court.

B

17
Under the Federal Aviation Act's split-enforcement regime,  Congress has delegated rulemaking authority to the FAA:"The Administrator of the Federal Aviation Administration  shall promote safe flight of civil aircraft in air commerce" by  prescribing, among other things, "regulations and minimum  standards for ... practices, methods, and procedure the  [FAA] finds necessary for safety in air commerce and national security."  49 U.S.C. § 44701(a).  Pursuant to that authority, the FAA promulgated the safety regulations at issue here,  49 C.F.R. §§ 91.123(b), (e).  Congress has also given the  FAA authority to enforce its regulations through a number of  methods, including the issuance of "an order amending, modifying, suspending, or revoking" a pilot's certificate if the  public interest so requires.  49 U.S.C. § 44709(b).  The FAA  exercised that authority in issuing its enforcement order to  Captain Merrell.  See J.A. at 7.


18
Congress has assigned adjudicatory authority under this  regime to the NTSB.  See generally 49 U.S.C. § 1133.  A  pilot whose certificate is adversely affected by an FAA enforcement order may appeal the order to the NTSB.  See id.  § 44709(d)(1).  Such an appeal is initially heard by an ALJ,  see 49 C.F.R. § 821.35(a), whose final decision may be appealed to the full Board, see id. § 821.47(a).  The Board's decision, in turn, may be reconsidered upon the petition of either  party.  See id. § 821.50.  In reviewing an FAA order, "the  Board is not bound by findings of fact of the [FAA] Administrator."  49 U.S.C. § 44709(d)(3).  It is, however, "bound by  all validly adopted interpretations of laws and regulations the Administrator carries out ... unless the Board finds an  interpretation is arbitrary, capricious, or otherwise not according to law."  Id.


19
If dissatisfied with a final order of the Board, either the  FAA Administrator or any "person substantially affected"  may petition for review in this court.  Id. §§ 1153(c), 44709(f),  46110.3  On judicial review, the "[f]indings of fact of the  Board are conclusive if supported by substantial evidence."49 U.S.C. § 44709(f);  id. § 1153(c);  see also id. § 46110(c).We must, however, set aside Board decisions if they are  "arbitrary, capricious, an abuse of discretion, or otherwise not  in accordance with law."  5 U.S.C. § 706(2)(A).4  And, like  the NTSB, we must defer to the FAA's interpretations of its  own aviation regulations.  Cf. Martin v. Occupational Safety  & Health Review Comm'n, 499 U.S. 144, 147, 150-57 (1991)  (holding that courts must defer to interpretations of Secretary of Labor rather than to those of OSHRC in split enforcement regime under Occupational Safety & Health  Act).

II

20
As we have just described, Congress has "unambiguously  direct[ed] the NTSB to defer to the FAA's interpretations of its own regulations."  Hinson, 57 F.3d at 1148 n.2 (citing 49  U.S.C. § 44709(d)(3));  see also id. at 1151.  Here, however,  the NTSB explicitly declined to defer to the agency's interpretation of 14 C.F.R. § 91.123.  In this Part, we consider the  argument that deference to the FAA was not required, either  because its interpretation was not validly adopted or because  that interpretation was really a factual finding in disguise.


21
* The NTSB declined to defer to the FAA primarily because  the agency had offered "no evidence of any policy guidance  written by the FAA, validly adopted or otherwise," to support  its interpretation.  J.A. at 38.  Instead, the agency had  merely offered the "litigation statements" of FAA counsel, as  well as citations to the Board's own case law.  See id.  The  NTSB believed the former insufficient to qualify for Board  deference under section 44709(d)(3).  Accordingly, it rejected  the FAA's interpretation and expressly adopted its own policy  to govern cases like that of Captain Merrell.


22
The NTSB's refusal to defer to the FAA on this question of  regulatory interpretation and air safety policy was error. 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.  We  have said as much before,5 and the Supreme Court so held in  Martin v. Occupational Safety & Health Review Comm'n  with respect to the similar split-enforcement regime of the  Occupational Safety & Health Act.6  Indeed, the NTSB itself has repeatedly made the same point.7 The fact that this  mode of regulatory interpretation necessarily is advanced  through the "litigation statements" of counsel does not relieve  the NTSB of its statutory obligation to accord it due deference.8


23
Nor was Merrell's the first case in which the FAA interpreted its regulations as it does here.  The position the  agency took in its petition for reconsideration can be summarized as follows:  Failure to understand an ATC instruction is  a valid defense to a section 91.123 charge only if the pilot  provides some exculpatory explanation, such as radio malfunction or precipitating controller error.  See R. at 371.That is precisely the position the FAA took before this court  in Hinson--although there we refused to consider it because  the agency had failed to raise it below.  See Hinson, 57 F.3d  at 1150-51.  It is also the position the FAA has consistently  taken in litigation before the Board.  See Administrator v.  Gentile, 6 N.T.S.B. 60, 64 (1988);  Administrator v. Wells, 1  N.T.S.B. 1472, 1474 (1971).  As discussed in Part IV, while  the NTSB's own position has wavered over the years, the  FAA's has not.


24
In sum, the NTSB's rationale for denying deference to the  FAA's interpretation of 14 C.F.R. § 91.123 was unjustified.

B

25
Merrell offers another potential justification for the  NTSB's failure to defer to the FAA.  The FAA's position  below was not truly an "interpretation," he argues, but rather  a determination of fact with which the Board was free to  disagree.  As Merrell observes, the FAA's petition for reconsideration states:  "When there is an 'error of perception'  resulting in a deviation, inattentiveness or carelessness are  imputed in the absence of some reasonable explanation...."  R. at 367.  In addition, the FAA's appellate briefs consistently describe its interpretation as a presumption or inference. See, e.g., FAA Br. at 23 ("FAA employs the following presumption:  where evidence shows that a pilot mistakenly fails  to understand and comply with a clear and distinct ATC  transmission, and where the pilot fails to provide an exculpatory explanation for his mistake, FAA presumes that the  pilot's mistake was due to inattention....");  see also id. ("[I]t  is fair and reasonable to infer that [Merrell's] mistake was  attributable to inattention....").  The FAA's decision to"impute," "presume," or "infer" carelessness in a particular  situation, Merrell argues, "is nothing more than a finding of  fact, which can be reversed by the NTSB."  Merrell Br. at 14.


26
We note first that Merrell did not make this argument  below, see Opp'n to Pet. for Recons., and that the NTSB did  not itself refuse to defer on the ground that the FAA's  interpretation was really a finding of fact.  Even if we could  nonetheless consider the argument here, it is plain that the  FAA's decision to infer carelessness from unexplained error  does not represent a finding of fact in this, or any other,  particular case.  To the contrary, the FAA's inference is  simply a justification for the regulatory interpretation the  agency applies in all cases--a rationale for why it is reasonable to declare a violation when a pilot errs and has no  explanation for his error.  Although the agency's rule does  act like a presumption, a presumption is a rule of law and not  a finding of fact.  See W. Page Keeton et al., Prosser &  Keeton on the Law of Torts 240 (5th ed. 1984) ("There is ...  general agreement that presumptions are rules of law....").


27
A presumption is valid if it is rational.  See Usery v.  Turner Elkhorn Mining Co., 428 U.S. 1, 28 (1976) (noting  that a presumption will be upheld if there is "some rational  connection between the fact proved and the ultimate fact  presumed, and [if] the inference of one fact from proof of  another shall not be so unreasonable as to be a purely  arbitrary mandate");  see also NLRB v. Baptist Hosp., 442  U.S. 773, 787 (1979);  Chemical Mfrs. Ass'n v. Department of  Transp., 105 F.3d 702, 705-06 (D.C. Cir. 1997).  And surely it  is rational to infer that a pilot was careless or inattentive if he  deviated from a clearance order without any explanation at  all.  In this case, everyone who listened to the recording of  the ATC clearance instructions--including Captain Merrell-confirmed that those instructions were clear and understandable.  See J.A. at 14-15, 18-19;  R. at 145.  Merrell's statement that he "misheard" the transmission is not an explanation for his deviation, but rather a concession that he has no  explanation.  Under such circumstances, it is not unreasonable to presume that he simply was not listening closely  enough.  Such a presumption is as common-sense as that employed in tort cases that hold that the running of a red  light creates a presumption of negligence, rebuttable only by  an exculpatory justification (such as brake failure).9


28
There is also no merit to Merrell's contention that the  FAA's presumption impermissibly reverses the burden of  proof in NTSB proceedings--a point upon which, again, the  Board did not rely.  FAA regulations mandate that "[i]n  proceedings under [49 U.S.C. § 44709], the burden of proof  shall be upon the Administrator."  49 C.F.R. § 821.32.  Merrell contends that the FAA's interpretation of section 91.123  is in reality an attempt to circumvent this evidentiary requirement.  He asserts that "[h]aving failed to carry its burden of  proof," the FAA "sought to eliminate that burden by inventing a legal 'interpretation.' "  Merrell Br. at 15.  The Supreme Court considered a similar contention in Director v.  Greenwich Collieries, 512 U.S. 267 (1994).  There, the Court  construed § 7(c) of the Administrative Procedure Act (APA),  5 U.S.C. § 556(d), which imposes the "burden of proof" on the  proponent of an order.  The Court held that the phrase  should be understood as having its "ordinary or natural  meaning," which, it said, was the burden of persuasion.  512  U.S. at 272, 276.  Because the Labor Department rule at  issue in Greenwich (the so-called "true doubt" rule) reversed  the persuasion burden, the Court struck it down.  See id. at  280-81.  It indicated, however, that a presumption that did  not shift the burden of persuasion would be acceptable under the APA because it would not affect the "burden of proof."Id. at 280.  In accordance with this reasoning, every Circuit  that has considered the issue since 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  APA.  See Gulf & W. Indus. v. Ling, 176 F.3d 226, 232-34  (4th Cir. 1999);  Glen Coal Co. v. Seals, 147 F.3d 502, 510-13  (6th Cir. 1998);  Lovilia Coal Co. v. Harvey, 109 F.3d 445, 452 (8th Cir. 1997).  Merrell offers no reason to read the same  phrase in section 821.32 any differently.


29
On this analysis, the FAA presumption at issue here is  permissible if it shifts only the burden of production--and it  does.  That is the typical role of presumptions in modern  evidence law,10 and the FAA's description of its presumption  indicates that it functions in the same manner.  That is, once  the FAA shows that a pilot failed to follow a clear ATC  instruction, the burden of production shifts to the pilot to  offer an exculpatory explanation.11  Accordingly, we find no  warrant for regarding the FAA's interpretation as the equivalent of a finding of fact or for concluding that it reverses the  FAA's burden of proof, and hence no warrant for the NTSB's  refusal to pay it appropriate deference.

III

30
Deference, of course, does not mean blind obedience.  The  agency's interpretation still must not be "plainly erroneous or  inconsistent with the regulation" it is interpreting. Cassell v.  FCC, 154 F.3d 478, 484 (D.C. Cir. 1998) (quoting Auer v.  Robbins, 519 U.S. 452, 461 (1997)).  And even if the interpretation meets this standard, the NTSB need not follow it if it "is arbitrary, capricious, or otherwise not according to law."49 U.S.C. § 44709(d)(3).  We consider these two standards  below.


31
First, we examine whether the FAA's interpretation was a  reasonable construction of its regulation.  The two subsections of section 91.123 that Merrell was charged with violating  state:


32
(b) Except in an emergency, no person may operate an aircraft contrary to an ATC instruction in an area in which air traffic control is exercised


33
.....


34
(e) Unless otherwise authorized by ATC, no person operating an aircraft may operate that aircraft according to any clearance or instruction that has been issued to the pilot of another aircraft for radar air traffic control purposes.


35
14 C.F.R. § 91.123.


36
Under the FAA's interpretation, a pilot who flies contrary  to either of these commands is in violation unless he has an  exculpatory explanation, such as "radio malfunction" or "ATC  error resulting in a faulty transmission that precipitates a  misunderstanding."  FAA Br. at 15.  This interpretation is  consistent with the regulation.  Indeed, the one respect in  which it varies actually favors the pilot:  it adds two exceptions (radio malfunction and precipitating ATC error) to the  only two expressly listed in the rule itself (emergency and  ATC authorization)--apparently because the FAA believes  they are fairly implied. None of these exceptions assists  Merrell, however, who has offered no explanation whatsoever  for his failure to understand the clear and distinct ATC  transmission.  The FAA has also indicated, as a matter of its  enforcement discretion, that in cases where ATC could have  corrected a pilot's misunderstanding but did not, the agency  will waive or reduce the sanctions for the violation (although  it will still declare that the violation occurred).  See id. at 18.Again, this offers Merrell no assistance, as it is undisputed  that ATC could not have corrected Merrell's error, and in any event, the FAA has in fact waived any possible sanctions  against him.  We therefore find that the FAA's construction  is a reasonable interpretation of its regulation, and that  Merrell's case fits comfortably within that interpretation.


37
Second, we must determine whether the FAA's policy, as  expressed in its interpretation, is arbitrary, capricious, or  otherwise not in accordance with law.  There is no question  that the FAA's policy is harsh, but that does not make it  unreasonable.  The FAA contends that the rule's strictness is  required by the potentially catastrophic consequences of noncompliance with ATC transmissions.  In the agency's view,  the only way to prevent air disasters is to ensure "that pilots  exercise unflagging diligence in monitoring, understanding,  and obeying clearly transmitted ATC instructions."  Id. at  16-17.  And the best way to ensure such diligence, the FAA  has concluded, is to hold pilots to "an exacting standard of  accountability."  Id. at 17.


38
To continue our earlier analogy, the FAA's approach is  somewhat akin to that of the motor vehicle safety laws. Although a driver may be able to defend the running of a red  light on the ground of brake failure, the excuse that he simply  "did not see it" does not avoid a ticket.  Following the same  logic, the FAA has concluded that while a radio malfunction  can excuse a pilot's deviation from an ATC instruction, the  claim that he simply "misheard it" does not.  This approach is  both rational and consistent with the Federal Aviation Act,  which instructs the FAA to prescribe rules that, in its judgment, "best tend[ ] to reduce or eliminate the possibility or  recurrence of accidents in air transportation."  49 U.S.C.  § 44701(c).


39
We recognize that the NTSB prefers a different approach,  one which might best be expressed, in the words of Alexander  Pope, as, "To err is human...."  Alexander Pope, An Essay  on Criticism, in Collected Poems 58, 71 (Bonamy Dobree  ed., Everyman's Library 1983) (1711).  The "premise" of its  approach, the Board states, is that "human beings make  mistakes, and there is no regulatory action, remedial or  otherwise, that can eliminate all mistakes."  Order on Recons., J.A. at 38.  Hence, the Board maintains that "where an  inevitable error of perception does occur, the pilot should not  face sanction if he has acted responsibly and prudently thereafter...."  Id. Although we cannot say that this view is  unreasonable, that is not the issue.  The NTSB is bound to  follow the FAA's interpretation of a regulation unless the  Board finds it arbitrary, capricious, or otherwise unlawful. See 49 U.S.C. § 44709(d)(3).  It was not arbitrary or capricious for the FAA to conclude that in the unforgiving environment of aviation, in which even good-faith error can lead to  tragedy, the best way to encourage pilot attentiveness is  through its harsh approach rather than the NTSB's more  lenient one.  This conclusion is consistent with the governing  law, which makes clear that the FAA's principal responsibility  is not to protect the interests of pilots, but rather to ensure  that air carriers "provide service with the highest possible  degree of safety in the public interest."  Id. § 44701.


40
Finally, we consider Merrell's argument that the FAA's  interpretation of subsections (b) and (e) of section 91.123 is  arbitrary because it conflicts with read back procedures assertedly contained in subsection (a) of the same section.  The  FAA's position, Merrell stresses, means that "a pilot who  inadvertently mishears a clearance, reads it back to the  controller to check his understanding, and receives no correction from the controller, would nevertheless be liable for a  violation of § 91.123" barring an exculpatory explanation for  the initial misunderstanding.  Merrell Br. at 19.  Yet, he  continues, subsection 91.123(a) states that a pilot who is  "uncertain" about a clearance must "immediately request  clarification from ATC."  Id. at 20 (quoting 14 C.F.R.  § 91.123(a)).  That request, according to Merrell, "is made  through a readback, and the written procedures governing air  traffic controllers obligate controllers to correct any errors in  the readback."  Merrell Br. at 20;  see supra note 2.  Because  of that obligation, Merrell argues, pilots are entitled to take  ATC silence as acknowledgment that their readback was  correct.  Moreover, he contends that if the FAA's position  were accepted, "s 91.123(a) would be superfluous" because a  pilot uncertain about a clearance "could follow the instruction of § 91.123(a) precisely, but nevertheless be liable for violating § 91.123(b) if ATC improperly failed, either because of  human or system error, to respond to the pilot's recitation of  an incorrect clearance."  Merrell Br. at 20.


41
There is no conflict between the FAA's interpretation of  subsections 91.123(b) and (e) and the language of section  91.123(a).  The latter provision refers to "clarification[s]," not  readbacks, and the two are not the same.  A request for  clarification--which is mandatory when a pilot is "uncertain"  about his clearance--requires ATC to transmit an affirmative  clarifying response.  If ATC fails to provide one, the pilot  must renew his request until one is forthcoming.  See 14  C.F.R. § 91.123(a);  FAA Reply Br. at 7-8.  A readback, by  contrast, is a non-mandatory acknowledgment by the pilot  which, if correct, does not require an affirmative response  from the controller.  See ATC Procedures p 2-72;  64 Fed.  Reg. 15,912, 15,913 (1999).  The clarification procedure is not  implicated in the current case, as Merrell does not contend he  was uncertain about the ATC instruction.


42
Nor is the FAA's interpretation either inconsistent with, or  rendered irrational by, what Merrell contends is the routine  pilot practice of reading back clearances and taking ATC  silence as acknowledgment of accuracy.  "Readbacks," the  FAA points out, "add a layer of safety redundancy."  FAA  Reply Br. at 8.  If a pilot transmits a readback, ATC will  usually be able to correct a misunderstanding even if the pilot  himself did not realize there was one.  But as this case shows,  the readback procedure is not failsafe;  there is no guarantee  that ATC's silence means it has received and confirmed the  pilot's transmission.  This underscores the reasonableness of  the FAA's policy, which requires pilots to perceive ATC  instructions correctly and not to depend upon the potentially  unreliable readback mechanism.  See id. at 8, 17.12

IV

43
In support of the decision below, Merrell argues that the  NTSB's holding is "thoroughly consistent with a well established line of Board precedent."  Merrell Br. at 17.  The  FAA contends that the opposite is true.  As we discuss in this  Part, the situation is far less clear than either party is willing  to concede.  But even if Merrell were correct, the fact that  the Board followed its own precedent would not be a sufficient basis on which to uphold its decision.  Because the FAA  is entitled to launch new policies through administrative  adjudication, it may sometimes be necessary for the NTSB to  accommodate such policies by changing its jurisprudential  course.


44
We begin by noting that there are actually two divergent  lines of NTSB precedent in this area.13  One line contradicts  Merrell's position, holding that if a pilot deviates from an  ATC instruction in the absence of an emergency, the pilot is  in violation unless an external factor precipitated the error.14 Under this line of cases, when the pilot cannot point to such a  precipitating factor, the NTSB attributes the error to the  pilot's own lack of care.  And under this line, a violation is not  excused even if the pilot reads back the misunderstood instruction and ATC fails to correct it, notwithstanding its  ability to do so.15


45
The second line of NTSB precedent, that cited by Merrell,  is more supportive of his position although not wholly supportive.  Under this line, the Board will excuse a pilot's  deviation if ATC error was a contributing cause.16  In the typical case, a pilot misunderstands a clear ATC instruction,  the pilot gives a readback that reflects this misunderstanding,  and ATC receives the erroneous readback but fails to correct  the error despite its ability to do so.  The cases Merrell cites  indicate the NTSB will exonerate pilots who deviate from  ATC instructions under such circumstances.  The underlying  rationale of these cases, however, appears to be that ATC  could have corrected the pilot's misunderstanding before a  violation occurred.  See cases cited supra note 16.17  Indeed,  the only precedent the NTSB itself cited in rejecting the  FAA's petition for reconsideration, Administrator v. Frohmuth & Dworak, was a case in which the Board excused a  violation because ATC, and not the pilot, was responsible for  the initial misunderstanding.18  Here, ATC was neither responsible for the initial misunderstanding nor capable of  correcting it since it never received Merrell's readback.


46
More important, even if the NTSB had followed an unvarying line contrary to the regulatory interpretation the FAA  advances here, that would not be sufficient to uphold the  Board's decision in this case.  As we noted at the outset, the  interpretation of air safety regulations is an area in which the  Board owes deference to the FAA.  For that reason, consistency with the FAA's position is more important than consistency with the Board's own.  As both the NTSB and Merrell  concede, the FAA is authorized to initiate new regulatory  interpretations through adjudication.19  And because the  Board is bound to follow such interpretations, it may at times  be both necessary and proper for the Board to depart from  its prior case law.20


47
As discussed in Part II.A, the position the FAA takes here  is neither new nor inconsistent with its previous view of a  pilot's obligations.  Nonetheless, there are still some constraints on the FAA's ability to bend the NTSB to its will in  this case.  For one, if a rule is to be applied to a regulated  party, that party must have received fair notice.  See United  States v. Chrysler Corp., 158 F.3d 1350, 1354 (D.C. Cir. 1998);General Elec. Co. v. EPA, 53 F.3d 1324, 1328-29 (D.C. Cir.  1995);  see also Martin, 499 U.S. at 158 (noting that decision  to use adjudication "as the initial means for announcing a  particular interpretation may bear on the adequacy of notice  to regulated parties").  In this case, however, there was fair  notice.  The plain language of section 91.123 states that a pilot must follow ATC directions unless there is an emergency, and does not suggest that he may rely on readback  procedures to absolve himself of responsibility.


48
An agency is also barred from applying a new rule in the  adjudication in which it is announced if doing so would work a  "manifest injustice."  Cassell, 154 F.3d at 486-87 (quoting  Clark-Cowlitz Joint Operating Agency v. FERC, 826 F.2d  1074, 1081 (D.C. Cir. 1987)).21  In cases like this one, the issue  boils down to the question of whether the regulated party reasonably and detrimentally relied on a previously established rule.  See id. at 486.  For the reasons discussed above,  however, there was no established, contrary rule upon which  Merrell could have relied.  Again, the FAA's position on this  matter has been unwavering, while the NTSB's position has  been at most internally inconsistent.  Nor does Merrell suggest that there is anything he would have done differently as  a pilot had he known how the FAA would interpret its rule.22Accordingly, the NTSB's precedent in this area is insufficient  to render the application of the FAA's interpretation to  Merrell a "manifest injustice."

V

49
Finally, Merrell complains that the FAA did not begin to  characterize its position as a regulatory interpretation until  its petition for reconsideration.  Both before the ALJ and  initially before the Board, Merrell contends, FAA counsel  presented the case as a straightforward charge of factual  carelessness.  But the NTSB did not refuse to consider the  FAA's interpretation argument on the ground of tardy presentation, and Merrell himself stops short of contending that  the agency's tardiness should have barred it from making the argument, saying only that the point is "worth noting."  Merrell Br. at 14.  He does, however, strongly suggest that the  FAA pursued an unfair strategy by shifting to a second  theory after losing on the first.  Three considerations lead us  to conclude that the FAA's delay should not affect our  disposition of this case.


50
First, it is true that the FAA did not initially argue that it  interpreted its regulation to presume inattentiveness or carelessness in the absence of explanation;  nor did it initially  argue that the NTSB was required to defer to such an  interpretation.  On the other hand, the FAA also did not  appear to limit itself solely to a claim of factual carelessness. For example, during the initial hearing before the ALJ, the  FAA's counsel argued:  "The Board has stated that an altitude deviation in positive control airspace ... is carelessness  in the absence of an emergency."  R. at 201.  Counsel also  argued that pilots should be found in violation of section  91.123 whenever their errors were not initiated by external  factors.  See id. at 200, 213-14.  These arguments are consistent with the position the FAA took on reconsideration. They suggest that the FAA's litigating posture was not so  much strategic as simply muddled.


51
Second, we are not precluded from considering a regulatory  interpretation simply because the FAA raised it for the first  time in a petition for reconsideration below--at least not  where, as here, the Board went on to consider and resolve the  petition on the merits.  The pertinent statute states that "the  court may consider an objection to an order of the Board only  if the objection was made in the proceeding conducted by the  Board or if there was a reasonable ground for not making the  objection in the proceeding."  49 U.S.C. § 1153(b)(4);  see  also id. § 46110(d).  The reconsideration process qualifies as  a proceeding conducted by the Board.  See 49 C.F.R.  § 821.50.  Indeed, although in Hinson we rejected the FAA's  effort to advance its regulatory interpretation because the  agency had not raised it at all in the NTSB proceedings, we  indicated we would have considered it had the FAA raised it  at the reconsideration stage.  See Hinson, 57 F.3d at 114849, 1150-51.


52
Third, and most important, Merrell does not suggest any  way in which the late emergence of the FAA's interpretation  argument prejudiced him.  He does not contend, for instance,  that if he had known of the argument earlier he would have  litigated the factual issues differently.  To the contrary, since  Merrell construed the charge against him as one of pure  factual carelessness, he had every reason to offer an explanation for his misperception of the ATC instructions at the  initial hearing.  And as he concedes he had no explanation,  there was no further evidence he could have produced, regardless of how he understood the charge.  Nor was Merrell  disadvantaged in arguing the legal issues.  After the FAA  articulated its position in its petition for reconsideration,  Merrell had a full opportunity to respond in opposition to the  petition, and he did so.  See R. at 382-92.


53
None of this excuses the FAA's failure to be clear about its  position from the start.  Given that the agency lost Hinson in  part because it failed to raise its interpretation argument in a  timely manner, one would think it would have taken care not  to wait until the last possible moment to raise the argument  this time around.  Employing the same presumption the FAA  applies to pilots, we would have to conclude that only the  agency's "inattentiveness" explains its tardiness.  But 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.

VI

54
Because the NTSB failed to defer to the FAA's reasonable  interpretation of its own regulations, we conclude that the  Board's ruling was not in accordance with law.  We therefore  grant the petition for review, reverse the Board's decision,  and remand the case for further proceedings consistent with  this opinion.23



Notes:


1
 Merrell was also charged with "operat[ing] an aircraft in a  careless manner so as to endanger the lives or property of others,"  in violation of 14 C.F.R. § 91.13(a).  As discussed infra note 23,  both parties appear to believe that the validity of this charge  depends wholly upon the validity of the § 91.123 charges.


2
 The handbook of ATC rules and procedures states:  "If altitude,  heading or other items are read back by the pilot, ensure the  readback is correct.  If incorrect or incomplete, make corrections as  appropriate."  Federal Aviation Admin., U.S. Dep't of Transp., Air  Traffic Control p 2-72 (1993) [hereinafter ATC Procedures].


3
 Although this case is styled Administrator, FAA v. NTSB, the  real parties in interest are the FAA and Captain Merrell.  The  situation is roughly analogous to an appeal from a district court:the NTSB (the adjudicator below) "has no direct stake in the  outcome" and therefore does not have any role "as a party in  judicial review proceedings."  Hinson, 57 F.3d at 1147 n.1.


4
 See generally Martin v. Occupational Safety & Health Review  Comm'n, 499 U.S. 144, 158 (1991);  Hinson, 57 F.3d at 1149-50;Public Citizen, Inc. v. FAA, 988 F.2d 186, 196-97 (D.C. Cir. 1993).Prior to 1994, the text of the Federal Aviation Act mandated that  judicial review of NTSB orders "be conducted in accordance with  the provisions of" the Administrative Procedure Act (APA), including 5 U.S.C. § 706(2)(A).  See 49 U.S.C. § 1903(d) (1994) (repealed  1994).  In 1994, this provision was "omitted as unnecessary because  [the APA] applies by its own terms."  H.R. Rep No. 103-180, at 18  (1993).


5
 See Hinson, 57 F.3d at 1148-49, 1151 (stating that the FAA  could assert its interpretations in litigation before the NTSB and  that "the Board would then be required to defer").


6
 See Martin, 499 U.S. at 157-58 (holding that "the Secretary's  litigating position before the Commission is as much an exercise of  delegated lawmaking powers as is the Secretary's promulgation of a  workplace health and safety standard," and that "the Secretary's  interpretation is not undeserving of deference merely because the  Secretary advances it for the first time in an administrative adjudication").


7
 See Petition of Quintana, NTSB Order No. EA-3737 (1992),  1992 WL 362084, at *2 (noting that NTSB has previously recognized "that rule interpretation may occur through adjudication");id. at *3 (noting that the NTSB has "adopted and followed the  principles discussed in Martin v. OSHRC");  see also Petition of  Van Eaton, NTSB Order No. EA-4692 (1998), 1998 WL 546384, at  *2 ("The FAA is entitled to make policy via adjudication.  In such a  case, the question for us would be whether the proposed policy  conforms with the words of the regulation.");  Administrator v.  Miller, NTSB Order No. EA-3581 (1992), 1992 WL 137750, at *2-4  ("While the evolutionary interpretation of rules is thought to be  better accomplished through the rulemaking process itself, there is  little question that the adjudicatory process may also be used to  develop and define the meaning of existing regulations.").


8
 In Martin, the Supreme Court rejected the contention that  according deference to agency litigating positions taken before an  administrative adjudicator would be inconsistent with the Court's  prior holdings denying deference to litigating positions taken upon  judicial review:
Our decisions indicate that agency "litigating positions" are not entitled to deference when they are merely appellate counsel's"post hoc rationalizations" for agency action, advanced for the first time in the reviewing court.  Because statutory and regulatory interpretations furnished in this setting occur after agency proceedings have terminated, they do not constitute an exercise of the agency's delegated lawmaking powers.  The Secretary's interpretation of OSH Act regulations in an administrative adjudication, however, is agency action, not a post hocrationalization of it.499 U.S. at 156-57 (citations omitted).  In this case, it is particularly clear that the FAA's position is not simply that of its litigators,  because after the agency instituted this enforcement action, it  published its interpretation of § 91.123 in the form of an interpretive rule.  See 64 Fed. Reg. 15,912 (1999).


9
 See, e.g., Byrne v. City & County of S.F., 113 Cal.App.3d 731,  740-41 (Cal. Ct. App. 1980);  deJesus v. Seaboard Coast Line R.R.  Co., 281 So.2d 198, 201 (Fla. 1973);  Piatt v. Welch, 974 S.W.2d 786,  788 (Tx. App. 1998).  See generally Keeton et al., supra, at 230-31  & n.12.


10
 See Fed. R. Evid. 301 ("[A] presumption imposes on the party  against whom it is directed the burden of going forward with  evidence to rebut or meet the presumption, but does not shift to  such party the burden of proof in the sense of the risk of nonpersuasion....").


11
 See FAA Br. at 23 ("FAA employs the following presumption: where evidence shows that a pilot mistakenly fails to understand  and comply with a clear and distinct ATC transmission, and where  the pilot fails to provide an exculpatory explanation for his mistake, FAA presumes that the pilot's mistake was due to inattention....") (emphasis added).  Compare FAA Pet. for Recons., R. at  371 (characterizing proof that deviation from ATC instruction occurred as establishing "prima facie case"), with Thomas v. National  Football League Players Ass'n, 131 F.3d 198, 202 (D.C. Cir. 1998)  (holding that proof of prima facie case of discrimination under Title  VII creates rebuttable presumption that shifts burden of production  but not burden of persuasion).


12
 Although the FAA could make full readbacks mandatory and  require pilots to await confirmation before proceeding, the agency  has concluded that such a policy would disserve air safety by  congesting radio frequencies.  See 64 Fed. Reg. 15,913 (1999).Neither we nor the NTSB may second-guess that policy determination.  Merrell also suggests that the FAA could require the installation of technology "that would eliminate the problem at the root of  this case:  blocked radio transmissions."  Merrell Br. at 21-22.Because this was not a part of the NTSB's rationale for rejecting  the FAA's interpretation, we may not rely upon it here.  See  Cassell, 154 F.3d at 483 n.5.


13
 The NTSB came close to acknowledging this point in its Order  on Reconsideration.  See J.A. at 38 ("As a principle of administrative law, we may modify our precedent....  We have done so over  time with regard to this issue, with the FAA often in disagreement.").


14
 See Administrator v. Swafford & Coleman, NTSB Order No.  EA-4117 (1994), 1994 WL 108069, at *2 (holding that although  "precedent recognizes that when ATC error is the initiating or  primary cause of the deviation, the complaint will be dismissed,"  that is not the case where "the ground controller's instructions to  [the pilot] were clear and unambiguous");  Administrator v. Wolfenbarger, NTSB Order No. EA-3684 (1992), 1992 WL 289055, at *3  (ruling that "the only regulatory exception to compliance with an  [ATC] instruction is in-flight radio malfunction" and that pilot's  claim he did not hear ATC instruction was therefore "irrelevant");  Administrator v. Gentile, 6 N.T.S.B. 60 (1988) (holding that "it is  patent that deviation from an altitude clearance in positive control  airspace is careless in the absence of an emergency or some other  extenuating circumstances");  Administrator v. Nelson & Keegan, 2  N.T.S.B. 1900 (1975) (concluding that "the most reasonable explanation for respondents' following instructions issued to another flight"  was that "respondents did not exercise the highest degree of care  expected of airline pilots," and that regulatory violation was not  excused by fact that "controller might have taken additional measures which could have averted a deviation of the magnitude that  occurred");  Administrator v. Wells, 1 N.T.S.B. 1472 (1971) ("Inasmuch as the altitude restriction was transmitted ... twice, both  times in clear terms, [the pilot's] failure to hear the clearance, and  adhere to it, can only be attributed to carelessness on his part.").


15
 See Swafford & Coleman, 1994 WL 108069, at *2.  While the  Board will not dismiss the violation under such circumstances, it will  mitigate sanctions.  See id. at *3;  see also Nelson & Keegan, 2  N.T.S.B. at 1900 (stating that system imperfections and contributing controller error are "more appropriately given weight as mitigating circumstances" rather than as excuses for violations).  As  previously noted, the FAA waived sanctions altogether in Merrell's  case.


16
 See Administrator v. Jackson, NTSB Order No. EA-4381  (1995), 1994 WL 804033, at *3 n.11 ("Our precedent holds that,  'even if a deviation from a clearance is initiated by an inadvertent  mistake on the pilot's part, that mistake will be excused and no  violation will be found if, after the mistake, the pilot takes action  that, but for ATC, would have exposed the error and allowed for it  to be corrected.' ") (quoting Administrator v. Atkins & Richards,  NTSB Order No. EA-4078 (1994), 1994 WL 49589, at *2) (emphasis  added);  Administrator v. Shields, NTSB Order No. EA-4180  (1994), 1994 WL 267742, at *1 (suggesting that pilot would have  defense if "ATC should have caught the mistake");  Administrator  v. Holstein, 6 N.T.S.B. 569 (1988) (dismissing order "under unique  circumstances" where ATC "either did not hear the miscommunication or was confused by it").


17
 The NTSB administrative law judge in Merrell's case read  these cases the same way.  See J.A. at 26 ("In all of the cases where  the board has absolved these pilots of some responsibility, the  circumstances have been that that responsibility has somehow been  put back onto air traffic control....").


18
 See Administrator v. Frohmuth & Dworak, NTSB Order No.  EA-3816 (1993), 1993 WL 75479, at *2 (observing that pilot error at  issue was "apparently induced ... by ATC's actions" because ATC  had "not clearly separated" instructions to Frohmuth's aircraft from  those to another plane with similar call sign) (emphasis added).


19
 See Petition of Van Eaton, 1998 WL 546384, at *3 (acknowledging FAA's prerogative to advance regulatory interpretation  through administrative adjudication even where such interpretation "amend[s]" the agency's prior approach);  Petition of Quintana, 1992 WL 362084, at *4-5 (deferring to FAA interpretation  "offered officially for the first time in this proceeding" and not  inconsistent "with the words of the rule or with [the Administrator's] past position");  Miller, 1992 WL 137750, at *2-5 (deferring  to FAA interpretation "now offered for the first time [but] not  inconsistent with any prior interpretative pronouncements");  Merrell Br. at 16 (citing Miller as case in which "Board deferred to  FAA interpretation of regulation, asserted for the first time in  enforcement proceedings").  Cf. Martin, 499 U.S. at 158 ("[T]he  Secretary's interpretation is not undeserving of deference merely  because the Secretary advances it for the first time in an administrative adjudication.").


20
 See Hinson, 57 F.3d at 1149-50 ("Nor is the Board irrevocably  bound to its own precedents, so long as it gives a reasoned  explanation for its departure.").


21
 In addition, the agency must (among other things) explain its  change of course, and the new course must be neither arbitrary nor  capricious.  See Motor Vehicle Mfrs. Ass'n v. State Farm Mut.  Auto. Ins. Co., 463 U.S. 29 (1983);  Hinson, 57 F.3d at 1149-50.


22
 To the contrary, Merrell contends that "[n]o matter what  happens" in this case, pilots will continue their current practices. Merrell Br. at 21.


23
 As noted supra note 1, Merrell was also charged with "operat[ing] an aircraft in a careless or reckless manner so as to  endanger the life or property of another," in violation of 14 C.F.R.  § 91.13(a).  On its face, § 91.13(a) could be read to require a Note 23--Continued  different standard of care than § 91.123, since only the former  expressly uses the term "careless."  Nonetheless, Merrell makes no  argument concerning § 91.13(a), apparently assuming that--as the  FAA asserts--a § 91.13(a) violation can be wholly derivative of a  § 91.123 violation.  See FAA Br. at 5 n.1 (citing Jackson v. NTSB,  114 F.3d 283, 287 (D.C. Cir. 1997) (noting NTSB decision characterizing § 91.13(a) violation as "residual or derivative" of § 91.123  violation));  see also Administrator v. Clark, 7 N.T.S.B. 434, 436  (1990) (holding § 91.13(a) derivative of § 91.123);  Administrator v.  Buller, 6 N.T.S.B. 31, 32 (1988) (same).  Accordingly, we reverse  without addressing whether the standard of care under each of  these regulations might be different.


