Casino Airlines, Inc. v. National Transportation Safety Board

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued October 24, 2005 Decided February 3, 2006

No. 04-1381

CASINO AIRLINES, INC.,
PETITIONER

v.

NATIONAL TRANSPORTATION SAFETY BOARD AND
FEDERAL AVIATION ADMINISTRATION,
RESPONDENTS

On Petition for Review of an Order of the
United States Department of Transportation

Mark T. McDermott argued the cause for petitioner. With
him on the briefs was Steven L. Graff.

Agnes M. Rodriguez, Senior Attorney, Federal Aviation
Administration, argued the cause for respondent. With her on
the brief was Peter J. Lynch, Assistant Chief Counsel.

Before: TATEL and GRIFFITH, Circuit Judges, and
WILLIAMS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge GRIFFITH.
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GRIFFITH, Circuit Judge: Casino Airlines, Inc. (Casino)
seeks review of an order of the National Transportation Safety
Board (NTSB or Board). The Board affirmed the decision of an
Administrative Law Judge (ALJ) to uphold the revocation of
Casino’s air carrier operating certificate by the Federal Aviation
Administration (FAA). We deny Casino’s petition for review
because we find that at least one of the grounds for the Board’s
decision was permissible.

I. BACKGROUND

The FAA Administrator revoked the operating certificate
for Casino, a small regional carrier, on January 23, 2003.
Without a valid certificate, Casino could not conduct air carrier
operations. See 49 U.S.C. § 44711(a)(4). Casino appealed the
revocation to the NTSB. See 49 U.S.C. § 44709(d)(1). The
NTSB assigns appeals to an ALJ, who is authorized to issue an
initial decision. 49 C.F.R. § 821.35(a), (b)(10). Appeals from
ALJ decisions may be made to the Board. 49
C.F.R. § 821.47(a). The carrier may then petition this Court for
review of adverse Board decisions. 49 U.S.C. § 1153(a); 49
U.S.C. § 44709(f).

Before the ALJ, the FAA submitted as its complaint the
“Order of Revocation,” which it is required to do under 49
C.F.R. § 821.31(a), but Casino failed to file an answer as called
for in 49 C.F.R. § 821.31(b). The FAA moved for summary
judgment, asking the Board to affirm the Administrator’s
revocation on the ground that there was no genuine issue of
material fact. Casino did not respond. The FAA attached two
declarations from FAA safety inspectors to its motion. The first
stated that Casino did not have “a qualified Chief Inspector”; the
second stated that Casino did not have an “economic authority.”
Under FAA regulations, an air carrier must employ a qualified
chief inspector and possess an economic authority, 14
 3

C.F.R. § 119.65(a)(5); 14 C.F.R. § 119.5(i), or face revocation
of its operating certificate. 49 U.S.C. § 44709(b)(1)(A).

The ALJ affirmed the FAA revocation order and gave two
reasons for its decision. First, he held that the allegations of the
complaint were deemed admitted because Casino had not filed
an answer. Second, the ALJ found that there were “no disputed
material facts” because Casino had not opposed the FAA’s
motion for summary judgment. Admin’r v. Casino Airlines,
Inc., NTSB Decisional Order, Docket No. SE-16809 (June 27,
2003) (hereinafter ALJ Opinion), reprinted in Joint Appendix
(J.A.) at 44-45. According to the ALJ, “the proceeding [stood]
for disposition upon the facts of the Complaint which [were]
deemed established and the unopposed representations and
attachments in said Motion [the motion for summary
judgment].” J.A. at 45 (emphasis added).

Casino appealed the ALJ decision to the Board, arguing that
its appeal should not have been dismissed for what it called a
“procedural defect,” given that it was not represented by counsel
at the time. J.A. at 55-56. The Board denied the appeal, stating
that Casino’s pro se status was irrelevant because Casino had
“failed to act in the face of clear notice of the necessity and
timing for doing so.” Admin’r v. Casino Airlines, Inc., NTSB
Order No. 5091, at 3 (May 27, 2004), reprinted in J.A. at 95.
More important to the disposition of this matter, the Board
affirmed the ALJ’s decision to “deem[] [the FAA allegations]
admitted by the unanswered complaint and the law judge’s grant
of the unopposed motion for summary judgment.” Id. (emphasis
added).

Casino moved for reconsideration, and for the first time in
its challenge to the revocation of its operating certificate, Casino
argued that its Notice of Appeal was the functional equivalent
of an answer, and that the ALJ and the Board should not have
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deemed the allegations of the complaint admitted. The Board
concurred that the ALJ could have treated the Notice of Appeal
as an answer, but still affirmed its prior decision on the basis of
Casino’s failure to respond to the FAA’s motion for summary
judgment: “[T]he law judge cannot be faulted for not
recognizing the appropriateness of disregarding respondent’s
failure to file a formal answer in the face of [Casino’s]
subsequent failure to respond to the Administrator’s motion for
summary judgment.” NTSB Order No. 5108 (September 14,
2004) at 1-2, reprinted in J.A. at 111-12.

On November 9, 2004, Casino petitioned this Court for
review of the NTSB orders.

II. ANALYSIS

We have jurisdiction to hear this petition for review
pursuant to 49 U.S.C. §§ 1153(a) and 44709(f), and, applying
the familiar standard of review found in 5 U.S.C. § 706(2)(a),
we uphold the NTSB orders because they are “not ‘arbitrary,
capricious, an abuse of discretion, or otherwise not in
accordance with the law.’” See Am. Fed’n of Gov’t Employees,
AFL-CIO v. FLRA, 778 F.2d 850, 863 (D.C. Cir. 1985) (quoting
5 U.S.C. § 706(2)(a)).

Casino rests its challenge to the Board’s decision upon its
argument that the ALJ and the NTSB should have treated
Casino’s notice of appeal letter as an answer to the FAA
complaint and should not, therefore, have deemed the
allegations in the FAA complaint admitted.1 But we need not

1
At oral argument, counsel for Casino also argued that the
NTSB should have considered disciplinary action as an alternative to
revocation. Oral Arg. at 3:45; 6:40. Casino, however, failed to raise
this argument in its briefs and therefore waived the argument. See Ark
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address this issue because both the ALJ and the NTSB relied on
another independent and valid ground for their decisions:
Casino’s failure to respond to the motion for summary
judgment.2

Although “[i]t is axiomatic that we may uphold agency
orders based only on reasoning that is fairly stated by the agency
in the order under review,” Williams Gas Processing – Gulf
Coast Co., L.P. v. FERC, 373 F.3d 1335, 1345 (D.C. Cir. 2004)
(citing SEC v. Chenery Corp., 318 U.S. 80, 88 (1943)), the
contested decision need not be a model of clarity. As long as
“the agency’s path may reasonably be discerned,” we will
uphold the decision even if it is “of less than ideal clarity.”
Bowman Transp., Inc. v. Ark.-Best Freight Sys., Inc., 419 U.S.
281, 285-86 (1974); see also Chritton v. NTSB, 888 F.2d 854,
862 (D.C. Cir. 1989) (upholding Board decision even though the
decision was “less than crystal clear”). We have consistently
held that “[w]hen an agency relies on multiple grounds for its
decision, some of which are invalid, we may nonetheless sustain
the decision as long as one is valid and ‘the agency would
clearly have acted on that ground even if the other were

Las Vegas Rest. Corp. v. NLRB, 334 F.3d 99, 108 n.4 (D.C. Cir.
2003); see also Oral Arg. at 10:17.
2
In any case, it is not entirely clear that the Board acted
arbitrarily and capriciously when it refused to treat the notice of appeal
as an answer to the FAA complaint. To be sure, the NTSB did find,
in Administrator v. Ocampo, NTSB Order No. EA-5113 (Sept. 28,
2004), at 3, that a “notice of appeal” should be treated as an “answer,”
but this decision was issued after the NTSB issued its order on
reconsideration on September 14, 2004. Given our conclusion in this
case, we do not address whether a decision can be arbitrary and
capricious or contrary to precedent if the precedential opinion relied
upon was issued after the issuance of the decision being challenged
but before the filing of the notice of appeal.
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unavailable.’” Mail Order Ass’n. of Am. v. U.S. Postal Serv., 2
F.3d 408, 434 (D.C. Cir. 1993) (quoting Syracuse Peace Council
v. FCC, 867 F.2d 654, 657 (D.C. Cir. 1989), cert. denied, 493
U.S. 1019 (1990)).

In this case, we can “reasonably discern” that Casino’s
failure to respond to the summary judgment motion was an
independent ground for the decisions at issue. The ALJ, for
example, held that “the proceeding stands for disposition upon
the facts of the Complaint which are deemed established and the
unopposed representations and attachments in said Motion [the
motion for summary judgment].” ALJ Opinion at 45 (emphasis
added). On appeal from that decision, the Board noted that the
ALJ had based its decision on Casino’s failure to file a
complaint and Casino’s failure to respond to the motion for
summary judgment. NTSB Order No. 5091, at 3. And, in its
denial of the motion for reconsideration, the Board explained
that it was denying the appeal because Casino had not responded
to the summary judgment motion. NTSB Order No. 5109, at 1-
2.

We agree with the Board. Its regulations provide that “[a]
party may file a motion for summary judgment on the basis that
the pleadings and other supporting documentation establish that
there are no material issues of fact to be resolved and that party
is entitled to judgment as a matter of law.” 49
C.F.R. § 821.17(d). Here, the FAA filed a motion for summary
judgment and attached affidavits declaring that Casino did not
have the required economic authority and was not employing a
chief inspector. Casino did not file a response to the motion for
summary judgment, and, consequently, NTSB properly
concluded that there were “no material issues of fact to be
resolved.” Id.
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Casino reads the Board’s decision differently and argues
that the Board held only that a notice of appeal cannot serve as
an answer if a party does not file a response to a subsequent
motion for summary judgment. But that is not a fair reading of
what the Board said. The Board’s language could have been
more direct, but we do not think there can be a reasonable
dispute that the Board orders were based, at least in part, on the
undisputed fact that Casino failed to respond to the FAA’s
motion for summary judgment. That is a sufficient basis for the
Board’s decision and for our decision to deny the petition for
review.

So ordered.