“Sometimes, government works.” With those words, the Sixth Circuit Courts have upheld the constitutionality of the Horse Racing Safety Integrity and Safety Act, setting up a potential court battle in the U.S. Supreme Court.
The Fifth Circuit Court of Appeals declared HISA unconstitutional in 2022, “because it gave `a private entity the last word’ on federal law,” reads the Sixth Circuit opinion. “In response, Congress amended the Act to give the Federal Trade Commission discretion to “abrogate, add to, and modify” any rules that bind the industry. The Constitution anticipates, though it does not require, constructive exchanges between Congress and the federal courts. A productive dialogue occurred in this instance, and it ameliorated the concerns underlying the non-delegation challenge. As amended, the Horseracing Act gives the FTC the final say over implementation of the Act relative to the Horseracing Authority, allowing us to uphold the Act as constitutional in the face of this non-delegation challenge as well as the anti-commandeering challenge.”
The ruling continues, “After the Fifth Circuit issued its decision and after we heard oral argument in our case, Congress enacted, and the President signed into law, an amendment to the Act that increased the FTC’s oversight role. The amendment eliminated the FTC’s interim-rule authority and instead gave sweeping power to the FTC to create rules that `abrogate, add to, and modify the rules of the Authority.’”
The ruling cites prior cases which, “taken together, draw a line between impermissible delegation of unchecked lawmaking power to private entities and permissible participation by private entities in developing government standards and rules.”
In its ruling, the court said that the central question was whether or not the Authority was inferior to the FTC. “The Horseracing Authority is subordinate to the agency,” they write. “The Authority wields materially different power from the FTC, yields to FTC supervision, and lacks the final say over the content and enforcement of the law—all tried and true hallmarks of an inferior body.”
This story will be updated.
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