By: Christian T. Deeter
In 2020, the Horseracing Integrity and Safety Act (HISA) was introduced to the House of Representatives by Lexington’s Rep. Andy Barr.[i] The bill created the Horseracing Integrity and Safety Authority (“Authority”), which is responsible for both drafting and enforcing uniform rules in thoroughbred racing across the United States.[ii] HISA created two programs, the Racetrack Safety Program and the Anti-Doping and Medication Control (ADMC) Program.[iii] The two programs will go into effect on July 1, 2022 and January 2023 respectively.[iv]
One might think those in the horseracing industry would welcome new uniform rules, especially after the controversy surrounding 2021’s Kentucky Derby winner, Medina Spirit.[v] Medina Spirit was stripped of his title after a post-race drug screening revealed a positive test for a banned substance.[vi] However, the industry has not been welcoming of the legislation, as it has been challenged in two actions.[vii]
Both suits challenged the Authority’s regulatory regime and argued that the non-governmental entity was given too much power.[viii] In the first lawsuit, the National Horsemen’s Benevolent and Protective Association, twelve of its affiliate organizations, and the state of Texas challenged HISA’s constitutionality.[ix] The district court granted the defendants’ motions to dismiss the plaintiffs’ claims that HISA violated the private nondelegation doctrine and due process clause.[x] The private nondelegation doctrine limits Congress’ ability to delegate regulatory authority to nongovernmental bodies.[xi] The court found that HISA’s regulatory regime was constitutional because it functions subordinately to the Federal Trade Commission (FTC).[xii] Unfortunately, this case was later reversed and remanded by the Fifth Circuit, which found that HISA’s delegation of rulemaking authority to the Authority violated the private nondelegation doctrine.[xiii]
The second lawsuit, initiated in the state of Louisiana, resulted in a different outcome.[xiv] There, Louisiana and West Virginia, joined by each states’ racing commissions, were granted an injunction that barred HISA from implementing some of its rules in their states.[xv] The plaintiffs in this case pointed to numerous rules that they argued exceeded HISA’s authority.[xvi] The court agreed that three of the rules went beyond the limits imposed by Congress, most notably that the Authority exceeded its limits when defining the term “Covered Horse.”[xvii] Because HISA operates subordinate to the FTC and does not violate the private nondelegation doctrine, the Texas district court’s approach is most convincing and should be followed.
Courts in the future, both for these cases on appeal and for possible new suits, should follow the Texas district court’s approach. While HISA is a non-governmental entity, it does not have the power to implement its proposed rules on its own.[xviii] In order for its rules to become enforceable, the FTC must first grant the proposals.[xix] This set-up is well within the bounds of the private nondelegation doctrine. Further, the rules are only enforceable if they comply with Congress’ statutory language.[xx]
Congress has been trying to standardize thoroughbred-racing regulations for years now, but proposals in 2013, 2015, and 2017 all failed to pass.[xxi] Finally, this piece of legislation was able to break through and become law. The Horseracing Integrity and Safety Act should be upheld because the FTC must first approve the Authority’s proposals, making this regulatory regime lawful. Because of this, HISA is constitutional and should be upheld.
[i] Congress Passes Horseracing Integrity and Safety Act led by Congressman Andy Barr and U.S. Senate Majority Leader Mitch McConnell, U.S. Congressman Andy Barr Representing the Sixth Dist. of Ky. (Dec. 22, 2020), https://barr.house.gov/2020/12/congress-passes-horseracing-integrity-and-safety-act-led-by-congressman-andy-barr-and-u-s-senate-majority-leader-mitch-mcconnell [https://perma.cc/LR5H-Y6B2].
[ii] About, Horseracing Integrity and Safety Auth., https://www.hisaus.org/about [https://perma.cc/5BB4-63BZ] (last visited Oct. 20, 2022).
[iii] Id.
[iv] Id.
[v] Gary B. Graves, Medina Spirit stripped of Kentucky Derby victory due to positive drug test, PBS (Feb. 21, 2022, 6:53 PM EDT), https://www.pbs.org/newshour/nation/medina-spirit-stripped-of-kentucky-derby-victory-due-to-positive-drug-test [https://perma.cc/ETB7-S3N5].
[vi] Id.
[vii] Kevin McGill, Horseracing panel’s nationwide power questioned in court, Associated Press (Aug. 30, 2022), https://apnews.com/article/sports-texas-louisiana-new-orleans-congress-fa99775121e25ab3bed9d5ddbdb1447d [https://perma.cc/EUN6-MVWQ].
[viii] Id.
[ix] Nat’l Horsemen’s Benevolent and Protective Ass’n v. Black, 596 F.Supp.3d 691, 696 (N.D. Tex. 2022).
[x] Id. at 708.
[xi] James M. Rice, The Private Nondelegation Doctrine: Preventing the Delegation of Regulatory Authority to Private Parties and International Organizations, 105 Cal. L. Rev. 539, 545 (2017).
[xii] Id. at 709.
[xiii] Nat’l Horsemen’s Benevolent and Protective Ass’n v. Black, 53 F.4th 869, 883-84 (5th Cir. 2022).
[xiv] Louisiana v. Horseracing Integrity & Safety Auth. Inc., 2022 WL 2960031, *14 (W.D. La. 2022).
[xv] Id.
[xvi] Id at *9.
[xvii] Id. at *10-11.
[xviii] Id. at *2.
[xix] Nat’l Horsemen’s Benevolent and Protective Ass’n, 596 F.Supp. at 697.
[xx] Id. at 709.
[xxi] Id. at 696.