Abstract
This article argues that the Supreme Court should find that the Horse Racing Integrity and Safety Authority (HISA) is unconstitutional because it violates the nondelegation doctrine. Specifically, the Court should find that, as the Fifth Circuit found, Congress incorrectly delegated federal power to a private group. The Supreme Court should agree with the Fifth Circuit and tell Congress to amend HISA in order to curb the power that was given to the Authority. In Part I, the article explores the HISA law and its function. It then discusses the decisions regarding HISA by the Fifth and Sixth Circuits that have caused the circuit split. Part II argues that the regulation violates the nondelegation doctrine because of the Authority’s relationship with the Federal Trade Commission. Part III explains the reasons that the Supreme Court should side with the Horsemen in its decision. “Horse racing ‘faces another formidable foe: itself,’ following a year that saw seven horses die during the week of the sport’s showpiece event
Introduction
The Horseracing Integrity and Safety Authority (HISA) has sparked significant legal and regulatory debate since it began. 2 The Horseracing Integrity and Safety Act of 2020 established HISA to enforce uniform safety and integrity standards across the U.S. horse racing industry. Legal challenges have frequently targeted the authority’s broad regulatory scope, especially regarding constitutional concerns. Two pivotal court rulings from the Fifth and Sixth Circuit Courts of Appeals have shaped the legal landscape surrounding HISA’s enforcement. The Fifth Circuit rejected parts of the regulation, citing concerns about delegating authority to a private entity, while the Sixth Circuit upheld HISA’s framework, emphasizing its alignment with federal regulatory powers. These conflicting decisions have created uncertainty and raised important questions about HISA’s future and the balance between federal oversight and state autonomy in regulating the sport.
The Supreme Court should find that HISA is unconstitutional because it violates the nondelegation doctrine. Specifically, the Court should find that, as the Fifth Circuit found, Congress incorrectly delegated federal power to a private group. The Supreme Court should overturn HISA and return the power of regulating horse racing back to the states.
In Part I, this article explores the HISA law and its function. It then discusses the decisions regarding HISA by the Fifth and Sixth Circuits that have caused the circuit split. Part II argues that the regulation violates the nondelegation doctrine because of the Authority’s relationship with the Federal Trade Commission. Part III explains the reasons that the Supreme Court should side with the Horsemen in their decision.
I. CIRCUITS SPLITTING
A. HISA in a nutshell
Before the Horseracing Integrity and Safety Act was enacted in 2020, horse racing regulations varied significantly across states, leading to inconsistent standards for both safety and drug control. Each state had its own approach to regulating racetracks and medications, resulting in inconsistent regulations across major venues like Churchill Downs and Saratoga. This lack of uniformity prompted the federal government to step in, aiming to centralize oversight and create a safer, fairer environment for horses, jockeys, and participants across the country.3,4
HISA, which was signed into law in December 2020, took effect in 2022. It introduced two main programs: the Racetrack Safety Program and the Anti-Doping and Medication Control (ADMC) Program. 5 The Racetrack Safety Program, which went into effect on July 1, 2022, focuses on enhancing equine welfare by implementing operational safety rules, establishing national accreditation standards for racetracks, and improving conditions such as surface maintenance and veterinary oversight. 6 The ADMC Program, which launched in 2023, centralizes testing and results management, applying uniform penalties for violations and enforcing a consistent anti-doping policy across all U.S. tracks.
HISA’s structure is designed to ensure independence and expertise in decision-making. The oversight body is governed by a nine-member board, with a mix of industry insiders and independent directors. The board chairs two standing committees: the Anti-Doping and Medical Control Committee and the Racetrack Safety Committee. These committees play critical roles in formulating rules and regulations that align with HISA’s mission of protecting the health and safety of horses and ensuring the integrity of racing.
The Racetrack Safety Program regulates racetrack surfaces, jockey health and safety, medical protocols, veterinary oversight, data collection, and racetrack inspections. 7 The program requires trainers, jockeys, veterinarians, and all other industry participants to register with HISA. The Racetrack Safety Program mandates regular inspections and enforces penalties for noncompliance, including suspension or fines. Additionally, every racetrack must employ a safety officer who ensures standards are met and assists with safety procedures during the race.
The Anti-Doping and Medication Program (ADMC) centralizes drug testing and bans certain performance-enhancing drugs and substances. 8 The Authority, a private group not affiliated with the government, runs ADMC. The program regulates substances prohibited at all times, substances prohibited on race days, out-of-competition testing, and medication limits. Horses may be randomly tested at any time, including during training sessions. Sanctions for violations of ADMC regulations include fines, suspensions, and disqualification from races. Severe violations or repeat violations can result in bans from the sport. Additionally, ADMC delegates all anti-doping and medication enforcement to USADA. 9
Congress gave the FTC insufficient authority to regulate the Authority in the 2020 version of the bill. The Fifth Circuit brought this issue up, and the law was amended to its current form. While the Fifth Circuit is okay with the rule-making of HISA, the issue still is with the enforcement and power given to the Authority. A strained relationship now exists between HISA and state-level racing commissions, as many states are accustomed to controlling their racetracks and making their own decisions.
Groups supporting the continuation of HISA believe it benefits the industry. They argue that it enhances the welfare of the horses, streamlines regulations nationwide, and creates fair competition throughout the racing industry. 10
Opponents of HISA argue that it represents federal government overreach by allowing HISA to control the industry. 11 They claim that the states have lost decision-making power and/or autonomy regarding how to run their tracks. Additionally, they argue that the regulations impose a financial burden on small racetracks.
B. The decision from the sixth circuit
In the Sixth Circuit decision, the court ruled that HISA and its amendments were constitutionally sound. The court determined that the delegation of authority from the FTC to the Authority and USADA did not violate the nondelegation doctrine.
It focused on the argument made in Carter Coal and stated that “private entities may serve as advisors that propose regulations.” 12 The court compared the Authority to the Securities and Exchange Commission, noting that the Authority is subordinate to the agency. It pointed out that 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.” 13 The court explained this by emphasizing that the FTC retains rulemaking authority, oversight, and control of the Authority’s enforcement activities, making it the controlling body in the HISA structure.
C. The decision from the fifth circuit
In the 5th Circuit decision, the court ruled that HISA’s enforcement provisions violate the private nondelegation doctrine. The court particularly noted that the law “empowers the Authority to investigate, issue subpoenas, conduct searches, levy fines, and seek injunctions—all without the FTC’s say-so…[which] is forbidden by the Constitution.” 14 The ruling that HISA is unconstitutional stems from the finding that the private nondelegation clause is in violation by the FTC under this law.
The decision focused on the enforcement authority that the FTC, Authority, and USADA all had. The nondelegation issue arose from the Authority’s role. The court argued that HISA was enforced by a private entity since the Authority held the sole power to decide where to investigate, issue subpoenas, impose sanctions, and enforce injunctions on an entity for violating a HISA regulation. 15 Thus, a private entity, not the FTC, is enforcing HISA.
The court further explained that the authority does not act as an aid to the FTC, as the FTC does not “retain[] the discretion to approve, disapprove, or modify” the authority’s actions. 16 Even if one argues that the FTC supervises the Authority by reviewing sanctions after an ALJ review, the Court found that this argument fails. As the Court stated, “each and every one of [the Authority’s] actions [prior to reviewing the decision] is “enforcement” of HISA [and each] can occur under HISA without any supervision by the FTC.” 17 While the 5th Circuit agreed with the 6th Circuit on the constitutionality of the rulemaking process of HISA, the court found its enforcement mechanisms unconstitutional.
II. CONSTITUTIONAL ISSUE
The main issue both circuits address is whether the legislation that created HISA unlawfully delegated enforcement powers to the Authority, powers usually reserved for the government. HISA remains in effect across most of the nation’s racing circuits, but it does not apply in Louisiana, Texas, and Mississippi after the 5th Circuits ruling. 18 The central question becomes whether there is a violation of the private nondelegation doctrine and if enforcement of HISA is unconstitutional. If the FTC controls enforcement, there is no nondelegation issue; if the HISA holds more control, the law is unconstitutional. 19
A. Enforcement power/nondelegation doctrine
The nondelegation doctrine prohibits Congress from transferring its legislative powers to entities that were not granted such authority under the U.S. Constitution. Rooted in the principle of separation of powers, this doctrine limits Congress’s ability to delegate legislative functions to private organizations or bodies without constitutional authorization. Essentially, it ensures that the power to make laws remains vested in the legislative branch and prevents the delegation of this power to nongovernmental entities or bodies that do not have a constitutional basis for exercising such authority.
Courts use the intelligible principle test to determine if Congress has provided sufficient guidance on how discretion should be exercised. 20 This standard is lenient because courts recognize that Congress must delegate tasks to administrative agencies to conduct business. The test, outlined in J. W. Hampton, Jr. & Co. v. United States, stated that “Congress was restrained only according to common sense and the inherent necessities of governmental cooperation in seeking the assistance of another branch.” 21 Congress defines the boundaries of the law and limits delegation to what is necessary for the law. Courts have given substantial deference to Congress and the agencies to which it delegates power. However, courts invalidate delegations of power only when Congress delegates to a private company, a standard set in Carter Coal. 22
The issue arises when Congress crosses the line between a permissible and impermissible delegation, a line that is very blurry according to the Courts. 23 In Gundy, the Court’s dissent highlights the agency’s unfettered discretion in decision-making under the law. 24 The Gundy decision signaled the first sign that the court may begin to split on this issue, as the plurality opinion did not see a constitutional problem with the power delegated to the Attorney General in that case. 25
The private nondelegation doctrine asserts that government entities cannot delegate governmental powers to private entities. While it has not been as relevant in the past few decades, it is an issue that is popping back up as something to revisit. 26 While historic precedent has favored the government, as seen in Amtrak and Lebron, some believe the current Supreme Court may not be as lenient.
A strong nondelegation doctrine would stop any agency exercises that amount relate to any policy discretion. 27 This would take away the powers of the administrative state to make any policy discretions through the powers that were allotted to them through the laws passed by Congress.
B. Unconstitutionality of HISA
After reviewing how courts have ruled on HISA, the Supreme Court should affirm the Fifth Circuit’s decision. Simply put, the powers that HISA, and more specifically the Authority, obtained through these regulations are unconstitutional. Congress incorrectly delegated powers to HISA, which then delegated them to a private group. The Court must draw the line here and rule in favor of the Fifth Circuit. HISA represents an unconstitutional delegation of power from the FTC and Congress.
The government can delegate power to private entities if they are under close watch and control of the agency; additionally, the government agency must make any final decisions, not the private entity. Here, the problem is that HISA in its original and amended form is still giving power to the Authority, which is a private company incorporated in Delaware, not a government entity.
III. THE SUPREME COURT DECISION
A. HISA is a private delegation
HISA grants the Authority power to conduct business as it sees fit, as it has been the organization filling the gaps that the law has had since its implementation. This is unconstitutional because the authority is a private delegation. Private delegations cannot hold governmental powers, which is what the Authority currently possesses.
Governmental function cannot be delegated to private persons or entities. 28 HISA gives regulatory and enforcement powers directly to a private entity—the Authority. There is no federal oversight over the Authority, allowing it to make whatever decisions it desires. The Authority has the final say over the fees it sets and the budget off when it works. 29 The FTC provides no oversight whatsoever over the way that the Authority conducts itself day to day, showing even more clearly how the Authority is a private actor using federal power.
HISA allows the Authority to make the rules that it is going to enforce and later approve them. There is no justification as to why the Authority alone should have this power to make the rules.
The lack of federal oversight violates the principles established in Carter Coal. In Carter Coal, the Supreme Court found that the Bituminous Coal Act unconstitutionally delegated legislative power to private parties. 30 The Court emphasized that to delegate power, Congress provides constitutional protections against the abuse of this power. There must be standards or guidelines for how the parties set and enforce the rules. The coal act in question did not do this sufficiently, so it violated the nondelegation act.
Here, the FTC and the Authority relationship is extremely similar to nondelegation acts that the Court has found to violate the constitution. The Authority has the power to set and enforce the rules against horse tracks and trainers. There is no standard or guideline for the Authority from the FTC; the standards or guidelines come from the Authority. 31
The 6th Circuit discusses a hypothetical that it believes highlights its argument regarding the constitutionality of HISA and the Authority.
“Take an example to illustrate the point. Imagine that the Horseracing Authority began enforcing its rule without giving thought to the procedural rights of jockeys, trainers, and other industry participants. Section 3053(e) gives the FTC the tools to step in. To ensure a fair enforcement process, the FTC could issue rules protecting covered persons from overbroad subpoenas or onerous searches. The FTC could require that the Authority provide a suspect with a full adversary proceeding and with free counsel. The FTC could require that the Authority meet a burden of production before bringing a lawsuit or preclear the decision with the FTC. In these ways as well as others, the FTC may control the Authority’s enforcement activities and ensure that the FTC, not the Authority, ultimately decides how the Act is enforced.” 32
The FTC does not have the time or energy to step in and change the rules or observe and control the Authority. The FTC has more things to worry about, so they likely just approve the rules that the Authority comes up with. This is likely on the backburner for the FTC on their list of things they have to deal with day by day. 33 The FTC is focusing on fraud, deception, and unfair business practice—what importance does drug regulation on horses who are being used for thoroughbred racing have to them?
Unlike groups like the National College Athletics Association or the National Football League, HISA got all of its enforcement power from the government since Congress passed the law. States had their own way of regulating and enforcing rules before HISA was enacted, and the states were forced to fall in line with the Authority’s rule. Other sports rulemaking groups do not get their power from Congress but instead collectively came together to regulate and protect the industries. It is the complete opposite of what has happened to the horse racing industry. This is unconstitutional, as the states are now under the control of a private entity that is getting its power from the Congress.
B. State’s rights
Historically, the regulation and management of horse racing has been left up to the states. States argue that the implementation of this law was rushed, and it has led to issues regarding how the law is implemented. By rushing the law, Congress did not take time to figure out the real holes and how to fix them but instead left this issue up to the Authority, which has caused issues for the states.
HISA has been criticized by Attorney Generals for “preempting state authority.” 34 The federal government cannot infringe on state sovereignty by transferring its regulatory power to a private regulator. HISA is a shift from a more centralized control of the industry, taking the power away from the states. AGs of 16 states have joined in the litigation against HISA, noting that it takes away regulatory power states have enjoyed. 35 States argue that “HISA’s very purpose is to take away a regulatory power individual states have exercised since the Founding—to oversee and regulate horse racing within their borders—and give that power exclusively to a private agency.” 36 The states believe that the Authority exercises federal regulation without any control, oversight, or supervision.
Additionally, some issues have come up for the states because they see this as an anti-commandeering issue. Congress cannot commandeer the state’s legislative process by compelling the state to enact and enforce a federal program. It is unconstitutional for the government to take resources from the state and use them to further its purpose. By taking revenue directly from the industry, the government is encroaching on the state’s sovereignty, violating anti-commandeering principles.
The Attorney Generals also argue that the industry is at risk due to Congress passing the bill hastily, without thoroughly addressing its requirements. HISA was warped into a massive spending bill in 2020, which took away time from formulating and making sure the bill was going to work properly and benefit the industry. The bill was just a rough blueprint of the regulation, and the power went to the Authority to fill in the details. 37
Texas, for example, argues that this law is against its sovereign interests. 38 Texas argues that before HISA, the state had to regulate and control horse racing on its own, doing this through the Texas Racing Commission. The state has been able to complete things on a state level, incorporating safety protocol, track protocol and operations, medical treatment of horses, and testing for prohibited substances. 39 With HISA’s implementation, Texas had to choose whether to be subject to HISA regulations and “surrender control over horse racing and its associated gambling activities or avoid application of HISA by surrendering the ability to simulcast Texas races to other states and abroad”. 40 If Texas avoids HISA, a lot of money would go out the window because of the loss of simulcasting to other states. 41
C. Harm to the horse racing industry
Aside from the economic impact that comes directly from the enforcement of HISA (as seen in Texas), the regulation generates more harm than good to the horse racing industry. The harm does not only come in financial loss but also in confusion and safety concerns. As the brief from the state of Texas stated in opposition to the application from HISA to stay the mandate from the Fifth Circuit, “[t]hose costs … are ‘nonrecoverable.’” 42 Additionally, with the increase of funds needed to comply with HISA, small racetracks see a grim future, likely being squeezed out of the industry because they are unable to keep up with the money needed. 43
Gulf Coast Racing notes that their company and stakeholders suffer substantial irreparable harm from HISA. 44 If horsemen are suspended, scratched, or barred from participating in races, it becomes impossible to make up for the loss that occurs, as “It is impossible in the context of sports to make up a race that is only run once, or to provide financial compensation after-the-fact when there is no way to know where a horse would have placed if allowed to run.” 45 So, if the Authority can make decisions regarding suspensions and bans, the industry will suffer. The decisions of the agency could lead to decreased profitability in the races that run in the United States because of the uncertainty of what the Authority can do.
From the start of the Authority’s rule, there has been constant chaos. While proponents and the Authority claim that they are helping the industry and protecting horses, the results seem to be the exact opposite. 46 Many horses have died tragically, and the Authority has failed to identify the direct causes of the problem, showing that they continue to be inept as an organization in charge of this. 47
After the tragic deaths of horses at notable racetracks, the Authority had issues with the implementation of its medical control rules. 48 The Authority changed normal racetrack safety rules, and when they discovered that they had acted too quickly, so they reversed them after tracks and jockeys had already purchased new items. 49
Additionally, the Authority has had hiccups in its implementation of the medication control rules, leading to animal rights activists criticizing the group and the potential health of animals being affected. 50 Additionally, the testing protocol has been confusing and delayed, causing more concerns for the well-being of the animals. 51 While the Authority claims to be protecting the animals, the major hiccups of the Authority and implementation of HISA regulations are causing harm to animals.
Conclusion
Estimations predict that the Supreme Court will not confront the issues with HISA for at least another year and a half. While the horsemen wait for their day in the highest court, the horse racing industry will have to deal with the immediate harm that the regulations cause on a day-to-day basis. If the groups are interested in the well-being of the animals and the industry, the correct decision would be to return the powers to the states. The incompetency of the Agency is a threat to the industry. The point of HISA is to protect the animals, but it does not seem like they have this under control. The court should rule in favor of the horsemen and either have Congress amend the law so that the Authority’s power is further limited or return the enforcement back to the states.
Footnotes
1
2
4
5
6
Id.
7
8
Id.
9
Horseracing Integrity and Safety Act, § 3054(e)(2)(A)(i), (3); § 3056(c).
11
12
Oklahoma v. United States, 62 F.4th 221, 229 (6th Cir. 2023), cert. denied, 144 S. Ct. 2679 (2024).
13
Id.
14
Nat’l Horsemen’s Benevolent & Protective Ass’n v. Black, 107 F.4th 415, 421 (5th Cir. 2024).
15
Id. at 429.
16
Ass’n of Am. Railroads v. U.S. Dep’t of Transp. (Amtrak I), 721 F.3d 666, 671 (D.C. Cir. 2013).
17
Horsemen, 107 F.4th 415, at 430.
18
The tracks in these states are not required to abide by any of HISA’s rules at the moment as there was an injunction ordered in the Fifth Circuit’s decision.
21
J.W. Hampton, Jr., & Co. v. United States, 276 U.S. 394, 406 (1928).
22
Carter v. Carter Coal Co., 298 U.S. 238 (1936).
23
Marshall Field & Co. v. Clark, 143 U.S. 649, 693 (1892); see also Wayman v. Southard, 23 U.S. (10 Wheat.) 1, 42 (1825).
24
Gundy v. United States, 139 S. Ct. 2116 (2019).
25
Id.
27
Supra note 19.
28
J.W. Hampton, Jr., & Co. v. United States, 298 U.S. 311 (1936); See also Wellness Int’l Network, Ltd. v. Sharif, 575 U.S. 665, 700–01 (2015) (Roberts, C.J., dissenting) (“It is a fundamental principle that no branch of government can delegate its constitutional functions to an actor who lacks authority to exercise those functions.”).
29
30
Carter v. Carter Coal Co., 298 U.S. 238 (1936).
31
Supra note 28 at 41, see also Horseracing Integrity & Safety Auth., Inc. v. Nat’l Horsemen’s Benevolent & Protective Ass’n, No. 24A287 (U.S. Sept. 30, 2024). (“Under the Act, the Authority “shall submit to the Commission… any proposed rule, or proposed modification to a rule.” Id. § 3053(a). The Commission then shall approve the proposed rule or modification in toto if it “finds that the proposed rule or modification is consistent with this chapter; and applicable rules approved by the Commission.” Id. § 3053(c)(2). This consistency review is no review at all; it is “arms-length,” “high-altitude,” “open-ended,” and “next to nothing.” NHBPA I, 53 F.4th at 885. And this is by design: “it is the Authority, not the agency, that is tasked with weighing policies that go into formulating rules.” Id. at 883. Even after the amendment, the FTC’s review of rules proposed to it remains limited to this rubber-stamp “consistency” review. See, e.g., F.T.C., Order on Anti- Doping and Medication Control Program (March 27, 2023).”).
32
Oklahoma v. United States, 62 F.4th 221, 231 (6th Cir. 2023), cert. denied, 144 S. Ct. 2679 (2024).
35
Id. (“We urge you not to do so. HISA has already caused enormous upheaval in our States. A lame-duck session is not the time to slip new language into legislation amending HISA in response to [a recent court ruling]. Indeed, language that attempts anything other than repealing this ill-advised legislation will only make a bad situation worse.”).
36
Id.
37
38
Id. at 11.
40
41
Supra note 35 11; see also Legal Expert: If Fifth Circuit Finds HISA Constitutional, Texas ‘Absolutely’ Can Implement Law, 
. (“On the flip side, however, if the Fifth Circuit rules that the amended version of HISA remains unconstitutional–just as it ruled on the prior version of HISA–then the TXRC would be correct in barring HISA implementation in the state, said Rodriguez.”).
42
Ohio Forestry Ass’n v. Sierra Club, 144 S. Ct. 2053 (2024) (quoting Thunder Basin Coal Co. v. Reich, 510 U.S. 200, 220–21 (1994) (Scalia, J., concurring)).
43
44
45
Nat’l Horsemen’s Benev. & Protective Ass’n v. Black, No. 5:21-cv-071, 2023 WL 2753978, at 6 (N.D. Tex. Mar. 31, 2023).
47
48
49
50
51
Supra note 48.