The U.S. Supreme Court on Monday handed down an order requiring the U.S. Fifth Circuit Court to issue a new ruling on the constitutionality of the Horseracing Integrity and Safety Authority, the private company that administers regulations in most major racing states.
The order requires the Fifth Circuit to review a Supreme Court decision issued on Friday in a case involving the Federal Communications Commission and a private company the FCC appointed to administer a fund providing payments to communities that lack broad internet access. In that case, FCC v. Consumers’ Research, the Supreme Court rejected a challenge from a party that contended the FCC had violated the non-delegation principle, which is at the core of the Fifth Circuit decision on HISA. The Fifth Circuit is the only circuit court to issue a decision holding part of HISA’s enabling legislation to be unconstitutional.
Technically, the Supreme Court on Monday required all three circuit courts that have issued opinions on HISA’s constitutionality to reevaluate their rulings in light of the Consumers’ Research decision. But because the other two circuits – the Sixth Circuit and the Eighth Circuit – issued decisions similar to the Consumers’ Research case, the Fifth Circuit decision is the likeliest to be revised.
The Fifth Circuit first ruled that HISA was unconstitutional in 2022. Late in 2023, the U.S. Congress amended HISA’s enabling legislation to address the Fifth Circuit ruling, but the court again ruled HISA unconstitutional in July of last year, although in a much narrower sense.
The National Horsemen’s Benevolent and Protective Association, one of the parties to the Fifth Circuit case, released a statement in response to the Supreme Court orders predicting that the Fifth Circuit would again rule HISA to be unconstitutional.
“HISA is fundamentally different from and more flawed than the statute in the Consumers’ Research case,” said Peter Ecabert, the general counsel of the National HBPA. “I am confident the Fifth Circuit will find HISA unconstitutional a third time.”
A statement released by HISA Monday indicated that the organization was encouraged by the Supreme Court orders, noting that the “sole adverse option from the Fifth Circuit is now off the books.”
“The Supreme Court’s ruling in FCC v. Consumers’ Research rejected a constitutional challenge under the private non-delegation doctrine,” the statement said. “That ruling aligns with what every district court has already said in the HISA cases: The private non-delegation doctrine challenges against [HISA’s enabling legislation] have no merit.”
Given the opposing decisions by the circuit courts, the Supreme Court was widely expected to consider the cases during the session that opened in October of last year. But the court cleared its docket last week without directly addressing the cases, instead opting to issue the Monday orders sending the cases back to the circuit courts for review after settling the non-delegation issue in Consumers’ Research.
The Fifth Circuit is considered a bulwark against federal power, which was a reason critics filed a suit challenging HISA in a lower court in the Fifth Circuit’s jurisdiction. Several of the Fifth Circuit’s decisions were overturned during the Supreme Court’s 2023-2024 session, despite its 6-3 conservative majority.
In the meantime, the status quo in HISA regulation is expected to remain in place until all three courts have issued their new opinions. HISA currently has jurisdiction in nearly all major racing states, with the exception of Louisiana and West Virginia, where a stay is in place, and in several other states, such as Texas and Nebraska, where tracks have declined to send their signals out-of-state to avoid HISA’s rules and regulations.
“HISA remains fully operational and will continue to be the national regulatory body overseeing safety and integrity in Thoroughbred racing while legal proceedings continue,” the HISA statement said.
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