Citing the year-end passage into law of a bill that included language giving the Federal Trade Commission (FTC) more rule-making authority in the Horseracing Integrity and Safety Act (HISA), officials from HISA and the FTC who are defendants in two lawsuits before the Fifth Circuit United States Court of Appeals filed four separate documents on Tuesday seeking to vacate two opinions related to constitutionality issues and get rehearings in both cases.
In one lawsuit initiated by the National Horsemen's Benevolent and Protective Association (NHBPA) and 12 of its affiliates against personnel from the HISA Authority and the FTC, the Fifth Circuit ruled on Nov. 18 that HISA was unconstitutional because it “delegates unsupervised government power to a private entity,” and thus “violates the private non-delegation doctrine.” In this case, the defendants fired back with a pair of “emergency” motions and petitions Jan. 3.
Those filings essentially said that Congress and the President have done their parts to clear up any lingering constitutional ambiguity, and now the Fifth Circuit is obliged to do its duty to “say what the law is” with regard to HISA.
“This is the rare case where critical 'dialogue between and among the branches of Government,' has worked in real time both to advance Congress's pressing policy goals and to address the judiciary's asserted constitutional concerns,” the HISA and FTC defendants stated, referring to how swiftly–just over a month–the legislative and executive branches reacted to the Fifth Circuit's unconstitutionality ruling on HISA.
“Since their July 1 effectiveness date, the new [HISA] regulations have brought much-needed safety reforms to the benefit of horses and horseracing participants and, in turn, have begun to restore integrity to the sport,” the defendants stated.
“A few weeks ago, however, this Court held that HISA violates the private-nondelegation doctrine…. Because (in the panel's view) the FTC lacked 'the final word on the substance of the rules, the panel concluded that the Authority did not 'function subordinately to the agency.'”
The motion to vacate continued: “Congress heard this Court's concern and acted swiftly to resolve it. On Dec. 23 Congress again enacted, and on Dec. 29 President Biden signed into law, bipartisan legislation–this time amending the operative language of HISA to fix the alleged constitutional defect the panel had identified…
“Accordingly, the [Fifth Circuit] panel opinion–predicated on a prior version of HISA that no longer exists and that Congress purposefully replaced–cannot stand. Congress's direct response to the constitutional concern at the heart of the panel opinion–obviating the principal basis for Plaintiffs-Appellants' constitutional objection–strongly supports affirmance of the district court's judgment.
“But regardless of how and when the Court ultimately adjudicates this appeal, the panel should vacate its opinion and the judgment of the Court forthwith to prevent the serious harms that mount each day from the now-moot holding that the former version of the Act is facially unconstitutional…
“The panel should rehear this case in light of the intervening congressional amendment HISA and reverse the district court's grant of a preliminary injunction,” the filing concluded.
That last line refers to a Mar. 31, 2022, ruling in United States District Court (Northern District of Texas) that affirmed HISA's constitutionality by stating “the law as constructed stays within current constitutional limitations as defined by the Supreme Court and the Fifth Circuit.”
The HISA and FTC defendants also made related Jan. 3 filings in a separate Fifth Circuit case. This one involves the states of Louisiana and West Virginia, plus other “covered persons” under HISA, alleging unconstitutionality and federal rulemaking procedure violations.
Unlike the two filings in the above-referenced HBPA case, these were not labelled “emergency” motions or petitions. But they did ask for the panel's previously issued opinion to be vacated, the reinstation of a previously issued stay pending further appeal, and a panel rehearing.
“The district court's order preliminarily enjoining enforcement in Louisiana and West Virginia of all then-existing rules promulgated under HISA directly undermines Congress's goal of providing for uniform regulations to protect horseracing participants (equine and human) and restore integrity to the sport nationwide,” the defendants' filing stated.
“This Court appropriately stayed that order, finding that each of 'the stay elements are met' with respect to the district court's (manifestly flawed) conclusion that the Administrative Procedure Act forecloses the 14-day notice period the FTC formally provided…
“The stay pending appeal was necessary to 'allow [the Court] to bring 'considered judgment' to the matter before [it] and 'responsibly fulfill [its] role in the judicial process.' Yet the panel's subsequent decision to remand the case and lift the stay short-circuits that process, not based on the merits of the district court's order–which have never been adjudicated–but on the sole ground that a panel in a 'separate cases held that 'HISA is facially unconstitutional.'”
The filing summed up: “This Court should vacate its panel opinion and judgment, and reinstate the Court's stay pending further adjudication of this appeal…. The Court should grant [a] panel rehearing and reverse the district court's grant of a preliminary injunction.”
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