By Bill Finley & Dan Ross
Friday’s shocking decision by the U.S. Court of Appeals for the Fifth Circuit ruling that the Horse Racing Integrity and Safety Act (HISA) is unconstitutional has opened up a whole host of issues and left experts in the dark. The legal team scrambled for opinions and found the best path for HISA after a resounding defeat in court.
“We are in a tumultuous situation right now,” said attorney Alan Foreman, a horse law expert and President/CEO of the Thoroughbred Riders Association. “That’s probably the easiest way to describe it. HISA is still in force, the anti-doping program is expected to go into effect on January 1, and now we have a court ruling declaring HISA unconstitutional. And there are still legal tricks that can take place. It will happen no matter who wins at this level as it is clear that HBPA, its affiliates and the participants in the lawsuit will go further if there is an adverse ruling. Now HISA must take the next step.”
According to Frank Becker, a private attorney based in Kentucky, HISA’s next step would be to ask the Supreme Court to take over the case or seek an “en banc” hearing before the Fifth Round. Friday’s ruling was made by a panel of judges, while an en banc hearing will require the case to be heard by the entire court.
The Supreme Court hears oral arguments in fewer than 100 cases a year, but Becker thinks the court can take the case.
“They probably took this because it was so unusual,” he said.
The manager agrees.
“When you have different circuits giving different rulings as has been the case with this case, those cases usually end up in the Supreme Court,” he said. “I think this case will eventually end up with the Supreme Court and a lot of people feel that way. I think they’ll take the case. It had to be there first and there had to be a reason for them to take the case, but what has happened so far has set the stage for them to take it.”
Attorney Bennett Liebman, Government Attorney in Residence at Albany Law School, said whether the Supreme Court would hear the case was still a matter of contention, but said if it did, it would not. There is no guarantee that the court will issue a ruling. support HISA.
“From the point of view of HISA, this is never a case where you want to end up in the Supreme Court because the courts are obviously very conservative and you just don’t know how they will rule on this matter. ,” he said.
In the meantime, Foreman said, HISA will have to stay. If not, it will have to dissolve on January 10 when Friday’s ruling goes into effect.
“Unless there is a stay, HISA has to stop,” said Foreman.
Foreman says he has no problem staying. Becker disagreed and said he doubted HISA would be successful in upholding the interim ruling.
Liebman adds that there is another way for HISA to prevail. The Fifth Circuit’s ruling was based on its findings that HISA was ultimately responsible and not the Federal Trade Commission (FTC). “But the Agency is not dependent on the FTC,” the ruling read. “The opposite is true. The agency, not the FTC, has the final say on HISA programs.”
Liebman suggests that HISA could go back to the drawing board and ask Congress to rewrite the law so that the FTC is given clear accountability.
“The obvious solution is to try to get Congress to fix what the Fifth Circuit thinks is the problem, that the FTC doesn’t have enough power,” Liebman said. “You can be sure that the FTC has substantial power over the Agency’s rules. In fact, they can make the rules. They can take recommendations from the Agency, but still make the rules. That’s the way to go, but can we get there? How the government works these days, I don’t know.”
Becker doesn’t see that happening.
“Have you seen Congress working lately?” he say. “Congress will be in chaos for the next year or so.”
All three attorneys agree that the plaintiffs chose the right court when deciding to take their case to the Fifth Court.
“It was the Fifth Round, an extremely conservative one, even more conservative by general rule than the Supreme Court,” said Liebman. “In that sense, this decision is not surprising as it comes from the Fifth Circuit. The judge (Circuit Judge Stuart Kyle Duncan) who wrote the decision is extremely conservative.”
“Experts thought it was constitutional and now it has been declared unconstitutional,” Foreman said. I doubt that has anything to do with the Supreme Court and this whole focus on the federal government versus the states’ rights. A circuit that can reverse the decision and declare it unconstitutional is this circuit. That’s why they go there. They are the ones most likely to declare it unconstitutional. The plaintiffs brought this case to the Fifth Circuit for a reason. They know this particular court has been very, very anti-government and very anti-regulatory.”
In the coming days and weeks, the industry will undoubtedly receive more information from HISA and its attack plan. But Friday is not a good day for the Agency. Could it exist and what would it take to do so? Amidst the chaos, that seemed to be anyone’s guess.
