Last week, the U.S. Court of Appeals for the Fifth Circuit issued an opinion that reiterated a conclusion they had reached two years prior–that even though the Horseracing Integrity and Safety Act (HISA)'s rulemaking structure is constitutional, its enforcement provisions are not.It was nearly this time last year the United States Supreme Court punted the question of HISA's constitutionality back down the legal ladder, telling the Fifth, Sixth and Eighth Circuits of the U.S. Courts of Appeal to consider in their various HISA decisions a then-recent Supreme Court ruling in Federal Communications Commission (FCC) vs. Consumers' Research.In that Supreme Court decision, a 6-3 majority of justices dismissed an argument that the agency delegated too much authority to a private company to administer the program.The Fifth Circuit has reconsidered that ruling but hasn't changed its mind.“HISA's explicit division of enforcement responsibility empowers the [HISA] Authority with quintessential executive functions and gives the [Federal Trade Commission] FTC scant oversight until enforcement has already occurred,” the Fifth Circuit wrote in its latest ruling, adding “such back-end review by the FTC does not subordinate the Authority.”The Fifth Circuit added that the FTC's general rulemaking power “provides no answer because executive rulemaking cannot amend the plain division of enforcement power laid out in HISA's text. Such a radical delegation [occurs because] the FTC lacks any tools to ensure that the law is properly enforced. HISA's enforcement provisions thus facially violate the private nondelegation doctrine.”A year ago, attorney Lucinda Finley foresaw such a possible scenario as played out this week. Her prediction was partially grounded in the fact there was no enforcement issue in the FCC case the Supreme Court had just ruled on.“There's nothing in that case that directly bears on the enforcement power given to the private entity,” Finley told the TDN last year. She's the Frank Raichle Professor of Trial and Appellate Advocacy and director of Appellate Advocacy at the University of Buffalo Law School.So, Finley added, “it is possible the same three judges of the Fifth Circuit that already found the enforcement power part of the HISA statute unconstitutional will say, 'we stick with our view. Nothing in the FCC case changes that.'”Now that the Fifth Circuit has indeed taken that course of action, the TDN spoke once again with Finley to discuss what happens now.TDN: Let's begin with a reminder of why the Supreme Court remanded this back down to circuit courts in light of the FCC vs. Consumers' Research ruling. If there was no enforcement issue at play in that ruling, what did the Supreme Court see in that FCC ruling that they thought would be relevant in the various HISA cases?LF: I can assume the Supreme Court thought the Consumers' Research decision was relevant because they announced what they see today as the guiding principle for any constitutional challenge arguing that too much rulemaking or enforcement authority has been delegated to a private entity.The Supreme Court and consumers research reiterated the longstanding principle that, so long as the federal agency does have the review authority, the final authority to approve rules or approve fees or approve enforcement actions, then the private entity is sufficiently subordinate to the agency, and there is no constitutional delegation problem.TDN: In their most recent decision, the Fifth Circuit judges use the following theoretical example to argue why they think HISA isn't really subordinate to the FTC: “Suppose the Authority sanctions a horse owner for a doping violation, but the sanction is later reversed by the FTC. Does that make the Authority's enforcement power subordinate to the agency? No, it does not. Consider everything the Authority was permitted to do up to that point: launch an investigation into the owner, subpoena his records, search his facilities, charge him with a violation, adjudicate it, and fine him. Each and every one of those actions is 'enforcement' of HISA.” How compelling do you think this and their overall argument is?LF: First, let me point out that the Sixth Circuit directly disagreed with that conclusion of the Fifth Circuit. The Fifth Circuit seems to be saying that every single step of enforcement has to be approved separately, step-by-step, by the FTC–that it's not enough the FTC can review HIWU's conclusion and decide on its own, independently of HIWU's reasoning, whether to uphold it or reverse it.The Sixth Circuit in contrast said that they read the U.S. Supreme Court decision on Consumers' Research as putting emphasis on whether the federal agency has the final or the ultimate reviewing authority.As we've been seeing under the HIWU and FTC enforcement provisions, there are administrative law judges that have frequently been disagreeing with enforcement actions started by HISA. Maybe to put it more succinctly, the Sixth Circuit read the Supreme Court decision on Consumers' Research as saying, 'It's okay for the private entity to start enforcement so long as the federal agency has the final say.'The Fifth Circuit in contrast says, 'No, no, no, no. It's not okay for the private entity even to start enforcement. Only the federal agency can do that.' That's the gist of the disagreement between the Fifth and the Sixth Circuits.I also think it's important to emphasize for your readers that now every circuit court agrees that the rulemaking of HISA is constitutional. The only area of disagreement left is over how HISA's rules get enforced.Lucinda Finley | University of BuffaloTDN: Last December, Congress authorized an amendment to HISA that includes new requirements for the Authority to seek Commission approval to issue a subpoena or commence a civil action under the Horseracing Integrity and Safety Act. Did the Fifth Circuit address that amendment?LF: Not that I'm aware of and not that they mentioned. The Fifth Circuit basically reissued their earlier opinion and added a section explaining why they didn't think the Supreme Court decision on Consumers' Research was relevant.The Sixth Circuit basically reissued their decision and issued a section saying why they think consumers' research is relevant.I think your next question is going to be, 'what happens now'?TDN: Exactly! How long will this all take to play out? I know the Eighth Circuit still needs to rule on their case. How long could that theoretically take? And then how long for the Supreme Court to take this up? LF: As I understand it, there's already been a petition for certiorari filed from the Sixth Circuit decision, and I would expect that HISA will file a petition for certiorari from the Fifth Circuit decision.The Supreme Court term is wrapping up in a couple weeks, by the end of June, and they won't reconvene until the beginning of October. Lots of petitions for certiorari will accumulate over the summer and usually, sometime in September, the court reviews all of the pending petitions for certiorari that came in over the summer, rejects some of them, grants some of them, just doesn't decide others and keeps them in the hopper of ones they still have to decide.That's a long way of explaining that the earliest the Supreme Court might say whether they're going to take the case over the constitutionality of HISA will be in the beginning of October.Given that there is no disagreement among the circuit courts about the constitutionality of the rulemaking authority, I think that if the Supreme Court takes the case, they are likely to take it only to examine the delegation of authority between HISA and HIWU and the FTC when it comes to enforcing the rules because there's no reason for them to wade in on the making of the rules themselves when all the lower courts agree that the FTC has sufficient oversight.If they are going to review the constitutionality of the enforcement provisions of HISA, then it'll be a couple months before the parties' briefs are due and then they probably wouldn't hear oral argument until sometime in the winter. So, it would probably be a year from now before there would be a decision.TDN: If they just look at it through that narrow lens of the constitutionality of the enforcement provisions, how do you expect them to rule? LF: Any lawyer should be very careful about predicting what the Supreme Court will do.I do think their Consumers' Research decision is a very strong signal that currently, a majority of the Supreme Court justices think that if the federal agency has the final say, has the authority to review either the rules or an enforcement action, then it is constitutional.But here we are now, back in limbo. We're back to conflicting circuit court decisions on enforcement. What does that mean in the meantime? Well, what it means in the meantime is the status quo that's currently in place continues: that HISA cannot enforce its rules in the states within the Fifth Circuit.It's a rather odd situation because you have the court saying the rules themselves are valid and the HISA statute says the federal rules preempt any state rules. But you have the Fifth Circuit, for the states within the Fifth Circuit, saying, 'but nobody can enforce them.'The Fifth Circuit, interestingly enough in its opinion, also seems to indicate that it doesn't think that HISA contracting with the State Racing Commissions to enforce the rules is sufficient.TDN: Is there a possibility the Supreme Court could, once again, remand this back down to the circuit courts to clear up? LF: To consider the effect of the more recent congressional amendment?TDN: Yes. LF: Sure, potentially.TDN: What does your gut tell you about what the Supreme Court will do? LF: I'm going to say this somewhat facetiously but also somewhat seriously. Maybe the Supreme Court is saying, 'you know, if we just keep remanding it and Congress keeps tweaking the statute, maybe eventually these people will give up with their challenges and just accept the new reality, then we won't have to wade in.'I go back to things I've said in previous Q & As with you: it just really doesn't seem to make a lot of sense that the national horsemens' organization is devoting so much time and energy trying to fight every aspect of this federal statute that's now been around for several years and the rulemaking authority has been upheld by every circuit court.I know their press releases say things like, 'we care about the constitutionality and we don't want our horsemen governed by the decisions of some small group of elites.' I question that.If they're a group that purports to represent the interests of horsemen, one would hope they also put the interests of horses very high on their values. All of the data shows the states that are subject to HISA's rules and enforcement have drastically lower fatalities, have better jockey safety records, and that racing is just better for the horses and humans that participate in it.I also think if you poll the horsemen, ask them whether they cared about the constitutional principle known as non-delegation, they would look at you and say, 'Lady, what I care about is whether the carded fifth race next week that my horse is ready to run in is going to go.'What do I think the ultimate result is going to be? The ultimate result is we're going to have uniformity and national rules.We now have it in all but a very small number of states. Congress seems very committed to it. Even when Senator McConnell leaves the Senate at the end of this year, I think there are other representatives that are very committed to it and will see that, if they need to make continued changes to the statute to satisfy judicial concerns, they will, and at the end of the day, the national uniformity of rules and standards will prevail.The post Q & A With Lucinda Finley: Any Potential Supreme Court Decision ‘Probably a Year’ Away appeared first on TDN | Thoroughbred Daily News | Horse Racing News, Results and Video | Thoroughbred Breeding and Auctions.