## Facts

- Congress enacted the Horseracing Integrity and Safety Act of 2020 (HISA) to establish uniform nationwide rules for thoroughbred horseracing safety and anti-doping.
- HISA created the Horseracing Integrity and Safety Authority, Inc. (Authority), a private nonprofit corporation tasked with developing nationwide horseracing rules and administering the statutory program.
- Under the statute as enacted, the Authority proposed rules that would take effect upon Federal Trade Commission (FTC) approval under HISA’s standards; the FTC could suggest changes but could not freely rewrite rules based on its own policy choices.
- Multiple horsemen’s associations sued, seeking declaratory and injunctive relief on constitutional grounds; Texas and the Texas Racing Commission intervened as plaintiffs.
- The district court dismissed the suit, reasoning that the Authority was sufficiently subordinate to the FTC to avoid any unconstitutional private delegation.
- Plaintiffs appealed to the Fifth Circuit, challenging HISA’s structure as an unconstitutional delegation of governmental power to a private entity.

## Issues

1. Whether HISA violates the private nondelegation doctrine by vesting a private corporation with effective nationwide rulemaking power.
2. Whether the FTC’s statutory review and approval role made the Authority’s rulemaking meaningfully subordinate to a federal agency.
3. Whether the alleged constitutional defect was facial (inherent in HISA’s structure) rather than limited to particular applications.

## Decision

- The Fifth Circuit reversed the district court’s dismissal and remanded.
- The court held HISA facially unconstitutional under the private nondelegation doctrine because the Authority’s rulemaking authority was not meaningfully subordinate to the FTC.
- The court concluded that the FTC’s limited ability to suggest changes, coupled with a constrained approval framework, left the Authority with controlling policy power over nationwide horseracing regulation.

## Legal Principles

- Congress may not delegate regulatory power to a private entity unless a federal agency exercises meaningful supervision and retains real authority over the private entity’s policy choices.
- Formal agency “approval” is insufficient when the agency lacks genuine discretion to revise, replace, or reject a private entity’s rules on policy grounds.
- A private nondelegation violation may be facial when the statute’s structural design vests effective governing authority in a private body without adequate federal control.

## Conclusion

The Fifth Circuit held that HISA’s original rulemaking framework unconstitutionally delegated governmental power to a private corporation because the Authority’s rulemaking was not genuinely subordinate to the FTC, and it reversed and remanded for further proceedings.


Nat’l Horsemen’s Benevolent & Protective Ass’n v. Black, 53 F.4th 869 (5th Cir. 2022)