Horseracing Integrity & Safety Act (HISA); The “non-delegation” doctrine; Expansion of the Federal Trade Commission’s (FTC) power to “abrogate, add to, & modify” the rules governing the horseracing industry; 15 USC § 3053(e); Whether the 2022 HISA amendment made the controversy “moot”; Delegations to private entities; FCC v Consumers’ Research; Standing to challenge the requirement that state authorities cooperate & share information with the Horseracing Authority or federal agencies; § 3060(b); Whether § 3052(f) violates the Tenth Amendment’s anti-commandeering guarantee

On remand from the U.S. Supreme Court, the court considered the Supreme Court’s decision in Consumers’ Research and other recent decisions and rejected plaintiff-Oklahoma’s facial challenge to the HISA. It held that the HISA, as amended, gives the FTC, not defendant-Horseracing Authority, “the final say over the Act’s key rulemaking and enforcement provisions.” Congress enacted the HISA “to establish a nationwide framework for regulating thoroughbred horseracing. That led to several non-delegation and anti-commandeering challenges to the validity of the Act throughout the country. The lead challenge—the facial non-delegation challenge—focused on the reality that the Act replaced several state regulatory authorities with a private corporation, the Horseracing Authority, which became the Act’s primary rulemaker and which was not subordinate to the relevant public agency,” the FTC. But the HISA was later amended to give the FCC the power “to create rules that ‘abrogate, add to, and modify the rules of the Authority.’” The court first held that the HISA’s amendments did not moot this case where “the revised statute continues to place a material burden on the plaintiff that arises from the same theory of unconstitutionality” stated in the complaint and where the “amendment does not affect other features of the challenge.” The court considered the principles of non-delegation as it applies to delegations to private entities. In Consumers’ Research, the Supreme Court held that a program does not impermissibly delegate government authority to a private entity where the government agency retains “final ‘decision-making authority.’” The court concluded here that, under § 3053(e), the FTC has “ultimate discretion over the content of the rules that govern the horseracing industry and the Horseracing Authority’s implementation of those rules.” It also has final authority over enforcement actions. Through “independent review, the FTC may reverse any sanction by the Authority.” The court next held that Oklahoma and the other plaintiffs-states lacked standing to challenge § 3060(b), “which requires state authorities to ‘cooperate and share information’ with the Horseracing Authority or federal agencies.” This statute “does not contain a penalty or enforcement mechanism. And Oklahoma does not point to any actual or threatened enforcement actions. An unenforceable statutory duty does not give rise to Article III standing.” Finally, although “3052(f)’s threat of preemption” gave Oklahoma standing to challenge it, “the provision does not commandeer the States.” Affirmed.