FTC disapproves HISA drug rules

The Federal Trade Commission on Monday disapproved medication control and anti-doping rules proposed by the Horseracing Integrity and Safety Authority. One commissioner, Christine Wilson, abstained.

The rules would have put in place the final major piece of the Authority’s regulatory apparatus. The racetrack safety component of the program went into effect July 1, and the medication control rules would have become effective January 1 had the FTC approved them.

However, the US Court of Appeals for the Fifth Circuit in November found the Horseracing Integrity and Safety Act (HISA), the legislation which created the Authority, to be unconstitutional. That means that the law is currently unenforceable in the states in the Fifth Circuit, Texas, Louisiana, and Mississippi.

The Sixth Circuit Court of Appeals, which covers Kentucky, Michigan, Ohio and Tennessee, heard oral arguments on a similar case December 7.

The legal uncertainty surrounding HISA weighed heavily in the FTC’s decision. All HISA rules must be approved by the FTC before they can become operative.

“The bedrock principle of the Act is the need for uniformity,” the FTC wrote in its order. But because HISA is not operational in three states currently because of the Fifth Circuit ruling, permitting the new rules to go into effect would not accomplish that goal.

“If that decision remains undisturbed, the proposed rule may be unenforceable in the States that are the plaintiffs in the Fifth Circuit action and in other States within the Fifth Circuit,” the FTC wrote.

Moreover, the Authority’s proposed rule would have gone into effect January 1 – just 10 days before the Fifth Circuit’s ruling is slated to become effective, potentially creating a chaotic situation.

“In addition, because Commission approval of the proposed rule would result in the rule’s taking effect on January 1, 2023, but the Fifth Circuit’s mandate is due to issue on January 10, 2023, confusion could result for industry participants and regulators in the jurisdictions affected by the Fifth Circuit’s decision, as the rule takes effect one week only to be rendered potentially unenforceable the following week,” the FTC wrote.

[Read the FTC order here]

The National Horsemen’s Benevolent and Protective Association, which has spearheaded lawsuit’s against HISA, applauded the FTC ruling.

“This is another step forward in uniformity done the correct way,” the group’s CEO, Eric Hamelback, wrote on Twitter.

The FTC’s decision also pleased the Association of Racing Commissioners International. That organization, which represents state racing commissions, had called for a delay in the rules, pending the ongoing legal wrangling.

 “We are pleased that the Federal Trade Commission (FTC) was responsive to the request last week by the ARCI to NOT approve the proposed HISA Anti-Doping and Medication Control rules given the serious questions that exist about the constitutionality of the HISA Act,” the organization said in a release.

The FTC’s decision to reject the rules is “without prejudice,” meaning the Authority can resubmit them at a future date. In a statement, the Authority indicated it would do just that.

“HISA is eager to launch Thoroughbred racing’s first and long-awaited national, uniform ADMC [anti-doping and medication control] program and stands ready to do so,” the organization wrote. “We will re-submit the draft ADMC rules to the FTC for their review as soon as these legal uncertainties are resolved, and once approved, we will implement the program through the Horseracing Integrity and Welfare Unit (HIWU).”