The Horseracing Case, Part 2: Private Delegation Before and After Schechter Poultry
This is one of a series of posts on the Fifth Circuit’s recent “private nondelegation case”, National Horsemen’s Benevolent & Protective Ass’n v. Black, where it struck down the Horseracing Integrity and Safety Act for delegating power to a private organization, the Horseracing Integrity and Safety Authority. In yesterday’s post, I explained how A.L.A. Schechter Poultry Corp. v. United States (1935), the main case that proponents of a “private nondelegation doctrine” usually rely on, gives no support to any view that delegations are judged more harshly if the recipient of the delegation is private instead of public.
Today, I’ll talk about private delegations before and after Schechter Poultry—the bottom line is that the Supreme Court has actually upheld private delegations on at least four occasions. Two of those were before Schechter Poultry, and Schechter Poultry actually mentioned them as examples of cases where private delegations were acceptable. Two of them were after Schechter Poultry. In two of the cases, the Court explained why the delegation was unconstitutional by analogizing the delegation to a delegation to a public party—which shows that the private nature of the delegate wasn’t relevant. None of these cases—neither Schechter Poultry nor the other four—has ever been overruled, and some of them (particularly Schechter Poultry, which approved of two of those cases) continue to be cited regularly.
And this makes sense: the Article I Nondelegation Doctrine is about how Congress can’t give up too much power; so far, the formulation it’s used is whether the delegate is limited by an “intelligible principle”. Provided that’s present and Congress hasn’t given up too much power, what does it matter who has been the recipient of the power? There might be other principles at work (I’m looking at you, Due Process Clause or Appointments Clause), but the Article I Nondelegation Doctrine doesn’t seem to be one of them.
Alas, Schechter Poultry has been mischaracterized since then. In a couple of cases since Schechter Poultry, the Court has mischaracterized that case—when it has upheld a delegation, it has sometimes distinguished Schechter Poultry on the ground that it involved a private delegation. This was clearly wrong, but fortunately it’s only dictum, and fortunately I’ve only found a handful of instances of this in Supreme Court caselaw. So the strongest case that there’s a private Article I nondelegation doctrine stems from dictum in a couple of 1940s cases.
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Let’s look at these four cases in detail. (I won’t do this in chronological order, but in an order that makes sense for explaining the principles involved.)
First, there’s Currin v. Wallace (1939). Currin concerned a challenge to the Tobacco Inspection Act of 1935. The Act authorized the Secretary of Agriculture to establish uniform standards for tobacco, and designate tobacco markets where no tobacco could be sold unless it was inspected and certified according to those standards. But the Secretary couldn’t designate a market unless two-thirds of the growers in that market voted in favor of the designation in a referendum. Industry members thus held an “on-off” power to decide whether predetermined regulations would go into effect.
Is this a delegation subject to the Article I Nondelegation Doctrine? Yes: an “on-off” power to determine the applicability of legal norms isn’t a trivial power, and it becomes a (forbidden) delegation of legislative authority if not adequately circumscribed. At least once—in Panama Refining Co. v. Ryan (1935)—the Supreme Court struck down a delegation of an “on-off” power to the president on th
Article from Reason.com