The United States Court of Appeals for the District of Columbia filed an order on December 5, 2022 denying the Celebration’s motion to intervene and petition for rehearing en banc. The Court of Appeals also formally denied the federal government’s motion for panel rehearing. The government’s motion for rehearing was much more limited than the Celebration’s motion, yet both were denied.

However, the court effectively grants the federal government the relief it sought by making it clear that, on remand, the district court may consider all remedial issues, including the question of whether remand to the agency without vacatur is appropriate. This terminology means that it is possible the district court could send the rule back to USDA but not require USDA to issue the rule, or as stated by the order, vacate (reverse) the withdrawal of the 2017 rule.

An opinion in the decision by Judge Tatel points out specifically that not vacating (reversing) the withdrawal of the 2017 rule make sense given that USDA is in the late stages of developing a rule addressing the same topic as the 2017 rule.

The reasons given by Judge Tatel and Judge Millet for denying The Celebration’s motion to intervene was that it was not timely. Judge Rao disagreed and based on case law referenced by The Celebration’s motion, she agreed that in fact the motion was timely given the new developments in the case.

The 2016/2017 rule was not published in the federal register when President Trump was inaugurated and with his executive order to stop all pending rules that had not been published, the rule was not published, final or enacted.  In 2021 the USDA formally withdrew the rule, citing new developments such as the National Academies of Science study and promised to expeditiously file a new rule addressing the amendments to the Horse Protection Act and its enforcement.

The Humane Society of the United States sued the USDA stating the rule should have been enacted because it had previously met all the requirements to make a final rule and the last step of publishing in federal register was not a necessary final step. The USDA disagreed and won at the district court level with the judge agreeing the rule had not met the longstanding requirements of the Administrative Procedures Act that it be published in order to be final.

HSUS appealed the decision and the DC Circuit Court of Appeals reversed the lower court’s decision in a split decision of the three-judge panel, which remanded the case back to the lower court. At this point, The Celebration filed a motion to intervene and the Department of Justice filed a motion for panel rehearing seeking only review of the remedy. The Celebration also filed a petition for rehearing en banc at that time.  The Court of Appeals has now ruled on all three of those actions denying them all.

The industry will evaluate all the potential options that exists once the case is sent back to the district court.