When Is A Horsemen’s Organization Not Really A Horsemen’s Organization?

by | 10.06.2016 | 2:05pm
Oxford Downs in Summerfield, Fla.

Traditional horsemen's organizations, along with the spirit of the Interstate Horseracing Act of 1978 – which gives horse owners approval rights on the export of simulcast signals – are under fire in two states, Massachusetts and Florida.

Last week, United States District Court Judge F. Dennis Saylor dismissed a lawsuit filed by the New England Horsemen's Benevolent and Protective Association (NEHBPA) against the Massachusetts Thoroughbred Horsemen's Association, (MassTHA) which claimed to be the representative horsemen's organization in negotiating a contract with a group that had hoped to have race meetings at the dormant Brockton Fairgrounds.

(The MassTHA is not affiliated with the National Thoroughbred Horsemen's Association, which has sent cease-and-desist letters to the Massachusetts group demanding they not use that name. The National THA has local affiliates in Illinois, Maryland, New Jersey, New York and Pennsylvania.)

The lawsuit turned out to be a moot point, since Brockton did not race in 2016 and failed to apply for racing dates in 2017. But the language in portions of the judge's ruling may be cited in future litigation.

In Florida, where some cunning entrepreneurs have made a mockery of the state's regulatory oversight of horse racing by getting licensed as pari-mutuel tracks through the staging of farcical races, track owners are contracting with “captive” horsemen's organizations and setting revenue sharing deals on their own terms. Pari-mutuel license approval has led to simulcast and poker rooms and, in the future, the operators of these farcical racetracks hope, slot machines. This practice may now be spreading to Hialeah Park, which until this year has operated legitimate Quarter Horse racing by contracting with a recognized horseman's organization. Hialeah Park's very profitable casino is contingent upon operating a minimum number of live racing dates.

Let's look at the Massachusetts case first.

Some disgruntled NEHBPA members who failed to win election to the organization's board of directors in 2015 formed the MassTHA. Led by William Lagorio, who the NEHBPA  said was the “self appointed president,” the MassTHA has not held any elections and has few members, according to the NEHBPA's complaint.

That same year, the Middleborough Agricultural Society (MAS) submitted an application to run a 2016 live meeting at Brockton and entered in a purse agreement with the MassTHA. According to a stall application, anyone wishing to race at Brockton must sign an agreement designating the MassTHA as their exclusive representative to negotiate any and all contracts. The agreement MAS reached with the MassTHA, according to the complaint, said horsemen would receive no payments from the organization operating the race meeting.

“Thus,” Saylor wrote in his order dismissing the NEHBPA's lawsuit, “all profits derived from any simulcasting and off-track wagering are to be retained by MAS.”

Saylor, who said the Interstate Horseracing Act “is no paragon of clarity,” declared the MassTHA “is the representative 'horsemen's group' as defined in the Act.”

He wrote: “Section 3002 (12) defines 'horsemen's group' as the group which represents the majority of owners and trainers racing (at a particular track), for the races subject to interstate off-track wagers on any racing day.' The statute thus defines 'horsemen's group' in terms of who represents the majority of those racing on a particular track on a particular day. … Under the IHA, it does not matter who represents the majority of horsemen in the state; for the purposes of this case, it matters only who represents the majority of those racing (1) at the Brockton Fairgrounds (2) in a race subject to interstate off-track wagering (3) on a particular race day. Because the stall application of MAS requires horsemen to consent to be represented by MassTHA with respect to the races held at Brockton Fairgrounds, MassTHA appears to be 'the horsemen's group' as defined in the IHA.”

More importantly, Saylor wrote, there was no violation of the IHA because no interstate wagers were accepted, since Brockton never opened for racing. Nevertheless, had Brockton opened for live racing, his ruling saw nothing wrong with a racetrack requiring participants to become members of horseman's organization of the track's choosing. This would be akin to a collective bargaining agreement between management and a union that was formed by management.

The “make up your own horseman's organization” ploy has been used successfully in Florida to convince the state's Division of Pari-Mutuel Wagering to license minimum-investment operations offering barrel, flag-drop or match race. These operations fulfill the state's minimum requirements, including having a written contract with horsemen.

'Nothing About Hamilton Downs Is Real'
One such operation is Hamilton Downs in Jasper, a small town near the Georgia border and just east of Interstate 75. Hamilton Downs was given a pari-mutuel license for Quarter Horse barrel racing, but then had to switch to flag-drop races after a judge ruled barrel racing illegal.

The Florida Division of Pari-Mutuel Wagering apparently had second thoughts about licensing Hamilton Downs as a racetrack and filed a complaint against the association, saying it violated several regulations. Hamilton Downs conducted a “race meeting” in 2014 that consisted of 160 races over five days. Each day consisted of four performances, with each performance consisting of eight “races.” Horses were supplied by the “Hamilton Downs Quarter Horse Association,” which cobbled together 19 horses, aged 7 to 23, including a 20-year-old Thoroughbred named Heaven's Trick that had never raced.

A hearing on the matter was conducted earlier this year. E. Gary Early, the administrative law judge who heard the case, wrote, among other things that:

“Flag drop racing as performed at Hamilton Downs involved two horses racing simultaneously on a crude dirt 'track' approximately 110 yards in length. … The race was started by a person who waved a red cloth tied to a stick whenever it appeared that both horses were in the general vicinity of what the starter perceived to be the 'starting line.' There was no starting box or gate.

“The track was in the middle of an open field. There was no grandstand, though there was a covered viewing area on 'stilts' from which the states steward and track stewards could observe the races. The track had one betting window and tote machine in an on-site shed. The only window in the shed, was mercifully, occupied by a window-unit air conditioner. As stated by (state steward Louis Haskell Jr.), 'nothing about Hamilton Downs is real in terms of racetrack standards.

“The races must be seen to be believed. The 14 events for which video evidence was received show a series of races involving – as a rule – tired, reluctant, skittish or disinterested horses moving at a slow pace down the dust-choked path. … the gait of the 'racing' horses ranged between a slow walk and a canter. Horses often simply stood at the starting line before slowly plodding down the track. In one instance, a horse actually backed up, until a bystander took it by the lead, thereafter giving the horse a congratulatory slap on the rump when it began to move in a forward direction.

“(The state steward) described numerous races, aptly, as non-competitive because one or both of the entrants walked, including one race (day 3, card 3, race 5) in which the racing steed took 1 minute and 45 seconds to cover the 110-yard course. The overall quality of the videotaped races was about what one would expect of an entry-level campers' horse show held at the conclusion of a two-week YMCA summer camp.

“Over the course of the 160-race meet, a total of 10 bets were placed, with two of those reportedly placed by a representative of a competing facility in an effort to substantiate wrongdoing on the part of Hamilton Downs. Given the competitive level of the races, a $20 handle seems about right.

“(The state steward) testified that the same horses just kept racing over and over.”

All this, yet the administrative law judge ruled in favor of Hamilton Downs because Florida's regulations and definitions regarding what constitutes a horse “race” are so vague.

Hialeah Park has contracted with the Florida Quarter Horse Racing Association (FQHRA) since 2009 to conduct what most would consider traditional Quarter Horse racing. Earlier this year, Hialeah signed an agreement with the South Florida Quarter Horse Association (SFQHA) – a new group described by the FQHRA as a “captive” organization. According to the contract between Hialeah and this new group, “only horses owned by members of the SFQHA will be eligible to participate in races during the race meet.”

That means Hialeah Park, which has a very profitable casino, may be joining with tracks like Hamilton Downs, Gretna in the Florida panhandle and Oxford Downs near Ocala – all of which offer racing that makes a mockery of the sport.

The FQHRA – the horsemen's organization that formerly had a contract with Hialeah – has challenged the Florida Division of Pari-Mutuel Wagering, saying the agreement between Hialeah and the SFQHA is a violation of state regulations. A hearing is scheduled on the matter later this month, and the ruling in Massachusetts has given further ammunition to those who would like put traditional horsemen's organizations out of business.

Order dismissing New England HBPA lawsuit

Order dismissing complaint against Hamilton Downs

 

(The Paulick Report visited Oxford Downs when it conducted its first “race meet” in 2014. The video below details that visit.)

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