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HIWU Appoints Three to Executive Team

The Horseracing Integrity & Welfare Unit (HIWU) announced three appointments to its executive leadership team-Ben Mosier to the role of Executive Director, Kate Mittelstadt to Chief of Operations, and Michelle Pujals to General Counsel. Both Mittelstadt and Pujals will report to Mosier.

The Horseracing Integrity and Safety Authority (HISA), in consultation with HIWU, is preparing to submit draft regulations for the Anti-Doping and Medication Control (ADMC) Program to the U.S. Federal Trade Commission for review ahead of implementation of the Program Jan. 1, 2023.

Mosier joined Drug Free Sport International (DFSI), the independent enforcement agency selected by HISA to operate HIWU and administer the ADMC Program, in 2010. He most recently served as Vice President of Business Development at DFSI and has overseen anti-doping programs for the National Basketball Association (NBA), the PGA Tour, Major League Baseball's Minor League Program, and NASCAR. Prior to joining DFSI, Mosier served as National Events Coordinator at the Kansas City Sports Commission.

Mittelstadt most recently served as Director of the IRONMAN Anti-Doping Program, which became the first program run by a private, non-federation sports organization that formally adhered to the World Anti-Doping Code. Mittelstadt's career in anti-doping began in 2000, when she became one of the first employees hired by the U.S. Anti-Doping Agency, and where she served for six years as Director of Doping Control. During that time, she was manager of Out-of-Competition Testing at the 2002 Winter Olympic Games in Salt Lake City. She has since served in various capacities with the World Anti-Doping Agency and the Association of National Anti-Doping Organizations.

Pujals, who served for over 20 years as a member of the NBA's legal department, most recently as Vice President & Assistant General Counsel. During her tenure, she oversaw the development and administration of anti-drug programs for NBA players, coaches, and trainers, and was a member of the NBA/NBPA Prohibited Substances Committee and the NBA Crisis Management Team. Pujals also oversaw the NBA's general litigation matters, internal arbitrations and investigations, and the development of the NBA Arena Security Standards. Prior to joining HIWU, she was the owner and principal of Tautemo Consulting, LLC, a legal and sports consulting firm.

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Op/Ed: Robert M. Beck, Jr.

During one of the most politically polarizing times in our country's history, Congress passed the Horseracing Integrity and Safety Act of 2020 (HISA) with bipartisan support. What did this rare display of unity say about the health of the Thoroughbred racing industry? To say it kindly: the industry needed help. HISA handed over the reins for regulating Thoroughbred safety and anti-doping and medication control matters to a private, self-regulatory organization named the Horseracing Integrity and Safety Authority (Authority). Before HISA, Thoroughbred racing in the United States was regulated by a patchwork of individual state racing commissions with different, and often conflicting, rules. HISA represents a significant change for an industry used to parochial and inconsistent governance–and even more disorderly enforcement. Perhaps more important, HISA is the solution to stop horse racing from going the way of the circus and dog racing, as many commentators and animal rights activists have warned.

Sadly, some in the industry have chafed at Congress' mandate that Thoroughbred racing must be safe, clean, and fair. Since the passage of HISA, the Authority has been attacked on all sides through meritless lawsuits that willfully ignore more than 80 years of binding legal precedent. Nothing about HISA or the Authority's structure is unique, let alone legally questionable. HISA is modeled after a law called the Maloney Act of 1938, which designated what would later become the Financial Industry Regulatory Authority (FINRA) to oversee financial regulation under the oversight of the Securities and Exchange Commission. Like FINRA, the Authority is self-funded, independent, and overseen by a federal agency. In other words, the Maloney Act and HISA are constitutional for the same reasons: Congress is well within its power to delegate its regulatory authority to private entities so long as a government agency retains ultimate decision-making authority as to rules and enforcement; Private organizations such as the Authority and FINRA are not subject to constitutional restraints on appointments and removal of board members; and Private self-funding of such organizations does not unconstitutionally compel states to enforce federal law.

For those keeping score, the Authority is winning the battles against its detractors. Two Federal District Courts–one in Kentucky and another in Texas–have soundly rejected the constitutional challenges lodged against HISA and the Authority, and the reviewing appellate courts are expected to affirm these decisions. No court has found HISA unconstitutional. Having lost their challenges to the Authority's constitutionality, the Authority's opponents have resorted to nitpicking the Authority's implementation of its rules. Thus far, these attempts have also failed. In one case, filed in Louisiana Federal District Court, the plaintiffs argued that the Authority failed to satisfy certain technical requirements of the Administrative Procedures Act. Significantly, the Louisiana Federal District Court found zero constitutional violations, but it did initially agree with the plaintiffs that the Authority's definition of “covered horse” and its search and seizure rule expanded beyond the scope the statute ever so slightly. Practically speaking, this portion of the ruling has no impact, because the Authority has already revised one of the rules and the other rule is revised in the ADMC rules. The District Court also questioned the Authority's rule on funding and the length of the notice and comment period, though it recognized that any of the claimed deficiencies could be easily remedied by the Authority even if the Authority is ultimately unsuccessful on the merits. It was perhaps not surprising then that the Authority recently sought and received an emergency stay of enforcement of a Louisiana Federal District Court's order halting implementation of the Authority's rules in Louisiana and West Virginia. This stay makes clear that the Authority's safety rules will continue to be enforced nation-wide.

Unfortunately, during the interim, the Authority's enforcement of its rules in Louisiana and West Virginia was delayed. Racing in both states suffered. For example, one jockey in Louisiana whipped a horse 17 times in one race, 11 times more than the Authority's strike limit. Under the Authority's rules, such behavior is prohibited and would have been swiftly and uniformly punished. But horses are not the only ones suffering as a result of these meritless lawsuits. A fourth federal lawsuit challenging the Authority and HISA was filed in Texas at the end of July. It recycles many of the failed legal claims. Like the cases that came before it (and those that will come after it), the new lawsuit merely serves as a distraction and a waste of industry resources. Ironically, under HISA, horsemen and racetracks will be the ones who bear the brunt of these additional legal costs. It is clear that litigation against the Authority will continue to burden the industry and threaten the safety and integrity of our equine and human athletes. The Authority is doing this good work despite the distractions of the ongoing litigation, and it continues to win the courtroom battles. Sadly, the Authority's legal costs to defend these lawsuits will only increase the costs to all racing participants, horsemen included.

Beck is an equine lawyer and member of Stites & Harbison, PLLC in Lexington, Kentucky. He previously served 7 1/2 years as the Chairman of the Kentucky Horse Racing Commission.

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HISA: Guild’s Claim of Contempt ‘Fails the Straight-Face Test’

Defending itself against contempt-of-court allegations for purportedly violating an under-dispute preliminary injunction order by imposing riding infraction penalties upon Jockeys' Guild members nationwide, the Horseracing Integrity and Safety Act Authority (HISA) fired back in federal court Tuesday with a filing that stated the plaintiffs' argument “fails the straight-face test.”

At issue is the still-disputed nature of the wording in a July 26 injunction order out of United States District Court (Western District of Louisiana), which stated that HISA rules would be enjoined in two plaintiff states until a June 29 lawsuit got decided in that court, while also noting that, “The geographic scope of the injunction shall be limited to the states of Louisiana and West Virginia, and as to all Plaintiffs in this proceeding.”

The plaintiffs–most specifically, the Guild–believe that last line of the judge's words applies to “all of the members of the Jockeys' Guild, regardless of the U.S. jurisdiction in which the jockey is riding.”

The HISA defendants have maintained that individual members of the Guild are clearly not plaintiffs in the lawsuit, and to consider them that way “would wreak havoc on the sport.”

HISA had asked the court to provide a clarification of the wording, but had first appealed the preliminary injunction to the Fifth Circuit Court of Appeals, which resulted in a stay being issued.

Now it appears as if the lodging of that appeal means no clarification will be forthcoming until the Fifth Circuit Court decides the matter it has been asked to consider, as per a separate order handed down early Tuesday evening by the district court.

“Because the Defendants have filed a Notice of Appeal before filing the Motion for Clarification of Preliminary Injunction Order, this Court does not have jurisdiction to clarify the Preliminary Injunction,” the Aug. 9 district court order stated. “The filing of a notice of appeal confers jurisdiction on the Court of Appeals and divests this Court over their aspects of the case as it rests before the Court of Appeals. Once jurisdiction has divested, this Court may not take any action that would alter the status of the case as it rests before the Court of Appeals.”

On Aug. 2 the plaintiffs, led by the states of Louisiana, West Virginia, and the Guild, had moved for a federal judge to issue an immediate order to enforce its injunction to keep Guild-member jockeys from being subject to HISA rules nationwide.

The plaintiffs also wanted the judge to make the HISA defendants explain to the court why they should not be held in contempt for “flagrantly violating this Court's injunction within a mere four days after this Court entered it.”

The Aug. 9 filing by HISA painted that dispute in a different light.

“Plaintiffs' contempt motion is beyond the pale,” is how the HISA filing started off.

“For starters, the Fifth Circuit has now stayed the preliminary injunction (PI) Order in substantial part, including as it relates to the riding-crop rules and other safety regulations that form the basis of Plaintiffs' motion,” the filing continued.

“In any event, until the Fifth Circuit's stay, the Authority complied fully with the PI Order as written. Indeed, the Authority's affirmative steps (out of an abundance of caution) to clarify the scope of the injunction contradict any suggestion that the Authority willfully flouted the Court's PI Order.”

The HISA filing continued: “The Authority complied fully with the PI Order even before the Fifth Circuit's stay orders. Plaintiffs do not contend that the Authority continued to enforce the enjoined HISA rules in either Louisiana or West Virginia (against anyone), or that the Authority continued to enforce the enjoined HISA rules against any actual Plaintiff (anywhere). And as the Authority has explained, the individual members of Plaintiff Jockeys' Guild (and other 'association plaintiffs') are not themselves 'Plaintiffs' to which the PI Order is expressly limited.

“There is good reason that the Order does not extend to all of Plaintiffs' thousands of individual members nationwide: That would transform the Court's limited preliminary injunction into the sort of expansive nationwide injunction that the Supreme Court and Fifth Circuit have sharply criticized, and it would wreak havoc on horseracing in every racing state [because some] jockeys would be subject to less protective rules (or perhaps no rules at all), while others remain subject to HISA rules.

“That is untenable,” the HISA filing summed up. “Yet Plaintiffs have offered no response to those critical legal and practical realities.”

In the Aug. 2 filing by the plaintiffs, three Guild-member jockeys (the California-based Drayden Van Dyke, plus Florida-based Edwin Gonzalez and Miguel Vasquez) were alleged to be plaintiffs who purportedly suffered new harms resulting from HISA's whip-rule enforcement that the Guild believed to be in contempt of the injunction order.

But HISA's response on Tuesday pointed out that the first two of those jockeys have yet to avail themselves of HISA's process to request stays pending appeals, and the third was never even formally penalized for the whip infraction that the Guild had alluded to in the court filing last week.

“Those jockeys have not suffered concrete harm for other reasons, too,” the HISA filing stated. “For example, the cited infractions for jockey Drayden Van Dyke (resulting in a 1-day suspension and $250 fine) would have violated California's own (pre-HISA) crop rules, and resulted in an even greater penalty. And no adverse ruling was even issued against jockey Miguel Vasquez.”

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Appeals Court Revisits Some Elements of HISA Stay Order

A panel of three judges from the United States Court of Appeals for the Fifth Circuit issued a new, more fine-tuned order Monday in the Horseracing Integrity and Safety Act Authority (HISA) lawsuit that narrows the scope of an “administrative stay” that same court had issued five days earlier.

The Aug. 8 order now means that instead of the entire slate of HISA rules being re-activated in Louisiana and West Virginia (as per the Aug. 3 Appeals Court order that trumped a preliminary injunction issued July 26 by a lower U.S. District Court in Western Louisiana), three contested HISA rules will once again be off-limits from being enforced in those two plaintiff states, at least until “expedited” oral arguments are scheduled in front of the Appeals Court next month.

“The district court in granting the injunction that is the subject of the motion to stay ruled only

on the lawfulness of the rules and not on the constitutional issues raised which are pending before this court in another case,” the Aug. 8 order stated.

“The district court held that Plaintiffs had a strong likelihood of success on the following two claims: '1) The 14-day period for notice and comment for each set of approved rules was insufficient under the Administrative Procedure Act (APA) and 2) Several rules go beyond the statutory authority given to HISA and the Federal Trade Commission (FTC).'” The order stated. “We conclude that the stay elements are met with respect to the insufficiency of the 14-day period of notice.

“With respect to the second part of the ruling, the district court did not address the vast majority of the regulations at issue, instead concluding only that a few of the rules within the regulations exceeded the authority.”

The order continued: “Having considered those matters, we rule as follows: The motion to stay the district court's July 26, 2022, preliminary injunction is GRANTED in part and DENIED in part. We grant the motion to stay the injunction as to all of the regulations except for the following: Rules 8400 and 8510 and two provisions of Rule 2010.”

Rule 8400 establishes the Authority's power of access to records and places of business used in connection with Covered Horses and authorize the seizure of medications or other items that are in violation or suspected violation of Authority rules. The rules require Covered Persons to cooperate with the Authority in investigations, and they include the duty to respond truthfully to questions posed by investigators about a racing matter. Rule 8400 also authorizes the issuance of subpoenas and oaths to witnesses.

Rule 8510 is HISA's “Methodology for Determining Assessments” that fund the Authority.

The plaintiffs in the underlying June 29 lawsuit (the state of Louisiana, its racing commission, the Louisiana Horsemen's Benevolent and Protective Association, the Louisiana Thoroughbred Breeders Association, the Jockeys' Guild, the state of West Virginia, its racing commission, and five individuals regulated as “covered persons” under the HISA Act) have argued that using purses as part of that assessment calculation violates the enabling legislation.

The two provisions of Rule 2010 that now can't be enforced in the plaintiff states deal with the definitions section of the racetrack safety program, specifically “the date of the Horse's entry in a Covered Horserace” and “the date of the Horse's nomination for a Covered Horserace,” according to the Aug. 8 order.

The defendants (the HISA Authority, the FTC, and board members and overseers of both entities) are alleged to have violated the Fourth, Seventh and Tenth Amendments to the Constitution, plus the APA, which governs the process by which federal agencies develop and issue regulations.

But that underlying lawsuit can't move forward until the Appeals Court issues get legally resolved first.

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