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Judge Dismisses Baffert’s Lone Remaining Claim Against CDI

A federal judge on Wednesday issued a summary judgment that dismissed trainer Bob Baffert's lone remaining claim in his 15-month-old lawsuit against Churchill Downs, Inc. (CDI). The order was handed down three months after the same judge tossed out five other counts in the case that alleged civil rights violations related to the gaming corporation's two-year banishment of the Hall-of-Fame trainer.

“The Court denied Plaintiffs motion for a preliminary injunction and dismissed Plaintiffs' claims for unlawful exclusion, unlawful conspiracy in restraint of trade, unlawful use of monopoly power, tortious interference with contractual relations, and tortious interference with prospective business relations,” wrote Judge Rebecca Jennings of United States District Court (Western District of Kentucky) in her May 24 order. “Defendants now move for summary judgment on Plaintiffs' only remaining claim–breach of due process.”

Back on Mar. 14, CDI had argued that, “Because Baffert's due process claim fails as a matter of law…the Court should grant Defendants summary judgment and dismiss Baffert's complaint in its entirety.”

Jennings wrote May 24 that CDI's suspension of Baffert from CDI-owned tracks and the 2022 and 2023 GI Kentucky Derbies did not “devalue” his training license in a manner that amounted to “an indirect deprivation of a property interest.”

“[Baffert's] license was not suspended or revoked by the issuing entity, meaning he must demonstrate an indirect loss in the value of his Kentucky trainer's license. For Plaintiffs to demonstrate that this indirect injury amounted to a violation of due process, they must prove that Baffert's license was rendered valueless…

“Here, the undisputed evidence demonstrates that Baffert's license is not valueless,” Jennings wrote. “While suspended from racing at CDI racetracks, Baffert conceded that he has 'raced horses all around the world with enormous success.'

“The Court cannot find that Baffert's Kentucky trainer's license was rendered valueless when he used it to win over $1 million racing horses in the Commonwealth [at Keeneland]….Therefore, Plaintiffs cannot demonstrate that they were deprived of a property interest–a necessary element of their due process claim,” Jennings wrote.

“Plaintiffs have failed to produce specific evidence creating a genuine issue of material fact that would allow a reasonable jury to find in their favor at trial,” Jennings wrote.

“Because Plaintiffs cannot prevail on the first element of their due process claim, the Court will not continue to examine additional arguments,” Jennings wrote.

CDI first imposed its ruling-off of Baffert in June 2021 because of a string of drug positives in horses Baffert trained, including two in CDI's most prominent races, the 2020 GI Kentucky Oaks and the 2021 Derby.

“Judgment is entered in favor of Defendants with respect to the claims brought in this matter,” Jennings wrote.

“This is a FINAL and APPEALABLE Judgment,” Jennings wrote. “The Clerk of Court is directed to strike this matter from the Court's active docket.”

Note: This is an updated version of a previously published story that contained an error describing the ruling. TDN regrets the mistake.

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Baffert Denied Injunction To Race in Derby; CDI Prevails In 5 of 6 Counts for Dismissal

A federal judge on Friday denied Bob Baffert a preliminary injunction that the Hall of Fame trainer had sought to be eligible to race in this year's GI Kentucky Derby.

Churchill Downs, Inc. (CDI), the defendant in Baffert's year-old lawsuit, also scored a legal victory when Judge Rebecca Jennings of United States District Court (Western District of Kentucky) granted the gaming corporation's motion to dismiss the case on five of the six counts that CDI had argued.

Baffert was attempting to reverse the second year of a two-year ban by CDI that prohibits his trainees from racing at CDI-controlled tracks, accruing Derby qualifying points and competing in the Derby.

CDI first imposed that punishment in June 2021 because of a string of drug positives in horses Baffert trained, including two in CDI's most prominent races, the 2020 GI Kentucky Oaks and the 2021 Derby.

“Churchill Downs is pleased that the Court denied Mr. Baffert's demand for a preliminary injunction and granted our motion to dismiss on all but one claim, and on that claim the Court held that Mr. Baffert did not establish a likelihood of success on the merits. Today's opinion is a victory for the integrity of horseracing and we will continue to take action to protect the safety of our human and equine athletes,” CDI spokesperson Tonya Abeln wrote in an emailed statement.

A voicemail message seeking comment from Baffert did not yield a return call prior to deadline for this story.

Baffert's attorney, Clark Brewster, spoke to TDN around 6:30 p.m. Eastern on Friday. He said he was just leaving a federal courthouse in Wisconsin after arguing another case, and that he would only be able to comment based on a summary of the rulings because he had not yet had time to fully read Judge Jennings's orders.

“This is extraordinary, because the whole alleged rule violation was based on the use of a salve or an ointment that was expressly permitted and authorized by the rules,” Brewster said. “There's no question about it. No person could look at it now and say that that was a rule violation…. So then you wonder how a private entity could just take somebody out for two years without even having an interest in knowing the merit of their position…

“All it would have taken was dialogue [with CDI], a fair exchange of information,” Brewster continued. “And this devastating action they took was very damaging to horse racing. It wasn't the use of the salve that was damaging to horse racing. It was the reaction without any knowledge or interest in obtaining knowledge…

“I haven't talked to Bob because I just stepped out of the courtroom,” Brewster said. “But I can tell you, knowing Bob well, he's amazing from the standpoint of accepting other people's actions toward him, even though they're misplaced in the facts.”

Drilling Down the Injunction Denial

“As explained, Baffert is the only trainer whose horses have tested positive in back-to-back marquee races on CDI tracks,” Jennings wrote. “Failing to punish trainers whose horses test positive in marquee races could harm CDI's reputation and the integrity of their races. Moreover, trainers have already earned points towards the 2023 Kentucky Derby. If Plaintiffs' horses are allowed to race, then they would necessarily exclude those who would have otherwise qualified,” Jennings wrote.

“The Court finds that CDI and innocent third parties who have already earned points would be substantially harmed if the court imposed an injunction. Therefore, the substantial harm factor weighs against injunctive relief,” Jennings wrote.

“The final factor the Court must evaluate is 'whether the public interest would be served by the issuance of the injunction.' There is a strong public interest in deterring misconduct on CDI's tracks. Moreover, the Sixth Circuit has held that '[t]he public has a strong interest in holding private parties to their agreements.'

“Baffert signed the Rules and Conditions for Racing and Training and the Stall Application. Accordingly, the Court is inclined to hold the parties to their agreements. The Court finds that the public interest weighs against injunctive relief,” Jennings wrote.

Baffert had initially sued CDI on Feb. 28, 2022, alleging civil rights violations related to what he said was a deprivation of his right to due process of law guaranteed under the Fourteenth Amendment.

But in her Feb 17, 2023, order, Jennings wrote that Baffert's time lag for renewing his initial motion for preliminary injunction was a factor in her determination not to grant it.

“Plaintiffs renewed their motion for a preliminary injunction approximately 10 months after filing the Complaint…” Jennings wrote. “This means they waited approximately 19 months after the [2021 CDI] suspension to request injunctive relief from this Court. In their reply and at the Feb. 2 hearing, the only excuse Plaintiffs could give for their delay was the pursuit of litigation in other jurisdictions…. Accordingly, Plaintiffs' delay weighs against a finding of irreparable harm from the outset of the Court's analysis.”

Jennings then wrote about other alleged harms Baffert had articulated.

“Plaintiffs contend that the most obvious harm they will suffer is the loss of purses. In response, Defendants contend that the loss of purse money is speculative and inappropriate for injunctive relief….Here, Plaintiffs allege that the amount of winnings they will lose due to CDI's suspension 'is impossible to calculate.' These winnings are impossible to calculate because

they are entirely speculative and theoretical….Accordingly, the Court finds that Plaintiffs' loss of purses is speculative and does not result in irreparable harm.”

Baffert had also argued that his inability to run horses in the Derby would create harms based on a loss of “goodwill” among long-standing clients with Derby prospects. Again, Jennings disagreed.

“Here, although a horse's eligibility to run in the Kentucky Derby is a once in a lifetime opportunity, trainers may enter horses every year,” Jennings wrote. “CDI's suspension is only applicable to [Baffert]. As [a trainer, he] may enter horses in every Kentucky Derby after the suspension expires…. There is no indication that owners would not continue to use Plaintiffs' services after the 2023 Kentucky Derby even if the Court did not enjoin CDI's ban…. Therefore, Plaintiffs have not demonstrated irreparable harm by losing their ability to compete in the 2023 Kentucky Derby.”

Dissecting the Dismissal Motion

Regarding CDI's motion to dismiss the case, Jennings framed her decision this way:

Count I (Violations of Civil Rights): “Plaintiffs have alleged facts sufficient to state a claim for a violation of Baffert's due process rights only as they relate to his trainer's license. Therefore, Defendants' Motion to Dismiss claim is DENIED.”

Count II (Unlawful Exclusion): “Plaintiffs have failed to assert a claim against CDI for unlawful exclusion under the common law. Defendants' Motion to Dismiss Plaintiffs' unlawful exclusion claims is GRANTED.”

Counts III-IV (Antitrust Claims): “Plaintiffs have failed to state a claim for either of the alleged antitrust claims. The Court will not address additional arguments asserted by the parties in their briefs because Plaintiffs do not have standing to assert antitrust claims as alleged. Defendants' Motion to Dismiss Plaintiffs' antitrust claims is GRANTED.”

Counts V-VI (Tortious Interference Claims): “Plaintiffs' tortious interference claims cannot succeed because CDI exercised legitimate contract rights…. Baffert violated the terms of the Rules and Conditions for Racing and Training, which prompted CDI's suspension. CDI was within its rights to suspend Baffert even if doing so harmed ongoing or prospective business relationships between Baffert and horse owners seeking his services….Therefore, Defendants' Motion to Dismiss Plaintiffs' tortious interference claims is GRANTED.”

KHRC Suspension 'Not an Issue'

After crossing the finish wire first in the 2021 Derby, Medina Spirit tested positive for the Class C drug betamethasone, which Baffert later asserted was introduced into the colt's system by way of a salve to heal a skin rash.

Medina Spirit collapsed and died after a workout at Santa Anita in December 2021. He was posthumously disqualified from the Derby by the Kentucky Horse Racing Commission (KHRC) in February 2022. Baffert's appeal on that matter (and the suspension he has already served but wants cleared from his record) is pending.

Jennings also noted within her ruling that during hearings on Feb. 2 and 3, both parties “spent a great deal of time discussing the merits of claims before the KHRC, which are not at issue here.”

She wrote that, “as the Court instructed at the beginning of the hearing on Feb. 3, whether Plaintiffs violated the KHRC rules and regulations is irrelevant. The Court will only examine whether Defendants acted within their rights to suspend Plaintiffs pursuant to federal and state law or any contracts between the parties. Therefore, the Court will not decide whether Plaintiffs violated KHRC rules and regulations by treating Medina Spirit with betamethasone because this issue is not before the Court.”

Additionally, in a separate Feb. 17 order, Jennings swatted down a Feb. 10 motion made by Baffert that asked for the judge to recuse herself from the case.

According to court documents, the stated reason for that recusal motion was that legislative lobbying efforts conducted by the judge's husband for two racing industry clients (The Jockey Club and The Stronach Group) allegedly created a conflict of interest for Rebecca Jennings in adjudicating Baffert's case.

“I have no personal bias or prejudice against any party to this litigation and I have no extrajudicial knowledge about the facts or circumstances of this case or the subject matter of this litigation,” Jennings wrote in denying the recusal motion.

“Additionally, neither I nor any member of my family has any financial interest in any of the parties or the outcome of this litigation. And, after a deep search of the law and review of all briefings, I have found no statutory or other reason for disqualification in the case before the Court and cannot recuse,” Jennings wrote.

Brewster told TDN he will be mulling legal responses based on whether it was appropriate for Jennings to issue the orders that came out on Friday in light of the pending recusal motion.

“I can tell you now that our motion to disqualify her was made in good faith, and with utmost respect for the court system,” Brewster said. “So the next thing is we have to consider the grounds for not granting our motion for recusal, and then determine whether her continued ruling somehow was not authorized [based on] the fact that she was under this recusal motion.”

“Again, we have the utmost respect [for] any judge who makes in to [a federal] position. But all parties are entitled to a clear appearance of no bias.”

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Baffert Wants Federal Judge Removed from Case Against CDI

Trainer Bob Baffert now wants the federal judge handling his year-old lawsuit against Churchill Downs, Inc. (CDI), to recuse herself.

The stated reason is that legislative lobbying efforts conducted by the judge's husband for two racing industry clients allegedly create a conflict of interest for Judge Rebecca Jennings in adjudicating Baffert's case.

Baffert is attempting to reverse the second year of a two-year ban by CDI that prohibits his trainees from accruing qualifying points and competing in the 2023 GI Kentucky Derby.

The now-deceased Medina Spirit (Protonico) tested positive for the Class C drug betamethasone after crossing the finish wire first in the 2021 Derby.

Seven months later, the colt collapsed after a workout and died in December 2021.

Medina Spirit was posthumously disqualified from the Derby by the Kentucky Horse Racing Commission (KHRC) in February 2022.

Baffert's appeal on that matter (and a suspension he has already served but wants cleared from his record) is pending.

“The plaintiffs submit that the Court's impartiality is in question because [the judge's] husband, Michael Patrick Jennings and his firm, Commonwealth Alliances, are legislative agents employed by The Jockey Club,” Baffert's motion for recusal stated.

“The Jockey Club has actively intervened publicly and litigiously in the litigation surrounding the Bob Baffert/Medina Spirit matter since the beginning of state and racing association action against Mr. Baffert,” the motion stated.

“R. Alex Rankin, a named Defendant in this case, is a senior, influential member of the Jockey Club and serves as a Jockey Club Steward,” the recusal request continued. “The motion is brought on a good faith basis after a diligent investigation of the public record and not for 'other advantage or litigation tactic'…. [T]he impartiality of the Court is in question, and the necessary remedy is a disqualification.”

In an affidavit signed by one of Baffert's lawyers that accompanied the motion, attorney Clark Brewster stated that Patrick Jennings was also employed as a lobbyist by The Stronach Group (TSG).

Although TSG tracks have not banned Baffert, the filing noted that the lobbyist's engagement with TSG overlaps a time when “litigation was pending against TSG by Jerry Hollendorfer (a racehorse trainer excluded from Santa Anita by TSG).”

Brewster's affidavit stated that Patrick Jennings's firm was paid $50,750 by The Jockey Club during 2022, and that his personal income from that client was $34,256. His 2022 personal income from TSG was $34,038 out of $74,219 that went to his firm.

Baffert had initially sued CDI on Feb. 28, 2022, alleging civil rights violations related to what Baffert said was a deprivation of his right to due process of law guaranteed under the Fourteenth Amendment.

According to the court docket, Judge Jennings was “randomly assigned” to the case on the same day it was filed.

“The fees earned in 2022 are a clear source of extrajudicial bias,” Baffert's filing stated. “At no time during the litigation did Judge Jennings disclose her husband's employment by The Jockey Club [or TSG].”

Brewster's affidavit laid out his version of recent events, including details of a spat that erupted over the past week involving differences of opinion related to alleged “ex parte” discussions between the judge and the CDI defense team that potentially occurred without Baffert's attorneys being included. The result was a written denial from the judge that anything improper happened, along with an admonishment from the judge to Baffert's legal team.

“After the Court adjourned on Feb. 3, I sent an informal email to lead counsel for the defense seeking some understanding of how he knew the Court would commence the continued hearing with the defense being permitted to call a party-witness (Mr. Baffert) out of order and cross-examine a party before he was presented by Plaintiffs' counsel,” Brewster stated in his affidavit.

“Given that not every contact with court staff is a prohibited ex parte communication, there was no accusation of ethical or judicial impropriety. The email was sent to gain an understanding of Defendants' surprising degree of knowledge about the mode and manner of the proceedings…

“Defense counsel sent an incendiary email response, copying Judge Jennings and accusing [Brewster] of making false accusations regarding ex parte communications between defense counsel and the Court,” the affidavit stated.

On Feb. 8 Judge Jennings issued a memorandum that stated, in part, that, “The Court has not engaged in ex parte communications with either side [and] Plaintiffs are warned that any future conduct implicitly threatening the Court, attempting to create or fabricate a situation suggesting recusal, or made for other advantage or litigation tactic will not be tolerated and may result in a show cause hearing and disciplinary action.”

Brewster claimed in his affidavit that he was “bewildered by the announcement of Judge Jennings and the 'warning' to counsel to not suggest recusal, given that counsel had made no effort to impugn the Court or to seek recusal.”

Then Brewster engaged in some Googling, which did lead to the seeking of recusal.

“To gain some understanding of Judge Jennings's disclosed concern regarding recusal, [I] searched the internet on Feb. 8 and discovered that Judge Jennings's husband, Michael Patrick Jennings, is the Legislative Agent/Lobbyist for The Jockey Club,” Brewster stated in his affidavit.

This is not the first time that a conflict-of-interest recusal has arisen in Baffert's intertwined legal cases and administrative appeals.

In September 2022, Clay Patrick, the hearing officer assigned to Baffert's KHRC appeal, recused himself three weeks after the appeal's testimony was heard.

Patrick stepped down after Brewster revealed that he had unknowingly bought a $190,000 horse at the Keeneland September Yearling Sale that was co-owned by Patrick, who operates Ramspring Farm.

The KHRC assigned a new hearing officer to that case.

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HBPA Plaintiffs Tell Fifth Circuit New Law ‘Does Not Fix’ HISA’s Problems

As the Fifth Circuit United States Court of Appeals weighs a motion by the Horseracing Integrity and Safety Act (HISA) Authority to vacate its recent opinion that HISA is unconstitutional, a plaintiff team led by the National Horsemen's Benevolent and Protective Association (NHBPA) on Friday urged the court not to do that, arguing that a new federal law passed two weeks ago to amend the operative language of HISA “does not fix” three alleged constitutionality issues.

“This Court's opinion identified three distinct problems with HISA: 'An agency does not have meaningful oversight if it does not write the rules, cannot change them, and cannot second-guess their substance,'” the NHBPA and its co-plaintiffs wrote in a Jan. 13 response.

“Congress's recent tweak to HISA fails to fix the second problem and does nothing to address the first problem or the third,” the filing continued.

“Under the amended HISA the Federal Trade Commission (FTC) still cannot initiate new rules and still cannot second-guess their substance beyond 'consistency review.' And though it can now modify promulgated rules, the Authority's rules will govern for a while even if the FTC eventually changes them,” the response stated.

“In addition, the amendment reduces the FTC's oversight by eliminating the commission's power to issue interim final rules [and] ultimately, the overall purpose of HISA remains to delegate legislative power to a private corporation to 'develop and implement' programs to regulate the horseracing industry,” the filing stated.

“The prior [Fifth Circuit] opinion was a correct statement of the law and the facts at the time it was issued, and the Authority has not borne its substantial burden to show the 'extraordinary remedy' of vacatur is equitable in this instance,” the response stated.

The underlying lawsuit was initiated by the NHBPA and 12 of its affiliates against personnel from the HISA Authority and the FTC on Mar. 15, 2021, bringing anti-constitutionality claims under the private-nondelegation doctrine, public nondelegation doctrine, Appointments Clause, and the Due Process Clause.

On Mar. 31, 2022, a U.S. District Court judge dismissed that suit, writing in an order that “despite its novelty, [HISA] as constructed stays within current constitutional limitations as defined by the Supreme Court and the Fifth Circuit.”

The HBPA plaintiffs appealed that decision, leading to the Fifth Circuit's reversal on Nov. 18.

But by amending HISA and passing it into law as part of a much broader year-end spending bill, the HISA Authority argued in its Jan. 3, 2023, “motion to vacate” that Congress and the President have done their parts to clear up any lingering constitutional ambiguity, and now the Fifth Circuit is obliged to do its duty to “say what the law is” with regard to the rewritten HISA.

Also on Jan. 13, the state of Texas and its racing commission (both of which had been allowed to join the plaintiffs as “intervenors” with an interest in the outcome), filed a separate response to the HISA Authority's motion to vacate.

“This Court should deny the Authority's motion,” the Texas plaintiffs stated. “Because the Authority tellingly does not assert that Congress's amendment moots this lawsuit…immediate vacatur is not warranted. Instead, as this Court has already remanded the case for further proceedings in the district court, this Court likely should follow its ordinary practice, issue its mandate, and allow the district court to consider the HISA amendment's impact on the merits of this suit in the first instance.”

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