litigation | Horse Racing Free Tips

Judge Orders Gulf Coast vs. HISA Case Transferred To Same Division As NHBPA Suit

An Amarillo Division federal judge in Texas on Thursday ordered the most recently filed lawsuit out of four active nationwide cases all trying to overturn the Horseracing Integrity and Safety Act (HISA) to be transferred to the Lubbock Division that is currently handling the National Horsemen's Benevolent and Protective Association (NHBPA)'s similar and recently remanded complaint.

The Apr. 6 order by U.S. District Judge Matthew Kacsmaryk (Northern District of Texas, Amarillo Division) comes more than eight months after the litigation was initiated on July 29, 2022, and just one day after the plaintiffs in the Amarillo case asked for a temporary restraining order and motion for preliminary injunction to halt the enforcement of HISA.

The plaintiffs in the case are Global Gaming LSP, a limited liability company that owns Lone Star Park; Gulf Coast Racing LLC, the owner of a greyhound track that no longer conducts live racing in Nueces County, and both LRP Group Ltd. and Valle De Los Tesoros, which are two limited partnerships separately looking to operate new horse tracks in south Texas.

The defendants are the HISA Authority and the Federal Trade Commission.

“Here, Plaintiffs have asked for extraordinary relief in asking for a TRO and a preliminary injunction,” the judge wrote. “Aside from the merits, at issue in the TRO is whether [the] NHBPA [case's 30-day injunction out of the Lubbock Division] remains binding on Defendants.”

The judge outlined the chronology of the two cases that led to his decision.

“In November 2022 the Fifth Circuit held that HISA violated the private nondelegation doctrine [in the NHBPA appeal]. On Dec. 23, 2022, Congress enacted legislation amending the operative language of HISA to purportedly cure the constitutional defect. The amendment was signed into law by President Biden on Dec. 29. Defendants then filed a motion to vacate the Fifth Circuit panel opinion and a petition for panel rehearing. On Jan. 31, 2023, the Fifth Circuit denied Defendants' motions and remanded the case to the Lubbock Division.”

The judge continued: “Because the Fifth Circuit remanded that case back to Lubbock, the Lubbock Division is in the best position to answer these questions. The issues raised by this case and the Lubbock Action substantially overlap. Both cases involve plaintiffs representing the horseracing industry. Both cases involve the same defendants. Both challenge the constitutionality of HISA. The proof adduced to resolve these claims will likely be identical. And the plaintiffs in both cases share the same ultimate objective.

“The Lubbock Action was filed more than a year before this case was filed and the Lubbock Division is much more familiar with the applicable law,” the judge's order continued. “Thus, the principles that underlie the first-to-file rule justify transferring this case to the Lubbock Division.

Quoting from precedents, the judge stated the legal basis for transferring the case.

“Under the first-to-file rule, when related cases are pending before two federal courts, the court in which the case was last filed may refuse to hear it if the issues raised by the cases substantially overlap. The rule rests on principles of comity and sound judicial administration. The concern manifestly is to avoid the waste of duplication, to avoid rulings which may trench upon the authority of sister courts, and to avoid piecemeal resolution of issues that call for a uniform result.”

The post Judge Orders Gulf Coast vs. HISA Case Transferred To Same Division As NHBPA Suit appeared first on TDN | Thoroughbred Daily News | Horse Racing News, Results and Video | Thoroughbred Breeding and Auctions.

Source of original post

In Advance of HISA Appeals, Court Date, Two Sides Hone Arguments

In advance of oral arguments scheduled Aug. 30 in the United States Court of Appeals for the Fifth Circuit, the two sides involved in the injunction appeal brought by the Horseracing Integrity and Safety Act Authority (HISA) have filed legal briefs that they hope will sway the court to their side of the case.

Both HISA and the Federal Trade Commission (FTC) are defendants in an underlying lawsuit led by the states of Louisiana and West Virginia, plus the Jockeys' Guild, that alleges unconstitutionality and federal rulemaking procedure violations regarding HISA's initial framework of regulations that went into effect July 1.

At issue in the appeal is whether a lower court (U.S. District Court, Western District of Louisiana) erred in preliminarily enjoining HISA regulations that were purportedly harming the plaintiffs. The issuance of that preliminary injunction favored the plaintiffs, but HISA and the FTC appealed it to the higher court.

The Appeals Court then ordered Aug. 8 that with the exception of three specifically contested HISA rules, HISA's legal authority would once again be valid in the two plaintiff states until that court heard oral arguments on the appeal. What happens in the Appeals Court will affect other actions in the lower court related to the underlying lawsuit.

“The district court had jurisdiction over Plaintiffs' claims,” stated an Aug. 19 brief filed by the plaintiffs. “The district court correctly concluded that Plaintiffs have standing because enforcing HISA's rules will inflict direct economic harm on each category of Plaintiff. Beyond that, the Plaintiff States are entitled to special solicitude, and HISA's rules inflict injuries on the States' sovereign, quasi-sovereign, and pecuniary interests.”

The plaintiffs' brief continued: “On the merits, multiple independent and valid grounds support the preliminary injunction. The HISA rules unlawfully dispensed with the requisite notice-and-comment period. Defendants' failure to provide for adequate notice and comment was not harmless given the significant changes these rules bring about for Plaintiffs, their members, and their citizens who raised substantive concerns that the FTC failed to take into account when it rubberstamped HISA's proffered rules…

“Beyond that, the district court correctly identified substantive flaws with each challenged series of rules–ways that HISA's rules clearly exceed its statutory authority–further amplifying the harms that warrant injunctive relief.

“Finally, the equitable factors support the preliminary injunction because the States cannot recoup their economic losses through an ordinary damages action [and] the public interest lies in ensuring that a private corporation is not unlawfully wielding federal power to implement a regulatory framework unauthorized by federal law.”

Not so, claimed the defendants in their Aug. 23 reply brief.

“Plaintiffs' response falls woefully short of justifying the district court's blunderbuss remedy–a preliminary injunction halting enforcement of all regulations promulgated under HISA at the time Plaintiffs brought this suit,” the defendants stated.

The defendants continued: “For each and every issue, Plaintiffs fail to so much as address critical defects highlighted by Defendants–presumably because they have no meritorious response. Plaintiffs do not even try to meet their burden to show actual and imminent harm for every rule they seek to enjoin, including the three specific rules that both sets of Defendants explained do not present any controversy.

“On the merits, Plaintiffs gloss over the gaping holes in the district court's plainly erroneous notice-and-comment analysis [and] lob a litany of misleading assertions on the assessment methodology…. Plaintiffs offer no meaningful response to the serious countervailing harms the order inflicts on Defendants and the public interest.

“These fatal flaws, independently or taken together, compel reversal of the extraordinary preliminary injunction in its entirety,” the defendants' brief summed up.

The post In Advance of HISA Appeals, Court Date, Two Sides Hone Arguments appeared first on TDN | Thoroughbred Daily News | Horse Racing News, Results and Video | Thoroughbred Breeding and Auctions.

Source of original post

Rice Spars With NYRA Over Whether She Is a ‘Threat’

Linda Rice took a legal swat at both the New York Racing Association (NYRA) and the New York State Gaming Commission (NYSGC) with a court reply underscoring that her participation as a trainer (currently permitted because of a temporary injunction) poses no threat to anyone. This latest legal filing comes as Rice continues to try and get a three-year license revocation and $50,000 fine for “improper and corrupt conduct” overturned via the state's judicial system.

The Sept. 29 memorandum of law filed by Rice's legal team in Schenectady County Supreme Court directly addressed a friend-of-the-court brief filed by NYRA Sept. 9 that had sided with defendant NYSGC by arguing that Rice's presence as an admitted seeker and user of allegedly restricted race-entry info undermines the integrity of the sport.

“Ms. Rice is currently racing her horses in good standing at NYRA and other tracks, and she has been doing so for the entire six-year period following the end of her purported misconduct in March 2015,” the trainer's legal team wrote in the reply. “There is simply no reason why she cannot, or should not, continue to do so while this case is heard and determined. Ms. Rice is demonstrably not a threat to racing, and all concerned–the commission, NYRA, and the public–would be completely and entirely unaffected by a stay/preliminary injunction.”

NYRA had argued otherwise back on Sept. 9: “Put simply, the need to protect NYRA's patrons and the wagering public from the significant risk [Rice] poses to the fairness and integrity of Thoroughbred racing in New York State far outweighs any alleged hardships to [Rice's] business resulting from the suspension of her license,” the friend-of-the-court brief stated.

Rice's filing replied that, “Simply put, the status quo is, and has been for many years, inoffensive to the Commission, NYRA, and the public, so there is no valid reason or basis to deny Ms. Rice's application for a stay until the conclusion of these proceedings.”

Rice's filing stated that, “Like the Commission, NYRA does not dispute that, in the absence of injunctive relief barring enforcement of the Commission's Order pending the outcome of this matter, Ms. Rice will suffer irreparable harm: that is, the loss of her only source of income, the destruction of her business and reputation, and the laying-off of the 55 individuals who depend on her and her stable for employment, many of whom are supporting families.”

Rice's filing continued: “Nor does NYRA make any serious attempt to demonstrate how Ms. Rice is unlikely to succeed on the merits of her claims. Although NYRA asserts Ms. Rice cannot satisfy her burden of demonstrating likelihood of success on the merits, it does not explain why.”

On May 17, 2021, culminating an investigation that had stretched over five years, NYSGC members voted 5-0 to agree with a hearing officer that Rice's years-long pattern of seeking and obtaining pre-entry information from NYRA racing office workers was “intentional, serious and extensive [and] inconsistent with and detrimental to the best interests of horse racing.”

Rice had testified that she did nothing wrong by using inside sources to gain a competitive advantage over other trainers. When the penalty got handed down, Rice contended that it was “unduly harsh.”

The ban went into effect June 7. Two days later, Rice's legal team secured a temporary injunction from the court that has allowed her to resume training while the legal process plays out.

The NYSGC on July 2 asked the court to deny Rice's motion for a preliminary injunction “because Ms. Rice has not shown a likelihood of success on the merits or that the equities weigh in favor of preliminary injunctive relief.”

Rice's Sept. 29 filing addressed both of those points.

“As to the merits of Ms. Rice's claims, the Commission's finding that the race information at issue in this case was 'confidential' and unavailable to trainers is not supported by substantial evidence and must be vacated. The finding is premised on nothing more than self-serving, conclusory pronouncements of a supposed 'universal rule' under which the names and past performance information of horses entered in overnight races constitute 'confidential information'…

“Regarding the equities in this case, NYRA's amicus brief argues that Ms. Rice's application should be denied because the 'available evidence indicates that continuation of the status quo may itself pose a significant risk to the public.' This argument completely ignores the record proof, as well as the plain fact that there has never been any suggestion–by the Commission or NYRA–that Ms. Rice has engaged in any misconduct since March of 2015.”

Rice's filing continued: “as previously discussed in Ms. Rice's prior submissions, it is undisputed that the wagering public was totally unaffected by Ms. Rice's receipt of the racing information at issue in this case…

“Lastly, because the Commission's three-year revocation of Ms. Rice's license is so disproportionate to the purported offense, it is shocking to one's sense of fairness, constitutes an abuse of discretion on the part of the Commission as a matter of law, and must be vacated on that basis as well…

“No interested party–neither the Commission, NYRA, nor the public–will suffer any diminution in the integrity of racing, any appearance of impropriety, or any other undue hardship or burden if the preliminary injunction is issued,” Rice's filing summed up.

“The Commission simply would be compelled to maintain the status quo, which is, and has been for many years, inoffensive to the best interests of the sport and those who regulate it, participate in it, and enjoy it,” the filing stated.

The post Rice Spars With NYRA Over Whether She Is a ‘Threat’ appeared first on TDN | Thoroughbred Daily News | Horse Racing News, Results and Video | Thoroughbred Breeding and Auctions.

Source of original post