W. Craig Robertson III | Horse Racing Free Tips

‘Social Licensing’ The Day Two Focal Point of Baffert/NYRA Hearing

The concept of perception versus reality has been a core plank on both sides of the highly publicized “detrimental conduct” case ever since the New York Racing Association (NYRA) first tried to banish trainer Bob Baffert eight months ago. On Tuesday, the second day of a hearing process that could lead to Baffert's exclusion from New York's premier tracks, the murky interpretation of who should be considered the true victim and which entity is in need of protection from harm rose to the forefront in the form of arguments over “social licensing” that at times played out in tense and pointed fashion.

Although Baffert is the most easily identifiable Thoroughbred trainer in North America, the key witness who testified Jan. 25 was not at all a recognizable name within the sport. Some 7 1/2 hours of testimony and cross-examination from four witnesses were anchored by about 90 minutes of debate regarding the opinions and PhD expertise of Dr. Camie Heleski, a University of Kentucky equine sciences professor who specializes in what the general public thinks of as horse racing.

“If somebody carries a lot of weight, if they have a strong visual branding in a certain piece of the industry, that's going to be noticed by a larger group of the public, a larger group of, let's say, horse racing fans than if it was not such a memorable person,” Heleski testified. She later added that, “Anybody that's paying attention to racing is going to know who Bob Baffert is.”

Heleski explained that in general, the public tends to regard any highly publicized news about pharmaceuticals in horse racing as something that could be damaging to the sport's social licensing, which is a way of terming general acceptance.

“Most of the time, they're simply feeling if there was a drug or a medication violation noted, they feel like it's bad. They kind of put it all under the umbrella of doping,” Heleski said.

And when Kelly McNamee, a lawyer representing NYRA, asked her to tie in the public's collective thought process and how it relates to Baffert's history of equine drug positives, his trainee Medina Spirit's betamethasone overage when winning the 2021 GI Kentucky Derby, and the “over 70 horses that have died under the care of Mr. Baffert,” Heleski didn't hesitate to answer that all of those things combined could adversely affect racing's social license to operate.

“I think drug and medication [positives] from a very prominent person carry more weight than people that are not followed as closely…” Heleski said. “[And] if a trainer has a large number of deaths in their stables, that's going to be looked on poorly.”

But under stern cross-examination from Baffert's lead lawyer, W. Craig Robertson III, the University of Kentucky professor at times seemed overwhelmed when challenged to explain how it could be Baffert's fault that the general public doesn't understand the difference between therapeutic medications and doping.

Robertson also hammered home points about Baffert's history of awards for sportsmanship and good deeds within the industry, plus his well-documented contributions to aftercare. He wanted Heleski to explain how, if Baffert is such an allegedly detrimental presence who could hurt NYRA, why didn't any activists protest his presence at Saratoga last summer, and why did the track enjoy record betting handles at that meet despite Baffert trainees being in the entries?

Robertson also attempted to dismantle Heleski's “amorphous” concept of social licensing, which, she admitted, has nothing to do with an actual “license” that a person or entity could apply for based on regulated standards, like a racing license.

But assuming such a concept exists, Robertson asked Heleski if it wasn't also part of NYRA's obligation to treat all trainers fairly as part of that social license to operate.

“They should treat trainers fairly, yes,” Heleski agreed.

And if NYRA singled out one trainer–like Baffert–for allegedly unfair punishment, Robertson wanted her opinion on whether “the public might not like that, either. That could hurt a social license to operate, couldn't it?” Robertson queried.

NYRA's legal team objected to that line of questioning, and hearing officer O. Peter Sherwood wouldn't allow Heleski to answer the question.

Baffert himself was not called upon to speak during the day-long proceedings in New York City. On the Zoom webcast made available by NYRA to the media, the Hall-of-Fame trainer could occasionally be glimpsed sitting alongside his lawyers in a conference room, dressed in a dark sport coat and open-collared white shirt.

Although his facial expressions were hidden behind a mask for pandemic precautions, Baffert's posture suggested tedium more than anxiety. He generally kept his hands folded in front of him, sometimes absently working his thumbs together repetitively while occasionally reaching up to flick his thick, silver-white hair off his forehead. For the most part, he looked more like a gent waiting for a bus than a seven-time Derby-winning trainer waiting to find out if he'd be exiled from one of America's most prominent racing circuits.

In previous legal pleadings that failed to keep Baffert's hearing from happening at all, his attorneys have described these proceedings as a “fait accompli.” Yet despite the fact that NYRA came up with the newly invented process for holding the hearings, the list of charges against Baffert, and was responsible for selecting the hearing officer who will decide Baffert's fate, a federal judge ruled last week that NYRA has a right to move ahead in that manner.

NYRA had outright banished Baffert May 17, 2021, in the wake of Medina Spirit's still-not-adjudicated Derby drug positive, noting that four other Baffert trainees had tested positive for medication overages in roughly the year before that. On July 14, a federal judge granted Baffert a preliminary injunction that allowed him to race at Saratoga, Belmont and Aqueduct. That injunction has since been made permanent, but with the legal stipulation that NYRA must afford Baffert a hearing process before deciding whether to kick him out or not.

NYRA is charging that Baffert's alleged conduct is or has been “detrimental” to three entities: 1) The best interests of racing; 2) The health and safety of horses and jockeys; 3) NYRA business operations.

Dr. Pierre-Louis Toutain, a France-based veterinarian considered an expert in pharmacology and toxicology, testified earlier Tuesday for 1 3/4 hours.

Some of Toutain's testimony tended to drag, in part because he was asked to offer definitions of and uses for phenylbutazone, lidocaine and betamethasone, three of the substances that NYRA purports are related to Baffert's alleged wrongdoing. Toutain also good-naturedly apologized a number of times for English not being his first language as he testified remotely while on a six-hour European time difference.

Toutain provided one of the lighter moments of the day when he politely interrupted a drug question from one of Baffert's attorneys, Clark Brewster, to ask, “Are you a scientist or a lawyer?”

When Brewster replied that he was a lawyer, that cued Toutain to know he shouldn't give too technical an answer,

“Ah, so I have to explain simply–okay!”

General laughter broke some of the inherent tension.

But there was no hint of humor from anyone in the room when a NYRA attorney, Hank Greenberg, asked Toutain if the presence of 21 picograms of betamethasone in Medina Spirit's post-Derby blood would have had the capacity to affect his performance.

“Yes, definitively,” Toutain replied.

But Toutain had been talking strictly about an intra-articular injection of betamethasone, which he said was the prevailing way that drug is administered to horses. So when it was Brewster's turn to cross-examine Toutain, he made sure to ask about betamethasone contained within a topical salve or ointment for a skin rash, which is how Baffert has alleged that the betamethasone found its way into Medina Spirit.

“Topical? I am not sure they use it [that way],” Toutain answered.

Toutain then seemed to be confused about whether Brewster was asking if betamethasone was sometimes administered via patch, like lidocaine (which the attorney was not asking).

Brewster then quickly ended his cross-examination of Toutain.

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Judge Dismisses Baffert’s Lawsuit Against NYRA

A federal judge on Friday dismissed Bob Baffert's lawsuit against the New York Racing Association (NYRA) that had alleged the Hall of Fame trainer was injured by NYRA's initial attempt to bar him back in May and again in September when it summoned him to a hearing to adjudicate his “detrimental” conduct related to repeated equine drug positives.

Chief among the reasons that United States District Court (Eastern District of New York) Carol Bagley Amon dismissed the amended complaint were that some of Baffert's claims were not yet “ripe” for a federal court to rule upon them because Baffert has yet to have the NYRA exclusionary hearing that is scheduled to begin Monday, Jan. 24.

Amon also wrote that Baffert could not substantiate his claim that NYRA's actions against him amounted to wrongful interference with his business relationships–such as owners who might have moved horses out of his care–because NYRA's actions were directed at Baffert, and not his clients.

“Baffert fails to explain how a state actor's truthful claims reporting a suspension are criminal or independently tortious,” Amon wrote. “Even though the underlying suspension was allegedly unlawfully undertaken, NYRA's statements about that suspension were entirely accurate and do not constitute a crime or tort.”

Asked via email to comment on the Jan. 21 court order on his client's behalf, Baffert's attorney, W. Craig Robertson III, wrote the following:

“The primary purpose of the federal court action was to obtain an injunction prohibiting NYRA [from] suspending Mr. Baffert without due process of law. We were successful in that regard and Judge Amon issued such an injunction [back in July that preliminarily lifted his suspension]–which she has now made permanent.

“As it pertains to our claims related to the renewed efforts by NYRA to suspend Mr. Baffert, Judge Amon has instructed us that we need to go through that [Jan. 24 hearing] process to see if NYRA actually affords the due process it is legally obligated to provide.”

“While we are skeptical NYRA will do as required given its past conduct, we will go through the hearing as instructed by the Judge. Should NYRA not act fairly and in accordance with the law, we will have the right–and we will be prepared–to once again return to Court to seek justice,” Robertson concluded.

Patrick McKenna, NYRA's vice president of communications, countered with the following emailed statement:

“NYRA is gratified by Judge Amon's decision to dismiss Mr. Baffert's lawsuit in its entirety. As we have said throughout this process, NYRA's focus in this matter is protecting the integrity of the sport of Thoroughbred racing in New York. In furtherance of that goal, the NYRA administrative hearing will begin on Monday morning.”

NYRA had banished the seven-time GI Kentucky Derby-winning trainer 16 days after now-deceased Medina Spirit tested positive for an overage of betamethasone while winning the May 1, 2021, Derby. In the 12 months prior to Medina Spirit's positive, four other Baffert trainees also tested positive for medication overages, two of them in Grade I stakes.

On July 14, the court granted Baffert a preliminary injunction that allowed him to race at New York's premier tracks until his lawsuit got adjudicated in full.

In the wake of that decision, NYRA drafted a new set of procedures for holding hearings and issuing determinations designed to suspend licensees who engage in injurious conduct. On Sept. 10, NYRA then summoned Baffert to appear at an exclusion hearing now scheduled for Jan. 24.

Baffert first filed a motion asking the judge to hold NYRA in civil contempt for trying to schedule such a hearing and to stay the hearing itself. When those requests were denied, he amended his original complaint to try and keep the hearing process from moving forward.

That amended complaint was the subject of Amon's order on Friday.

By changing the injunction over Baffert's initial May suspension from “preliminary” to “permanent,” Amon wrote that the civil rights aspect of Baffert's initial complaint is now “fully resolved.”

That left five counts in the amended complaint to be adjudicated. Amon sided with NYRA by dismissing all of them.

NYRA had argued that one of the counts should have been dismissed related to a legal term called the “Younger abstention,” which is a doctrine that mandates federal courts must not hear cases involving federal issues already being decided at the state level.

“Younger abstention is appropriate here,” Amon wrote, noting that NYRA's upcoming administrative proceeding qualifies as a “civil enforcement” proceeding.”

“A Younger-eligible civil enforcement proceeding can be a proceeding or hearing in front of an agency or committee tribunal; it does not need to take place in state court…” Amon wrote.

“NYRA's administrative proceedings resemble criminal prosecutions in the important respects identified in [a precedent],” Amon wrote. “First, the purpose of the proceeding is to determine if Baffert should be sanctioned for alleged wrongdoing…”

“Second, NYRA initiated the proceedings as a state actor. Baffert argues that NYRA cannot call itself a state adjudicative body because it has previously argued that it is not a state actor. Notably, Baffert does not argue that NYRA is not a state actor, since any such argument would be fatal to his [civil rights] claim…”

“Third, NYRA's proceeding was preceded by an investigation that culminated in the filing of formal charges,” Amon wrote. “Baffert does not dispute that the Statement of Charges qualifies as formal charges. Instead, he argues that NYRA failed to conduct a satisfactory, independent investigation before bringing those charges. That argument is not persuasive.”

As for the “ripeness” issue, Amon wrote: “Courts considering prudential ripeness ask first 'whether an issue is fit for judicial decision' and second 'whether and to what extent the parties will endure hardship if decision is withheld.'

“Baffert alleges that proceeding with the hearing violates his due process rights. And as in [a precedent] it is not yet clear that the hearing will deprive Baffert of any property interest. Although Baffert argues that NYRA has targeted Baffert for disparate treatment and that the hearing presents a 'fait accompli' of suspension, the September 10th Letter does not suspend Baffert. Whether NYRA is a biased agency and whether suspension is a 'fait accompli' will certainly be clearer after the hearing has run its course and NYRA has decided whether to suspend Baffert.

Amon also wrote that Baffert did not successfully argue that dismissing his case would cause him significant harm.

“If having to participate in an ongoing administrative hearing counted as per se hardship, courts would routinely find claims ripe while administrative hearings are ongoing,” Amon wrote.

Baffert had argued that even the specter that he might be suspended from racing in New York had caused his business “significant injury.”

But Amon wrote that his amended complaint “does not include allegations that the [letter summoning him to a hearing] has injured his business.”

Amon added that, “Baffert alleges that one client [WinStar Farm] moved its horses because of the May suspension, and that other owners 'have indicated that they may have to move their horses away from Baffert if he cannot race in New York.'

“These allegations do not indicate that Baffert will suffer any business injury from the ongoing hearing now that his original suspension has been lifted. And Baffert has provided no

other evidence indicating an injury accruing from the specter of suspension,” Amon wrote.

Amon wrote that courts can't be expected to be constantly reviewing whether or not the “cloud of official investigation” harms someone's business, because reviewing every such claim of harm would disrupt the administrative process and add to “already overcrowded court dockets.”

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Medina Spirit Team Claims Proof Derby Drug Overage Came from Ointment

The legal teams for the trainer and owner of GI Kentucky Derby winner Medina Spirit (Protonico) jointly issued statements after 6:00 p.m. Friday stating that long-awaited split-sample testing has finally been completed on the colt's urine that “definitively confirmed” and has “scientifically proven” that the type of betamethasone that showed up in his post-race positive test is the type that comes from a topical ointment and not via an intra-articular injection.

The distinction is important to trainer Bob Baffert and owner Zedan Racing Stables (Amr Zedan) because they believe the proper adjudication of the betamethasone overage hinges on how it was administered to Medina Spirit.

In the wake of the positive findings, they claimed that Medina Spirit was treated with the betamethasone-containing ointment Otomax as late as Apr. 30 (the day before his Derby win) to help deal with a skin lesion. They have denied that the colt's joints were ever treated with the injectable form of that drug.

“The betamethasone in an injection is betamethasone acetate. The betamethasone in the topical ointment is betamethasone valerate. Only betamethasone acetate is addressed and regulated in the rules of racing in Kentucky. Thus, the presence of betamethasone valerate in Medina Spirit, which resulted from a topical ointment, is not a rules violation,” W. Craig Robertson, Baffert's lead attorney, stated in a press release.

Robertson continued, citing findings from the New York Equine Drug Testing and Research Laboratory's director, George Maylin:

“Dr. Maylin's testing not only confirmed the presence of betamethasone valerate, but also the absence of betamethasone acetate. This should definitively resolve the matter in Kentucky and Medina Spirit should remain the official winner of the 2021 Kentucky Derby.”

Early Friday evening, TDN asked Marc Guilfoil, the executive director of the Kentucky Horse Racing Commission (KHRC), if his agency could confirm the findings that were announced by Medina Spirit's connections.

“I haven't seen it, so we can't confirm anything,” Guilfoil said via phone.

When asked if a finding of betamethasone from an ointment and not an injection would change anything related to how Medina Spirit's overage of betamethasone would be handled, Guilfoil said, “We cannot comment on an ongoing investigation.”

Clark Brewster, an attorney representing Zedan, stated in a press release that the new finding should change the trajectory of how the case gets settled.

“The KHRC has steadfastly enacted rules relating to corticosteroid joint injection and have drawn a bright-line rule that no injections are permitted within 14 days of a race,” Brewster stated. “Now there is zero doubt that the 14-day rule some thought might have been violated by the earlier less-specific testing is revealed as premature judgment. That groundless accusation is without scientific merit.”

TDN asked Guilfoil if Robertson's and Brewster's interpretations of the KHRC rule were correct, and whether or not the rules relating to the Class C violation for betamethasone in Kentucky made any distinction pertaining to how the substance got inside a horse.

“I can't comment on it. I don't have a rule book in front of me, and anyway it would be a question for our lawyer. We're in litigation, and we can't comment on ongoing litigation,” Guilfoil said.

Guilfoil was referring to the June 7 civil complaint Medina Spirit's connections filed against the KHRC that forced the agency to turn over the colt's post-race urine sample to the New York lab for independent testing.

Robertson's statement read, in part: “In other words, it has now been scientifically proven that what Bob Baffert said from the beginning was true–Medina Spirit was never injected with betamethasone and the findings following the Kentucky Derby were solely the result of the horse being treated for a skin condition by way of a topical ointment–all at the direction of Medina Spirit's veterinarian.”

Eight days after the Derby, on Sunday, May 9, Baffert first disclosed the betamethasone positive at a press conference outside the barn where Medina Spirit was stabled at Churchill Downs. In doing so, he was getting out in front of the official announcement that would come later by the KHRC.

But Baffert didn't actually bring up the possibility that an ointment had triggered the positive until two days later, on Tuesday, May 11.

At first, on May 9, Baffert chose to implicate circumstances as the hazy, underlying culprit in the case (“I don't know what is going on with the regulators…. It's a complete injustice…. It's getting worse, and this is something that has to be addressed by the industry…. [This is] the biggest gut punch in racing for something that I didn't do”).

But as TDN's Bill Finley reported when Baffert's legal team put out a press release two days later implicating the ointment, “Baffert reversed course after declaring emphatically earlier in the week that the horse had never been treated with betamethasone. The trainer now says that he was not aware until [May 10] that the ointment in question, called Otomax, contained betamethasone. Betamethasone is clearly listed as an ingredient in Otomax on the box containing the drug.”

When asked at that time by TDN how a veterinarian could have given the horse Otomax so close to the most important horse race in America without knowing it could result in a drug positive, Robertson replied, “That's a question you're going to have to ask the veterinarian. I don't want to be quoted as throwing the veterinarian under the bus either. Listen: I don't know the answer to that question. I just don't.”

Although Medina Spirit's veterinarian was once again alluded to in the Dec. 3 statements, neither Baffert nor Zedan has publicly named that doctor, nor have they addressed why the Otomax was administered so close to the Derby in the first place.

The fallout from the betamethasone overage–which hasn't even resulted in a KHRC hearing yet, let alone any official ruling–has been costly to Baffert (in terms of being banned by some tracks) and to the sport (in terms yet another crisis that delivers an outsized hit to the game's public image).

The gaming corporation that owns Churchill Downs has barred Baffert from competing at its portfolio of tracks for two years, and none of his A-list 2-year-olds, including likely champion juvenile Corniche (Quality Road), are being allowed to accrue 2022 Derby qualifying points to get into the race Baffert has won seven times.

Baffert has also been barred from competing at the New York Racing Association (NYRA)'s tracks, but in July he secured a preliminary injunction in the courts that still allows him to race there until that lawsuit is resolved in full.

Although his ruling-off by NYRA came eight days after Medina Spirit's betamethasone positive was first made public, NYRA has claimed that its banishment of him has more to do with his pattern of equine drug positives: In the 12 months prior to Medina Spirit's finding from the Derby, four other Baffert trainees also tested positive for medication overages, two of them in Grade I stakes.

Baffert's attorneys have claimed throughout the ordeal that he's a victim in this case.

“Since May, Mr. Baffert has been the subject of an unfair rush to judgment,” Robertson stated in Friday's release. “We asked all along that everyone wait until the facts and science came to light. Now that it has been scientifically proven that Mr. Baffert was truthful, did not break any rules of racing, and Medina Spirit's victory was due solely to the heart and ability of the horse and nothing else, it is time for all members of racing to come together for the good of the sport. Mr. Baffert has been a tremendous ambassador for the sport throughout his 46-year Hall-of-Fame career and he has every intention of continuing to do so.”

Brewster stated that “Zedan is proud to have stood by Bob and is ecstatic that Medina Spirit will receive the honor of his great victory.”

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Baffert Seeks $162K in Legal Fees from NYRA

Even though trainer Bob Baffert has secured only a preliminary injunction in his ongoing lawsuit against the New York Racing Association (NYRA) that allows him to race at New York's three major tracks pending the final resolution of the case, his attorneys filed a motion in federal court Aug. 25 seeking $162,086 in legal fees and expenses from NYRA based on the claim that Baffert is due that money as the “prevailing party.”

The three attorneys Baffert engaged for work on this case have billed him at rates between $450 and $975 hourly, according to court filings in which the lawyers detailed their costs. NYRA on Wednesday countered with its own court filing, which came in the form of a “notice of motion to dismiss” the original complaint. Essentially, that response was NYRA's way of telling Baffert's legal team that the case is not yet over.

According to a schedule that had been ordered back on July 22 by Judge Carol Bagley Amon of United States District Court (Eastern District of New York), NYRA had until Aug. 27 to “serve, but not file, its motion to dismiss.” Oral arguments for that motion aren't even scheduled until Nov. 16.

In a civil complaint filed by Baffert June 14, the seven-time GI Kentucky Derby-winning trainer had alleged that NYRA's banishment of him since May 17 over the issue of his repeated equine drug violations violates his constitutional right to due process.

On July 14, the eve of the lucrative Saratoga Race Course season, Amon granted Baffert a preliminary injunction, writing in her order, “I find that Baffert has established a likelihood of proving that NYRA's suspension constituted state action, and that the process by which it suspended him violated the Due Process Clause of the Fourteenth Amendment of the United States Constitution.”

Yet Amon also wrote, “although NYRA's actions have functionally deprived Baffert of his trainer's license, NYRA has not formally suspended that license. In sum, it is not likely that Baffert will be able to prevail on his claim that NYRA had no legal authority to take the action that it did.”

In Tuesday's filing on behalf of Baffert, his attorneys wrote, “Baffert qualifies as a prevailing party in this suit because the Court entered a preliminary injunction against NYRA enjoining it from enforcing its indefinite suspension of Baffert from all of its thoroughbred racetracks…”

The filing continued: “Under any view of the case, Baffert has fully prevailed on all of his due process claims asserted under Section 1983….It further cannot be disputed that the Court's Opinion altered the legal relationship between the parties by nullifying NYRA's suspension of Baffert–he is no longer barred from participating in NYRA races and he has entered horses at Saratoga as a direct consequence of the Court's order. As a result, Baffert has essentially achieved his main objective in this litigation [and] the Court's preliminary injunction is to Baffert the functional equivalent of a final judgment on the merits with respect to his claims and relief sought.”

One of Baffert's attorneys, the Kentucky-based W. Craig Robertson, the lead counsel in the case, wrote in a declaration that accompanied the motion that he charged Baffert $475 hourly for his work, and that his hourly fee and those of his firm's associate attorneys ($255 and $220), plus a paralegal ($265), are “well within the range of typical fees charged in commercial litigation cases in this District.”

Another attorney retained by Baffert since the inception of the case, the New York-based Charles Michael, wrote in a separate declaration, “my $975 hourly rate is within the reasonable rate customarily charged by attorneys with comparable experience.”

A third attorney, the Oklahoma-based Clark Brewster, wrote that he billed $450 hourly since being retained July 3, and “the rate charged to Baffert is reasonable with respect to equine matters and the rates fall within the standard range for commercial and equine litigators.”

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