Maryland Jockey Club Sues TVG
Updated: Tuesday, August 5, 2003 1:40 PM
Posted: Tuesday, August 5, 2003 9:48 AM
A lawsuit against TV Games Network was filed in U.S. District Court in Baltimore by the Maryland Jockey Club for the network's inability to maintain a three-month average of $230 million in gross handle, which the suit claims is part of the contract between the two entities.
The MJC allege the $230 million mark "was a critical and material term of the contract that formed one of the bases for [MJC's] expectations regarding future revenue." The Maryland Jockey Club and the Laurel Racing Association signed with TVG in 1997.
The contract required TVG to reach an average handle of $230 million a month by November 2001, the Baltimore Business Journal
reports. The MJC would give TVG access to its races from Laurel and Pimlico Race Course when the level was reached, but could terminate the agreement if the standard was not met.
It is also alleged the MJC was to acquire a half-interest in TVG when these conditions were met -- TVG deployment in Maryland and Virginia, and TVG receiving exclusive wagering rights to the Preakness Stakes (gr. I). The MJC was to receive one-third interest in TVG for each of the three conditions, the suit claims.
It is also alleged in the suit, which was filed July 21, MJC is owed one-third ownership in TVG because it has been deployed in Maryland. However, TVG responded by saying the MJC would not earn any ownership interest until all three conditions were met.
Said John Hindman, general counsel for TVG: "There is a dispute among the parties as to the meaning of some aspects of our contract, and the court will decide it."
The MJC was recently purchased by Magna Entertainment Corp., which launched its own horse-racing network (Horse Racing TV) that competes with TVG.
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