Hialeah Purse Lawsuit Heads to Arbitration

The track is questioning how the Florida QHRA has used about $500,000.

In a civil suit filed Nov. 26 in a state court in Miami, Hialeah Park is seeking to take control of administration of its purse account from the Florida Quarter Horse Racing Association.

South Florida Racing Association, the parent of Hialeah Park, also is asking the 11th Circuit Court of Florida to require the Florida QHRA to pay an unspecified amount of damages.

The track maintains that the Florida QHRA has violated an agreement on spending. The suit alleges the horsemen's group has spent almost  $500,000 over five years to reimburse itself for expenditures that are not direct Florida QHRA expenses, do not relate to activities at Hialeah Park, and do not provide direct benefits to trainers and owners at Hialeah Park.

Hialeah Park's contract with the Florida QHRA allocates 5% of purse money to a horsemen's fund, within the purse account, that the Florida QHRA uses for administrative costs, advertising expenses, and breeders' awards. For the 2013-14 meet, purses are $5.6 million with $280,000 allocated to the Florida QHRA.

Before Hialeah Park stopped having Thoroughbred racing after its 2001 meet, there were several disputes in which the Florida Horsemen's Benevolent and Protective Association maintained that Hialeah Park was delinquent in putting money into its purse account.

Joseph DeMaria, an attorney who represents the Florida QHRA, said the contract with Hialeah Park allows the Florida QHRA to determine the use of the money.

"(Hialeah Park chairman) John Brunetti has been trying to take control of the horsemen's account for several years, and this is his latest attempt," said DeMaria, a partner in the Miami law firm Tew Cardenas.

On Jan. 30, 2013, Hialeah Park told the Florida QHRA that because of issues that included spending it planned to open a new purse account the track would manage. The Florida QHRA did not accept the change and has continued to administer the existing account under terms of an agreement that extends through June 30, 2015.

Hialeah Park filed the suit three days prior to the start of its 2013-14 Quarter Horse meet, which will have 40 race dates through Feb. 23.

The track and the horsemen's group agreed Dec. 5 to have the case settled through arbitration. The court will appoint an arbitrator if the two parties cannot jointly agree on one.

The Florida QHRA is confident an arbitrator will reject the complaint, DeMaria said.

Hialeah Park has had its purse agreement with the Florida QHRA for each meet since it began Quarter Horse racing in 2009-10.

The Florida QHRA is based in Tallahassee and is the Florida chapter of the American Quarter Horse Association. Dr. Stephen Fisch, a Tallahassee veterinarian, is president of the Florida QHRA. The Florida QHRA is the only organization in Florida that can provide horses for races sanctioned by the AQHA.

Brunetti said his purpose in the lawsuit against the Florida QHRA is to hold it accountable for its spending.

"Last year, some of the horsemen came to us and said, 'We'd like to know how (the Florida QHRA) is making decisions on spending the money,' " Brunetti said.

The Florida QHRA has always made that information available to its members, DeMaria said. The account "is an open book," he said.

The current system at Hialeah Park is commonplace at Thoroughbred and Quarter Horse tracks. The track holds and owns the purse account, while a horsemen's group administers it and hires the bookkeeper.

Brunetti said Hialeah Park does not want to force out the Florida QHRA and find a way to have a different organization for its purse account.

"We want to put out any fires and make sure the money is spent to benefit the horsemen who are at Hialeah Park," he said.

The lawsuit doesn't provide specifics on the $500,000 Hialeah Park maintains the Florida QHRA spent for its own purposes.

An undetermined amount of Florida QHRA spending led to a successful request to Florida regulators to prohibit any continuation of pari-mutuel barrel racing in the state. The Florida QHRA and its allies maintained that a proliferation of low-cost Quarter Horse barrel racing facilities would jeopardize the growth potential for Hialeah Park and other Florida horse tracks.

The barrel racing issue arose in 2011 when the Florida Division of Pari-Mutuel Wagering granted Gretna Racing a Quarter Horse license to hold pari-mutuel barrel racing.

Gretna Racing used Quarter Horses in its events. The Florida DPMW used that as a criterion for granting a Quarter Horse license to Gretna Racing, which is located in the Florida Panhandle town of Gretna.

Gretna Racing's purse contract is with the North Florida Horsemen's Association, which was formed several weeks prior to Gretna's race meet in December 2011. The Florida QHRA and the Florida HBPA filed several administrative complaints challenging the legality of the Gretna program and several similar applicants.

Hialeah Park was among the Florida horse tracks that questioned the legality of pari-mutuel barrel racing but didn't join the two horsemen's groups in their formal complaints.

On Aug. 6 the Florida Division of Administrative Hearings issued a ruling that pari-mutuel barrel racing is illegal under Florida law. The Florida DPMW, however, has allowed Gretna Racing to hold flag-drop pari-mutuel races but will not approve any new licenses for pari-mutuel barrel racing.