Ohio Horsemen Challenge State Simulcast Law

A complaint filed by the Ohio Horsemen’s Benevolent and Protective Association in United States District Court for Southern Ohio challenges the constitutionality of an Ohio law that allowed the Ohio State Racing Commission to overrule a decision by the horsemen’s group to block the sending of signals to a Pennsylvania racetrack.

The filing is based on a request by the Ohio HBPA for a higher host fee from Harrah’s Chester Downs, a Standardbred track with slot machines, for being allowed to accept signals from Beulah Park and River Downs in Ohio. The two tracks asked the horsemen’s group for permission to send their signals to Harrah's Chester in exchange for a 3% host fee; the Ohio HBPA wanted 5% and denied its consent

Harrah’s Chester Downs opened for live harness racing and simulcasting in September 2006. It’s located in southeastern Pennsylvania, not far from Delaware Park, a Thoroughbred track, and Turf Clubs operated by Philadelphia Park Racetrack & Casino, another Thoroughbred facility.

The Ohio State Racing Commission discussed the situation and on Dec. 16 ruled in favor of Beulah Park and River Downs. Ohio statute grants the commission that power, but the Ohio HBPA contends the signals can’t be sent without its authorization under the Interstate Horseracing Act of 1978.

“Beulah Park and River Downs challenged the decision of the Ohio HBPA by relying on an Ohio law that allows racetracks to appeal to the Ohio State Racing Commission,” Bob Reeves, chairman of the Ohio HBPA Purses and Wagering Committee, said in a Jan. 26 statement on the situation. “Under Ohio law, the commission can overrule the position of a horsemen’s group if it finds that permission to export simulcast signals by a track was ‘unreasonably withheld.’ The commission clearly does not have that authority under federal law.”

Norm Barron, who chairs the Ohio racing commission, said Jan. 26 the commission acted in accordance with the Ohio Revised Code, which as a section on simulcast rules. The law references the IHA but goes further to say a permitholder--racetrack--can object if it believes horsemen are withholding approval to send a signal without substanial merit, which the racing commission decided was the case. The law also says the determination of the commission is final.

“We’re sitting as a state agency with a state law,” said Barron, an attorney. “We’re following what we believe is our obligation under state law.”

Barron and Ohio HBPA president Jim Yaegel noted the case has interesting ramifications given the conflict between federal and state law. Yaegel said Thoroughbred breeders, owners, trainers and their employees “have a vital stake in this case.”

“The Interstate Horseracing Act gives horsemen an inalienable and unchallengeable right to grant or withhold consent for the interstate transmission of simulcast signals.” said attorney Doug McSwain, who handles legal affairs for the National HBPA and is the lead attorney for horsemen in the Ohio case. “We believe that the Ohio law is unquestionably unconstitutional in that its application deprives of horsemen everywhere of rights granted under federal law and the Constitution. The Ohio law violates the supremacy of the United States Constitution, the Interstate Horseracing Act, and the expressed will of Congress in exercising its authority under the United States Constitution to regulate interstate commerce.”

It appears 2007 could be an eventful year in the area of simulcast rights and fees. Earlier in January, the Florida HBPA challenged a contract between Gulfstream Park and New York off-track betting corporations in its bid for a higher host fee for the Gulfstream signal, and Woodbine Entertainment Group chief executive officer David Willmot said at the Asian Racing Conference that racetracks should form an entity to sell signals.

The Ohio HBPA in recent years has questioned why revenue from Thoroughbred handle in Ohio goes to support harness racing purses.

Full Text of Court Filing (PDF - large file, may download slowly on some connections)