"Only two scenarios are likely at this point:
Arlington will either enter into an agreement with plaintiff or not accept interstate off-track wagers"
Order By U.S. District Judge Manish S. Shah
Dan Sullivan, the ITBOF president who helped facilitate Churchill Downs Inc./Arlington Park's takeover of the ITBOF, and who for two years has teased his plan to have the ITBOF replace the ITHA at Arlington, on Wednesday appeared in federal court and announced his retreat.
Sullivan, in court on behalf of the ITBOF, told U.S. District Judge Manish S. Shah that the ITBOF would not, after all, pursue a contract with Arlington for the 2016 meet.
When Judge Shah on Thursday denied the ITHA's request for a temporary restraining order to prevent Arlington from signing a contract with the ITBOF, he cited Sullivan's reversal as the basis of his decision. He noted in his order that "ITBOF has backed off from negotiating with Arlington."
"I conclude, based on the preliminary evidentiary presentation made to date, that plaintiff's threat of litigation has deterred defendant ITBOF from pursuing a contract with Arlington," Judge Shah wrote in his order, while also noting the resolution adopted by the ITBOF - stating its intent to pursue a contract with Arlington - had lapsed.
Judge Shah then made clear the options remaining for CDI/AP: "Only two scenarios are likely at this point: Arlington will either enter into an agreement with [ITHA] or not accept interstate off-track wagers."
Make no mistake: the judge denied the request for a TRO precisely because Sullivan backed off, and Sullivan backed off precisely because the ITHA fought the ITBOF's misguided attempt to somehow transform itself from a breeders foundation into a horsemen's association for purposes of representing owners and trainers at Arlington.
"The ITHA diligently devotes 100% of its time, effort, and funds to provide services to its members and support Illinois racing. In the past, despite contentious negotiations, the ITHA compromised with AP so as to not jeopardize the summer meet," said ITHA Owner-Director Steven Holland. "This year compromise was not enough; we had to respond to coordinated attacks by three other industry participants to threaten, defame, malign, and defund the ITHA. When these actions reached the point of being illegal, we were forced to respond in court. In the words of the judge, our lawsuit caused those taking those actions to abandon them."
Holland continued: "As owners, my wife and I just want to see our horses train and run, and enjoy the pleasure of summer days at the races. However, as an ITHA Board member, I know we have to do everything necessary to protect both the short- and long-term interests of the horsemen."
It's past time for Arlington officials to engage in good faith negotiations with the ITHA. It's also time for them to be honest with the men and women ofIllinois horse racing - those individuals who, through their investment and work, are the lifeblood of our sport and industry.
Even as CDI/AP repeatedly claimed to be negotiating only with the ITHA and conducting such negotiations in good faith, and even as it engaged in mediation over that contract, it secretly submitted a contract proposal to the ITBOF. If that didn't constitute negotiating with the ITBOF - even as it was supposedly committed to reaching agreement with the ITHA - what did?
In an April 8 letter to Arlington General Manager Tony Petrillo, Sullivan noted that Petrillo had forwarded to the ITBOF "a red line contract." (Click here for that letter and see the highlighted statement.) That letter occurred a day after the ITBOF board meeting at which it adopted its resolution - and two weeks before the expiration of the ITHA's existing contract with Arlington.
At that April 7 meeting of the ITBOF, you will recall, Petrillo and Mr. D personally attended and lobbied the ITBOF board members to approve the resolution. And as a prominent breeder, respected horseman and former member of the ITBOF board noted in an account of that meeting (click here), the Arlington officials have been trying for at least the last two years to recruit the ITBOF to replace the ITHA.
Why is CDI/AP so determined to silence the ITHA?
This is the same out-of-state corporation that, for 2015, reported "record net revenue of $1,212.3 million, 49% higher than the prior year."
This is the same track that is taking $4.41 million from the horsemen's purse account in 2016 to satisfy its "recapture" subsidy, even though substantially reducing purses diminishes our industry's ability to support local jobs and compete with other racing jurisdictions. Arlington's "recapture" taking in 2016 will deplete purses by nearly $60,000 a race day.
And this is the same track that is taking $2.34 million in "pari-mutuel tax credits" in 2016, even though those dollars would otherwise help fund theIllinois Racing Board. The IRB is responsible for testing winning horses and ensuring the integrity of our business.
The ITHA's budget has exactly zero impact on CDI/AP's bottom line. The ITHA is funded by a portion of funds from the purse account and those funds are administered by the elected representatives of horsemen - the ITHA Board of Directors. In 2015, the ITHA derived $466,000 of its funds from the horsemen's purse account at Arlington. By comparison, CDI/AP's "recapture" taking last year was $4.2 million from purses - nine times the amount the ITHA used from the purse account at that track.
CDI/AP's obsession with stifling funding for the ITHA has everything to do with crippling our organization's ability to effectively advocate for horsemen. Even as the ITHA and other industry parties have repeatedly renewed our support for the gaming legislation negotiated in 2010 by all major industry stakeholders - tracks, horsemen and breeders - CDI/AP has refused to renew its own commitment.
Indeed, CDI/AP reportedly is maneuvering to postpone the repeal of "recapture" and also significantly reduce the scope of live racing that would be mandated by that bill. Either of those outcomes - let alone both - would crush what remains of live racing in Illinois.
And now the state's flagship track is dangling the threat of cancelling the summer meet - all because Illinois horsemen will not happily capitulate and allow CDI/AP to determine the level of advocacy necessary to counter CDI/AP's hostility toward live racing opportunities and the jobs of thousands of individuals at the track and throughout agribusiness.
Increasingly, it's CDI/AP's malevolent attitude toward others in Illinois racing that necessitates the strongest possible ITHA.