Views toward the Horseracing Integrity and Safety Authority at this year's National Horsemen's Benevolent and Protective Association conference, held this week at Oaklawn Park, ranged from confrontational to lukewarm if the messages of multiple participants serve as an accurate gauge.
Panel moderator Peter Sacopulos, an Indiana equine attorney, wants mediation included in HISA's adjudication system that many horsemen consider oppressive. Mediators try to resolve cases by agreement, an engagement that stops short of the arbitration process where decisions are made by third parties.
"Because many in this industry simply cannot afford to go through the administrative gauntlet and then try to look at judicial review," Sacopulos said, "it's simply too expensive … for the average person to purchase."
Horse owner Brent Malmstrom said he's spent millions of dollars footing legal bills of trainers accused by the authority of breaking the rules. According to an HBPA release, Malmstrom has helped Jonathan Wong, who trains for him, and Phil Serpe, whom he's never met.
"We believe that you cannot take someone's economic livelihood away from them without an appropriate opportunity to defend yourself," Malmstrom said. "Today … you go through this arbitration process, where you don't get to pick the arbitrator—it's assigned—where you don't get to do discovery, you don't get to do disclosures, you don't get to do depositions. … It's really about fundamental fairness."
Even so, Malmstrom's ideas about HISA are not all negative.
"When I look at where we started and where we are today, there have been some changes, and some of it is good. Your adverse analytical finding notice, you're no longer immediately suspended. Back when this happened several years ago (with Wong), we had 18 hours to disperse 140 horses, and that's on a Fourth of July weekend. There has been some progress made."
Malmstrom also views HISA's increase of the metformin threshold as a positive. Metformin is a common diabetes drug. But, he said, a violation against Wong wasn't dropped.
"These rules, the punishment needs to fit the crime," he said. "The CEO of HISA (Lisa Lazarus) stated publicly, 'Our job is to serve the industry as best we can, so that we have to balance due process and fairness to all the participants with finding the cheaters and cleaning up our sport.' So, we’re saying we have to balance due process? I'm not OK with that."
Lawsuits against HISA popped up in lots of courts after its inception, and three of them are at the forefront of an ultimate conclusion. Daniel Suhr, lead counsel in a case brought by the National HBPA and state affiliates against HISA and its umbrella agency, the Federal Trade Commission, attended the conference again this year.
Suhr's case has seen action in a Texas federal district court twice and is now before the United States Fifth Circuit Court of Appeals for the third time after taking a trip up and down the ladder to the U.S. Supreme Court, which told appellate courts in the Fifth, Sixth, and Eighth circuits to reconsider previous rulings in light of a recent ruling the high court made in a separate matter.
Previously, the Fifth Circuit upheld HISA's rulemaking power but ruled against its enforcement authority. Suhr said he does not think the Fifth Circuit will change its mind.
"Ultimately we're going to be back where we were before we got sidetracked, which is at the U.S. Supreme Court. … We can't have rules provisions and not have enforcement provisions," Suhr said. "So, if the Court agrees with us just on the enforcement part and strikes that down, the whole bill fails. And if the whole bill fails, Congress has to go back and fix the problem, and so at that point, we will essentially force Congress' hand."
The National HBPA backs the proposed Racehorse Health and Safety Act, which if ever enacted would establish an interstate compact to develop national rules replacing those created by HISA.
A similar case is also pending in the Eighth Circuit Court of Appeals, which upheld HISA. The Sixth Circuit has already reaffirmed its prior holding that HISA's rulemaking and enforcement powers are legal.
Ed Martin, CEO of the Association of Racing Commissioners International, which represents pari-mutuel racing regulators, said there have been improvements in the game since the formation of HISA but at a high cost. HISA's annual budget has increased from $66.4 million in 2023 to $78.4 million.
Martin noted an extremely low incidence of catastrophic injuries but said low numbers also exist at some non-HISA tracks insulated from its jurisdiction, for now, by court orders.
"HISA is doing a credible job at a greatly increased cost with results comparable to those previously achieved by the state racing commissions," Martin said. "The racing industry has lost transparency, independent financial oversight, and the checks and balances that safeguarded the public when dealing with a government agency."
