2002 - Harness Tracks of America, Inc.

HARNESS TRACKS OF AMERICA
Executive Newsletter
A daily fax and e-mail report on racing and gaming developments in North America and beyond
Stanley F. Bergstein, Editor
THE WORST FEARS REALIZED
Disaster struck in Washington this morning when
the House Judiciary Committee stripped horse
racing’s exemption from the Goodlatte Internet
prohibition bill and reported the measure out of
committee, 15 to 12. As passed by the committee,
the bill makes gambling on the Internet, including
horse racing, illegal, but it carries an even
greater potential danger. If it were to pass the
House and Senate in its present form, and get
signed into law, it would end telephone account wagering
in the 13 states in which it now is legal.
There has been a gnawing fear in these quarters
for months that an exemption for horse racing could
not withstand the pressures of opposition from both
inside and outside the industry. It is no consolation
that those fears turned out to be accurate, and
no likelihood that the exemption can be restored.
So it would seem that horse racing now must muster
whatever strength it can to make certain that
the Goodlatte Bill -- H.R. 3215 -- does not pass.
NO REVIEW IN OFFSHORE CASE
The United States Supreme Court yesterday refused
to review the conviction of Jay Cohen, the
New York operator of an Antigua offshore bookmaking
operation. Although the operation -- World
Sports Exchange -- advertised worldwide that all
bets were to take place at its Internet server in
Antigua, the U.S. government filed a criminal complaint.
Cohen reported his income to the government,
called his business “wagering” and paid
taxes on it, and waived Antigua’s protection from
extradition. He voluntarily returned to New York
and was arrested and charged with conspiracy and
illegal gambling. He was convicted and sentenced
to 21 months in jail. After a federal appeals court
upheld the conviction he asked the Supreme
Court for review. Yesterday it rejected his
petition, without comment.
June 18, 2002
WAR EMBLEM IN COURT
Not the horse, but the million dollar bonus that he
won for romping in the Illinois and Kentucky Derbies.
Sportsman’s Park in Cicero, Illinois, filed
suit yesterday in federal court, asking that it not
have to pay the bonus until Russell Reineman and
Bob Baffert’s sheik settle who is entitled to what.
Reineman sold 90% of War Emblem to Prince
Ahmed bin Salman of Saudi Arabia for $900,000
after War Emblem won the Illinois Derby at
Sportsman’s. Inexplicably, neither of the big
money men addressed the specific issue of how to
split the million dollar bonus. Perhaps the idea of
the colt winning the Kentucky Derby was so remote
in their minds that neither thought it important.
It is now, and Sportsman’s wants out of the
middle.
RICKMAN GETS MD OTB
In another court matter, a judge in Dorchester
county, Maryland, upheld a decision by the city
zoning appeals board of Cambridge, MD, to allow
William Rickman, owner of HTA member Ocean
Downs and Delaware Park, to open a satellite simulcast
facility in a shopping center he owns in
Cambridge. Gambling opponents had been fighting
the idea.
KY, INDIANA STILL ON EDGE
Budget stalemates in Kentucky and Indiana are
threatening tracks in those states. In Kentucky,
tax breaks for Churchill Downs and Keeneland that
amount to $960,000 for the former and $372,000
for the latter are endangered and will expire if a
new state budget is not adopted by July 1, the end
of Kentucky’s fiscal year. In Indiana, the political
dogfight over new taxes roars on. The Senate
stripped pull-tabs for tracks out of its bill, and it
seems possible that the measure in that form
might pass both houses without any conference
committee action to alter the situation.