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Horse Racing Commission must pay horsemen $56K in legal fees

June 6, 2018

A judge has ordered the state agency that regulates horse racing to pay the legal fees of an owner who successfully challenged an administrative rule restricting racehorses’ ability to compete outside Indiana.

Judge William T. Lawrence of the U.S. District Court for the Southern District of Indiana on Monday ordered the Indiana Horse Racing Commission to pay $56,365 in attorney fees and costs to plaintiffs who won a ruling last year overturning a commission regulation. Plaintiffs represented by attorneys from the Indiana and Kentucky offices of Frost Brown Todd LLC sought nearly $65,000 in fees and costs, but Lawrence disallowed some requests that were not directly related to the case, Jerry Jamgotchian, et al. v. Indiana Horse Racing Commission, et al., 1:16-cv-2344.

Jamgotchian, who owns more than 50 thoroughbreds around the country, and trainer Eric Reed won a court order last year striking down the commission’s so-called “claiming jail” rule. The rule, 71 Ind. Admin. Code 6.5-1-4(h), barred any horse purchased from an Indiana claiming race from competing in races outside the state for 60 days.

In a claiming race, any of the entered horses may be purchased or “claimed” before the race for an advertised price. Claiming races are typically structured so that six to nine horses offered for sale at about the same price compete. There were about 494 claiming races in Indiana in 2016, 144 of which involved claiming prices of $20,000 or higher.

Jamgotchian sued the commission after the IHRC denied permission to enter horses claimed from Indiana Grand Race Course in Shelbyville in races at West Virginia tracks. Jamgotchian had previously entered a horse claimed in Indiana in an out-of-state race before the “claiming jail” period ended.

Lawrence ruled last year the commission’s rule violated the dormant Commerce Clause as an impermissible restraint of trade. He rejected the commission’s argument that Indiana had an interest in having sufficient horses to fill claiming races. He ruled the commission had “not shown that Section 4(h) advances a legitimate local purpose that cannot be adequately served by reasonable nondiscriminatory alternatives. Rather, they evince the type of economic protectionism that the dormant Commerce Clause is designed to prevent.”

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