Business

Judge might rule on part of historical racing case within a week

Franklin Circuit Judge Thomas Wingate will rule on whether historical racing machines can use cartoons in the race replay. Photo by Charles Bertram | Staff
Franklin Circuit Judge Thomas Wingate will rule on whether historical racing machines can use cartoons in the race replay. Photo by Charles Bertram | Staff Herald-Leader

Attorneys for Kentucky Downs and for the Family Foundation sparred Monday in Franklin Circuit Court over whether it matters if the replay of races used in historical horse racing are photographic or illustrations.

Attorney Stan Cave, representing the conservative advocacy group that opposes historical wagering, argued that the Encore games used at Kentucky Downs show “cartoons” rather than videos. That doesn’t meet the legal requirements, he said, and if that’s the case, the 625 Encore games in use at Kentucky Downs should be found to be illegal.

If the cartoon horses are allowed, Cave said, next will be “cartoon frogs or wiener dog races ... and they’ll say it’s tied back to horse racing.”

Franklin Circuit Judge Thomas Wingate allowed a video of the games to be played in court, which showed a snippet of the race replay in action as part of Cave’s motion for summary judgment on the Encore games. Wingate said that was the first time he’d seen the games in action.

William Hoskins, attorney for Kentucky Downs, argued that the representation in the replay of the race is irrelevant and that the only question before the court is whether the betting is parimutuel.

Wingate asked whether the Encore games allow players to bet “win, place, show” for first, second and third places, and Hoskins said yes. “Just like the racetracks do?” Wingate asked. Again, Hoskins replied yes.

The games look and sound like electronic slots, but proponents contend that unlike slots, they use the outcome of a previously run horse race to determine winners. The Family Foundation challenged the legality of the games, which were approved by the Kentucky Horse Racing Commission in 2010.

After more than an hour of discussion, Wingate announced that he would deliver a ruling on the summary judgment motion within a week. He also set aside a Sept. 6 trial date for the case, granting Cave two months to depose the expert witness for the racetracks and the state.

At stake are millions of dollars in gambling revenue for the four racetracks currently operating historical racing parlors: Keeneland and the Red Mile in Lexington, which use RaceTech’s Instant Racing games; Ellis Park in Henderson, which also uses RaceTech; and Kentucky Downs in Franklin, which uses Encore games. Late last year, Turfway Park in Florence received approval from the Kentucky Horse Racing Commission to put in historical racing games but has not done so yet.

Kentucky Downs, open since September 2011, averages more than $1 million a day in betting on historical wagering. Through June, more than $61 million had been bet on historical horse racing in Kentucky, more than double the handle for the same period of 2015.

About 80 percent of the money wagered is returned to players in the form of winnings, but the tracks keep a portion and the state gets 1.5 percent in tax revenue, about half of which goes to the general fund. Year-to-date, historical wagering has generated more than $9.6 million in taxes, including more than $3.3 million for the general fund.

Steve Pitt, general counsel for Gov. Matt Bevin, was in the courtroom observing the arguments. Pitt had no comment on Bevin’s potential interest in the case. So far, the Bevin administration has shown no sign of reversing former Gov. Steve Beshear’s position supporting historical racing.

  Comments