Baffert v. Churchill Downs Inc.
| Docket Number | Civil Action 3:22-cv-123-RGJ |
| Decision Date | 24 May 2023 |
| Parties | BOB BAFFERT, AND BOB BAFFERT RACING STABLES, INC Plaintiffs v. CHURCHILL DOWNS, INC., WILLIAM C. CARSTANJEN, and R. ALEX RANKIN Defendants |
| Court | U.S. District Court — Western District of Kentucky |
Defendants Churchill Downs, Inc. (“CDI”), William C Carstanjen (“Carstanjen”), and R. Alex Rankin (“Rankin” together with CDI and Carstanjen “Defendants”) moved for summary judgment. [DE 78]. Plaintiffs Bob Baffert (“Baffert”) and Bob Baffert Racing Stables, Inc. (together with Baffert, “Plaintiffs”) responded [DE 80] and Defendants replied [DE 82]. For the reasons below, Defendants' Motion for Summary Judgment [DE 78] is GRANTED.
Baffert is a resident of California and a nationally recognized thoroughbred trainer. [DE 1 at 5]. He holds a license issued by the Kentucky Horse Racing Commission (“KHRC”) to enter horses into races and apply for stall occupancy at all racetracks in Kentucky. [Id. at 6]. CDI is a for-profit corporation with its principal place of business in Louisville, Kentucky. [Id.]. CDI is in the business of horseracing, online wagering, and gaming entertainment. [Id. at 10]. Its flagship events include the Kentucky Derby and the Kentucky Oaks at its Churchill Downs Racetrack in Louisville. [Id. at 6]. Defendant Carstanjen is CDI's chief executive officer, and Defendant Rankin serves as chair of CDI's board of directors. [Id. at 7].
On May 1, 2021, Medina Spirt won the Kentucky Derby. [DE 1 at 2]. Following the race, pursuant to 810 KAR 8:060, a KHRC veterinarian took samples from Medina Spirit to test for prohibited substances. [Id. at 20]. On May 8, 2021, it became known to CDI that Medina Spirit had tested positive for betamethasone. [Id. at 20-21]. Betamethasone is labeled as a Class C prohibited substance by the KHRC. [Id. at 21].
On May 9, 2021, CDI issued a statement that CDI has come to understand that Medina Spirit's post-race sample violated the Commonwealth of Kentucky's equine medication protocols. [Id. at 22]. As a result, Baffert would be immediately suspended from entering any horses at Churchill Downs Racetrack for an indefinite period. [Id. at 22-23]. CDI cited the seriousness of the offense and noted that if the KHRC's findings were confirmed, then the results of the 2021 Kentucky Derby would be invalidated. [Id.].
On June 2, 2021, CDI announced that Baffert, and any trainer directly or indirectly employed by Plaintiffs, was suspended from entering horses in races or applying for stall occupancy at all CDI-owned racetracks for two years. [Id. at 23]. CDI reserved the right to extend the period of its suspension. [Id.]. This decision followed the confirmation by Plaintiffs' attorneys that Medina Spirit had tested positive for betamethasone following the 2021 Kentucky Derby. [Id. at 23-24]. CDI's suspension makes Plaintiffs' horses ineligible for race entries and stabling privileges. [Id.]. The terms of CDI's suspension do not prevent Baffert from entering the grounds or limit his right of access as a member of the public to observe races on CDI properties. [Id. at 23-24].
On September 10, 2021, CDI instituted a new rule, which prohibits any horse trained by a person suspended from running at Churchill Downs from earning points to qualify for the Kentucky Derby or the Kentucky Oaks, even if those races were not held at CDI properties. [Id.]. Baffert alleges that he was the only trainer affected by the new rule and that CDI created the rule with the “singular aim of destroying Baffert's career.” [Id. at 25-26]. He also alleges that CDI caused significant damage to Baffert's ability to conduct his customary business on a national scale. [Id. at 26].
After Medina Spirit tested positive for betamethasone, Plaintiffs were provided with notice from the KHRC of the suspected violation and informed of their right to an evidentiary hearing before the stewards. [Id.]. The Stewards hearing occurred on February 14, 2022. [Id. at 29]. The stewards recommended a 90-day suspension and disqualified Medina Spirit as the winner of the 2021 Kentucky Derby. [Id.]. The KHRC denied Plaintiffs' request for a stay of the suspension. [Id. at 29-30]. Plaintiffs' attempts to stay the suspension in Kentucky State Court were unsuccessful.[1] [DE 33-3; DE 33-4; DE 33-5].
On February 28, 2022, Plaintiffs sued in the Western District of Kentucky. [DE 1]. The Complaint articulates eight causes of action: Count 1 violation of 42 U.S.C. § 1983 against CDI and Carstanjen and Rankin in their individual capacities, Count 2 unlawful exclusion against CDI, Counts 3 unlawful conspiracy in restraint of trade pursuant to 15 U.S.C. §§ 1, 15, and 26 against Defendants, Count 4 unlawful use of monopoly power pursuant to 15 U.S.C. §§ 2, 15, and 26 against Defendants, Count 5 tortious interference with contractual relations against CDI and Carstanjen, Count 6 tortious interference with prospective business relations against CDI and Carstanjen, Count 7 asks for a declaratory judgment against Defendants, and Count 8 asks for a preliminary and permanent injunction. [Id.].
On March 1, 2022, Plaintiffs filed their first motion seeking injunctive relief from CDI's suspension. [DE 5]. Plaintiffs also moved to expedite briefing to secure a preliminary injunction before the 2022 Kentucky Oaks and Kentucky Derby. [DE 6]. The Court promptly scheduled an evidentiary hearing for April 15, 2022. [DE 32]. On April 4, 2022, Plaintiffs moved to withdraw their motion for a preliminary injunction. [DE 33]. Plaintiffs explained that the stewards had imposed a 90-day suspension independent of CDI's that would begin on April 4. [Id. at 1125]. Plaintiffs sought judicial relief in Franklin County Circuit Court and the Kentucky Court of Appeals. [Id.]. However, neither court would stay the KHRC's suspension. [Id.]. Because Plaintiffs would have to resolve the KHRC's suspension independently from CDI's suspension to race in the 2022 Kentucky Oaks and Kentucky Derby, Plaintiffs decided to withdraw their first motion without prejudice. [Id.]. The KHRC's suspension expired on July 2, 2022. [Id.].
On December 15, 2022, Plaintiffs renewed their motion for a preliminary injunction. [DE 41]. The Court held an evidentiary hearing on February 2 and 3, 2023 regarding Plaintiffs' Renewed Motion for a Preliminary Injunction. [DE 65]; Feb. 2-3, 2023, Hrg. Tr., 1:1-2. Following Plaintiffs' suspension and after the commencement of this action, Baffert conceded that he has “raced horses all around the world with enormous success.” Hrg. Tr., 182:1-16. Baffert has used his Kentucky trainer's license to win more than $1 million at Keeneland during his suspension. [DE 53-42].[2]
The Court denied Plaintiffs motion for a preliminary injunction and dismissed Plaintiffs' claims for unlawful exclusion, unlawful conspiracy in restraint of trade, unlawful use of monopoly power, tortious interference with contractual relations, and tortious interference with prospective business relations. [DE 70]. Defendants now move for summary judgment on Plaintiffs' only remaining claim-breach of due process. [DE 78].
Summary judgment is required when “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). The moving party bears the burden of specifying the basis for its motion and showing the lack of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). Once the moving party satisfies this burden, the nonmoving party must produce specific facts showing a material issue of fact for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). Factual differences are not considered material unless the differences are such that a reasonable jury could find for the party contesting the summary judgment motion. Id. at 252.
The Court must view the evidence and draw all reasonable inferences in a light most favorable to the nonmoving party. Williams v. Int'l Paper Co., 227 F.3d 706, 710 (6th Cir. 2000). But the nonmoving party must do more than show some “metaphysical doubt as to the material facts.” Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). Instead, the nonmoving party must present specific facts showing that a genuine factual issue exists by “citing to particular parts of materials in the record” or by “showing that the materials cited do not establish the absence . . . of a genuine dispute[.]” Shreve v. Franklin Cnty., Ohio, 743 F.3d 126, 136 (6th Cir. 2014). “The mere existence of a scintilla of evidence in support of the [nonmoving party's] position will be insufficient; there must be evidence on which the jury could reasonably find for the [nonmoving party].” Liberty Lobby, 477 U.S. at 252.
Rule 56(c)(1) requires that a “party asserting that a fact . . is...
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