Heleringer: Will The Absolute Insurer Rule Save Racing … Again?

“Doped” horses. “Hopped” horses. “Drugged” horses. Cheating. Indictments. Scandals. Let the bettor beware.

Those terms don’t describe the current conditions in horse racing, but the overarching problems that dogged the sport nearly 90 years ago when racing had basically no reliable security system in place to protect the betting public. As is the case today, horse racing in the United States had no national governing body that set uniform standards and rules to police the sport. (Thankfully, this will finally change on July 1, 2022, with the federally mandated Horseracing Integrity and Safety Authority.)

Until his death in 1924, August Belmont Jr. could unofficially govern the game by the sheer force of his name and prestige — he had created the concept of a racing commission in 1895 and then persuaded a New York legislature dominated by Republicans to enact it into law. (Belmont was a staunch Democrat.) But at his passing, there still was no effective means – no proven scientific process – to combat racing’s biggest challenge: how to detect and thwart the cheaters, the unscrupulous horsemen who drugged horses to reap huge “scores” at the betting windows.

Joseph Widener, in an attempt to both reform a sport he loved and, less altruistically, protect the sizeable investment he was making in the total transformation of Hialeah Park in south Florida, dispatched Marshall Cassidy in 1934 to France to study the post-race drug-testing system of a horse’s blood/saliva the French racing authorities had conceived to police their own game. Cassidy brought the system back to the United States and installed it for Widener at Hialeah (overcoming a brief but bitter strike of horsemen in the process).

That single act, with stout punishment for offenders, copied nationally by a burgeoning racing industry that couldn’t build racetracks fast enough, may have single-handedly saved the sport of horse racing from itself. The fans that fueled this explosive growth could now push their money through the windows with some degree of confidence they were betting on an honestly-run sport.

The simple, uncomplicated standard that governed was called the “absolute insurer rule.” The person doing the “absolute” insuring was a horse’s trainer of record. It didn’t matter if that trainer was (theoretically) on a three-year shuttle to Mars, if he ran a horse during that time anywhere in America and was the listed trainer of record; he was totally and exclusively liable for the consequences of any failed post-race drug specimen ­­– not the groom, the hotwalker, a veterinarian, or even the familiar “disgruntled former employee.” Confirmed “positives” meant, automatically, the DQ of the winner, loss of purse by the owner, and a fine/suspension or both for the trainer. But how would the reviewing courts interpret such a unique guilty-until-proven-innocent standard? The answers were not long in coming.

In a landmark case with a number of similarities to the current Bob Baffert imbroglio, in late 1945, prominent trainer Tom Smith, the man who had trained the immortal Seabiscuit, was suspended for an entire year by New York’s racing board after one of his grooms had been observed in the paddock at Jamaica spraying a “substance,” later confirmed as ephedrine, into the nostrils of Smith’s horse. (Smith wasn’t even at the racetrack that day.) In a battle of experts sure to be reprised when the Baffert hearing begins, Smith’s expert testified the ephedrine’s effect on the horse was “negligible” while New York’s chemist believed the drug “might [key word] affect a horse … by increasing its respiratory capacity.” The racing board’s harsh penalty was upheld by New York’s appellate court. (Smith was even ordered to pay the board’s court costs of $50.)

But, at least initially, no other state was inclined to follow New York’s lead. Perhaps as a consequence of the strong (but widely unpopular) sanction meted out to Tom Smith, Maryland’s highest court – barely two months after the Smith decision was handed down – affirmed a lower court’s decision declaring Maryland’s own absolute insurer rule unconstitutional. Trainer J. Dallett “Dolly” Byers had a winning steeplechase horse at Pimlico test positive for “benzedrine,” a stimulant. Echoing Mr. Baffert’s initial defense after Medina Spirit’s positive for betamethasone, Mr. Byers testified at his hearing that he was totally innocent and had no idea how the prohibited drug got into his horse’s system. Byers’ defense, complete with character witnesses, was found unavailing and he received the same one-year suspension that Tom Smith had gotten. A reviewing trial court threw out the suspension and the law/regulation on which it was based, calling the rule’s “conclusive presumption of guilt” a “great vice.” A unanimous Maryland court of appeals affirmed and went even further: “This irrebuttable presumption [of guilt under an absolute rule] destroyed the right of [Byers] to offer evidence to establish his innocence. If this is ‘just,’ then the term ‘unjust’ has no meaning.”

Florida’s Supreme Court weighed in the following year (1947), striking down that state’s own absolute standard in the Baldwin case, holding for the first time anywhere that a horseman’s license was “a valuable property right” that could not be suspended without due process of law, i.e., without some finding of guilt based on evidence not a mere violation of an automatic rule.

But just when it looked like the absolute insurer rule was going to be ruled off, California’s Supreme Court upheld the beleaguered standard in 1948. In a 5-2 decision that the two dissenting justices called “un-American,” the majority reinstated a six-month suspension of trainer W.L. Sandstrom’s license after his winning horse at Del Mar, Cover Up, tested positive for a “caffeine-type alkaloid.” Sandstrom’s sanction, said the high court, was not “unreasonable, arbitrary, or capricious” since the absolute rule upon which it was based “was designed to afford the wagering public a maximum of protection against race horses being stimulated or depressed” and was a “reasonable exercise of California’s ‘police powers.’”

Over time, the Sandstrom decision became the consensus view of nearly every court that considered constitutional challenges to racing’s single most important rule. (Both the Byers and Baldwin cases were eventually overruled.)

With the hiring of Spencer J. Drayton in 1946, wooed away from the upper leadership of the FBI, and his national efforts to “clean up racing” with the Thoroughbred Racing Protective Bureau (TRPB) that included the agency’s aggressive enforcement of absolute insurer rules, horse racing became a major recognized sport in the United States, as honestly-run and incorruptible as humanly possible. The game enjoyed its “golden age” thereafter up through the 1970s.

The question must be asked, in the crucible of the serial Bob Baffert “medication” controversies, which supplanted the serial Rick Dutrow “medication” controversies, can horse racing survive in this country without a drug-testing system that is NOT based on the strict enforcement of an absolute insurer rule that the betting public can rely upon with the utmost confidence?

While every horseman’s constitutional right to due process of law must be protected, at the same time, does the sport’s leadership seriously believe that the wagering public (or their elected representatives) will tolerate a drug-enforcement apparatus that, far from the zero tolerance standard it adopted barely a dozen years ago (and has obviously been discarded), permits a chaotic system that allows excuses, explanations, and prevarications for drug positives that are only limited by a licensee’s imagination? Exactly how is the public interest served if horsemen can plead, not just in mitigation, but as an affirmative defense, “environmental contamination,” transferred lidocaine patches, innocent applications of ointment, and wide-open-to-varying-interpretations how many picograms of a “therapeutic” (but nevertheless prohibited during races) medication “affects” a horse’s performance during a race that lasts perhaps a minute and a half?

Now that the abandonment of the former “absolute” standard is on full display in the aftermath of a positive drug screen of the winner of the world-renowned Kentucky Derby, with the attendant incalculable damage to horse racing’s “brand,” is it time once again to resume the strict application of an absolute insurer rule to save an industry that employs tens of thousands and is enjoyed by millions?

Bob Heleringer is a Louisville, Ky., attorney, former racing official and author of the legal textbook Equine Regulatory Law, the second edition of which will be released later this year by the University Press of Kentucky.)

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