Kentucky Judge OKs Betting on Old Horse Races

FRANKFORT, Ky. (CN) – The leader of a conservative group in Kentucky said Friday that while he is disappointed with the decision, he wasn’t surprised when a judge ruled this week that wagering on historical horse-racing machines is legal under state law.

“I expected to win, I believe we’re right according to the law, but there have been a lot of unusual things in this case, so I wasn’t startled by the fact that the judge decided to go the other direction,” Kent Ostrander, executive director of The Family Foundation, said during a phone interview.

An eight-year case may have been brought to a close Wednesday when Franklin County Circuit Court Judge Thomas Wingate ruled that gamemaker Exacta Systems’ electronic horse-race betting method is legal.

The Exacta historical racing machines resemble slot machines but utilize previously held horse races for players to bet on.

Judge Wingate found that the French-designed system abides by Kentucky gaming laws because the players bet against each other as opposed to the house, the wagers are placed in a pool, and the net pool is awarded to winning players. That method of wagering is called pari-mutuel.

“The Exacta machines are structured to operate in accordance with the pari-mutuel system of wagering,” Wingate wrote in a 22-page opinion. “Furthermore, the Legislature has determined that historical racing machines are not gambling devices as long as they comport with pari-mutuel wagering.”

Corey Johnsen, president of the Kentucky Downs gaming center in Franklin, which uses the system, said he was pleased with the ruling.

“In the world of horse racing, Kentucky often sets the pace. This is an important ruling for the future of pari-mutuel wagering on historical horse racing. I’m sure other states are watching this situation closely, and the ruling is really great news,” Johnsen said in a statement.

It all began in 2010 when the Kentucky Horse Racing Commission, Kentucky Department of Revenue and several state racetracks filed a case in Franklin County Circuit Court to test the legality of horse-racing regulations and the Exacta machines. They are represented by Lexington-based attorney Bill Hoskins.

The Family Foundation, represented by Lexington-based attorney Stan Cave, intervened in the case, claiming the regulations were invalid and that the Exacta machines were not pari-mutuel because they lack “mutuality.”

“When a patron is sitting at his own distinct device, with his own distinct randomly-selected race or races, pushing the button at his own distinct nano-second moment of time, the question is: ‘Who is he wagering with . . . among . . . against?’ No one can point to a single other person with whom he is ‘pari-mutuelly’ wagering,” the conservative group said in a statement Friday, adding that it will appeal Judge Wingate’s latest ruling.

Wingate initially upheld the legality of the Exacta machines and the state’s gaming regulations several years ago, but the Family Foundation appealed. The Kentucky Court of Appeals then vacated Wingate’s ruling and remanded the case for further testimony and briefing.

A discretionary review by the Kentucky Supreme Court also called for additional discovery but upheld the validity of the regulations.

Wednesday’s decision came nine months after the new trial was held. The Family Foundation says the fight isn’t over.

“After an initial analysis of the ruling, we have no choice but to appeal,” Ostrander, the group’s executive director, said in a statement. “We thank the court for its diligence over the last eight years, but we are convinced the opinion overlooks several critical elements of what it means to have pari-mutuel wagering—specifically, wagering among the patrons.”

According to its website, the Family Foundation is “committed to the health of Kentucky families,” and focuses on issues surrounding family and parental rights, education, human sexuality, sex education, pornography, abortion and faith in public life.

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