Hollendorfer, CHRB Hearing Played Out, Ruling Pending

The legal fallout from The Stronach Group's (TSG) decision to ban trainer Jerry Hollendorfer from its facilities in June of 2019 moved onto the San Diego County Superior Court earlier this month, with a hearing in the case between the trainer and the California Horse Racing Board (CHRB).

The hearing Oct. 8 concerned two writs of mandate that Hollendorfer filed against the CHRB constituting an oftentimes complicated and convoluted legal knot essentially surrounding which entity–the tracks or the state agency–have the ultimate jurisdiction to bar the trainer from participating in California horse racing.

TSG barred Hollendorfer from its facilities after six of the trainer's horses were catastrophically injured between December 2018 and June 2019 at Golden Gate Fields and Santa Anita, a time when the latter track experienced a well-publicized spike in equine fatalities during an unusually wet spell.

This past July, Hollendorfer reached a settlement with TSG-controlled subsidiary owners of Santa Anita Park and Golden Gate Fields, the details of which have not been publicly disclosed.

Hollendorfer has not raced or trained at TSG-owned facilities since that June 2019 exclusion.

The CHRB's responses to the writs of mandate–entwined as they are in the language of race-meet agreements [RMA] and stall applications–also provide an interesting backdrop to the years-long dispute over contractual legalese in the race-meet agreement between the tracks and the California Thoroughbred Trainers (CTT), primarily surrounding matters of fair procedure.

Without accord, the same contract has been automatically adopted at the start of each meet in California for some three years. The CHRB has given the relevant stakeholders until this Thursday's CHRB meeting to reach a compromise.

At the heart of the two writs of mandate are the events surrounding Hollendorfer's attempts to enter horses at Del Mar and Santa Anita in the summer and fall of 2019.

After TSG initially banned Hollendorfer from its grounds, the Del Mar Thoroughbred Club (DMTC) took the same course of action for its subsequent summer meet.

In response, Hollendorfer, through the CTT, asked the CHRB to intervene on his behalf, but because Del Mar's action was subsequently overturned in court, the CHRB dropped the matter before a formal hearing could take place, according to court documents.

After Hollendorfer's failed attempts to enter horses at the start of Santa Anita's following fall meet, the trainer once again petitioned the CHRB to intervene. “The CHRB investigated and determined in its discretion that no rules were violated” because of language in the RMA and stall applications, according to CHRB'S court filings.

Also key to the arguments is CHRB rule 1989, which relates to a track's ability to remove or deny access to a licensee. The CHRB argues in court filings that “There has never been any assertion by the CHRB or the racing associations that Petitioner was removed or denied access under Rule 1989.”

Hollendorfer disagrees and writes in court filings that the CHRB's own counsel, Robert Brodnik, “independently invoked Rule 1989 as the basis for asserting that the associations had 'denied access' to Petitioner rather than 'exclude or ban' him.”

Hollendorfer also argues that rule 1989 is inconsistent with other statutes-an inconsistency that gives the CHRB, through its board of stewards, the ultimate right to refuse a trainer's entries, and not the individual racing association.

Through the writ of mandate, Hollendorfer seeks to “compel” the CHRB “to perform its mandatory ministerial” duties in deciding whether the trainer should be able to race at Santa Anita and Golden Gate.

“Petitioner's regulatory complaints against DMTC and [Los Angeles Turf Club] LATC were substantively similar. Both stemmed from actions by those associations in refusing to accept race entries submitted by Petitioner. CHRB's Rules only authorize racing personnel to establish individual race conditions and the procedures for the submission of entries, with control over and the power to refuse entries delegated exclusively to the CHRB's Board of Stewards,” Hollendorfer writes.

“In investigating Petitioner's complaint against LATC, Respondent's Chief of Investigations confirmed that LATC had independently refused Petitioner's valid race entry without involving the Stewards. Respondent's investigation further confirmed that LATC did so based on a purported 'contractual rights' secured via RMAs and Stall Applications, which conflicted with CHRB Rules. As a consequence, Respondent was fully aware that the actions of both racing associations were inconsistent with controlling statutes and regulations,” according to court filings.

In failing to conduct “any hearings on Petitioner's complaints,” the CHRB “permitted the illegal acts of licensed racing associations in dereliction of its duties under the law, all to the harm and damage of Petitioner,” Hollendorfer's court filings state.

“The general rule as stated by the Supreme Court is that 'statutes do not supplant the common law unless it appears that the Legislature intended to cover the entire subject or, in other words, to 'occupy the field.' '[G]eneral and comprehensive legislation, where course of conduct, parties, things affected, limitations and exceptions are minutely described, indicates a legislative intent that the statute should totally supersede and replace the common law dealing with the subject matter,” the filings add.

Hollendorfer also questions the impartiality of the CHRB in adjudicating his case, citing email communications and deposition testimony from former board members.

“The day the ban of Petitioner was announced, [former board member Madeline] Auerbach shared with senior CHRB staff her, and that of CHRB Chair Charles Winner, approval of the media's change in focus from the recurring number of fatalities to the exclusion. Her email stated: 'It appears to me that most of the coverage that I have read seems more concentrated on Santa Anita's action to remove Hollendorfer than on the latest fatality. That is probably a good way of getting a positive spin on a negative story.' Chair Winner replied, 'Well put,'” Hollendorfer's court filings state.

In response to Hollendorfer claims, The CHRB claims that the 2018-2019 race RMA in place between Santa Anita and the CTT contains language providing the track authority to “deny stable space and refuse entries” so long as the decision is not arbitrary or capricious.

“Petitioner insists that the CHRB had a mandatory duty to give him a hearing regardless of the actual reasons behind the racing associations' decisions to not allow him to enter or race in 2019. However, possession of a valid trainer's license does not 'confer any right upon the holder thereof to employment at or participation in a race meeting,'” the CHRB's court filings state.

“[The CHRB's] Chief Loehr completed his investigation and report on October 1, 2019, five days after Petitioner submitted his Complaint. He found no violation of the Horse Racing Law. He found that Petitioner was banned from all Stronach Group tracks on June 22, 2019, and the ban remained in place as of the time of his investigation,” states CHRB court filings.

“[Loehr] determined that both the Stall Application and the RMA gave the LATC the authority to deny stalls and refuse race entries as long as the decision is not arbitrary or capricious, and that 'The LATC decision to deny Mr. Hollendorfer's entry is based upon his June 22, 2019 ban from all Stronach Group tracks,'” according to the CHRB's court filings.

In response to Hollendorfer's questions over the board's impartiality, the CHRB distances itself from TSG's actions.

“Petitioner claims that former CHRB Chair Charles Winner and Vice-Chair Madeline Auerbach harbored pecuniary or other bias that somehow infected the CHRB's response to his complaints. His allegations are baseless and irrelevant. Neither Winner nor Auerbach were involved in any CHRB decisions concerning Petitioner. Both were off the Board by February 2020, and did not vote to approve the Hearing Officer's proposed decision that the CTT/LATC dispute was moot,”

In a separate writ of mandate, Hollendorfer claims the CHRB “abused its discretion” by voting to deem the RMA in place between the CTT and the relevant tracks when the trainer was initially barred from Santa Anita “expired” and “incapable of repetition” when it came to Hollendorfer's later actions through the CTT.

“Conversely, Respondent has maintained that the same RMAs were extended [by the CHRB], effective December 26, 2019, and deemed operative and binding on those same signatory parties for the purposes of re-licensing the racing associations to conduct subsequent race meets, and the resolution of trainer expulsion disputes,” according to Hollendorfer's court filings.

“Respondent's inconsistent actions constituted, at a very minimum, an abuse of discretion that unlawfully deprived Petitioner of due process and equal protection under the law, as to vested fundamental rights recognized and protected by the constitution and judicial precedent established by the Supreme Courts of the United States and California,” Hollendorfer adds.

In response, the CHRB argues that the writ should be denied because Hollendorfer “was not a party to either of the two administrative proceedings conducted by the CHRB, and has no standing to challenge the results of those proceedings.”

Even if Hollendorfer did have standing, the CHRB continues, “the petition should still be denied. As to the LATC administrative process, the CHRB correctly decided that the matter was moot. Subsequent actions by the CHRB to impose the terms of the RMA on later race meets because parties could not agree on the terms of a RMA was unforeseeable, and is irrelevant to whether the CHRB's mootness decision was correct at the time based on the administrative record before the CHRB.”

The CHRB adds: “As to the DMTC proceeding, there was no hearing, and the CHRB never issued an administrative decision that would be subject to judicial review under C.C.P section 1094.5. The CHRB accepted the parties' representation of settlement and never rendered a decision. Thus, that aspect of Petitioner's cause of action is not ripe for adjudication now. Petitioner has no standing to challenge the outcome of either administrative proceeding conducted by the CHRB, and his petition under C.C.P. section 1094.5 should be denied.”

The judge in the case took both writs under submission and a ruling is pending.

Hollendorfer's court briefs can be read here, here, here and here. The CHRB's oppositions briefs can be read here and here.