Battle over MTHA board could land in court
Who can serve a key issue
The next skirmish in the battle over the bylaws governing the Maryland Thoroughbred Horsemen’s Association (MTHA) may be fought in an Anne Arundel County courthouse.
Trainer John Robb sued the MTHA April 27, claiming two of its recent actions violate its own bylaws and are illegal. It’s the latest step in a multi-month fight that’s included dueling lawyers, a heated meeting, and efforts to involve state regulators.
The larger question behind the struggle: Who should make decisions on behalf of Maryland’s horsemen, and whom should they represent?
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Robb and other dissatisfied Laurel Park trainers, who claim to represent a “substantial and decisive majority” of Maryland horsemen, say they have been left out of the loop or ignored on important decisions.
They have been pushing the MTHA to amend its bylaws in ways they claim will make the board of directors better informed, more responsive, and more representative of the trainers and owners with the most involvement in Maryland racing.
But MTHA officials defend the board’s work and say the primary effect of the proposed changes would be to shrink the pool of potential board members. They portray it as an effort by Robb and others to take over the organization.
Robb’s lawsuit followed a testy meeting March 19, when an effort at compromise ran aground. The MTHA board rejected one of the three proposed compromise bylaws and amended two others to – in the eyes of Robb and his supporters – weaken them.
That led Robb to demand a special meeting of the membership and to seek the intervention of the Maryland Racing Commission, which declined to become involved.
“Your allegations regarding MTHA’s corporate governance are not within the Commission’s jurisdiction,” Commission executive director Chris Merz wrote in a letter to Robb.
The legal issue at hand in the lawsuit: whether the MTHA can require members seeking a special meeting to pay the costs of calling that meeting, which the organization estimates will amount to $15,000, and whether a bylaws amendment, which could it more difficult for members to change the bylaws and which the MTHA adopted April 15, well past the start of the current unpleasantness, should apply.
Alan Foreman, general counsel for the MTHA, said both actions were at the advice of outside counsel the organization has retained to advise it in this matter.
Under federal and state law, the MTHA, as the organization representing the majority of the state’s owners and trainers, plays a major role in the racing landscape, signing off on the import and export of simulcast feeds, overseeing the purse account, and more.
Moreover, under the legislation enabling the Pimlico Plus project, it is the purse account that must backstop operating losses incurred by the nonprofit Maryland Jockey Club; that subsidy is projected to reach $18 million this year, sources said.
The board currently is comprised of 15 members elected by the entire membership: seven owners, seven trainers, and one additional member, who is the top vote-getter not otherwise elected.
Robb and his group are seeking three major amendments.
The first would require that those elected as board members in the “owner” category must have owned at least 25% of a horse or horses that made a combined total of at least 10 starts in Maryland in the preceding 12 months.
The second would limit trainer board members to those trainers who, in the prior 12 months, had made either 50% of their starts in Maryland or a total of at least 50 starts here.
And the third is an unusual provision that would direct that, while both owners and trainers could vote for the owner representatives, only trainers may vote for the trainer representatives.
The effort, said retired trainer Dale Capuano, who has advised the dissident group and who served a long tenure on the MTHA board, is designed to get “people that have a lot more skin in the game” onto the board.
But MTHA president Katy Voss said the notion that current board members are insufficiently committed to Maryland racing is unfair.
“You can’t find people that are more actively involved and heavily invested [in the industry]” than current board members, she said.
Voss provided The Racing Biz an analysis claiming that the first two provisions would dramatically reduce – by, perhaps, as much as 85% in the case of owners – the number of owners and trainers who could serve on the board. Some of those who would be rendered ineligible currently serve on the board.
That, it seems, would be fine with many of the trainers, who portray the MTHA board as out-of-touch.
“They were saying, ‘You guys can come here and say what you want, and then we figure it out together.’ But that’s not the truth,” said Jonathan Maldonado, a Laurel-based trainer. “If they decide they want something else, they make the decision. They always do whatever they want. I always thought that the board represents the whole community.”
“There is no working with the general population of horsemen,” agreed Kenny Cox, another Laurel trainer. “When you do go to them, you always feel like you’re dismissed.”
Their frustrations run the gamut: the size of the subsidy paid to the racetrack. Races that don’t fill. A racing strip that Maldonado said used to be “the best one on the East Coast” but is now too inconsistent. The imposition of the Horseracing Integrity and Safety Authority, which the MTHA’s umbrella group, the Thoroughbred Horsemen’s Association, ultimately supported though many rank-and-file horsemen opposed it. The infrequency of open board meetings. Even the number of breaks during morning training.
“There was a poll — one or two breaks — and it was pretty much unanimous [that] everyone just wanted the one break,” said trainer Hugh McMahon. “It was brought to the board, and they denied the one break. That’s not representation.”
Voss, the MTHA president, believes the anger is more a result of challenging circumstances in the industry writ large than in anything the MTHA has done or failed to do.
“I think that times are tough now, and it’s tough for a lot of people just trying to make ends meet in this business,” she said. “You’ve got a horse shortage, so we’re having a tough time filling races. A lot of times, you’re pointing for a race and it doesn’t go. I just think it’s total frustration.”
Oddly enough, it was Robb, Voss, and Foreman, now opponents in this fight, who were among the leaders in the effort, 40 years ago, to unseat the Horsemen’s Benevolent and Protective Association as the local horseman’s group and replace it with the MTHA.
For his part, Robb says, “I just want to get the MTHA back to what it was supposed to be, and the first thing I would do is start having monthly meetings again.”
Voss and Foreman point out that it’s an election year for the MTHA board. All 15 seats are up.
“We have an election this year, and we’ve told them, ‘Get your guy elected,’” Foreman said in an interview prior to the lawsuit. “Every other organization does it that way.”
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