New Jersey Thoroughbred Horsemen’s Association

Leagues Deny NJTHA Claim of $150M Damages in Post-PASPA Ruling Skirmish

Counsel representing the five US sports associations from whom the parent company of New Jersey‘s Monmouth Park Racetrack seeks $150 million in compensatory and punitive damages in a PASPA ruling follow-up have sent an initial letter denying that the associations should owe a $3.4 million case bond or any additional damages to the track’s owners.

In a letter dated May 29th and addressed to the case’s presiding US District Judge, Michael J. Shipp, the leagues’ counsel, Jeffrey A. Mishkin, describes the damages request by the New Jersey Thoroughbred Horsemen’s Association (“NJTHA”) as “meritless, if not frivolous”. The letter further seeks an-person conference with Judge Shipp, also to be attended by the NJTHA’s counsel.

ScalesA separate letter filed by attorney Anthony J. Dreyer, like Mishkin a member of the leagues’ lawfirm, Skadden, Arps, Slate, Meagher & Flom, LLP, invokes an automatic 14-day extension of the time needed to file a response to NJTHA’s May 24 request for damages, in the expectation of the need to file an “oversized brief”.

Within the request for an in-person conference, the leagues’ response letter declares that the leagues will file motion to bifurcate, or split, the damages request by NJTHA away from other post-ruling elements of the case, with the belief that the bifurcation itself, if granted, would entirely moot the NJTHA request, thus saving the leagues significant discovery-related expense.

According to the leagues’ letter, “The first phase [of the proposed bifurcation] would seek a determination from the Court whether, as a matter of law, NJTHA can recover any sums either under the bond or in excess of the bond amount based on a finding of ‘bad faith’. No discovery would be necessary for the Court to make such a determination. Only if the Court concludes that Plaintiffs are potentially liable for any such sums—and we believe they are not—would the parties then proceed to any necessary discovery and briefing on the issue of damages within the scope of the Court’s determination of any potential liability.”

The leagues’ response letter also begins the expected return attack against the NJTHA’s claims. According to the letter, “NJTHA is entitled to no recovery as a matter of law. The contention that Plaintiffs’ arguments concerning the constitutionality of PASPA were advanced in ‘bad faith’ is utterly unsupportable; indeed, those arguments were repeatedly held to be well-founded by this Court and by the Third Circuit.”

The response adds, “Nor can NJTHA demonstrate ‘bad faith’ by reviving well-worn arguments concerning at least some of the Plaintiffs’ purported involvement in fantasy sports and “gambling” activities that were already the subject of extensive discovery, and that both this Court and the Third Circuit have repeatedly rejected.”

The letter also attacks the NJTHA’s “sworn certification and claim to more than $140 million in damages”, which was assembled by gambling-industry publisher Chris Grove (OPR and other sites). A footnote within the letter declares: “[A]mong other deficiencies, the certification of Chris Grove fails to comply with the expert disclosure requirements of the Federal Rules of Civil Procedure.”

Counsel for the NJTHA filed its own response to the leagues’ letter. That letter agreed to the in-person conference and to the leagues’ request for additional time to file a lengthy response brief, but balked at the leagues’ argument for possible bifurcation.

According to the NJTHA’s May 30 followup, “The NJTHA has no objection if Your Honor decides to grant the Leagues a reasonable extension of time to file their response papers to the NJTHA’s Motion. However, there is no basis for the bifurcation of proceedings requested by the Leagues. In essence, what the Leagues want to do is pick and choose which parts of the NJTHA’s Motion it wishes to respond to at this time. Allowing a party responding to a motion to control how, when, and to what parts of a motion it chooses to respond is not contemplated by [the applicable filing rule], nor does it, as the Leagues suggest, promote efficiency.”

The NJTHA May 30 letter also attacks the leagues’ attempt to debate the merits of the damages claim before any actual court proceedings on the matter: “Finally, the Leagues have improperly chosen to offer in their letter a preview of why they think the NJTHA’s Motion is “meritless.” As the Leagues should well know, their letter to Your Honor is neither the time nor place to argue the merits of the NJTHA’s Motion. Despite the temptation to do so, we will defer commenting on the League’s preview of their legal arguments until such time as the Leagues set forth all of their arguments in proper form by filing responsive papers that conform to the applicable Rules rather than the Leagues’ wishes.”

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