Churchill Downs and NYRA File Lawsuit Against HISA Over Fee Dispute

Churchill Downs Inc. (CDI), which owns the Kentucky Derby, and the New York Racing Association (NYRA), which runs major New York tracks like Belmont Park and Saratoga Race Course, have started a legal battle against the Horseracing Integrity and Safety Authority (HISA). They filed the lawsuit on December 4 in a Kentucky federal court. CDI and NYRA claim HISA has unconstitutional practices and mismanages fees as the national horseracing regulator.

Legal Battle Over Millions in Fees Puts Iconic Horse Racing Tracks at Risk

The fight is about millions of dollars in fees that HISA says CDI and NYRA owe. The plaintiffs claim these fees were worked out using the wrong method mixing the number of race starts with prize money (“purses”). They say this way of doing the calculations goes against the Horseracing Integrity and Safety Act, which states that fees should be based on race starts.

HISA set up in 2020 as part of government efforts to enforce consistent safety and anti-doping rules in horseracing, has defended its actions. The organization says its fee assessment system, which the Federal Trade Commission (FTC) approved makes sure funding is fair to keep its programs running. HISA CEO Lisa Lazarus stressed that they made the rules after getting lots of input from stakeholders and that these rules are essential to keep the sport fair and honest.

There is a lot on the line. If the plaintiffs do not pay, HISA has said it might stop racing at their tracks, which could mess up the 2025 season at places like Churchill Downs and Belmont Park.

Horse Racing Regulation in Question as Lawsuit Alleges HISA Overreach

CDI and NYRA allege that HISA is going beyond its legal powers by using its own internal processes to enforce penalties, not federal courts. They argue this steps on Article III of the US Constitution, which says the judiciary can settle private disputes. The lawsuit also claims HISA’s actions break due process rights and the Administrative Procedure Act. It says HISA works with little government oversight but has a lot of power.

This court fight brings up bigger discussions about HISA‘s job again. Some say its rules across the country have taken away states’ usual power to make rules and cost the industry a lot without help from the federal government. However, those who back it, like NYRA, agree that HISA has an important job to make horses safer and raise standards in the industry.

As the case goes on, both sides have until early 2025 to get their arguments ready. Other courts have already said different things about whether HISA follows the Constitution. How this case turns out could change a lot about how horse racing is controlled in the United States in the future.