Simulcast dispute gets 'unsightly' in public Commission listens to claims, defers action

October 23, 1997|By Tom Keyser | Tom Keyser,SUN STAFF

FORT WASHINGTON -- Disputes within the racing industry that simmered behind the scenes for months burst into public view yesterday at a meeting of the Maryland Racing Commission at Rosecroft Raceway.

The conflicts revolve around simulcasting out-of-state horse races. Although they are disputes over money among headstrong track owners, they threaten the statewide network that allows bettors to wager on harness and thoroughbred races from around the country.

The owners of the state's harness tracks, Rosecroft Raceway in Prince George's County and Ocean Downs near Ocean City, want to televise out-of-state thoroughbred races without the consent of -- and without paying a premium to -- the state's principal thoroughbred tracks, Pimlico and Laurel Park.

Joe De Francis, majority owner of Pimlico and Laurel Park, said that harness tracks' importing thoroughbred races without oversight from the thoroughbred side would cause, "in a word, chaos."

Martin Jacobs, general counsel to Pimlico and Laurel Park, said it would be "calamitous for the thoroughbred industry."

Owners of the harness tracks responded by saying that Jacobs and De Francis were greatly overstating the case.

Claims and counterclaims, accusations and counter-accusations dominated the 5 1/2 -hour meeting. Even one of the participants, Dennis McCoy, a lawyer for Bally's Maryland Inc., which owns Ocean Downs, called it "unseemly and unsightly."

Alan M. Foreman, longtime lawyer for the thoroughbred and standardbred horsemen's groups, also found it disturbing.

"As one who's been on both sides and worked to bring the industry together, it's very troubling to see the industry tearing itself apart over this issue," Foreman said. " It began with Bally's purchase of Ocean Downs."

Before Bally's bought Ocean Downs earlier this year, the state's harness and thoroughbred industries operated under a "facilities-use agreement" that, in part, detailed how money bet on out-of-state simulcasts was divided.

As soon as Bally's closed the deal for Ocean Downs, it withdrew from the agreement. The agreement called for Ocean Downs to pay 15 percent of day betting on thoroughbreds to the Maryland Jockey Club, of which De Francis is president and chief executive officer.

Bally's offered to pay 3 percent. That's what the Maryland Jockey Club charges most out-of-state tracks. The Maryland Jockey Club rejected the offer, and Bally's stopped simulcasting thoroughbred races during the day.

Then Bally's asked the Maryland Racing Commission for permission to negotiate its own deals for out-of-state thoroughbred signals. It also sought permission to open an off-track betting parlor near Hagerstown, about 20 miles from the state's most successful OTB, the Cracked Claw, in Frederick County.

On top of that, the owner of Rosecroft asked the racing commission for permission to negotiate its own deals for out-of-state thoroughbred signals.

Although Rosecroft remained a party to the facilities-use agreement, it set a deadline for reaching a new deal. Already extended once, the deadline is now Nov. 15. If Rosecroft and the Maryland Jockey Club reach no agreement by then, the state's simulcast network could collapse.

Private negotiations between Rosecroft and the Maryland Jockey Club, and between Bally's and the Maryland Jockey Club, have not produced agreements. Yesterday, the conflicts boiled over in public.

De Francis said the economic cornerstone of the state's thoroughbred industry is wagering on out-of-state thoroughbred races. That accounts for 68 percent of all money wagered in Maryland, he said. Any reduction in the slice that goes to thoroughbreds jeopardizes the financial stability of the industry, De Francis said.

Also, he said, if Bally's receives permission to simulcast whatever it chooses at Ocean Downs, it then will seek permission to do the same at OTBs around the state, further undermining the thoroughbred industry.

"It would have a disastrous impact on thoroughbred racing in Maryland," De Francis said.

John P. Mc Donough, a lawyer for Rosecroft, said all his client wants is control of what it simulcasts -- instead of dealing with the Maryland Jockey Club for thoroughbred signals. Eliminating the Maryland Jockey Club from the equation would mean more than $1 million per year to Rosecroft, Mc Donough said.

Dennis Dowd, president of Ocean Downs, said the ability to negotiate thoroughbred simulcasts would reduce next year's projected loss from $700,000 to $200,000.

"We believe cross-breed simulcasting is necessary to our survival," Dowd said.

The racing commission did not rule on any of the disputes. It deferred action on everything, including Bally's request for an OTB near Hagerstown, until it meets again in November.

Pub Date: 10/23/97

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