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GILMOUR v. NEW YORK STATE RACING & WAGERING BD.

December 9, 1975

William GILMOUR, Plaintiff,
v.
NEW YORK STATE RACING AND WAGERING BOARD et al., Defendants


Edward Weinfeld, District Judge.


The opinion of the court was delivered by: WEINFELD

EDWARD WEINFELD, District Judge.

Plaintiff, William Gilmour, a driver and owner of harness racehorses, moves for an order enjoining defendants Roosevelt Raceway, Inc. ("Roosevelt"), Yonkers Racing Corporation ("Yonkers") and New York State Racing and Wagering Board ("State Racing Board") from barring him from participation in harness races conducted by the defendants pending the trial and determination of this action on the merits.

 Essentially plaintiff claims that he was deprived of his liberty and property without due process of law. *fn1" His property is his employment; his liberty is his freedom to practice and to continue his chosen profession. These rights come within the liberty and property concepts of the Fourteenth Amendment and plaintiff is entitled to follow his profession free from unreasonable state interference. *fn2"

 The first question is whether Roosevelt's *fn3" refusal to plaintiff of access to its facilities was state action. If this is answered in the affirmative, it follows that he was entitled to due process with respect to his termination at the raceway. The next and ultimate question is did plaintiff receive notice and " some kind of hearing" *fn4" sufficient to satisfy due process requirements?

 With plaintiff and defendants in sharp disagreement on the issue of "state action," the court assumes, only for the purpose of this motion for a preliminary injunction, that Roosevelt's termination of the use of its facilities was state action and that Gilmour was entitled to notice of the basis of the termination and an opportunity to be heard in resistance thereto. However, due process "does not require a trial-type hearing in every conceivable case of government impairment of private interest." *fn5" Each case must be decided on its own facts, and "consideration of what procedures due process may require under any given set of circumstances must begin with a determination of the precise nature of the government function involved as well as of the private interest that has been affected by governmental action." *fn6"

 Harness racing is a sport enjoyed by many, but, like other national sports that attract huge audiences, it unfortunately has had its share of scandals. The owners of the raceways, no less than the state and its official agency, the State Racing Board, have a great stake in maintaining and protecting the sport's integrity against those who would despoil it. The state's interest essentially reflects the public interest that sports be honestly conducted, which extends to the avoidance of even the appearance of impropriety in connection with pari-mutuel betting. The state also has a substantial monetary interest since it receives vast sums from the proceeds of racing meets.

 The raceway has a vital interest in protecting its investment, stated in the case of Roosevelt to be 75 million dollars. It also has an interest, and indeed an obligation, in supervising its activities at the raceway so that its patrons have confidence that the sport is honestly conducted. A breach of this obligation of proper supervision may result in forfeiture or denial of its annual license. The failure to take swift and decisive action, unencumbered by the delay of a formal trial-type hearing, could also result in public scandal and ultimately a decrease in spectatorship, a substantial loss of revenues to the state and the race track, and even the potential decline of harness racing in general as a sport, with consequent loss of jobs and investments. In the past, suspicious race results have resulted in fans rioting at the race tracks, causing both personal injury and property damage. *fn7" Thus, the need to maintain strict vigilance against race fixing and to take immediate steps against dishonest drivers and owners is of prime importance in the long run and perhaps in the short run as well. It is important to the public no less than to those who run the raceways.

 On the other hand, Gilmour's interest in pursuing his profession and maintaining his reputation is constitutionally protected against arbitrary state action. His continued termination at Roosevelt, one of the nation's biggest and most prestigious harness race tracks, would surely bring him into professional disrepute and seriously impair his livelihood as a driver and owner of racehorses. Accordingly, assuming, as we do solely for the purposes of this motion, that Gilmour was entitled to notice and some kind of hearing with respect to his termination at Roosevelt, the issue is narrowed to determining, in the light of the interests of the respective parties, whether the procedures afforded Gilmour were constitutionally adequate.

 The various affidavits submitted by the parties on this motion establish the following undisputed facts:

 The plaintiff was indicted with others in the United States District Court for the Eastern District of New York, charged with conspiracy to fix superfecta races at Roosevelt and Yonkers. After a long trial in 1974, at least one defendant was found guilty and a number were acquitted. Plaintiff was among those as to whom the prosecution failed to sustain its burden of proof. One Forrest Gerry, a nondriver and nontrainer, was convicted as the alleged mastermind of the conspiracy. According to George Morton Levy, chief executive officer and general counsel to Roosevelt, who was familiar with the trial evidence, the evidence indicated that Gilmour had suspicious relations with Gerry.

 Following the trial, Gilmour sought to race again at Roosevelt. Despite his acquittal, Roosevelt was reluctant to allow him to race at its track or to use its stalls, and it contends that it then had the right, in the exercise of a reasonable discretionary business judgment, to bar undesirable persons, whether race track touts, dishonest drivers, owners, or others, under the common law and the statute under which each race track is licensed by the state. *fn8" In any event, Roosevelt conditioned Gilmour's re-entry to its track, as well as the re-entry of other drivers involved in the Eastern District trial, upon their written agreement, in the event of any future investigations, to cooperate fully, to report any irregularities in racing that they observed, and to take a polygraph test whenever requested by management. Gilmour, represented by counsel, agreed thereto in June 1974, and thereafter availed himself of Roosevelt's facilities free of any restriction. Then, on September 18, 1975, an exacta race was run which Gilmour won; one McNutt placed second and Webster, another driver, placed sixth. That race and action taken thereafter by Roosevelt are at the center of this controversy.

 We put aside whether inquiry about the race was caused by the spectators booing after it was over, since plaintiff denies that this occurred. But the morning following the race Jacques Dupuis, one of the drivers in the race, complained to the State Steward/Presiding Judge that he was crowded out by Webster -- that Webster had ridden "shotgun" to keep other drivers from passing to assure that plaintiff and McNutt would finish first and second. Roosevelt management was advised of this complaint. Dupuis' version of the race was supported by another driver who was in a position to see and who felt that Webster had deliberately blocked Dupuis out. Roosevelt management also received complaints about the race from telephone callers. It reviewed the videotapes of the race. Inquiry soon exposed an unusual betting pattern on the particular race. Two strangers, in the closing minutes that the betting window was open, had placed an unusually large bet of $5,000 on the exacta combination of "1" and "5", the numbers of the horses driven by Gilmour and McNutt, and immediately after the race collected between $28,000 and $32,000 on the winning combination and then disappeared. Heavy bettors are monitored at Roosevelt and they are known to its race track personnel; the winners in this instance were not known and to this day have not been identified. Based on these circumstances, management undertook an investigation.

 On September 24, 1975, Gilmour, Webster and McNutt were invited to a meeting (McNutt did not attend) with George Morton Levy, Roosevelt's chief executive officer. Over the course of an hour-long session Gilmour and Webster were advised that complaints had been received and questions raised about the September 18, 1975 exacta race; that management was conducting an investigation; that the drivers had "a continuing obligation to take affirmative action to eliminate any suspicion that we have on any race here"; and that Roosevelt wanted them to adhere to their agreement and to take a lie detector test. Gilmour was fully apprised of the basis for the suspicion attending the exacta race, including the two unknown bettors and the amount of their bet, and also of the request that he submit to the test, although he was not asked for his side of the story in so many words.

 On September 27, 1975, still before he was terminated, Gilmour, accompanied by his then lawyer, attended a second session with Levy and other Roosevelt executive officers. The meeting lasted for one and one-half hours and again Gilmour and his counsel were informed of the basis for Roosevelt's concern about the questioned race and why the polygraph test was proposed, and again Levy renewed his request that Gilmour comply with the agreement which had conditioned his readmission to the race track following the 1974 superfecta trial. Instead of consenting thereto, his lawyer, in Gilmour's presence, sought to disavow the agreement, arguing that the test was unreliable and charging that management was engaged in a ...


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