Yonkers Raceway, Inc. v. New York City Off-Track Betting Corp.

68 Misc. 2d 882, 328 N.Y.S.2d 577, 1971 N.Y. Misc. LEXIS 1056
CourtNew York Supreme Court
DecidedDecember 9, 1971
StatusPublished

This text of 68 Misc. 2d 882 (Yonkers Raceway, Inc. v. New York City Off-Track Betting Corp.) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Yonkers Raceway, Inc. v. New York City Off-Track Betting Corp., 68 Misc. 2d 882, 328 N.Y.S.2d 577, 1971 N.Y. Misc. LEXIS 1056 (N.Y. Super. Ct. 1971).

Opinion

Nathaniel T. Helman, J.

Petitioners Yonkers Raceway Inc. and Tanbro Fabrics Corporation, a taxpayer, apply to this court for an order (1) enjoining respondent New York City Off-Track Betting Corporation (OTB) from undertaking, arranging or contracting for live television broadcasting of harness racing combined with off-track betting, in disregard of the prior decision of the Harness Racing Commission of November 18, 1971; and (2) directing respondent Harness Racing Commission to implement its said decision by requiring that any corporations undertaking to engage in live television broadcasts coupled with legal off-track betting, refrain from such broadcasting of harness racing. By way of cross motion OTB seeks a dismissal of the petition.

By chapter 1095 of the Laws of 1971, section 38 of chapter 254 of the Laws of 1940 (Pari-Mutuel Revenue Law) was amended to authorize the State Harness Racing Commission to permit harness racing during a previously restricted period between December 16 and January 2 inclusive. This privilege was limited, however, to counties having a population of 250,000 or less and only ‘ ‘ if the commission is satisfied that a special occasion makes the holding of such meetings and the conduct of such races on such day or days proper or necessary An application having been filed by Monticello for leave to conduct racing meetings between December 15, 1971 and January 8, 1972, permission therefor was granted by the commission in conjunction with the ‘ ‘ Sullivan County Winter Carnival ’ in order to induce and generate tourism.

Two contracts were then entered into by Monticello with OTB. Under the terms of the first agreement described by the parties as the “Interface Contract ”, Monticello agreed to provide space and facilities necessary for the incorporation of the offtrack wagers of OTB into the on-track betting pools at Monticello. In consideration for such interfacing and facilities, OTB agreed to pay Monticello a percentage of off-track wagering, [884]*884pursuant to section 120 of the Pari-Mutuel Revenue Law (L. 1940, ch. 254, as amd. by L. 1971, ch. 423, § 5).

Under the terms of the second contract OTB was granted exclusive television broadcasting rights for all meets at Monticello for the period from December 15, 1971 to the end of the winter meet terminating in January of 1974. For such television rights, OTB agreed to pay $600,000 (less a small credit of 1%%) on races run at Monticello during such period. In addition, OTB agreed to expend $50,000 in promoting such television programs, with the understanding and agreement that profits resulting from the sponsorship of the programs were to be divided equally between the contracting parties.

The agreements having been duly deposited with the Harness Racing Commission, Yonkers and Roosevelt Raceways, as licensed track operators, protested to the commission that the contract provisions violated existing statutes in several respects. A formal hearing thereafter was held by the Harness Racing Commission for a reconsideration of Monticello’s application for a license. At the conclusion of the hearing, at which several witnesses testified, the commission sustained the views of the protesting track operators, and amended the original license of Monticello to include the condition that the licensee do not conduct its racing programs in conjunction with any television broadcasts. Monticello and OTB thereupon brought proceedings in the Supreme Court, Sullivan County, to review the determination of the commission, and were successful in obtaining an adjudication upholding the validity of their television agreement, and further staying the commission from enforcing its judgment (68 Misc 2d 579).

A notice of appeal was then filed by the Attorney-General from the decision of the Supreme Court Sullivan County, which in effect stayed the order and judgment of that court pursuant to CPLR 5519. OTB and the Sullivan County Racing Association then joined once more in an ex parte application before the Appellate Division, Third Department, for leave to vacate the stay in effect pursuant to CPLR 5519, and that court by its own order vacated such statutory stay, thus reinstating the order and judgment of Mr. Justice Mahoney of the Sullivan County Supreme Court. Presently, therefore, the contracting parties are free to proceed with the implementation of their agreements.

It is the claim of the petitioners that they were not a party to the Sullivan County proceeding (although respondents indicate that their names appeared therein as interveners), that they [885]*885were not served with any of the papers thereon, nor did they appear or authorize an appearance on their behalf. It is therefore their contention that the issues before the Sullivan County Supreme Court are not res judicata, that litigations involving OTB as a party are restricted by statute to a venue within New York City, and that in any event, several issues before this court on the present application were not determined by the Supreme Court in Sullivan County.

It is clear that by the provisions of sections 117, 118 and 141 of the Pari-Mutuel Revenue Law (L. 1940, ch. 254, as amd. by L. 1971, ch. 423, §§ 1, 3) OTB acquired the statutory authority to accept wagers on races run at Monticello from bettors in New York City. Did this right to accept such wagers prevent OTB from employing television to stimulate bettors ’ interest in races which were held in Monticello Í While several aspects of this question have already been reviewed in the prior determination of the Sullivan County Supreme Court, the direct question of whether the off-track betting law, or any provision of the New York State pari-mutuel statutes, render the television contract between Monticello and OTB illegal, becomes an important consideration on this application.

At the hearing before the Harness Racing Commission for a reconsideration of the petitioners’ application for a license, the crucial question as to the right of a licensee to “ televise ” was answered by the commission in this fashion: “ Whether or not such conduct since it would be accomplished indirectly through the device of television would constitute an actual violation of the Pari-Mutuel Law is debatable.” At another point, it stated that its holding did not foreclose future exploration of the subject of televised races, should additional facts and knowledge become available. ’ ’ Indeed, the record of the commission shows that three tracks, Yonkers Raceway, Roosevelt Raceway and Saratoga Raceway, have at different times over a period of years employed television as a promotional aid designed to increase track attendance. The programs were broadcast one night a week from local stations and were discontinued respectively, by Roosevelt in 1961, by Yonkers in 1962, and by Saratoga after 1970, because the track management, in each case, concluded that the broadcasts discouraged attendance rather than increased it.

In essence, therefore, petitioners in this proceeding have failed to demonstrate by clear and convincing evidence that the use of telecasts by a licensee constitutes a clear violation of existing statutes.

[886]*886The principal challenge to the contemplated program of the respondents in telecasting Monticello races is with relation to an existing statutory restriction on the granting of a harness track license within 25 miles of another licensee.

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Related

Buck v. Jewell-LaSalle Realty Co.
283 U.S. 191 (Supreme Court, 1931)
Sullivan County Harness Racing Ass'n v. Glasser
68 Misc. 2d 579 (New York Supreme Court, 1971)

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68 Misc. 2d 882, 328 N.Y.S.2d 577, 1971 N.Y. Misc. LEXIS 1056, Counsel Stack Legal Research, https://law.counselstack.com/opinion/yonkers-raceway-inc-v-new-york-city-off-track-betting-corp-nysupct-1971.