06/15/2012 9:55AM

Kentucky court vacates ruling that allowed Instant Racing machines

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LEXINGTON, Ky. – The Kentucky Court of Appeals on Friday issued a ruling vacating a lower court’s determination that state racetracks could operate gambling devices that use the results of previously run horse races to determine payoffs.

The ruling is not expected to have any immediate impact on the operation of the devices, called Instant Racing machines, at Kentucky Downs in southern Kentucky, the only track in the state that has installed the devices. However, the ruling is a victory for the Family Foundation of Kentucky, which filed a lawsuit challenging the legality of the devices.

The Court of Appeals ruled that the Franklin Circuit Court had denied the Family Foundation the right to collect evidence to support its case when initially ruling that the devices were consistent with state law. As a result, its ruling is no longer valid, and the Family Foundation’s challenge can now begin anew without the force of a court ruling authorizing the devices.

“We conclude that the request for discovery by Family Foundation was relevant and necessary to the court’s determination and that the court’s denial of discovery constituted an abuse of discretion,” two of the three judges wrote. “By virtue of the absence of any discovery, the record before us is without meaningful evidentiary basis to support the judgment of the trial court.”

The Kentucky Horse Racing Commission approved regulations allowing for the devices in 2010. Simultaneously, it asked the Franklin Circuit Court to rule on the legality of the rules. Because the commission’s rules approving the devices remain in force, the devices remain legal.

Kent Ostrander, the executive director of the Family Foundation said on Friday that the ruling is a “major victory” for the organization, which will continue to pursue a legal opinion that the devices violate Kentucky’s prohibition on gambling other than pari-mutuel racing and the lottery.

“We maintain that this is not live horseracing, and we continue to maintain that this is not parimutuel wagering,” Ostrander said.