money horse racing

Sometimes, all you can do is just shake your head in disbelief.

We all know that a huge bucket load of money does the rounds in the racing industry. That’s a “given”, and a large proportion of that money is controlled by the various racing organisations in each State. As in any industry, there are organisations that are well managed, and there are those that so obviously are not. Unfortunately, it is beginning to look very much as though Racing Victoria has to fall into the latter category.

Last week, the bitter legal battle between Racing Victoria and Group 1-winning trainers, Danny O’Brien and Mark Kavanagh that was sparked by the cobalt saga ended with the trainers being fined $8,000 and $4,000 respectively. OK, so what? Well, the “what” is that O’Brien and Kavanagh were ultimately found to have been unaware that their vet. was doping the horses they presented to race. The problem for Racing Victoria (RV) was that their integrity team was unable to provide sufficient proof to satisfy the Victorian Civil & Administrative Tribunal (VCAT) that Kavanagh and O’Brien knew that their horses had been treated with illegal levels of cobalt. This is after 30 months of disputation. Maybe that was because there was no proof, and never had been.

The problems for RV management are many.

There are two possible charges where doping, of any kind, is concerned. The first is a charge of “presentation”. That charge is very easy to prove. Any trainer has a responsibility to “present” their horses to race in a drug-free state. If a horse tests positive to a banned substance on race day, the Rules of Racing state very clearly that it is the trainer’s problem, and the appropriate charge is one of “presentation”. “Presentation” is the lesser of the two evils. It simply accepts that there was no proof that the trainers were aware of the horse’s drug status, but also says that they should have been. The charge of “presentation” is the risk all trainers have to take unless they have every horse they bring to the races drug-screened every race day. Obviously, that level of stringency will never happen. It’s simply commercially unviable. The appropriate penalty is a fine, and the appropriate action for the trainer is to learn from the occurrence, and take whatever stable management measures are possible to avoid as repeat of the issue.

“Administration”, the alternative open to authorities in any instance says that the trainers knowingly drugged the horses, or were party to drugging the horses. That’s the charge that was originally levelled at both Kavanagh and O’Brien, and that was the charge under which they were originally found guilty and disqualified for three years and four years, respectively. Those penalties were challenged successfully by the trainers in VCAT in March, 2017. RV then took the case to the Court of Appeal which last November agreed that the pair should be penalised for “presentation” of horses with cobalt, but also said that neither trainer had knowledge of how the cobalt got there. So, a charge of “administration” simply could not be sustained.

What all that has to mean is that the original decision to charge the trainers with “administration” was either dumb, or bloody-minded. Dumb if the evidence couldn’t sustain the charge, and bloody-minded if RV knew that the evidence gathered by the integrity team couldn’t sustain the charge and still went ahead with it. What were they thinking? Were they thinking?

In management terms, it simply destroys any concept of fiduciary responsibility at RV. The costs incurred by RV in running the case are said to be in the range of $7 million. O’Brien and Kavanagh are said to have spent $1 million on their defence cases. All to end up with the same result as would have happened if the original charge had been “presentation”. Had the original charge been “presentation”, Kavanagh and O’Brien would most likely have pleaded guilty, copped the fines and got on with life. But instead, RV decided to run with charges of “administration”, and keep running, even after two separate courts indicated that the charges weren’t sustainable. Had that happened in a more commercial organisation, the CEO would likely be looking for a new position.

Simply more money than sense! They burned around $7 million plus the investigation costs, with possibly more costs to come from the trainers’ recovery actions to achieve what they could have achieved by getting the charges right in the first place.

What happens now will be interesting. O’Brien and Kavanagh are looking at suing the responsible veterinary clinic for damages in the order of $10 million. They are also looking at pursuing RV for VCAT costs totalling around $1 million. In my view, their chances of recovery are certainly not that slim.

It’s a bloody mess, and now we come to the latest saga facing RV – the Aquanita inquiry.

Would you believe that RV is considering negotiating the penalties?

For heavens sake, there are 271 counts of breaching the Rules of Racing involved and truckloads of irrefutable evidence of wrongdoing. And RV is thinking about negotiating? About “cutting a deal” for reduced penalties for early guilty pleas? Are these the same people who botched the cobalt issue?

Why are they still there?

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