Acra Turf Club, LLC v. Zanzuccki

Acra Turf Club, LLC v. Zanzuccki

Opinion

 [*128]  SMITH, Circuit Judge.

ACRA Turf Club, LLC ("ACRA") and Freehold Raceway Off Track, LLC ("Freehold") (collectively, "Plaintiffs") filed this suit pursuant to 42 U.S.C. §§ 1983 and 1988, against Francesco Zanzuccki ("Zanzuccki"), Executive Director of the New Jersey Racing Commission (the "Commission"), asserting that certain amendments to New Jersey's Off-Track and Account Wagering Act violate their rights under  [*129]  the United States Constitution. The District Court dismissed the case on Younger abstention grounds, and Plaintiffs appealed. During the pendency of this appeal, the Supreme Court issued its decision in Sprint Communications, Inc. v. Jacobs, 134 S. Ct. 584, 187 L. Ed. 2d 505 (2013), which clarifies and reminds courts of  [**2] the boundaries of the Younger abstention doctrine. Because this action does not fit within the framework for abstention outlined in Sprint, we will reverse.

In an effort to promote horse racing in the State, the New Jersey Legislature enacted the Off-Track and Account Wagering Act (the "Act"), N.J. Stat. Ann. § 5:5-127 et seq., on February 1, 2002, providing for the establishment of up to fifteen off-track wagering ("OTW") facilities. The Act authorized the Commission to issue a license to a single entity, the New Jersey Sports and Exposition Authority (the "NJSEA"), but conditioned this grant upon the NJSEA entering into a participation agreement with all other entities that held valid permits to conduct horse racing in the year 2000. N.J. Stat. Ann. §§ 5:5-130, 5:5-136. Other than the NJSEA, ACRA and Freehold were the only two entities to qualify as permit holders during the relevant period. Thus, on September 8, 2003, the NJSEA, ACRA, and Freehold entered into the Master Off-Track Wagering Participation Agreement (the "Agreement"), which allocated licensing rights for the fifteen OTW facilities as follows: NJSEA the right to license nine OTW facilities, Freehold the right to license  [**3] four OTW facilities, and ACRA the right to license two OTW facilities. The Agreement also provided for geographic exclusivity near the participants' respective racetracks.

Although the Act authorized licenses for up to fifteen OTW facilities, by 2011, only four facilities had opened and were operating, including one by ACRA (Favorites at Vineland) and one by Freehold (Favorites at Toms River). The NJSEA owned two racetracks (Monmouth Park and the Meadowlands), but had leased control of those tracks to other entities, one of which was the New Jersey Thoroughbred Horsemen's Association, Inc. (the "NJTHA"), which currently operates thoroughbred racing at both tracks.¹

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