Tomorrow marks the first Saturday in May, so the sporting world will turn its attention to Louisville, Kentucky for the 150th running of the Kentucky Derby at Churchill Downs. Perhaps $200 million will be wagered on “the fastest two minutes in sports.” And while the Derby is “the most storied race of them all,” West v. Kentucky Horse Racing Comm., 972 F.3d 881, 883 (2020), Churchill Downs will play host to 26 more horse races this weekend—on all of which wagers will be placed. The proliferation of sports gambling in conjunction with this weekend’s run for the roses makes Judge Cole’s opinion for Sixth Circuit in Mattera v. Baffert all too timely.

This week in Mattera, the Court clarified that, under Kentucky’s law of pari-mutuel race betting, the “first order of finish marked ‘official’ counts for wagering purposes.” That means, if a horse wins, places, or shows—finishes in the top three—only to be later disqualified and retroactively scratched from the race, bettors on the pre-disqualification finish are in luck. “A subsequent change in the order of finish may affect the purse and the history books,” the Court explained, “but it will not impact pari-mutuel wagering.”

The 147th running of the Kentucky Derby in 2021 brought these rules to life. Thoroughbred Medina Spirit led from wire to wire. The race stewards marked the official finishing order as: (1) Medina Spirit, (2) Mandaloun, (3) Hot Rod Charlie, (4) Essentially Quality. Wagers were paid out accordingly. But several months later, the Kentucky stewards disqualified Medina Spirit (posthumously) and crowned Mandaloun the winner. Medina Sprit tested positive for a performance enhancing substance after the race.

For several bettors, including Anthony Mattera, that change in finishing order would have made all the difference. He and others “would have won their bets if the new order of finish counted for pari-mutuel wagering purposes.” Still unable to cash their bet slips, the bettors sued Churchill Downs and Medina Spirit’s trainer, Bob Baffert. The district court dismissed their claims and the Sixth Circuit affirmed, explaining that Kentucky’s regulations on horserace gambling depend on the first official result after the race. “Medina Spirit’s disqualification,” as a matter of law, “had no impact on the plaintiffs’ wagers.” And with losing wagers, the court explained, the bettors sustained no harm.

Just two years earlier, a similar fate befell Maximum Security after 2019’s running of the 145th Kentucky Derby. Like Medina Spirit, Maximum Security crossed the finish line first. “Despite this, the horse was not declared the official winner of the race.” West, 972 F.3d at 884. After the race, but before posting official results, the race stewards determined that Maximum Security (or his jockey) interfered with other racers, thus requiring disqualification. That disqualification, too, generated litigation in the Sixth Circuit. Maximum Security’s owners, who stood to gain millions from a Kentucky Derby victory, argued that the disqualification was arbitrary and infringed constitutional liberty and property rights. But from “[r]ight out of the gate” to “down the final stretch” the Court stood by the race stewards’ decision. The court would not reinstate Maximum Security as the winner.

The judiciary has turned away frustrated owners and bettors, but perhaps they have a better audience for their grievances. Last year, the Sixth Circuit upheld the constitutionality of the Horseracing Integrity and Safety Authority, which Congress designed to regulate horseracing on a national level. Oklahoma v. United States, 62 F.4th 221 (6th Cir. 2023). Oddly, the Authority is not staffed by government officials; it is a private nonprofit regulatory entity. Splitting from the Fifth Circuit, the Sixth Circuit held that Congress delegating regulatory power to private actors did not violate the private non-delegation doctrine. What saved the Authority is its subordinance to the Federal Trade Commission. Accordingly, in this Circuit at least (horseracing’s home Circuit), federal regulators could possibly preempt Kentucky’s laws on horserace wagers.

Enjoy the Kentucky Derby!