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More on the blocked sale of Rosecroft to Vogel

Cloverleaf President Kelley Rogers testifies at a Racing Commission meeting last year

Today’s story on the potential end of Rosecroft Raceway contained a lot more back story and details than any conscionable reporter could include in a daily news story.

But that’s what the Internet is for, right? If you’re interested in more, here it is:

I have to say, the judge’s opinion denying the sale of Rosecroft to Greenbelt-area developer Mark Vogel was a pretty enlightening window into his attitude about this case. After laying out Rosecroft’s debts and sale plan to Vogel, Judge Paul Mannes turned to the objectors.

“The opponents to the motion are competitors of the Debtor for the gambling dollar, so the court takes the high-minded tone of their objections relating to the public interest and the racing industry with a grain of salt. The court believes that they would not be disappointed in the least were CEI [Cloverleaf Enterprises Inc.] to disappear from the scene, so that they would not have to share any portion of the Maryland gamblig dollar with them.  … [But] the requirement of good faith does not require that they act in selfless disinterest.”

I asked Alan Foreman, the general counsel for the Maryland Thoroughbred Horsemen’s Association (one of the objectors) about this statement. Here’s his response:

“If we wanted to put Rosecroft out of business and recapture them, we wouldn’t have agreed to the 2006 agreement,” he said, referring to an agreement between Rosecroft and the Maryland thoroughbred industry that authorized the track to take bets on thoroughbred races for a fee of $5.9 million a year.

A year ago, Cloverleaf president Kelley Rogers appeared before the Maryland Racing Commission and said Rosecroft was refusing to make its payments because it could no longer afford them as its annual handle had declined significantly. The commission pulled the track’s thoroughbred simulcast signal and the two breeds have been at a standstill ever since.

Moving on, Mannes also notes Rosecroft is planning to close its backstretch facilities next month, so horses for Rosecroft’s planned race days later this year would have to be trucked in from another location.

“If [the sale is] not approved, the proposition is that the Debtor will run out of money and the enterprise will crater. That may well be the result. But who benefits from the proposed transaction? Certainly not the unsecured creditors as the sale will only produce funds to pay a portion of the administrative expenses and … a small portion of the unsecured claims that are assumed by the prospective purchaser. The [standardbred] horsemen might have the benefit of nine racing days, but with the closing of the backstretch facilities on May 1st, who will be around to benefit from that short racing schedule?

“What the Debtor did here is to decide, at the time of the filing of the case, that it would sell out to Mr. Vogel. To that end, it negotiated an agreement that precluded the marketing of its assets to anyone else.”

On Monday, Vogel said he didn’t know why the judge said that, other than his efforts to pass a bill allowing poker tables at Rosecroft may appear to the judge as being more focused on alternative gaming.

“I’ve always looked at the number one goal as live racing,” he said. “My purchase price guarantees live racing at least until slots money comes in.”

So now that I’ve laid all this on you, it’s quite possible you might be more confused than ever about what’s really happening. Welcome to covering horse racing in Maryland …