The New York Racing
Association, Inc. (NYRA) Board of Directors exercised its business judgment as
a private, not-for-profit corporation to appoint a President and Secretary.
These appointments were made to stay in compliance with NYRA’s Bylaws,
Article VII, Section 7.01.
NYRA’s Board acted to insure that there was professional
management in place to operate a complex business which has a significant
economic impact on New York
State. The NYRA Board has
a fiduciary obligation to exercise its business judgment to protect the best
interests of racing and the income stream that pari-mutuel wagering provides to
On May 1, 2012 Racing and Wagering Board Chairman John Sabini sent a
letter to the NYRA Board of Directors, which stated “…it is
imperative that you provide an interim operational plan to the Board,
especially who will be performing functions as Chief Executive Officer and
Counsel.” This letter contained no indication of any concerns or
limitations with respect to these appointments. The NYRA Board acted to name a
President and Secretary without any knowledge of any concerns by either the
Franchise Oversight Board or the Racing and Wagering Board.
Furthermore, neither the Racing and Wagering Board nor the Franchise
Oversight Board has authority over the naming of officers by the NYRA Board of
The suggestion in the May 15, 2012 letter from Chairman Sabini and
Chairman Megna that the NYRA Board and other NYRA executives have a potential
role in the improper take-out investigation, thereby making the NYRA Board’s
action inappropriate, is flawed. This reasoning would effectively paralyze the
corporation based on innuendo. The Inspector General’s investigation is
ongoing and there should not be a rush to judgment until a final report is
issued, and due process is provided.