Appalachian Racing, LLC Real Party in Interest v. Commonwealth of Kentucky, Kentucky Horse Racing Commission
2016 Ky. LEXIS 565
| Ky. | 2016Background
- Appalachian Racing contracted with Keeneland, which sought to preserve an option to buy Appalachian’s Thunder Ridge track; Floyd County had a financial interest in that sale.
- Keeneland applied to the Kentucky Horse Racing Commission for a license for Cumberland Run; the Commission posted notice of a December 1 review with short lead time.
- Appalachian Racing (with Floyd County) sued the Commission in Floyd Circuit Court alleging aiding-and-abetting fraud and tortious interference, and sought declaratory relief plus a temporary restraining order to bar the Commission from considering Keeneland’s license application.
- The Floyd Circuit Court entered a restraining order preventing the Commission from acting on the application; the Commission then sought a writ of prohibition from the Court of Appeals to block enforcement of that order.
- The Court of Appeals granted the writ as a “special case” to protect separation-of-powers concerns; the Kentucky Supreme Court affirmed, holding the trial court unconstitutionally intruded on executive agency action and that the writ was appropriate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a circuit court may enjoin the Commission from considering a license application before the agency acts | Appalachian Racing: court may enjoin because rights threatened now; restraining order appropriate to prevent irreparable harm | Commission: circuit court lacked power to preclude an executive agency from performing duties absent a justiciable, ripe claim | Court: Floyd Circuit unconstitutionally intruded on executive function; it may not bar the Commission from considering the application |
| Whether a writ of prohibition was appropriate despite an available appeal for other parts of the case | Appalachian Racing: writ not warranted; adequate remedies (interlocutory relief/appeal) existed | Commission/Court of Appeals: restraining order was a non-appealable interlocutory order and extraordinary writ was needed to prevent separation-of-powers injury | Court: writ proper—no adequate appellate remedy against the restraining order and separation-of-powers harms justify the writ |
| Proper characterization of agency action (legislative, executive, judicial) and impact on injunctive relief | Appalachian Racing: Commission was acting in a judicial role when adjudicating licensing rights | Commission/Ct: agency exercises executive power (though with quasi-legislative/quasi-judicial functions); that does not authorize judicial preclusion | Court: Commission’s licensing is executive; courts cannot preemptively enjoin executive acts absent a ripe judicially cognizable claim |
| Whether the separation-of-powers doctrine requires flexible equitable relief to preserve orderly administration of the laws | Appalachian Racing: separation concerns do not bar all pre-enforcement relief; procedural remedies suffice | Commission/Ct: separation-of-powers can mandate extraordinary relief (writ) to prevent judicial usurpation of executive domain | Court: separation-of-powers is strong in KY; issuance of writ to preserve orderly administration was warranted |
Key Cases Cited
- Legislative Research Comm’n v. Brown, 664 S.W.2d 907 (Ky. 1984) (constitutional separation-of-powers limits interbranch incursions)
- Clark v. Ardery, 222 S.W.2d 602 (Ky. 1949) (courts may not exercise functions vested in executive bodies)
- Commonwealth v. English, 993 S.W.2d 941 (Ky. 1999) (standard for reviewing discretionary writs and abuse of discretion)
- Grange Mut. Ins. Co. v. Trude, 151 S.W.3d 803 (Ky. 2004) (standards for reviewing factual findings and legal conclusions)
- Wal-Mart Stores, Inc. v. Dickinson, 29 S.W.3d 796 (Ky. 2000) (use of extraordinary writs to preserve administration of justice)
- Nixon v. Fitzgerald, 457 U.S. 731 (U.S. 1982) (discussion of constitutional separation principles as applied to branches of government)