Omaha Expo. & Racing v. Nebraska State Gaming Comm.
307 Neb. 172
| Neb. | 2020Background
- Nebraska tracks must deduct portions of wagers for breeder/purse awards under Neb. Rev. Stat. §§ 2-1207(2) and 2-1207.01; HBPA’s bookkeeper historically collected and distributed those funds.
- NTBA requested the Nebraska State Racing Commission (Commission) to designate NTBA (and its bookkeeper) as custodian and require racetracks to pay future and accumulated deducted funds to NTBA.
- After hearings, the Commission ordered HBPA’s held funds transferred to NTBA and required future deducted funds be paid to NTBA.
- Omaha Exposition & Racing (OER) filed a petition for judicial review in district court but did not serve NTBA or the Commission (through the Attorney General) with summons within 30 days as required by the Administrative Procedure Act (APA).
- The district court reversed and vacated the Commission’s order on the merits. The Nebraska Supreme Court held the district court lacked subject matter jurisdiction because of insufficient service, vacated the district court’s order as void, and dismissed the appeal without reaching the merits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether district court acquired subject matter jurisdiction under the APA when petitioner failed to timely serve all parties of record (NTBA and Commission via AG). | OER: service defects are not jurisdictional; NTBA and Commission entered appearances so service requirement waived. | Appellants (NTBA/Fonner Park/etc.): service within 30 days is mandatory for subject matter jurisdiction under § 84-917; appearances do not cure lack of statutorily required service. | Service of parties of record (including agency via AG where agency is a party) is a subject matter jurisdictional requirement; failure to timely serve NTBA and the Commission deprived the district court of jurisdiction. |
| Whether the Commission was a "party of record" (i.e., acted beyond a neutral factfinder) such that summons must be served on the AG. | OER/appellees: Commission acted as neutral factfinder; only hearings were held, so ordinary service-copy sufficed. | Appellants: Commission exercised regulatory/licensing/enforcement functions in approving a custodian/bookkeeper, so it acted beyond neutral factfinder and was a party of record. | The Commission acted beyond a neutral factfinder (licensing, oversight, fraud-prevention functions) and thus was a party of record; summons to AG within 30 days was required. |
| Whether NTBA’s filing of an answer within 30 days cured the lack of service. | OER: NTBA voluntarily appeared by filing an answer, which is effectively service/waiver. | Appellants: Subject matter jurisdiction cannot be waived by appearance; statutory service requirement is mandatory. | A party’s appearance does not confer or cure lack of subject matter jurisdiction; timely service is mandatory. |
| Whether the district court reached and correctly decided merits (Commission authority to appoint custodian / use of funds). | OER: Commission exceeded authority; funds must be used at generating track per statute. | NTBA/Commission: Commission had authority to ensure proper custody and distribution to prevent misappropriation. | Court did not decide merits: vacated district court order as void for lack of jurisdiction and declined to rule on Commission’s authority or on substantive issues. |
Key Cases Cited
- Concordia Teachers College v. Neb. Dept. of Labor, 252 Neb. 504 (1997) (APA requires timely service of all parties of record for district court jurisdiction)
- Candyland, LLC v. Nebraska Liquor Control Comm., 306 Neb. 169 (2020) (reiterates Concordia rule on service and jurisdiction under APA)
- J.S. v. Grand Island Public Schools, 297 Neb. 347 (2017) (service/appearance issues treated as jurisdictional in APA context)
- Shaffer v. Nebraska Dept. of Health & Human Servs., 289 Neb. 740 (2014) (agency acts beyond neutral factfinder when exercising regulatory/administrative oversight)
- McDougle v. State ex rel. Bruning, 289 Neb. 19 (2014) (agency enforcement/licensing functions make it more than neutral factfinder)
- Metropolitan Util. Dist. v. Aquila, Inc., 271 Neb. 454 (2006) (contrasting example where agency was not a party of record because statute limited agency’s role)
- Anthony K. v. State, 289 Neb. 523 (2014) (discusses purpose of service statutes and notice to state agencies)
- Francisco v. Gonzalez, 301 Neb. 1045 (2019) (court may vacate void district court orders when appellate jurisdiction lacking)