McGuinty must testify in horse-racing case

Breeders say they were blindsided by 2012 decision to scrap revenue program

Former Ontario premier Dalton McGuinty and his one-time finance minister, Dwight Duncan, must answer questions under oath from a group of horse breeders regarding a controversial 2012 decision to end a slot machine revenue-sharing program with the horse racing industry.

Ontario Superior Court Justice Michael Emery has ordered McGuinty, Duncan and 11 others — including their chiefs of staff, economist Don Drummond and former chair of the Ontario Racing Commission Rod Seiling — to be cross-examined by counsel for the rural plaintiffs who are suing the province and co-defendant Ontario Lottery and Gaming Corp. (OLG) for $65 million.

The breeders allege that powerful individuals had secretly resolved to scrap the slots deal before it was raised at a key cabinet meeting on Feb. 8, 2012. The breeders claim they were blindsided by the decision because, for years, they had been encouraged by the government to keep producing racehorses.

Emery excluded Premier Kathleen Wynne and MPP Ted McMeekin (Ancaster-Dundas-Flamborough-Westdale) from the plaintiffs’ original list of witnesses, citing “parliamentary privilege” as they are sitting members of the legislature, according to Emery’s ruling released Friday.

However, the standardbred breeders emailed a letter Tuesday to both Wynne and McMeekin to request they waive their privilege.

The letter states in part: “We deserve access to justice and trust that your willingness to participate in court cases is not reserved for Liberal insiders and includes rural standardbred horse breeders who live throughout the province.”

The letter references Wynne’s decision to waive her privilege in order to testify at an upcoming trial in Sudbury involving her former chief of staff. Wynne and McMeekin were cabinet ministers in 2012 under McGuinty.

The province and OLG had sought to quash summonses for witnesses, a move challenged by the breeders in a June 19 hearing. The province and OLG deny all allegations of wrongdoing in their statements of defence. Earlier this year, both filed motions to have the case summarily dismissed, a matter scheduled for a November hearing in Guelph. The OLG declined to respond to Emery’s ruling. “As the matter continues to be before the courts, it would not be appropriate to comment,” spokesperson Rui Brum said.

The Ministry of the Attorney General did not respond to a request for comment on the judge’s decision.

The original slots agreement was established in1998 when the Ontario government moved to install gaming machines at 17 racetracks. The province, racetracks and horse breeders in the racing industry shared in the revenues annually.

In March 2012, Duncan — then the finance minister, who was also responsible for OLG — gave the horseracing industry a year’s notice the slots sharing would end. Up to 2013, horse racing’s total share of slots revenue was about $4 billion.

In 2014, the breeders sued Wynne’s government over the “bad faith” decision made in 2012.

One of the central allegations in the breeders’ lawsuit: the five- to sevenyear cycle required to produce a standardbred racehorse from conception to race day. The plaintiffs claim the defendants had long understood the breeding cycle and the timeline’s importance to breeders’ business planning.

Another aspect of the civil action involves the government compensating racetrack owners after the slots deal died — and not those who bred the racing animals.

“Ontario and OLG paid $80.6 million in compensation to those racetrack owners, while refusing to even discuss compensation for the standardbred breeders,” the plaintiffs’ statement of claim alleges.