An Amarillo federal judge on Thursday ordered the American Quarter Horse Association (AQHA) to change its rules to begin registering quarter horse clones and their offspring.
Last month, an Amarillo federal court jury found the AQHA and one of its committees violated two sections of the Sherman Antitrust Act and a Texas law by barring clones from the organization’s registry. Jurors also found the AQHA’s actions harmed the plaintiffs, but the jury awarded no damages.
Rancher Jason Abraham of Canadian and Amarillo veterinarian Gregg Veneklasen sued the 280,000-member organization last year, seeking to overturn the rule. In her ruling Thursday, U.S. District Judge Mary Lou Robinson said the AQHA cannot enforce Rule 227a, which bars cloned horses from the association’s registry. The decision also spelled out a series of rule changes the AQHA will have to make to allow for registration of clones or their offspring produced through a cloning technique called somatic cell nuclear transfer.
Robinson’s ruling said the AQHA’s rule must be amended to provide for parentage verification of foals and that cloned foals shall receive a registration number if DNA testing confirms the horse’s DNA matches the DNA of an already numbered American quarter horse.
The AQHA also cannot discriminate against or exclude clones from any “AQHA sponsored, sanctioned, jointly conducted or affiliated show, competition and/or other equine related event,” according to the judge’s decision.
The judge’s findings of fact and conclusions of law said that the AQHA possessed monopoly power in the market for elite quarter horses and that the association’s “illegal conduct” was a material cause of the plaintiffs’ injuries.
The ruling, however, also allows the AQHA to amend its rules to meet the court’s order.
“In the event that the existing AQHA rules and regulations conflict with this court’s mandated rules allowing registration of cloned quarter horses and their offspring, AQHA may in the regular course of its business adopt or amend such additional rules and regulations as shall be necessary to harmonize the rules imposed by this court with other AQHA rules and regulations,” the ruling said.
The judge’s ruling also said no sum of money would fairly compensate the plaintiffs for damages caused by the AQHA’s actions.
Nancy Stone, one of the plaintiffs’ attorneys, said they were pleased with the judge’s decision.
“She was very careful to draft the judgment so that it would be enforceable. We’re right where we want to be,” she said Thursday.
Officials from the AQHA said they will take further legal action to try and reverse the decision.
“Although the jury’s verdict found that our association’s decision to refuse to register clones and their offspring was in violation of antitrust laws, we strongly believe in the right of our members and our directors to make such registration decisions on their own. We also believe in this case that there has been no violation of antitrust law” said AQHA Executive Vice President Don Treadway. “Therefore, AQHA will continue to take any and all necessary legal steps in seeking to have the final judgment entered by the court in favor of the plaintiffs reversed.”
The association also said it will file a motion for judgment as a matter of law and will ask the court to enter a take-nothing judgment in its favor, based on its claims that the jury’s verdict was not supported by evidence presented at trial. If the court denies the AQHA’s motion, the association said it will file an appeal with the U.S. Fifth Circuit Court of Appeals in New Orleans.
“It is clear from the phone calls, e-mails and posts by our members that they are very disappointed in the verdict” said AQHA President Johne Dobbs. “They continue to be against registering clones and their offspring for a number of reasons, and they object to this verdict as it represents a complete shift away from the sire-dam paradigm upon which all of our rules and processes are based, and which have governed our association for nearly 75 years.”
Treadway also said the AQHA has insurance coverage and will keep its members updated on the case.
“Like many responsible corporations, AQHA proactively carries insurance and has a policy in the present case,” Treadway said.
At trial, the AQHA argued that its registration rule didn’t violate federal and state antitrust laws and that the association should be able to set its own rules much like other private organizations do. After Robinson informed attorneys she planned to rule for the plaintiffs, the association’s attorneys also asked her to limit registration of clones to mares only, an argument Robinson rejected in her ruling.
The plaintiffs’ attorneys argued that the association and key members its Stud Book and Registration Committee, many of whom own elite quarter horses, conspired to keep clones out of the AQHA registry, violating federal and state antitrust laws.
The court’s judgment also ordered the AQHA, the world’s largest equine breed registry, to pay more than $890,000 in attorneys’ fees to the plaintiffs.