AQHA Embryo Transfer Case Revisited

On Friday, Sept. 14, 2001, officials and attorneys for the American Quarter Horse Association were back in court to receive presiding Judge Patrick A. Pirtle's decision on a motion that was filed by AQHA asking the judge to reconsider his summary judgement, which was rendered on Dec. 15, 2000.

The plaintiffs in this case are AQHA Members who allege that AQHA illegally restrains trade under Texas law by the adoption and enforcement of Rule 212(a) that limits for AQHA registration one genetic foal per mare, per calendar year.

The horses that are the subject of the plaintiffs' suit are embryo transfer foals, of which AQHA has registered a sibling during the same foaling year. Also included in the suit are offspring from those embryo transfer foals.

The lawsuit was filed in June of 2000 and initial arguments were heard before Judge Pirtle on October 9 last year. Following those arguments, the judge rendered an interlocutory judgement declaring that Rule 212(a) violated Texas antitrust law, based on summary judgement evidence. Because of that judgement, AQHA was not given trial opportunity to fully develop its record on why the rule is reasonable and is pro competitive.

Last Friday, the judge stated that "AQHA should have had the opportunity for a full review." In a letter to AQHA's attorneys, the judge stated, "This court did, however, err in determining the reasonableness of Rule 212(a) on the basis of summary evidence." AQHA favors a trial so that it can receive a full-scale look at the rule and develop its record on the reasonableness of the rule.

The portion of the judge's ruling that AQHA's rule is not illegal "per se" nor constitutes an alleged group boycott remains unchanged by this latest ruling.

"We are extremely pleased with Judge Pirtle's ruling, which will open the way for a full trial," said AQHA Executive Vice President Bill Brewer. "We believed all along that this case deserved more than the 'quick-look' {a federal restraint of trade term} the judge initially gave it. I do remain tremendously disappointed with the plaintiffs in this case. They have chosen to try and alter AQHA's rules through the court system rather than through the Association's established method of changing rules—a method that has worked for more than 60 years."

It was unclear as to whether or not a trial would occur this year. AQHA will continue to provide information on the facts of this case as they become available.

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