American Pharoah’s owner slams trainer’s lawsuit
Owner Ahmed Zayat has issued a statement calling a lawsuit filed on behalf of trainer Mike Maker "absurd" and "outrageous".
The complaint filed by Maker's attorneys on Thursday sues Zayat for breach of contract and fraud and seeks damages including more than $120,000 the trainer says the prominent owner and breeder owes his operation.
Zayat is also being sued in a separate case filed by MGG Group, a New York-based investment firm seeking at least $23 million in damages.
MGG claims that Zayat Stables defaulted on a loan from MGG and has sold assets, including breeding rights to 2015 Triple Crown winner American Pharoah that were being held as collateral against the loan, and that the receivership was necessary to protect its interests in the Zayat holdings.
Maker's lawsuit states that Zayat defaulted on a settlement agreement made in September 2019 to address overdue bills and claims the defendant "knew that its financial situation was untenable and that Zayat Stables was in fact insolvent and unable to pay its creditors, including Maker . . . Defendants had no intention of honouring the settlement agreement, as the defendants had already notified other creditors of their insolvent status and, according to published reports, begun to liquidate assets without notifying creditors."
In a statement released on Saturday by Zayat's legal counsel, the owner refutes the claims.
"This lawsuit from Mike Maker is absurd," the statement read. "Ahmed Zayat made all payments required under his prior settlement with Mr Maker until MGG seized control of Zayat Stables' bank account last month.
“It is outrageous for Mr Maker to cry foul given that he agreed to the terms of the workout, which Mr Zayat has fully honoured in an effort to keep his business afloat and repay each of his creditors. To suggest he's done anything less, and accuse Mr Zayat of fraud, is scurrilous and defamatory.
"Mr Zayat fully expects this lawsuit will be dismissed and intends to seek appropriate sanctions against Mr Maker for pursuing this malicious action."
Maker dismissed Zayat's comments, saying the owner had not paid him for what he was owed, nor kept him abreast of when to expect payment. Maker also said his most recent payment from Zayat Stables was due on 15 January, before Zayat Stables was placed into receivership.
"If he is so honourable, why didn't he call his creditors?" Maker said. "Say, 'Because of this receivership, we have no more (funds) coming out'. That would have been the honourable thing to do. Say, 'Hey, I'm sorry', instead of not contacting someone." – Racingpost.com