While Thoroughbred racing hoped a Triple Crown winner would help save the sport, it didn't save its owner from bankruptcy.
Ahmed Zayat, owner of 2015 Triple Crown winner American Pharoah, filed for Chapter 7 bankruptcy protection in a United States Bankruptcy Court in his home state of New Jersey on Monday, the Thoroughbred Daily New reported.
According to TDN, Zayat estimated his total number of creditors between 100 and 199 and his liabilities to be between $10 million and $50 million. Zayat estimated his assets to be worth between $1 million and $10 million.
BloodHorse reported that Zayat has assets of $1,892,815 and liabilities of $19,371,466. He also reported monthly expenses of $72,903 compared to income of $13,875.
Chapter 7 bankruptcy allows the clearing of unsecured debts as a form of liquidation.
One of Zayat's lenders filed a $23 million lawsuit against his family's Zayat Stables, LLC in January. The suit is still pending in Kentucky. Among the complaints, the suit alleges that Zayat Stables hid proceeds from breeding rights to American Pharoah, who won the Kentucky Derby, Preakness, Belmont and Breeders' Cup Classic before being retired to Ashford Stud, which obtained his breeding rights. His lifetime earnings were $8,650,300. His stud fee at Ashford was initially put at $200,000.
According to TDN, the bankruptcy filing includes debts of $227,884.17 to trainer Bob Baffert; $194,836.19 to trainer Brad Cox; and $120,921.88 to trainer Mike Maker, among others. Baffert trained American Pharoah for the Zayats.
The filing also states that Zayat owes over $200,000 to veterinary providers, including Hagyard Equine Medical and Rood and Riddle in Lexington.
In January, emergency hearing Judge Kimberly Bunnell granted a motion ordering a receiver to seize control of Zayat Stables, including its horses, as part of the $23 million lawsuit filed by New York investment firm MGG.
In February, MGG amended its lawsuit against Zayat Stables to include Coolmore and Ashford Stud, where American Pharoah stands as a stallion. MGG accused Coolmore and its affiliates of buying seven of nine of American Pharoah's lifetime breeding rights that were part of the collateral on a loan MGG made to Zayat Stables in 2016.
In June, Bunnell granted a summary judgment saying Zayat owed MGG $24,534,166. That ruling is not yet final.
