Archive for June, 2008

The other day I received an e-mail from a young lady, 18 years old, commenting on an article I had written for ESPN.com in the wake of Big Brown’s defeat in the Belmont Stakes. The passion with which she wrote about the sport reminded me that racing always has and always will have tremendous appeal because of one thing: the horse. As long as the people in racing don’t completely mess things up, there is still hope for racing. The young lady, Emily Patton, said it would be OK to share her email with readers of the Paulick Report:

I just finished reading your article on ESPN.com, and sincerely enjoyed it.

I am an 18 year old girl who fell in love with horse racing as a 12-year-old: a 12-year-old girl falling in love with a sport that attracts many with serious addictions, involving smoking, gambling, and drinking.

I would race to the television to watch Bob Baffert’s horses, watching Real Quiet and Silver Charm race for the crown. I cannot tell you how upset my parents were as I begged them to please, please let me go watch the races. When Smarty Jones came around in 2004, I was sold. I had hit rock bottom. I was in love with a horse.

My parents couldn’t deny it, buying me Blood-Horse after Blood-Horse that had Smarty on the cover.

I plainly want to say, your article is the absolute truth. Every year I choose a Derby horse. I pick it early, around February, and see if “my” horse can do it. I slowly become attached, and by the time they are driving down the stretch at Churchill, I am on my feet, screaming.

I pick a horse who can handle the distance. I like closers, I don’t like horses that go to the lead. I like Kentucky breds. I like a horse with non-corporate owners. And the list continues… I didn’t pull for Big Brown this year, well prior to the Derby at least.

I was alive one month before Secretariat passed away, about ten years before Seattle Slew went, and my gosh, I cannot tell you how I would have loved to be around for the 12th triple crown winner to parade in front of me. I thought, “For once, a team is doing it the right way with a horse in the Triple Crown: racing him lightly before, not running too huge in the Preakness…”

I was getting excited. I even called a sports radio station the morning of the Belmont, excited, talking about how he would do it. I convinced myself that the Sport of Kings, would be that again. I don’t know how I fell in love with horse-racing. I don’t know why as a young teenage girl I found it more appealing to memorize all the Derby winners instead of chase boys around. I don’t know.

Big Brown did what he could.

Thank you for the enjoyment.

–Emily Patton

Let’s hope there are a lot more Emily Pattons out there, young people who bring such passion to our great sport.

Have you ever been to one of those business meetings where the boss calls his managers together and “wants feedback” on an idea that, it’s clear to see, he has already decided to put into play? That’s what Thursday’s Congressional hearing, entitled “Breeding, Drugs, and Breakdowns: The State of Thoroughbred Horseracing and the Welfare of the Thoroughbred,” was all about.

The members of the subcommittee on commerce, trade and consumer protection weren’t at all interested in getting feedback from a broad mix of Thoroughbred industry participants. If they were, they would have invited track owners, jockeys and someone representing the Racing Medication and Testing Consortium to testify.

Most glaring, however, was the absence of any racing fans and horseplayers — the people who fuel the entire multi-billionaire-dollar industry with their bets. They would have had plenty to say. Where were all the fans?

Thursday’s hearing was all about reinforcing the predetermined opinion by some - if not all - of the subcommittee members that racing and breeding is in dire need of some form of federal intervention. It was a two-act play, masterfully choreographed by acting chairwoman Jan Schakowsky of Illinois and ranking Republican Ed Whitfield of Kentucky, who tipped their hand that they will try and amend the Interstate Horseracing Act to employ guidelines that could radically change how the sport is regulated and conducted.

Many of racing’s numerous flaws were exposed during the three-hour hearing, which came to an abrupt end when the members were called to the floor of the House of Representatives for a vote. The happiest man in the room when that happened was National Thoroughbred Racing Association CEO Alex Waldrop, the last of a dozen speakers providing testimony. House members were interrupted just before a question and answer session got under way in which Waldrop was likely going to be grilled.

In short order, those problems are:

- Drugs have contributed to a decline of the Thoroughbred breed and Thoroughbred racing

- Research, drug testing programs and horse rescue/retraining efforts are severely underfunded

- The lack of a central authority or national regulatory standards, and the existence of state-by-state regulations, have led to dysfunction

- Existing industry organizations and perceived industry leaders have failed miserably to address the problems successfully

Allowing Congress to interfere with any industry is a frightening thought, given some of the pointless and idiotic questions directed at the two panels. For example, if one of the Congressman had his way, inbreeding would be banned. What’s next, nicking? However, doing nothing under the present industry leadership is the greatest risk we can take.

The uninformed comment about inbreeding was far from being the most outrageous aspect of Thursday’s hearing. It was the complete absence, both in body and spirit, of the racing fan and horseplayer. To my knowledge there was only one mention of fans (by Waldrop, in response to a question) throughout the day, as if they didn’t exist. Let’s not forget that the word “consumer” is part of this subcommittee’s name.

Shame on the committee for not including racing’s ultimate consumers who fuel the industry’s revenue engine.

The NTRA is attempting to put together a coalition of horseplayers, but the NTRA’s track record is not exactly inspiring on many levels. But before we bludgeon that 10-year-old organization to death, it should be pointed out that divisiveness, lack of trust and reticence from other alphabet groups (TOBA, TJC, HBPA, THA, TOC, AAEP, RCI, TRA et al) to give up control emasculated the NTRA and prevented it from having the national oversight and major league commission office status it was designed to have.

Jockey Club CEO Alan Marzelli was pressed hardest by House members and ultimately came out looking the worst of all the industry experts during the hearing. When asked what authority the Jockey Club has to ban steroids and enact other recommendations of its safety committee, Marzelli said it has the “power of persuasion.” It was a pitiful and embarrassing moment for the industry, or a bad attempt by Marzelli to imitate Don Corleone of The Godfather.

The Jockey Club’s same power of persuasion has been ineffective on getting a national license for racehorse owners. If that power of persuasion was so strong, a national owner’s license would have happened 20 years ago when the Jockey Club created an ownership registry, which could have been a first step toward that goal. That boat never left the dock. Instead, we have a patchwork system of state licensing that is a poster child for the industry’s complete and total dysfunction when it comes to regulatory oversight. Look at the situation involving Curlin’s minority owners, the Midnight Cry Stable. Their horse, Einstein, couldn’t run in New York on Belmont Stakes Day because of licensing problems, but could run at Churchill Downs a week later because Kentucky has different licensing rules.

If the Jockey Club’s power of persuasion isn’t strong enough to get something as simple as a national owner’s license accomplished, how can we count on the same failed leaders to persuade 38 state agencies to uniformly ban steroids and enact other necessary change to move the sport forward?

By Ray Paulick

Copyright ©2008, The Paulick Report

The Paulick Report will be blogging live from Thursday’s hearing on horse racing from Washington, D.C.

9:45…The guests begin to assemble for the hearing on “Breeding, Drugs, and Breakdowns: the State of Thoroughbred Horseracing and the Welfare of the Thoroughbred,” and Christian Fjeld, staff counsel for the subcommitee on commerce, trade and consumer protection, doesn’t seem very happy about Rick (no show) Dutrow. “We havent heard from him, so we are still expecting to see him here, Fjeld said. “His chair and name placard will be here unless we here from him before the hearing starts.” Fjeld said it is “unusual” for someone not to call the committee to say they are unable to attend.

“Unusual?” That’s a good way to describe Mr. Dutrow.

9:50…Debbye Turner, correspondent for the CBS Evening News, is here to put the finishing touches on a piece she has been working on about Jess Jackson and the horse racing industry. She said it will air tonight. TV people sure look a lot better than print folks. She’s seated next to me and Joe Drape of the NY Times, which could make anyone look good.

9:55…The room is filling up quickly. Heavy press attendance and horse racing folks who are not testifying, including Roy Jackson, who raced Barbaro with wife Gretchen.

10:07…Meeting called to order by Democratic Rep. Jan Schakowsky of Illinois. She acknowledges subcommittee chairman Bobby Rush of Illinois (yes, the former Black Panther, but that is sooo yesterday), who is recovering from a serious health issue. She then reads an opening statement that charges horses racing are “doped with cocaine, caffeine and anabolic steroids.” A breeding expert apparently, she goes on to talk about how Eight Belles was inbred too much to unsound horses. Someone on her staff must be a Bill Nack fan. Nack wrote a piece critical of the pedigree of Eight Belles, who died in the Kentucky Derby, being inbred to Native Dancer. “It has become almost impossible to tell what their natural condition is (because of doping).” Oh, brother, this is going to be a long day. “What’s going on here?” she asks. Hey, that’s not fair to use that slogan. The Blood-Horse editorial page owns that. “Work with us to clean up your sport,” she says.

10:12…Next up is Rep. Ed Whitfield of Kentucky, the ranking Republican of the subcommittee. He cites three primary problems. “Our horses race more on drug induced ability than on natural ability,” Whitfield says. Second problem, he said, “is a lack of transparency.” Third issue “is a lack of an authority to make decisions and enforce rules and regulations. There is not any one entity that can enforce regulations.”

10:15…In fairness to No Show Dutrow, Joe Drape leaned over and said, “They lie,” in reference to politicians. What? OMG. “I know for a fact Dutrow called Whitfield’s office,” he said. Sorry, Rick. You’re absence is excused as far as I’m concerned.

10:10…Rep. Cliff Stearns of Florida talked about his home region in Ocala, Fla., then shifted to Eight Belles. “Was this a freak accident with Eight Belles?” He said he doesn’t want the federal government to run horse racing. “I don’t want you to work with us. I want you to work without us,” he said. Stearns talked about “rainers who give their horses cocaine and all they get is a slap on the wrist. Stearns said horses are committing suicide. I wonder, do they have mental problems, too, in addition to their physical weakness?

10:25…Rep. Lee Terry of Nebraska saluted Jack Van Berg, the Hall of Fame trainer who will be testifying later. Terry said he worked at Ak-sar-ben (hey, that’s Nebraska spelled backwards!) during college and the Van Berg name was huge back then. Wonder if the good Congressman knows Ak-sar-ben is toast.

10:30…After all the opening statements by congressman are finished, acting chairman Schakowsky states, “This hearing is completely bipartisan.” That could be a first in this town.

10:35…Schakowsky slaps Dutrow a hard one. “Disappointed” by his absence, she says. Lot of chuckles from the audience when she says she hopes, after he feels better, Dutrow will join the efforts to clean up the sport. Now I am conflicted. Who should I believe: Joe Drape or a politician?

10:37…Alan Marzelli of the Jockey Club is the leadoff hitter. Says he is “grateful” to be here. Anyone have a lie detector machine around here? A look around the room shows it is standing room only. “The thoroughbred safety committee’s work has just begun,” Marzelli says, after outlining the recommended changes the committee announced Tuesday. Marzelli said he is “confident” that 2008 will be the last year anabolic steroids are used in horses for racing or training.

10:43…Richard Shapiro, chairman of the California Horse Racing Board gets off a good line: “We used to have twice the horses and half the vets. Today we have twice the vets and half the horses.” Is “pharmacopia” a word? Shapiro used it to describe the prevalence of medication in racing today. He cites clenbuterol as an example of a drug that is misused. “It was intended for cattle,” he said.

10:46…Shapiro cut off by the chairman…”You have one minute left.” He reads faster! Shapiro wants a national racing charter with one set of rules for all. He is against a national regulatory body, but wants a national racing commission. Not sure I understand the difference.

10:50…Van Berg not happy with the status quo. He needs horses, and he should tell the chairwoman that Alysheba isn’t dead (unless she knows something we don’t…thanks for the comment and the heads up Alicia)

10:53…Randy Moss is g-oo-oo-oo-d. He should be on TV, he is so Randy. Great inflections and solid commentary. He talks about how U.S. racing’s emphasis on drugs has hurt the sport, then slowly says: “This…must…change.”

Moss for racing commissioner. Seriously.

10:56…Arthur Hancock has a tough act to follow, but his folksy Kentucky accent should go over well. “No one’s in charge,” said Arthur. We’ve heard this over and over, and it’s been Arthur’s mantra for many years. Will this change things? “Chemical horses make chemical babies,” he said, discussing drugs. Great story about the cat and mice. Finishes on a nice touch, quoting Winston Churchill with a twang.

11:03…Jess Jackson trumps Arthur Hancock! “I’m an eighth-generation horseman,” he proclaims. Arthur, the poor sap, is only a fourth generation horseman. And Jackson said he saw Seabiscuit…the horse…not the movie! I heard the movie was better than the horse. But the book was better than both. But seriously. Drugs? “Ban them,” he says. Jackson also wants more disciplinary measures taken against veterinarians. David Foley, executive director of the American Association of Equine Practitioners looks sternly in Jackson’s direction and whispers something to veterinarian Wayne McIlwraith, who speaks on the second panel. Jackson wants a national owner’s organization and said two words should be changed in the Interstate Horseracing Act to accommodate a national owners’ organization to negotiate with the tracks. I’m afraid Jackson is going to get the gong from the chair if he doesn’t wrap it up.

11:10…Question time from the chair. Do you believe in a national body? Yes or no? All say yes (but Marzelli says “industry” not “government”). Mixed responses about the federal government regulating drugs: Marzelli was a clear “no,” but the others say yes, some with conditions. Should all drugs be eliminated? Yes, all around. This should be easy, then, right? She’s onto Marzelli’s confidence about swiftly changing the drug rules nationally. Why? “I’m an optimist at heart,” Marzelli said. “We certainly make it difficult on ourselves.” Now he is patting himself on the back about creating Equibase…there’s a smokescreen if I ever saw one to avoid a very good question.

11:16…Whitfield aims at Marzelli, too, about the powerless of the Jockey Club to get its recommendations adopted. “What power do you have?” he asked. “We have the power of persuasion and consensus building,” Marzelli said, in a very low tone. “I would like to see the industry regulate itself.”

11:23…”The Jockey Club is a fiefdom!” Jackson says in response to a comment from Marzelli. Much laughter from the audience. Congress wants to enforce rules against inbreeding or wants the Jockey Club to do that? Marzelli is against these “selective and arbitrary measures.”

11:28…”The army needs a general,” Hancock says, in reference to a change in the Interstate Horseracing Act putting owners in charge of simulcast contracts.

11:30…Voting break.

What he would have said. Dutrow’s written testimony:

When I was contacted by one of your staffers and asked to speak here today I agreed because I wanted to share my insights and points of view on some of these issues and I hope that I can be helpful here.

I also hope that I was not asked to be here because of some of the problems I have had in the past. I hope your staff people were sincere in inviting me because they valued my insight. I want to be part of the solution and not part of the problem.

I also ask for your patience today. I’m not always the best at explaining things. I’ve been taking care of horses all my life. I dropped out of high school more than 30 years ago to take care of horses and sometimes I think I do better with horses than with people.

As you may know, I am the trainer for Big Brown, the very talented horse who won the Kentucky Derby and the Preakness this year. Despite my best efforts and those of the team of people around him, he did not win the Belmont Stakes but that’s horseracing. Big Brown is healthy and our plan right now is to keep him racing this summer and fall.

In addition to Big Brown, I am responsible for approximately 150 horses at any one time – 110 in active training and 40-50 at various farms getting ready to race. My operation has about 75 people, including grooms, stable hands, exercise riders, blacksmiths and vets, who care for our horse on a daily basis.

While some people’s focus is on the big days, we care about our horses and keeping them safe 365 days a year. Taking care of horses is a way of life for us. Our horses get the best care we can give them. They are gifted athletes and are trained to give their best performance when they run.

During the Triple Crown, I was asked several questions about my past and I expect those will come up today so let me address them.

My barn has been penalized in the past for medication violations. I was suspended and fined five years ago when traces of a prohibited substance, mepivicaine, turned up in a test for one of my horses. I said then that we don’t use it and I don’t know how it happened.

We have also had violations when legal, permitted, therapeutic medications have shown up in race day tests because they were given to the horse too close to the race. That’s something that many trainers in the country have had to deal with. But I take responsibility for the condition of my horses.

During the Triple Crown I told the media that my horses are given Winstrol on the 15th of each month. This is an FDA approved medication and is within the current rules of racing in most states. It is something we started a few years ago at the recommendation of one of our vets.

People have asked me why I do it. My observation is that it helps the horses eat better. Their coats brighten. They’re more alert. It helps them train. Having said that, our barn has won hundreds of races with horses that weren’t on steroids. Earlier this winter, I won two one million dollar races in Dubai, where steroids are prohibited. If steroids are banned in the United States, we’ll stop using them.

I also said that I’m not qualified to speak to the science of it. For that, I would suggest that you talk to the vets and scientific experts.

Thank you.

12:05…During the break, Congressman Whitfield’s wife, Connie, has subcommittee staff counsel Fjeld cornered. She, of course, is the vice chair of the Kentucky Horse Racing Authority accused recently by Kentucky State Sen. Damon Thayer of having a conflict of interest.

Interesting observation about the first panel from a Washington insider: “Well, they got that one set up just like they wanted.” In other words, the subcommittee is pushing for national oversight, and with the exception of Marzelli, all the witnesses said some form of national oversight is necessary.

12:25…Having some technical issues (hey, the Internet’s still new, right?).
During some lively (?) questioning from the chair, Arthur Hancock says the veterinarians are getting rich giving all those drugs to horses. Bet Arthur wishes he would have studied harder at Vanderbilt and gone to vet school. Foley and McIlwraith of the AAEP simultaneously lean forward with increased interest.

Moss makes a good comment in response to a question from Whitfield about why people don’t want a national authority. “Fear,” Moss says, “fear of lack of control.”

Van Berg sounds bitter talking about these “young guys” who come onto the racetrack and want to win and will do anything to win. “The veterinarians are mostly training the horses now,” he says. “If you don’t know what’s wrong with the horse yourself, you shouldn’t have a trainer’s license.”

12:36…Hancock was asked why the various organizations can’t work together, and whether any one organization is worse than others. He said no one was worse than others. “Ego has a lot to do with it,” Hancock said. “They all envision themselves as the saviors of racing. They have their own CEO. It’s some good people trying to pull a wagon, but they’re all pullin’ in different directions.

12:43…Whitfield asks Marzelli if the Jockey Club gives money to organizations that rescue or retrain Thoroughbreds for careers after racing. Like a good politician, Marzelli avoids the direct question, talking about the Jockey Club Foundation for human charities and the Grayson-Jockey Club Research Foundation that funds research on horse health issues. Whitfield repeats the question. Marzelli responds: “We believe every owner is responsible for their horse.” In other words, the Jockey Club does not support horse rescue/retraining operations. At least the Jockey Club is opposed to slaughtering horses, according to Marzelli…and probably babies, too.

12:48…Second panel, mostly veterinarians reviewing research, so for the next 45 minutes or so I’m going to do all I can to stay awakezzzzzzzzzzzzzzzzzzz.

12:54….Rep. Pitts of Pennsylvania stifles a series of yawns during Dr. Stover’s testimony reviewing statistics on fatalities at California racetracks over the past 25 years. Whitfield learns forward and does that squinty thing with his eyes, suggesting he is trying very hard to understand all this data flowing his way. Nowhere near the fireworks of panel one. But wait till Alex Waldrop is up and the subcommittee members turn on him.

1:00…Wayne McIlwraith takes the mike. He is one of the best veterinarians in the business and has probably presented research thousands of times during his distinguished career. If every practitioner at the racetrack had his ethics and knowledge, we wouldn’t be in such a mess.

Incidentally, for those who want to read the testimony of the veterinary panel and the previous panel, their written statements will be posted on the subcommittee’s web site later today: http://energycommerce.house.gov/Subcommittees/ctcp.shtml

1:10…Dr. Mary Scollay is reading too fast for me to comprehend at this stage, but I think she must have had some Jockey Club Kool-Aid during the break. She said “Jockey Club” a whole lotta times during her review of the research she’s been involved with.

1:12….Allie Conrad has a lot of passion for what she does at CANTER Mid Atlantic, and the subcommittee members seem to paying far more attention to her than to the previous veterinary presenters. Perhaps it’s because she is talking in layman’s terms, or maybe because she is “on message” with what the subcommittee wants to hear. In talking about some of the horses she ends up with at CANTER, she said: “These horses weren’t injured from a freak accident or a tragic misstep. They were injured over time with the assistance of trainers, owners, and veterinarians — all who shoud have put the horse’s welfare as a higher priority. … Racing is not bothering to take care of its own horses, and are allowing the public — often not even racing fans — to take care of the problems.” Powerful stuff and effective with the committee members, I’ll bet.

1:18…Here comes who I bet will be the day’s whipping boy, NTRA’s Alex Waldrop, who proudly said his organization is a “consensus builder.” Alex sounds defensive already, like he knows what’s coming during the Q&A session later. Maybe he can be saved by the bell (when the members have to go vote.)

1:21…Waldrop is almost shouting now. “This industry is no longer a rudderless ship.” Take that Arthur Hancock! “The last thing this industry needs is yet another layer of regulation.”

1:26…Brief question session because of an upcoming vote. Whitfield doesn’t ask a question of Waldrop but makes a statement to him: “I don’t think it’s unreasonable for the government to set minimum standards. I think the first panel displayed very clearly that there are serious problems within the industry.”

1:30…Who’s to blame, one Congressman asks, for the drug problems in racing? The consensus answer from the panel: “everyone.”

1:32…Hearing adjourned abruptly for a vote. Alex Waldrop walks away and mutters, “Saved by the bell.” Wonder if he’s been reading my blog?

Line of the day from Jack Van Berg when asked what it’s like to train horses today: “It’s chemical warfare out there?”

That is all for now….

Copyright ©2008, The Paulick Report

A spokesman for the New York State Racing and Wagering Board said Wednesday that 2007 Horse of the Year Curlin would not be allowed to race in New York until all of his owners are licensed in the state. The license for one of the partners in the Midnight Cry Stable that owns 20% of Curlin, jailed attorney Shirley Cunningham, expired last August. Cunningham has been in custody since August while being tried on charges of conspiracy to commit wire fraud in a case involving a class-action lawsuit over a diet drug. One of the other defendents in the case is William Gallion, another partner in Midnight Cry.

The case is expected to go to the jury on Friday.

The licensing issue came to light days before the Belmont Stakes, when Einstein, one of the top runners in the grass division this year, was pointed for the Manhattan Handicap on the Belmont undercard June 7. The New York board told Einstein’s connections Cunningham’s license had expired and that the horse would not be able to enter the race. Andre Regard, attorney for Midnight Cry, said efforts were made to renew Cunningham’s license in New York but was told by an attorney representing the New York board the application would be denied “in the best interests of racing.”

The application was withdrawn, because an official denial by the board would have jeopardized the horse from running in states with licensing reciprocity rules. Einstein ran one week later on the dirt, finishing second to Curlin in the Stephen Foster at Churchill Downs. Cunningham is still licensed in Kentucky.

Under the current circumstances, Curlin would be denied entry in any race in New York, according to Dan Toomey, a spokesperson for the New York board. In his last start in New York, Curlin won the Jockey Club Gold Cup Sept. 30, more than a month after Cunningham’s license had expired.

Another horse in the race, Proudinsky, is owned by Gary Tanaka, who has been under house arrest in New York since 2005 after being arrested on charges of securities fraud with his partner in Amerindo Investment Advisors, Alberto Vilar.

The Manhattan was won by the Phipps Stable’s Dancing Forever, who was beaten a neck by Einstein in the Gulfstream Park Turf earlier this year.

By Ray Paulick

Copyright ©2008, The Paulick Report

The fight for control of the Breeders’ Cup began in earnest in January 2006, shortly after the organization’s board of directors ratified a change in bylaws that would end its self-perpetuating nature and give anyone who nominates a foal or stallion to the program the opportunity to vote in an annual election.

The battle is ongoing, as witnessed by the 21 candidates seeking 12 positions on the 48-person board of members and trustees. Ballots were recently sent to nominators, who will have the option this year for the first time to vote via a secured web site. Results will be announced in July, after which a meeting of the new board of members and trustees will be held to vote for seven of the 14 positions on the board of directors, the group that makes most of the key operational decisions for the Breeders’ Cup.

Until the 2006 change in governance, the Breeders’ Cup had been tightly controlled by an executive committee consisting of a handful of Jockey Club members who stockpiled approximately $40 million in cash reserves but made precious few changes or enhancements since the championship event’s inaugural running in 1984. Thoroughbred breeders unhappy with the event’s status quo and with the Breeders’ Cup’s expensive alliance with the National Thoroughbred Racing Association saw the change in bylaws as an opportunity to bring in new blood and new ideas to the organization in an effort to stimulate growth and interest. Many from the old guard saw it as a threat to their long-established rule.

It became a classic battle of the new guard vs. the establishment. In some cases it was new money, self-made millionaires, against a wealthy group populated with members of what investment wizard Warren Buffett calls the “lucky sperm club.”

The contrast of the two groups is best exemplified by a pair of New Yorkers who are worlds apart in background but share a passion for Thoroughbred racing: Dinny Phipps and Bobby Flay.

Phipps, chairman of the Jockey Club and born into the wealthiest of old-money New York families, is a current trustee and member of the Breeders’ Cup. Until he was voted off the smaller Breeders’ Cup board of directors last July, Phipps was considered one of the most powerful figures in racing.

Flay, seeking election for the first time as a Breeders’ Cup member and trustee, is a high-school dropout who worked his way up from salad maker at a New York restaurant to become a master chef, restaurateur, television celebrity and highly successful businessman.

Phipps is the leader of the racing establishment’s inner circle that has held control over numerous organizations and initiatives. Flay has close ties to Thoroughbred Daily News Publisher Barry Weisbord, one of the industry’s most progressive thinkers but considered by some in the establishment as a thorn in the side.

The primary role for members of the large board that Flay seeks to join is to elect individuals to serve on the 14-member board of directors. There has been intense lobbying, politicking and deal-making among people seeking positions on that small board, beginning with the first election in January 2006, when two separate slates of candidates were circulated.

One slate was pushed by WinStar Farm’s Bill Casner (also the chairman of the Thoroughbred Owners and Breeders Association) and the other by Lane’s End Farm’s Bill Farish, the son of Jockey Club vice chairman Will Farish (the younger Farish is the son-in-law of Phipps). Among other things, Casner’s group was not happy with the Breeders’ Cup operating agreement and relationship with the NTRA and sought more transparency and accountability for the money spent by the Breeders’ Cup on administrative expenses. He and his allies also pushed for the 2006 Breeders’ Cup championship purses to be increased to $20 million.

The Farish slate was victorious, though not overwhelmingly. Six of the board members were establishment figures who were members of the Jockey Club. Farish was elected board chairman and Robert Clay of Three Chimneys Farm as vice chairman. It was Farish’s father who served for many years as chairman of the Breeders’ Cup executive committee that made most of the major decisions for the organization.

Nevertheless, enough critics of the status quo were elected to bring about some of the changes Casner sought. In May 2006, the new Breeders’ Cup board voted to approve $20 million for that year’s championship day purses, and in August the Breeders’ Cup terminated its operating agreement with the NTRA. The new board also reached an agreement with longtime executive D.G. Van Clief Jr. to step down as Breeders’ Cup president. He was replaced by Greg Avioli, an attorney who previously held key positions at the NTRA.

Lobbying, politicking and deal-making has not been limited to the small-board election. Nominators to the Breeders’ Cup program vote for the larger board using a formula of one vote for each $500 they spend on stallion or foal nominations. A farm with $500,000 in annual stud fees gets 1,000 votes, so it quickly became apparent that the largest stallion farms, including Coolmore, Darley, Lane’s End, WinStar, Taylor Made, Three Chimneys, and Gainesway had the most power in electing individuals to the large board of members and trustees. Alliances have been formed among some of the farms to support specific candidates.

Sources said a number of the people elected to the large board have not bothered to attend any of the annual meetings, when members of the smaller board are elected. Instead, they send in proxies to a trusted ally.

According to several board members, Bill Farish has controlled more voting proxies than all of the other members and trustees combined. One current board member (not on this year’s ballot), who spoke on condition of anonymity, was critical of three of the people running for re-election this year: Joseph Shields, Leverett Miller and Maria Niarchos-Gouaze. “I’ve never seen either Joe Shields or Leverett Miller at a meeting,” the board member said. “Frankly, I have no idea who they are, what level of investment they have in the game, why they are on the Breeders’ Cup board of trustees, or why they are running for re-election. Maria Niarchos (Niarchos-Gouaze) is strictly a proxy vote for Bill Farish. Never, to my knowledge, has she been to one meeting in all the years she’s been on the board.”

(For the record, Shields is an investment banker and an owner-breeder who served as co-chairman of the board of the New York Racing Association prior to the federal indictments and bankruptcy proceedings. Miller formerly owned and operated T-Square Stud in Florida, where Shields’ horses have been boarded. Niarchos-Gouaze took over her family’s Thoroughbred operation after the death of her father, Greek shipping magnate Stavros Niarchos. Her horses are boarded at Lane’s End.)

“There is no question that guys like like Lev Miller and Joe Shields are good for votes for the old establishment,” said one of this year’s candidates. “It concerns me that the person with the most muscle tries to stack the board to have their philosophy represented. Doing that loses any free-thinking. How much free or creative thinking can there be if there is just one faction combating another faction.

“There was a lot of politicking last time,” he continued. “The way it’s heavily weighted, the factions know where they have to go to get the votes – the major stallion farms. In the last election, Bill Farish came to me and said here are the candidates I hope you’ll vote for. There’s no slate circulating this time, at least to my knowledge, and I haven’t heard from Bill. Maybe he thinks he’s got it under control and doesn’t need any more votes.”

Following last year’s election of the members and trustees, there was controversy involving Terry Finley, the head of West Point Thoroughbreds. Finley, previously a member of both the small and large boards, did not receive enough votes in the June 2007 election to remain on the large board. It was expected he would have to resign from the smaller board, since membership on the larger board is a requirement.

During the July 2007 meeting of the members and trustees, however, it was decided that Finley could remain on the small board for the duration of his two-year term, which expires this year. In a press release announcing the 2008 member and trustee candidates, the Breeders’ Cup said Finley was running for reelection to the large board—even though he was voted off last year.

Here are the 21 individuals running for the 12 spots on the board of members and trustees:

Helen Alexander–Middlebrook Farm
Doug Cauthen–WinStar Farm
Robert N. Clay–Three Chimneys Farm
Robert Cromartie–Briggs & Cromartie Bloodstock Agency
Bill Farish, Jr.–Lane’s End Farm
Terrence P. Finley–West Point Thoroughbreds, Inc.
Bobby Flay —B Flay Thoroughbreds, Inc.
Lucy Young Hamilton–Overbrook Farm
Arnold Kirkpatrick–Kirkpatrick & Co.
Allan G. Lavin, Jr. –Longfield Farm
James McAlpine–McAlpine Thoroughbreds
Leverett S. Miller –T-Square Stud
Maria Niarchos-Gouaze–Poseidon Services Inc.
Charles Nuckols III–Nuckols Farm
Bill Oppenheim–Bloodstock consultant
Don M. Robinson–Winter Quarter Farm
J.V. Shields, Jr. –Shields & Company
Mark Taylor–Taylor Made Farm
Ric Waldman–Overbrook Farm
Charlotte Weber–Live Oak Stud
Barry Weisbord –Media Vista

Editor’s note: The original version of this article incorrected stated Leverett Miller owns and operates T-Square Stud in Florida. Miller sold the major portion of that farm in December 2006.

Copyright ©2008, The Paulick Report

It took centuries for the people of Iraq to experience the joys of voting in a democratic election. Thoroughbred breeders only had to wait 25 years.

For over two decades since its inception in 1982 as the brainchild of the late John Gaines, Breeders’ Cup Ltd. had been run under the cloak of darkness, or as Canadian breeder Frank Stronach said, as a “club.” There was an unwieldy, self-perpetuating board numbering 48 individuals and numerous committees dominated by members of the Jockey Club. For most of its 25 years, however, the Breeders’ Cup was controlled by a small executive committee headed by Will Farish, the vice chairman of the Jockey Club, and later by G. Watts Humphrey Jr., a partner in many of Farish’s breeding ventures at Lane’s End Farm and a Jockey Club insider. Meetings of the large board were seen by some board members as nothing more than a good opportunity to catch up on industry gossip, doze and rubber stamp decisions of the executive committee.

Control fell into the hands of the Jockey Club hierarchy at the outset of the Breeders’ Cup when then-powerful Claiborne Farm at first resisted the idea of nominating its stallions to the program, a move that would have prevented it from leaving the starting gate. Gaines, who was never a member of the Jockey Club and often referred sarcastically to its poo-bahs as the “self-appointed guardians of the Turf,” agreed to remove himself from any management role in order to end the acrimony with Claiborne. The farm’s president, Seth Hancock, had very close ties to the Jockey Club’s ruling family, the late Ogden Phipps and son Dinny.

A decision by Farish and Humphrey to reach into the rich coffers of the Breeders’ Cup (estimated conservatively then at $40 million) and provide financial assistance to the fledgling National Thoroughbred Racing Association through a joint operating agreement in 2001 rankled many breeders, who had built the program from scratch with annual foal nominations of $500 and annual stallion nominations equal to a horse’s stud fee. Those breeders had grave concerns over how their money was being spent. Breeders’ Cup purses were being outpaced by a growing number of international races, and under Farish’s leadership (and Breeders’ Cup executives Ted Bassett and D.G. Van Clief Jr., both Jockey Club members) the original seven race program that began in 1984 was unchanged until the addition in 1999 of the Filly & Mare Turf.

Many breeders did not see or understand the merit of propping up the NTRA, an organization formed in 1998 after Dinny Phipps derailed another initiative pushed by Gaines, the owner-driven National Thoroughbred Association, morphing that into a hybrid vehicle driven by a combination of owners, breeders and racetrack executives who could never agree to do anything significant enough to help the industry.

But I digress.

Stronach was among those who began to stir the nest in 2001 making pointed comments at a public forum about both the NTRA and Breeders’ Cup and its boards of directors. By then, his Magna Entertainment owned a number of racetracks, and he threatened to pull them out of the NTRA unless he was satisfied the organizations would make some reforms in governance. Van Clief, then vice chairman of NTRA and president of the Breeders’ Cup was quoted in a Jan. 14, 2001, article at ThoroughbredTimes.com as saying that the Breeders’ Cup was reviewing its methodology for electing directors and hopeful of resolving the issue in “the next few days.”

Those “few days,” however, stretched into weeks, then months, then years. Stronach was otherwise appeased, and his tracks remained NTRA members.

In 2005, when the Breeders’ Cup board rubber-stamped a committee recommendation to increase stallion nomination fees for stallions with 50 or more foals, there was more stirring. John Sikura, owner of Hill ‘n’ Dale Farm, wrote a letter published in The Blood-Horse that was extremely critical of the move. “The focus of the Breeders’ Cup should be on cost containment and fixing their business model so that 20 years after inception, we do not have to alter an agreed revenue sharing formula to fill revenue gaps and create their profitability,” wrote Sikura, who called the change a “luxury tax” on stallions producing more than 50 foals. Sikura agreed that the Breeders’ Cup needed its purses to keep pace with competing races, then added, “At the very least, the Breeders’ Cup must pledge 100% of these additional revenues to purses and realize it is our money they are spending, not theirs.”

The Breeders’ Cup was not strapped for cash. At the time, it had accumulated over $40 million from nominations and revenue from its annual championship day of racing.

Sikura’s letter was a lightning rod for the growing discontent many breeders were feeling over the use of Breeders’ Cup funds in NTRA operations. “That letter really got people fired up,” a current Breeders’ Cup board member told me recently. “People weren’t so much upset about the decision to increase the fees, but how it was made and where the money was going.”

Many people believed the administrative budget for operating the Breeders’ Cup and NTRA had become bloated. “The overhead model was strewn with numerous employees with outrageously high salaries and no financial accountability to the breeders who funded the organization,” said one current board member.

The stallion fee increase came in the wake of a simmering dispute between the ruling members of the Breeders’ Cup/NTRA boards and a group of owners and breeders organized under the banner of the Thoroughbred Owners and Breeders Association who were proposing a race series called the Thoroughbred Championship Tour. Among the big names pushing the TCT series was its chairman, owner-breeder Robert McNair, the owner of the National Football League’s Houston Texans. The series concept was created by Thoroughbred Daily News publisher Barry Weisbord, who a decade earlier had started the American Championship Racing Series, which gained traction on the racing landscape but ultimately failed because of industry squabbling.

TCT backers felt the Breeders’ Cup/NTRA boards were not doing enough to support their proposed series, which never got off the ground and suspended its operations in July 2005. Those backers joined the growing chorus of voices seeking reforms at the Breeders’ Cup, where the people John Gaines called the “self-appointed guardians of the Turf” finally realized that change was inevitable and necessary. The old board altered the corporate bylaws in November 2005, creating a new operating board of 13 members, who would be selected by a larger group of “members and trustees.” Those members and trustees would be elected by Breeders’ Cup foal and stallion nominators under a formula that assigns one vote for each $500 in nominations to the program. (For example, someone who owns a stallion with a stud fee of $10,000 would get 20 votes.”

Finally, 25 years after the Breeders’ Cup was created, the people who funded the program would have the chance to have a say in how it is run. The struggle for control of the Breeders’ Cup was reopened.

Game on.

Editor’s note: The original version of this article incorrectly stated that the National Thoroughbred Association was created by John Gaines. The NTA was solely created in 1993 by advertising executive Fred Pope. Gaines joined Pope in helping push the initiative three years later.

TOMORROW: Part 2. Power-seekers, politicking, deal-making, and clashing egos.

By Ray Paulick

Copyright ©2008, The Paulick Report

Welcome to the Paulick Report, your new, independent source for news, analysis and commentary on the Thoroughbred industry.

Why, you might ask, does racing and breeding need an independent voice, one that is not affiliated with any of the industry’s numerous organizations and does not cater to a specific segment of the business? We think the answer is obvious: that some organizations, businesses and individuals within the Thoroughbred industry have had too much influence on the traditional role of the press to ask the difficult questions and report the unvarnished truth. That is what the public deserves, and what the Paulick Report aims to deliver.

The Paulick Report is modeled after the success of web-based publications including Real Clear Politics, The Huffington Post and Drudge Report. It will break exclusive stories, featuring reporting and analysis on a wide range of topics by veteran award-winning journalist Ray Paulick, the longtime editor of The Blood-Horse who over the past three decades has developed a trusted and informed network of sources throughout the industry.

The Paulick Report also will feature links — updated throughout the day — to global Thoroughbred news and commentary produced by mainstream media and the growing community of knowledgeable bloggers who keep a watchful eye on the racing and breeding industry. In addition, readers will have the opportunity to provide anonymous news tips.

The Paulick Report promises to be relevant, intuitive and independent. Said Paulick: “We hope to revolutionize the news coverage of the Thoroughbred industry with quality reporting of the large reservoir of uncovered news, emphasis on breaking the big story and by tapping into the talented army of on-line contributors.”

It should be the first and last stop for anyone seeking up-to-date information regarding the Thoroughbred industry. “This industry combines all the ingredients of Wall Street, Washington and Hollywood — and we plan to bring this out with a laser focus on the business of racing, the politics of the industry and the celebrities of horse racing, including the horses themselves,” said Paulick. “This business can be a great deal of fun, and we also aim to reflect that, too.”

We hope you will be a frequent visitor to the Paulick Report. Our mission is to provide you with the news and analysis you want and need. We look forward to your feedback. Also, please keep in mind that this is a reader-supported site, and we hope we can count on your support in the days and weeks to come.

Will they or won’t they?

That’s the big question I have about a group of U.S. Congressmen who have nothing else to do (health care, foreclosure crisis, soaring gas prices, Iraq war?) but put the horse racing industry in the crosshairs during a hearing on Capitol Hill Thursday entitled “Breeding Drugs and Breakdowns: The State of Thoroughbred Horseracing and the Welfare of the Thoroughbred.”

The Paulick Report will attend the hearing and “live blog” the event, which begins at 10 a.m. EDT.

Will the U.S. House of Representatives’ subcommittee on commerce trade and consumer protection recommend federal intervention in the form of national oversight or national horse racing authority of some type? Led by Arizona senator and current presidential candidate John McCain, Congress took on boxing in 1996 and created the Professional Boxing Safety Act when it determined that the individual state commissions regulating the sport were not acting in the best interests of the fighters to protect their safety and financial well being. They amended that act four years later with the Muhammad Ali Boxing Reform Act.

Cleaning up boxing wasn’t easy, nor have the federal reforms been wholly effective. Additional hearings on the sport have been held by the same subcommittee that is looking into racing, but there continue to be problems with enforcement of the federal boxing laws.

There is a precedent and a similarity between the two sports. Boxing and horse racing in this country are both regulated by state commissions, many of them with distinct rules and regulations. Both sports can occasionally be brutal, tragic and scandalous. Both boxing and racing have participants who can be exploited and whose health and welfare have been called into question by a sizable percentage of the public.

The federal government does regulate gambling on horse racing with the Wire Act and Interstate Horse Racing Act, but it does not delve into issues of the health, welfare and safety of its human or equine participants — at least not yet.

This same subcommittee of the House’s committee on energy and commerce has called in racing participants to testify on previous occasions: first, when the Jockeys’ Guild was being run amok by its leaders, and riders had limited catastrophic injury insurance; and second, earlier this year, when the use of anabolic steroids in several sports were questioned.

Based on who is providing testimony on Thursday, you can be assured that racing will come off as a divided industry, and one that is not able to make across-the-board reforms because of the multitude of state regulatory bodies. Another recurring theme you can expect is that the National Thoroughbred Racing Association and its president, Alex Waldrop, cannot speak on behalf of the industry in the same fashion that the commissioners of the National Basketball Association, National Football League and other major league sports do. In fact, according to sources, the NTRA had to fight with the subcommittee’s ranking Republican, Ed Whitfield of Kentucky, to even get Waldrop onto the witness list. Apparently, Whitfield and others were not happy with some backtracking Waldrop did after testifying to Congress about medication rules in February when he made comments that a number of NTRA members privately told him later they would not support.

The hearings have been called because Whitfield, more than anyone else in Congress, has been convinced by his wife, Connie (a member of the Kentucky Horse Racing Authority), among others, that racing has a drug problem that may take federal intervention to resolve. Whitfield’s poster child is Eight Belles, who died a tragic death after running a gallant second in the Kentucky Derby. Eight Belles did not race on steroids and was trained by Larry Jones, someone with a squeaky-clean reputation on medication use.

This showdown at Gucci Gulch will be an interesting display. During the first and more lively panel, horsemen Arthur Hancock, Jess Jackson and Jack Van Berg can be expected to say that the industry is badly in need of reform and isn’t doing enough to protect horses and people from “drugs and thugs.” Others, like California Horse Racing Board chairman Richard Shapiro and Jockey Club president Allen Marzelli, will point to changes they are trying to enact. The Jockey Club made a preemptive strike Tuesday by announcing its recommendations to ban steroids and toe grabs on racing plates and regulate whips.

Congressmen will pointedly ask what authority the Jockey Club or the California board has to enact the recommended changes in all racing states. Rick Dutrow, who trained Big Brown with permitted steroids to win the Kentucky Derby and has a long list of medication violations, is scheduled to be the closing act to the first panel and is the wild card in that group. Dutrow might say anything, although he has been coached by a p.r. adviser to defer as many questions as possible to others (and to not call any of the Congressmen “babe,” as he is wont to do with most people).

During the second panel, a number of veterinarians will send House members scrambling for NoDoz pills with statistical analysis of racing injuries and tedious descriptions of new surgical procedures. The two-act play will come to a resounding crescendo if Waldrop is brought in last, allowing Whitfield and others to make him horse racing’s whipping boy.

Powerful Thoroughbred people are betting their bottom dollar that no significant action will follow in Congress, and that the industry will be able to hide under the skirts of its longtime ally in Washington, Republican Sen. Mitch McConnell.

Depending on what happens in November’s election, however, McConnell may not have enough control to derail federal action. Thursday’s hearing may be just the tip of the iceberg.

By Ray Paulick