Archive for the ‘Industry’ Category
Sunday, November 9th, 2008
By Ray Paulick
I knew I wasn’t in Kentucky anymore when I went out for an early morning walk and came across a group of about 20 people standing at a nearby intersection. It was only a two-lane road, and there wasn’t a car in sight in any direction, yet everyone stood patiently for what seemed an eternity, waiting for the crosswalk light to change from red to green.
I resisted the temptation that any American who’s ever jaywalked across a city street surely would have had.
When the light changed, everyone broke into a brisk walk, as if, all of a sudden, they were in a hurry. It is one of the strange .jpg) idiosyncrasies of the people of Japan, this nation of talking elevators, American fast-food, on-time trains and silly television commercials. Its natives honor Japanese laws, yet many of them complain privately about the nature of their traditions.
I’ve come to Tokyo ostensibly to cover the 32nd Asian Racing Conference, which began on Sunday with a trip to the Tokyo Race Course and runs through Thursday. (The time frame of some of my reports may seem a bit odd since I’ll be writing in the past tense about days that haven’t yet arrived in most of the U.S., since Tokyo is plus 14 hours from Eastern Standard Time.)
In truth, however, I’ve decided to cash in some frequent flier miles and come to Japan to meet and hear from officials representing racing countries that have faced challenges, worked cooperatively and developed strategies they hope will succeed and help them grow and prosper. I’ve come for a shot of optimism after nearly drowning in the sea of pessimism that saturates American racing these days, where the efforts seem to focus on stopping the bleeding and the only strategy relies on subsidies from other forms of gambling. Most American tracks have given up on the idea that they can be competitive anymore.
One example: In Hong Kong, where the stock market has fallen by nearly 50% in the current financial crisis, betting is off by about 6%. But the Hong Kong Jockey Club, instead of wringing their hands over the dreadful economy, has developed a new program to give bettors a 10% rebate on individual losing bets that exceed a certain amount.
Another story: When on-track business peaked at Japan Racing Association tracks in the mid 1990s, the JRA looked at its aging flagship track, Tokyo Race Course, and rebuilt the main grandstand, giving it a much more inviting design, one that in some ways resembles the Forum Shops of Caesars Palace in Las Vegas. When they began losing fans, their strategy was fixed on giving on-track customers a better experience.
There are more than 600 delegates here from at least 30 countries. The Asian Racing Federation, which presents the conference, consists of racing nations from Asia, Australia/New Zealand, Africa and the Persian Gulf. These countries represent 36% of the world’s prize money, 32% of the international foal crops and 47% of global wagering on pari-mutuel racing. Europeans and Americans are welcome to attend the conference, though only a handful of them do. Only five Americans are scheduled to be here, two of whom are journalists.
 Among those I ran into at the track was Michael Dickinson and his partner, Joan Wakefield, who are here as exhibitors for Tapeta Footings, the synthetic surface developed by Dickinson that has been used so successfully at, among other places, Golden Gate Fields, Presque Isle Downs and the Fair Hill Training Center in the U.S., and as a training track in Dubai. Dickinson, of course, is hoping to find new clients among the Asian Racing Federation’s membership.
It was the couple’s first visit to Japan, and as someone who’s been to Tokyo a number of times for the Japan Cup and other major races, I gave them a walking tour of the massive, yet elegant new building. They were amazed at the cleanliness and bright, friendly design, the variety of comfort levels, and the size and length of the nine-story main structure, which is nearly a quarter-mile long.
.jpg) In the bowels of the grandstand, there is a maze of tunnels for horses to use as they leave the paddock, go onto one of the three tracks, or return to the stable area. We took one tunnel up to the winner’s circle, where Dickinson gazed wistfully out onto the main turf course and dirt track, desperately wanting to walk the courses to get a feel for them. The former trainer is a man long obsessed with the conditions and safety of racing surfaces, and his new calling as a proponent of synthetic tracks comes to him naturally.
“Do you think it would be okay for me to walk out there, after all the races have run, just to see what the dirt and grass tracks are like?” Dickinson asked. And he wasn’t kidding.
I’ll try to find out tomorrow whether the man known as the “mad genius” found his way out there to sample the footing of the Tokyo turf and dirt. I’ll be reporting from inside the meeting and presentation rooms of the conference, and working the unofficial meetings and break rooms for the latest news and gossip throughout the racing world.
I’ve come here in search of some optimism for our sport, to learn more about how other countries have achieved their success. I’ll be disappointed if I return home empty handed.
Copyright © 2008, The Paulick Report
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Tags: 32nd asian racing conference, asian racing conference, asian racing federation, betting rebates, dubai, fair hill training center, golden gate fields, hong kong jockey club, Horse Racing, international horse racing, japan racing, japan racing association, joan wakefield, jra, michael dickinson, Paulick Report, presque isle downs, Ray Paulick, synthetic racing surface, synthetic surface, tapeta, tapeta footings, tokyo race course
Posted in Horse Racing, Industry, Industry Conferences, International Racing, Synthetic surfaces | 10 Comments »
Wednesday, October 15th, 2008
By Ray Paulick
The National Thoroughbred Racing Association announced a series of sweeping safety and integrity reforms and the hiring of a former governor and Bush administration official during a press conference in New York this morning.
The reforms, organized under the banner of the newly created NTRA Safety and Integrity Alliance, touch on a wide range of issues that have been bubbling under the surface for years but came to a head this spring in the wake of the death of the filly Eight Belles in the Kentucky Derby, the revelation that Derby winner Big Brown won while racing legally on anabolic steroids, and a damning Congressional hearing that left industry leaders red-faced and fearful of federal action. The reforms and the creation of the Safety and Integrity Alliance evolved over the last several months from a series of closed-door meetings and a confidential discussion document circulated throughout the industry and published in the Paulick Report in July.
The Alliance, to be funded by the financially challenged NTRA, consists of racetracks, owners, breeders, horsemen, jockeys, auction companies, veterinarians, fans, regulators and breed registries. The NTRA has retained the services of former Wisconsin Gov. Tommy Thompson, who also served as secretary of the Department of Health and Human Services for President George W. Bush and made a brief run for the 2008 presidential nomination of the Republican Party. Thompson will be charged with independently monitoring the program and annually providing public reports on the progress the Alliance has made in meeting its goals.
Thompson, incidentally, attended the 2005 Kentucky Derby and later joined a West Point Thoroughbred partnership that owned Flashy Bull, who was unplaced in the 2006 Derby but subsequently won the Grade 1 Stephen Foster at Churchill Downs. According to West Point president Terry Finley, Thompson "loves the racing game" and is in a partnership that currently owns a West Point 2-year-old named Tapit’s Brew.
Click here to read the complete text of the NTRA Safety and Integrity Alliance and Pledge.
For a list of tracks and racing organizations that have agreed to the pledge, click here.
Following is the NTRA’s press release on the formation of the Safety and Integrity Alliance and the hiring of Thompson as an independent monitor.
NTRA FORMS SAFETY AND INTEGRITY ALLIANCE AND ANNOUNCES SWEEPING REFORMS; TABS FORMER WISCONSIN GOVERNOR TOMMY THOMPSON TO PROVIDE OVERSIGHT
National Thoroughbred Racing Association (NTRA) President and CEO Alex Waldrop and Thoroughbred racing industry leaders outlined a series of industry-wide safety and integrity reforms at a press conference in New York today. The NTRA also announced the creation of a new Safety and Integrity Alliance, comprised of the largest tracks and horsemen’s groups in the U.S. and Canada, which will be responsible for implementing the reforms. The Honorable Tommy G. Thompson, former four-term Governor of Wisconsin and Secretary of Health and Human Services, will serve as independent counsel for the new NTRA Safety and Integrity Alliance. Governor Thompson will conduct an ongoing review and provide an annual independent and public assessment to the Alliance.
The reform initiatives are the broadest and most comprehensive in the sport’s history, including:
- uniform medication rules for each racing state
- ban of steroids from racing competition
- out-of-competition testing for blood and gene doping agents and pre-race testing
- uniform penalties for all medication infractions
- mandatory on-track and non-racing injury reporting
- mandatory installation of protective inner safety rail
- mandatory pre- and post-race security
- adoption of a placement program for Thoroughbreds no longer competing
The reforms were approved by the NTRA Board of Directors, representing North America’s leading racetracks, owners, breeders and horsemen, at a special Board Meeting in September and communicated via e-mail to fans just prior to the press conference. Waldrop, joined by NTRA Executive Chairman Robert Elliston, Thoroughbred Horsemen’s Association Chairman Alan Foreman and Governor Thompson, unveiled an ambitious timetable for implementing reforms, calling on NTRA Alliance member organizations to adopt house rules to enforce the measures until individual states and regulatory agencies can catch up via statute and regulations.
“Our industry is taking strong, positive steps to ensure the safety and integrity of our sport,” said Waldrop. “Despite challenges and significant short-term and long-term costs, there is an unprecedented level of commitment among Thoroughbred racing’s leadership to see these measures through.”
Governor Thompson—currently a partner in the Washington, D.C., offices of the law firm Akin, Gump, Strauss, Hauer and Feld—will lead a team that will independently review, monitor and assess the program and provide annual public reports of the industry’s progress toward achieving its goals in the area of human and equine health and safety.
"Our first priority is to insure the health and safety of the athletes and horses in the racing industry,” said Thompson. “On its own initiative, the NTRA has taken a great step forward in committing to reforms and the creation of an important new body to oversee implementation of the reforms. I will take my independent oversight role seriously and work to assure transparency in this process.”
The NTRA Safety and Integrity Alliance will be a standing organization whose purpose is to implement safety and integrity reforms. The Alliance also will function as a certification/accreditation body for the purpose of recognizing and incentivizing compliance by all stakeholders. Reforms will be undertaken using a phased approach that begins immediately—in some cases, under a House Rules format—and transitions to a broader strategy that relies on licensure requirements, continuing education programs and the state regulatory process.
“The health and safety of all participants in Thoroughbred racing – both human and equine – have always been top priorities at Churchill Downs, the home of the Kentucky Derby, and all of our company’s racetracks,” said Robert Evans, President and CEO of Churchill Downs, Inc. “We know that the job is never done where safety is concerned. We fully support the NTRA’s development of safety and integrity standards and the annual certification of tracks that meet those standards. On the issues of safety and integrity, we believe we must hold ourselves to only the highest standards. Our customers do.”
Virtually every leading racetrack and horsemen’s association in North America, representing some one million industry participants, has pledged its support to the Alliance and the reforms. Waldrop indicated that, in the coming weeks, the Alliance will be broadened to include other racing organizations, individuals and fans; and that additional reforms, including wagering integrity issues, will be addressed by the Alliance.
"The horsemen are the people who are ultimately responsible for the day-to-day care and safety of the Thoroughbred,” said Alan Foreman, Chairman of the national Thoroughbred Horsemen’s Association. “As such, the health and safety of our horses and the integrity of our sport are our highest priorities. We are committed to seeing that these reforms and standards are implemented across the nation."
The reforms include improvements to medication and testing policies, guidelines for injury reporting and prevention, safety research, providing a safer racing environment, and post-racing care for retired race horses. They are drawn from the recommendations that have emerged over the past several months from The Jockey Club’s Thoroughbred Safety Committee and Welfare and Safety of the Racehorse Summit, Breeders’ Cup Limited, the Thoroughbred Owners and Breeders Association’s Graded Stakes Committee and the long-standing work of the Racing Medication and Testing Consortium and the Association of Racing Commissioners International, among others.
“Fortunately, we have the excellent work of many industry organizations to build on, allowing us to focus on implementation, oversight, measurement and transparency,” said Waldrop. “The reforms and the plan for implementation have been conceived by those who have pledged to operate at a higher level of integrity.”
The NTRA is a broad-based coalition of horse racing interests consisting of leading thoroughbred racetracks, owners, breeders, trainers and affiliated horse racing associations, charged with increasing the popularity of horse racing and improving economic conditions for industry participants. The NTRA has offices in Lexington, Ky., and New York. NTRA press releases appear on the NTRA web site, NTRA.com.
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Tags: akin gump strauss hauer and feld, alan foreman, alex waldrop, american graded stakes committee, anabolic steroids, association of racing commissioners international, backstretch security, Barbaro, bob elliston, bob evans, Breeders' Cup, churchill downs, eight belles, former wisconsin governor, injury reporting, Jockey Club, National Thoroughbred Racing Association, NTRA, ntra safety and integrity alliance, out of competition testing, post-, post-race security, pre-race security, racing injuries, racing medication and testing consortium, RCI, rmtc, robert elliston, robert evans, safety rail, steroids ban, thoroughbred horsemen's association, Thoroughbred Owners and Breeders Association, thoroughbred safety committee, tommy g. thompson, tommy thompson, uniform medication, welfare and safety of the racehorse summit
Posted in Horse Racing, Horse Welfare, Industry, Industry Organizations, Industry Reform, National Thoroughbred Racing Association, Regulatory Issues | 9 Comments »
Monday, July 28th, 2008
By Ray Paulick
Within two weeks of the June 19 Congressional hearings that looked into Thoroughbred racing’s safety and medication issues, a small group of industry insiders met at Keeneland in Lexington, Ky., to discuss potential reforms that could stave off threatened federal intervention.
A confidential discussion document that came out of the Keeneland meeting and talks with other industry stakeholders outlines a far-reaching program of potential reforms as well as suggestions for implementing and enforcing them. The Paulick Report has obtained a copy of that confidential discussion document and memorandum (1, 2, 3, 4, 5) sent to the board of directors of the National Thoroughbred Racing Association written July 9 by NTRA CEO Alex Waldrop.
Among the possible reforms discussed in the document are minimum national standards for medication, drug testing and penalties; benchmark safety standards of racing surfaces and/or a mandatory switch to synthetic tracks; a ban or limitation on racing fillies against colts; eliminating timed workouts at 2-year-old sales and distance restrictions for 2-year-old races; a funding mechanism for permanently disabled jockeys; wagering protocols and mandatory public disclosure of wagering abnormalities; uniform scratch rules and "other player-friendly advances"; integrity clauses and potential revocation of Eclipse Awards for individuals involved in infractions; and a national placement program for retired racehorses.
"As part of our post Triple Crown public relations and communications strategy based on consumer research findings, it is clear that the industry must implement real reforms in the area of horse health and safety ," Waldrop wrote in the memorandum to the NTRA board. "It is equally clear that the NTRA must play a leadership role to ensure responsible, timely and uniform execution of the equine health and safety reforms put forth by a number of industry organizations, including The Jockey Club Safety Committee. To that end, we believe it will be necessary for industry stakeholders to come together to reach consensus on industry reforms and to agree upon the methodology for timely implementation."
Waldrop recommended two days of meetings of industry leaders in Lexington, Ky., Sept. 3-4.
Waldrop called the confidential discussion document "far-reaching and ambitious to say the least and impacts virtually all segments of the industry. However," he added, " it appears that virtually all segments of the industry are in agreement that if we do not take pro-active action on the integrity front, the Federal government will very likely act on our behalf. And the questions from fans and media asking, ‘What has the industry done since Eight Belles?’, will come soon enough."
Congressman Ed Whitfield of Kentucky, the ranking Republican member of the U.S. House of Representatives subcommittee that conducted the hearings, is calling for an amendment to the Interstate Horseracing Act of 1978 that would set minimum standards for racetracks wishing to conduct interstate simulcasting.
In fact, the threat of federal intervention will be used as leverage to get people on-board with the reforms, the document suggests. Suggested implementation would occur in four phases, beginning with "house rules" at racetracks "commencing upon the start of each track’s first full racing meeting in 2009." Phases II and III would depend on adoption of model rules and minimum standards by the Association of Racing Commissioners International and its member associations in various racing states. The final suggested phase would be the formation of a "national governing body comprised of key industry stakeholder and legislative bodies under an interstate compact."
Potential penalties for failing to comply with whatever reforms are pushed are loss of eligibility to host a graded race, loss of Breeders’ Cup stakes money or consideration as host site of the championships, loss of NTRA membership or loss of right to conduct interstate simulcasting.
The discussion document also calls for the commitment of owners, trainers and jockeys to compete only at tracks that operate under the agreed upon rules.
Copyright © 2008, The Paulick Report
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Tags: 2-year-old sales, alex waldrop, congressional hearings, disabled jockeys, eclipse awards, ed whitfield, eight belles, interstate horseracing act, jockey club safety committee, Keeneland, Paulick Report, Ray Paulick, Simulcasting, wagering protocols
Posted in Congressional Hearing, Horse Welfare, Industry, Industry Reform, Medication, National Thoroughbred Racing Association, Regulatory Issues | 13 Comments »
Tuesday, July 15th, 2008
The road less traveled covered more than 3,000 miles, stretching from Central Kentucky through the upper Midwest, to the Great Plains, Wild West and finally to Southern California in time for Wednesday’s opening day of the summer meeting at Del Mar. There were sights for which words cannot do justice, natural wonders that make this country unique and awesome in its beauty.
And, oh yes, there were horses nearly everywhere the highways and backroads took us on this weeklong Westward trek.
There were no horse races, though we did pass by several "dark" racetracks, including Indiana Downs southeast of Indianapolis in the Hoosier State, Metra Park in Billings, Montana, and Wyoming Downs in rustic Evanston, Wyoming. But horses were everywhere, or so it seemed.
There was a horse show in Wisconsin, trail riders in Minnesota, and dude ranches in South Dakota. Rodeos in small-town Wyoming appeared to be as commonplace as little league baseball in the suburbs of most American cities. Real-life cowboys still use their horses to check fence lines under the Big Sky of Montana.
Horses remain an unmistakable and unique part of the fabric of American life, not just in the West but throughout the United States. But this trip West served as a reminder of how important the horse is to our society — past and present.
The Thoroughbred is just one thread in that colorful fabric. Yet it’s an important thread, providing entertainment and sport and competition at the highest level.
The Paulick Report recognizes that the horse industry is a business — a massive one that, according to the American Horse Council, produces a $102 billion economic impact annually and provides for 1.4 million jobs. The AHC’’s economic impact study estimates there are 9.2 million horses in the United States.
In all the annual numbers that we see in our slice of the business, Thoroughbred racing and breeding ($15 billion wagered, $1 billion in purses, another $1 billion in auction receipts), it’s sometimes easy to lose sight of what really drives the industry: the horse, and the fascination and love people hold for this majestic creature.
By Ray Paulick
Copyright ©2008, The Paulick Report
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Tags: American Horse Council, Horse Racing, Paulick Report, Ray Paulick
Posted in Industry | 2 Comments »
Tuesday, July 8th, 2008
I was in the middle of a dinner celebrating my son’s 20th birthday at the new Malone’s restaurant in the Palomar Center in Lexington (highly recommended, by the way, certainly up to the standards of all the Malone’s and with an appealing outside bar with large plasma screen TVs showing horse racing), so I didn’t get a chance to read the story until sometime later in the evening.
When I did, I was shocked and even more filled with angst when I read the article, written by the interestingly named Frank Angst, a ground soldier in the trade publication army of the Thoroughbred Times I’d crossed paths with on a number of occasions during my tenure as editor in chief of Bloodhorse.
Believe it or not, there are ethical standards among journalists, just as, I suppose, there are among horse traders. One of those standards is that publications that run exclusive stories should receive attribution or credit whenever another publication does a “cover your ass” rewrite, which is clearly what ground soldier Angst was ordered to do from on-high. To quote the leading media critic Howard Kurtz of the Washington Post and CNN’s Reliable Sources, “Making a couple of calls to confirm a story that a journalist would not otherwise know about doesn’t excuse the obligation to give proper credit.” Dick Jerardi, an Eclipse Award-winning writer for the Philadelphia Daily News (and an occasional Thoroughbred Times contributor), found the past-posting article of interest and wrote a story for his paper, giving attribution to the Paulick Report. The story by Frank Angst is not the kind of journalism my old friend Mark Simon, the longtime editor of Thoroughbred Times, expected from his employees 20 years ago when he hired me as the weekly magazine’s managing editor, and I doubt that Mark’s standards have changed very much. So I sent Angst a few angry emails Monday night that he’s had plenty of time to respond to, and hasn’t. (Note to Frank: It’s 2008. If you’re not checking your inbox 24/7, you’re no damned good.)
This is the same Thoroughbred Times and same Angst that was so anxious to report my demise from Bloodhorse last August but failed to run even a brief note about the start-up of the Paulick Report a few weeks back (neither, incidentally, has the Bloodhorse, though traffic reports on the Paulick Report web site show Bloodhorse IP addresses as a frequent, daily visitor…perhaps looking for news leads?). Someone once suggested that there is something Machiavellian about the trade press, that the ends (keeping the trade publications in a cozy, friendly relationship with the industry they cover) justify the means (parsing and lifting from non-trade press). That led me to run a picture of the Italian diplomat and author Niccolo Macchiavelli, especially since Frank Angst isn’t famous enough to have a photo on the Flickr web site. I never read The Prince, Macchiavelli’s most famous written work (I’m sure I’m not the only one who likes to say something is Macchiavellian without knowing what the hell we are talking about), but I do know something about the Thoroughbred trade press and the cozy relationship it has with advertisers and industry organizations it covers. I plead nolo contendere to charges that I was influenced at times during my 15 years at Bloodhorse, succumbing occasionally to brow-beating from advertisers, members of the organization’s board of trustees, its parent at the Thoroughbred Owners and Breeders Association, or from a publisher whose frequent jaunts to Margaritaville were made possible by a contented, free-spending group of advertisers. I’ll never forget the chilling words one of the Bloodhorse trustees said to me when I first met him: “We can’t tell you what to do or write. All we can do is fire you.”
The trade publications, for example, are not going to report on something that nearly every breeder in Central Kentucky already knows – that top older stallion Seeking the Gold has been shooting blanks this breeding season and may be finished – because 1) the farm that stands the stallion, Claiborne, is a major advertisers at Bloodhorse and Thoroughbred Times and hasn’t sent out official word yet through a press release, and 2) the stallion is controlled by Dinny Phipps chairman of the Jockey Club, and the people who run the two publications don’t want to do anything to upset Phipps since they enjoy being invited to the Jockey Club Dinner in Saratoga Springs, NY, in August.
Of course, in the Jockey Club’s Macchiavellian manner of controlling as much of the industry as possible (did I just insert Niccolo Macchiavelli again?), one of the members of the board of trustees at Bloodhorse is Bill Farish, who has a double-barrel blast of lucky sperm as the son of Jockey Club vice chairman Will Farish and son-in-law of Dinny Phipps. The chairman of the Bloodhorse board is Stuart Janney, the cousin of Dinny Phipps.
As someone once said to me, “Why should the Jockey Club buy the Bloodhorse when it already controls it?”
The lifting by the Thoroughbred Times of the Philadelphia Park story wasn’t the first time in the brief history of the Paulick Report and certainly won’t be the last time something like this happens. I’m happy to say I may even be influencing their coverage.
In the wake of our breaking story last week on the election of the Breeders’ Cup board of members and trustees, the Paulick Report headline read: CLAY CANNED IN CUP ELECTION. A short time after that story was posted, the Thoroughbred Times apparently did another hasty rewrite, but with the bland headline: BREEDERS’ CUP ELECTS 12 TO BOARD OF MEMBERS AND TRUSTEES. Later that night, apparently someone at the Thoroughbred Times with at least marble-sized testicles changed the story headline to read: CLAY NOT AMONG 12 ELECTED TO BREEDERS’ CUP BOARD OF MEMBERS, TRUSTEES.
Bloodhorse.com apparently transitioned the other way in its brief rewrite and headline treatment. Its original headline, posted hours after the Paulick Report broke the election story, read: CLAY LOSES BREEDERS’ CUP BID. Sometime later, it was changed to the milquetoast: FOUR NOT RE-ELECTED TO CUP BOARD. Perhaps someone thought the latter headline told the story more accurately than the former. It’s more likely that someone reminded the editorial side of Bloodhorse how much money Clay’s Three Chimneys Farm spends on advertising on its web site and magazine.
The Paulick Report will not be beholden to industry organizations like the Jockey Club or to major advertisers. We are operating on the simple premise that the Thoroughbred industry needs and deserves independent reporting and analysis. Similar to listener or viewer supported operations like National Public Radio or Public Television, we believe we will receive support from readers like you.
By Ray Paulick
Copyright ©2008, The Paulick Report
CORRECTION: THE ORIGINAL VERSION OF THIS STORY INCORRECTLY STATED THAT A.P. INDY "HAS BEEN SHOOTING BLANKS" DURING THE 2008 BREEDING SEASON. ACCORDING TO STATISTICS PROIDED BY WILL FARISH, A.P. INDY HAS COVERED 113 MARES AND HAS 80 OF THOSE MARES IN FOAL. THE PAULICK REPORT REGRETS THE ERROR.
Tags: Add new tag, Bill Farish, bloodhorse, dick jerardi, Dinny Phipps, frank angst, Horse Racing, howard kurtz, journalistic ethics, journalistic standards, macchiavellian, mark simon, niccolo macchiavelli, Ogden Mills Phipps, past-posting, Paulick Report, Philadelphia park, Ray Paulick, Robert Clay, thoroughbred times, Three Chimneys, trade publications, Will Farish
Posted in Industry, Industry Organizations, Racing Media | 29 Comments »
Thursday, July 3rd, 2008
The startling election results for the Breeders’ Cup board of members and trustees conducted among nominators to the program teaches us one thing about this relatively new process: no single farm or entity can stack the board with its own candidates.
That is driven home by the fact that Robert Clay of Three Chimneys Farms, the current vice chairman of the Breeders’ Cup board of directors (the 14-person board elected by the 48 members and trustees), did not receive enough votes to retain his spot as a member/trustee. It is confirmed again by the election loss of James McAlpine, a longtime Magna executive associated with Frank Stronach, who presumably would have thrown the considerable clout of his Adena Springs Farm behind McAlpine in the Breeders’ Cup election process that Stronach himself helped bring about through reforms in governance several years ago. (Those reforms were detailed in a two part series in the Paulick Report: Part 1, Part 2). In voting conducted during the month of June, Breeders’ Cup nominators received one vote for every $500 they paid in foal or stallion nominations. Stallion farms with the high-end stud fees obviously hold the most votes, since a $100,000 stud fee would give a farm 200 votes in the process. Yet even with a Three Chimneys stallion roster that currently includes $460,000 in annual “published” stud fees (and, thus, 920 votes, theoretically), Clay was unable to secure enough votes to retain his seat on the board of members and trustees.
As a result, Clay, who has served on numerous industry organization boards over the last 25 years, will not be eligible to run for re-election to a two-year term on the 14-member Breeders’ Cup board of directors, the group that makes the key operational decisions for the organization. That election will be held during a meeting of the newly elected board of members and trustees in Lexington July 11. To be eligible to run for the board of directors, an individual must be on the larger board of members and trustees. Just as consensus building is necessary to get federal legislation passed in Congress, individuals seeking seats as Breeders’ Cup members/trustees must build coalitions among different groups of nominators. Clay apparently did not do that; nor did three others seeking re-election on the board of members and trustees: Robert Cromartie, Leverett Miller, and Joseph Shields, Jr.
Elected to the board of members and trustees were Helen Alexander of Middlebrook Farm; Doug Cauthen of WinStar Farm; Bill Farish Jr. of Lane’s End; Terry Finley of West Point Thoroughbreds; Lucy Young Hamilton of Overbrook Farm; Maria Niarchos-Gouaze of Poseidon Services Inc; Charles Nuckols III of Nuckols Farm; Bill Oppenheim, a bloodstock agent who writes for Thoroughbred Daily News; Don Robinson of Winter Quarter Farm; Mark Taylor of Taylor Made Farm; Charlotte Weber of Live Oak Stud; and Barry Weisbord, publisher of Thoroughbred Daily News. Of that group, Alexander, Farish, Young Hamilton, Niarchos-Gouaze, Nuckols, and Taylor were re-elected.
In addition to Clay, Cromartie McAlpine, Miller and Shields, the following nominees to the board of members and trustees did not get enough votes for election: Bobby Flay, Arnold Kirkpatrick, Allan Lavin Jr. and Ric Waldman.
Seven of the 14 board of director seats will be open for nomination during the July 11 election, including the seats that have been held by Clay and Shields, whose terms expire. With their required departure, there will be at least two new members elected. In addition, the two-year terms of Antony Beck, current board chairman Bill Farish Jr., Terry Finley, R.D. Hubbard and Satish Sanan also expire, with each eligible for re-election.
The smaller board of director positions are staggered, and the following six individuals were elected to two-year terms in July 2007: Reynolds Bell Jr., Donald Dizney, Tracy Farmer, B. Wayne Hughes, G. Watts Humphrey Jr., and Robert Manfuso. The 14th board position is filled by the Breeders’ Cup CEO, Greg Avioli.
It may be noteworthy that Clay, Miller and Shields were considered part of the “old guard,” as each are members of the Jockey Club, which for decades has tried to assert control over many industry organizations. Not everyone newly elected or re-elected to the board of members and trustees can be classified as “old guard” or “new guard,” but victories by Doug Cauthen, Bill Oppenheim and Barry Weisbord clearly indicate that efforts were made by nominators with large blocs of vote to inject new blood into the organization that runs the two-day championships scheduled to be held for the next two years during the Oak Tree Racing Association meeting at Santa Anita Park in Southern California.
What new alliances are formed among the newly seated board of members and trustees will determine who is retained, newly elected or rejected from the smaller board. That new board, to be seated in September, will determine whether Bill Farish will remain chairman and will also elect a vice chairman of the board. More importantly, the new board will control the fate of the Breeders’ Cup—at least until the next election.
By Ray Paulick
Copyright ©2008, The Paulick Report
Tags: Allan Lavin Jr., Arnold Kirkpatrick, b. wayne hughes, Barry Weisbord, Bill Farish Jr., Bill Oppenheim, Bobby Flay, Breeders' Cup, Breeders' Cup board of directors, Charles Nuckols III, Charlotte Weber, Don Robinson, donald dizney, Doug Cauthen, Frank Stronach, g. watts humphrey jr., Greg Avioli, Helen Alexander, Joseph Shields Jr., Leverett Miller, Lucy Young Hamilton, Maria Niarchos-Gouaze, Mark Taylor, Paulick Report, Ray Paulick, reynolds bell jr., Ric Waldman, Robert Clay, Robert Cromartie, robert manfuso, Terry Finley, tracy farmer
Posted in Breeders' Cup, Industry | Comments Off
Wednesday, July 2nd, 2008
Robert Clay, the owner of Three Chimneys Farm and vice chairman of the 14-member Breeders’ Cup board of directors, did not receive enough votes from nominators to retain his seat on the organization’s 48-person board of members and trustees, the Paulick Report has learned. In something of a changing of the guard for the Breeders’ Cup, Clay was one of four incumbents on the board of members and trustees who was not re-elected. The others were Robert Cromartie, Leverett Miller and Joseph Shields Jr., the latter also a member of the smaller board of directors.
Voting took place during June, with nominators getting one vote for each $500 spent for foal or stallion nominations. Farms with major stallions or a large number of nominated foals had the largest blocs of votes.
Elected to the board of members and trustees were Helen Alexander, Doug Cauthen, Bill Farish Jr., Terry Finley, Lucy Young Hamilton, Maria Niarchos-Gouaze, Charles Nuckols III, Bill Oppenheim, Don Robinson, Mark Taylor, Charlotte Weber, and Barry Weisbord. Of that group, Alexander, Farish, Young Hamilton, Niarchos-Gouaze, Nuckols, and Taylor were re-elected. Farish, son of Lane’s End owner William S. Farish, is chairman of the Breeders’ Cup board.
The nine nominated for board of members and trustees positions but not receiving enough votes for election were: Clay, Cromartie, Bobby Flay, Arnold Kirkpatrick, Allan Lavin Jr., James McAlpine, Miller, Shields Jr., and Ric Waldman.
The primary purpose of the 48-member board of members and trustees is to elect 13 members to two-year terms on the board of directors (the 14th board seat is filled by Breeders’ Cup CEO Greg Avioli). To be elected or re-elected to the board of directors, an individual must be on the larger board of members and trustees. That group meets in Lexington, Ky., July 11 to elect seven individuals for the open positions on the board of directors. Two of the seven — Clay and Shields — are now ineligible to run. The other five whose terms are expiring and will be eligible for re-election are Antony Beck, Farish, Finley, R.D. Hubbard and Satish Sanan.
By Ray Paulick
Copyright ©2008, The Paulick Report
Tags: Allan Lavin Jr., Arnold Kirkpatrick, Barry Weisbord, Bill Farish Jr., Bill Oppenheim, Bobby Flay, Breeders' Cup, Breeders' Cup board of directors, breeders' cup election, Charles Nuckols III, Charlotte Weber, Don Robinson, Doug Cauthen, Helen Alexander, James McAlpine, Joseph Shields Jr., Leverett Miller, Lucy Young Hamilton, Maria Niarchos-Gouaze, Mark Taylor, Paulick Report, Ray Paulick, Ric Waldman, Robert Clay, Robert Cromartie, Terry Finley
Posted in Breeders' Cup, Industry | 2 Comments »
Tuesday, July 1st, 2008
One of the most surprising themes in Monday’s Paulick Report article on Fasig-Tipton’s new owner, Synergy Investments of Dubai, wasn’t so much the comments about the No. 2 Thoroughbred auction house, but what was said about the market leader, the Keeneland Association. A word that was repeated several times by consignors and buyers commenting for the story was “arrogant.” It is an affliction that strikes many companies with a substantial lead in market share over their competition. Microsoft has been called arrogant. So were the phone companies before deregulation. Arrogant is a term often used to describe the New York Racing Association, especially when it was under the leadership of the Phipps family and suffered steady declines in business. It’s also a word some in the horse business use to describe Keeneland.
How strong a grip does Keeneland have on the Thoroughbred auction market?
Last year, Keeneland did $815 million in business in a $1.2 billion North American Thoroughbred bloodstock market. That’s 68% of the total receipts, more than a 2-to-1 lead over all of their competitors combined, including Fasig-Tipton, Ocala Breeders’ Sales Co., Barretts and several regional outfits.
Any company with that kind of lead in market share can become complacent, or, worse, arrogant. Based on comments we received, that may be the case with Keeneland.
More than 15 years ago, I had the opportunity to talk with a member of Keeneland’s board of directors about how the company was run. I was surprised to learn from this individual, a major breeder and consignor in Central Kentucky, how little responsibility is given to the board members by the three trustees who run the company. (Current trustees are William S. Farish, former board chairman of Churchill Downs and current vice chairman of the Jockey Club; breeder Louis Lee Haggin, grandson of Keeneland founder Hal Price Headley; and attorney William Lear, who was recently named to replace the late attorney, Buddy Bishop.)
“They (three trustees) don’t ask for any input at board meetings, and they don’t like any questions from board members,” the Keeneland board member told me. “They tell us what they’ve decided they are going to do.”
Worse, this person said, “I have to practically crawl into Beasley’s office on my hands and knees if I want something related to a sale.” Rogers Beasley was then the director of sales for Keeneland, a position now held by Geoffrey Russell. Beasley currently is Keeneland’s director of racing.
There can be no doubt that Keeneland does many things right and is looked upon by numerous racing fans and organizations as an industry leader. Of course, it has the money to do things many other struggling racing associations cannot do. That money is fueled by sales entry fees and the 4.5% commission it rakes in during a sale.
Do the math: 4.5% of $815 million is $36.7 million earned in 2008. Since 2000, Keeneland has taken in over $243 million in sales commissions. Some have suggested one of the association’s biggest problems is deciding what to do with all the money it has stockpiled over the years. It is a for-profit company, one with a charitable foundation, but it does not return dividends to any shareholders. Its financials are a closely held secret.
Trainer D. Wayne Lukas, who has been affiliated with some of the biggest spenders at Keeneland sales over the last 30 years, used to complain loudly about Keeneland’s big race for 3-year-olds, the Blue Grass Stakes, having far too low of a purse compared with other Derby preps. It was around that time that the Blue Grass temporarily slipped from Grade 1 to Grade 2 status.
“All they need to do is reach into their safe deposit box and grab a few T-bills,” Lukas said. Eventually, Keeneland made substantial increases to its stakes program, including the Blue Grass Stakes.
The purchase of Fasig-Tipton by Synergy has many breeders excited because they are hopeful there will be significant investment in initiatives to bring new people in to the business as horse owners. “Keeneland has tried some new owner programs, but they’ve failed because they really don’t have the talent or know-how to attract new investors,” one breeder said.
“If I were in Keeneland’s shoes,” another breeder said in reference to the sale of Fasig-Tipton, “I’d be a little nervous right now.”
By Ray Paulick
Copyright ©2008, The Paulick Report
Tags: d. wayne lukas, fasig-tipton, geoffrey russell, Horse Racing, Keeneland, louis lee haggin, Paulick Report, Ray Paulick, rogers beasley, synergy investments, thouroughbred auctions, william farish, william lear
Posted in Industry, Thoroughbred Auctions | 3 Comments »
Monday, June 30th, 2008
Consignors and buyers attending Fasig-Tipton yearling sales in Lexington, Ky., and Saratoga Springs, N.Y., in July and August may be a little disappointed if they are looking for a sudden transformation of the 110-year-old Thoroughbred auction company under the new ownership of Dubai-based Synergy Investments.
The sale, announced in April, closed May 30. Synergy is headed by Abdulla al Habbai, an associate of Sheikh Mohammed al Maktoum of Dubai’s ruling family and the owner of the worldwide Darley racing and breeding operation.
“The upcoming sales will be extremely similar to 2007 and the years prior to that,” said Boyd Browning, Fasig-Tipton’s chief operating officer. “It might seem a little boring right now. Everyone wants to know what we are going to do differently. There is a sense of raised expectations in the market place, and that’s a positive thing. We’re really revved up, but we’re not there yet.”
In fact, Browning said he’s had just one meeting with a representative of Synergy in London the week after the deal closed. There have been no personnel changes, and none are anticipated in the near future. Budgets for recruiting and marketing remain what they were prior to the sale. Fasig-Tipton had been owned by a group of Thoroughbred industry breeders led by John Hettinger.
“The marching orders (from the initial meeting) are to develop ideas,” Browning continued. “We don’t have a ‘formalized plan’ yet. We’ll do a review of the company, what we can do better and what types of things can we be involved with that can help the industry overall and the sales industry. We’re in the brainstorming stage now. We hope to have more definitive ideas in 60 to 90 days.”
Browning said he’s been pleasantly surprised by an outpouring of ideas from people in the industry.
“I’ve got a folder full of emails with suggestions,” he said. “Some people have their own personal agenda, but many others have some very creative ideas. We’ve got an opportunity to think outside the box and get people engaged.”
A survey of more than 30 Fasig-Tipton consignors and buyers by the Paulick Report found widespread though not unanimous enthusiasm for the new ownership and what it can bring to the auction marketplace and the Thoroughbred industry.
Asked to rate the sale of Fasig-Tipton on a scale of 1-to-10, with one being extremely bad news and 10 extremely good news, respondents answered with an average of 8.1. The median rating was 9. Only two respondents answered with a rating below 5.
Comments on the sale were virtually unanimous in support of increased competition being good for any industry, including Thoroughbred auctions. Currently, Keeneland enjoys roughly an 80% to 20% market share lead over Fasig-Tipton in the $1-billion annual Thoroughbred auction market. There have been repeated rumors over the years that Keeneland would buy out Fasig-Tipton, but that never happened, perhaps to the regret of Keeneland’s current board and management team. At the time the sale to Synergy was announced, Keeneland president Nick Nicholson issued a terse statement that said only: "The purchase opens a new chapter for an historic, well-established company in the Thoroughbred auction business."
Respondents to the Paulick Report survey were assured their comments would remain anonymous unless they specifically gave approval to be named. All but one chose to remain anonymous.
“I hope the sale inspires Keeneland to treat their customers better,” said one bloodstock agent.
“The sale (to Synergy) is good for the industry and good for Fasig-Tipton, provided there is no hidden agenda,” a major buyer and consignor commented. “Being this is the second-largest sale company, it’s going to put Keeneland on its toes. They both need to be more customer centric, and more customer service oriented. They should do some of the things to attract and retain customers. Keeneland has been arrogant. They’ve had a monopoly virtually. If Fasig-Tipton steps it up a level or two, I think it will only improve Keeneland’s customer service focus. Good competition is good for the industry.”
“Keeneland is a company that doesn’t treat its consignors that well,” said a major Kentucky breeder. “So it will be interesting to see how they respond to the increased competition. They have operated like some pre-Teddy Roosevelt high-handed monopoly. The question will be: Does Keeneland have the talent and ability, the corporate mentality, to compete in the real world. American capitalism does not allow sacred cows to stand alone in fields by themselves eating all the hay.”
“What excites me most,” said a Kentucky horseman, “is that it’s my understanding that Sheikh Mohammed wants to see things done to promote and grow our industry. One only needs to take a look at a before and after picture of Dubai to see he knows how to make things happen.
“This will probably make Keeneland step up and get active as well. I have never seen a time where the status quo was less acceptable in our industry. It is time for people to get with the program!”
While Sheikh Mohammed has not officially been linked with Synergy Investments, nearly everyone polled suggested that he was at least partially behind the purchase. His chief bloodstock agent, John Ferguson, negotiated the purchase on Synergy’s behalf.
“(Sheikh Mohammed) is definitely involved,” one horseman said. “There is no question about that.”
Said another: “I see no downside that would cause any worries (unless one is a shareholder in Keeneland). The positives are that this group, apparently and hopefully, will be applying the same intensity and energy into the commercial arena as they have applied to stallion management and marketing. Further, I imagine they will probably be recruiting new buyers and participants to become involved through 1) their Middle Eastern contacts and 2) incentives and encouragement to all purchasers (particularly trainers and other end users via hospitality and purchase incentives).”
One consignor said he does not believe Sheikh Mohammed has any intent to hurt Keeneland. “He simply wants to improve the economic state of affairs within the North American side of our industry,” he said. “He has a ton of money invested here and our prosperity is important to him. “My understanding is that he plans to use this purchase as a platform to launch innovative approaches to attract new buyers.”
Another breeder cited the new structure of Fasig-Tipton’s ownership as a plus. “The purchase takes Fasig out of a business model that is predominantly aimed at cost control and providing profits to distribute to a small handful of shareholders. This establishes a new business model that will have increased focus on customer appreciation and service, with capitalization to develop many new customer friendly initiatives. It has the potential to be a competitive threat to Keeneland, and increase competition almost always benefits the consumer. It should also lead to initiatives that bring more high-end clients to the sales and into the business. Basically, the possibilities are mostly limited by the imagination of the individuals in charge of designing and implementing.”
“Nothing but good can come from this sale,” said another consignor. “F/T has always been the ‘Avis’ of the equine sales companies where they ‘try harder,’ and the ‘product’ they produce is with less capital than their competitor. Keeneland does an excellent job; however, healthy competition is always good. F/T now has the capital to compete head to head with their competition, which should make a win/win for everyone.”
“What excites me,” said another, “is the injection of large amounts of cash, if necessary, in a contracting breeding/racing environment. ‘Doing it right,’ regardless of cost, will take precedent over profit.”
Another breeder said the sale has “enormous potential. It can be very significant or a non event. The potential to revitalize racing and selling is immense if the commitment is there. I have no worries about this sale unless they under deliver on the expectations the industry has for the new company. Unlimited funding, not just market driven. What an opportunity.”
Some were more guarded in their comments, listing potential negatives.
“Possible downsides include unknown effects, if any, of having one faction seeking to dominate the American horse scene,” said one consignor. “I’m not too worried, because I think the American breeding, racing, and sales scene is too broad and multi-faceted, and enough competition will always exist for one group to dominate enough to cause serious negative effects. (The situation is unlike that of the Jockey Club which negatively affects the industry because it is a monopoly without competition.)”
“Main concerns would be major changes in strategic direction and/or management,” said another.
“It might not be the best thing for so much of the industry to be under the control of one entity,” said one bloodstock agent. “That said, they put up the money so more power to ‘em. If the Arabs let it be known that they will support their sale and no longer buy at Keeneland, then it could have a significant impact on where consignors send their horses. If nothing else, I hope the sale makes Keeneland more user-friendly.”
“I am concerned that the ultimate goal may be domination in the market place,” a consignor said.
Said another: “I have been told (which means nothing, as we know), that the group behind Synergy are not fans of how things are done at Keeneland. So I’m guessing that this is a beginning process to eventually have more power than Keeneland does in the sales world."
“Nothing about it excites me,” said breeder Garrett Redmond. “My worry is: If it is profitable and profits are shipped to Dubai, more of our patrimony is exported to an OPEC member. That cartel is already taxing us into depression and poverty.
“There is one way it might help sellers,” Redmond added, “but I know it will not be done. With the huge capital at its disposal, FT could pay sellers on the day following the sale instead of the waiting period there is now. That alone would be a huge blow against Keeneland; the kind of competition we need to take Keeneland down a few pegs.”
Several horsemen contacted by the Paulick Report brought up the feud between Sheikh Mohammed’s Darley operation and the Coolmore camp led by John Magnier and the team that includes Demi O’Byrne and Paul Shanahan.
“Coolmore bought and sold a lot of horses with Fasig-Tipton, and there is the fact that Sheikh Mohammed doesn’t buy Coolmore horses or Coolmore-bred horses,” said one breeder. “I’m not sure how that is going to play. Would Coolmore have the same kind of relationship with Fasig-Tipton that they’ve had before? That’s still to be panned out.”
Browning addressed the question directly. “We’ve tried to be proactive with Coolmore and Darley. Both camps have been important customers of Fasig-Tipton and the overall industry. We’ve had a longstanding relationship with Coolmore, especially with Demi and Paul, and we’ve tried to make every effort to encourage them and assure them that we want to continue those relationships. It’s important for the industry.
“Competition is good and good for all of us,” Browning continued. “We want a competitive environment where we have both sides on the same horse. We want them both to be completely comfortable buying and selling horses at Fasig-Tipton. We are striving to do that. I can’t say that it’s going to be a success or failure.”
For now, Browning is hoping the industry has some patience as new plans are formulated.
“Rome wasn’t built in a day,” he said. “This transaction closed May 30. Our perspective is to make the game better and the sales better on a long-term basis. We want to do the right thing consistently and for the long term. It’s not very glamorous or exciting, but we are more interested in where we’ll be in five years, not five months.”
By Ray Paulick
Copyright ©2008, The Paulick Report
Tags: Abdulla al Habbai, boyd browning, coolmore, darley, dubai, fasig-tipton, john hettinger, john magnier, Keeneland, Paulick Report, Ray Paulick, sheikh mohammed, synergy investments
Posted in Industry, Thoroughbred Auctions | 2 Comments »
Monday, June 23rd, 2008
Brant Latta, a veteran racetrack executive who has been with Magna Entertainment for nearly 10 years, most recently as senior vice president of operations, has left the company, he told the Paulick Report on Monday.
Prior to his last position, to which he was promoted in October 2006, Latta was the senior manager of Magna’s “continuous improvement team,” from August 2003 to March 2006, and before that was general manager of Santa Anita Park. Before joining Magna, Latta had worked at several racetracks, including Turf Paradise, Longacres, and Rillito Park. He is a graduate of the University of Arizona’s Racetrack Industry Program.
Latta called it a “mutual parting” that was prompted by efforts to reduce corporate overhead. Magna is currently run by its chairman, Frank Stronach, who has been acting chief executive officer since Michael Neuman was sacked a year ago after less than six months on the job.
By Ray Paulick
Copyright ©2008, The Paulick Report
Tags: Brant Latta, Frank Stronach, Magna, Magna Entertainment, Paulick Report, Ray Paulick
Posted in Industry, Magna Entertainment | 1 Comment »
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