REBUFFED BY CUP
On the surface, it seems unfathomable that the 40-some members and trustees, founding members and officers of the Breeders’ Cup who select the organization’s operating board of directors could have rejected Richard Santulli, whose business acumen is such that he is on the short list of candidates to succeed Warren Buffett, the “oracle of Omaha,” as chairman of Berkshire Hathaway. But that’s what they did on Friday, when the group voted to fill seven positions on the 14-member board. Neither Santulli, a New Jersey-based Thoroughbred owner and breeder, or Hill ‘n’ Dale Farm owner John Sikura received enough votes to secure a board seat.
The members and trustees re-elected all five of the candidates who sought re-election to two-year terms: Breeders’ Cup board chairman Bill Farish of Lane’s End Farm, Antony Beck of Gainesway Farm, Terry Finley of West Point Thoroughbreds, racetrack and casino owner R.D. Hubbard, and Satish Sanan of Padua Stables. Two open seats, made possible when board members Robert Clay and Joseph Shields Jr. were voted off the board of members and trustees by Breeders’ Cup nominators, were filled by Helen Alexander of Middlebrook Farm and Roy Jackson of Lael Stables.
Those seven are joined on the Breeders’ Cup board by the following individuals who were elected to two-year terms in 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 is widely believed that the xenophobic duo of Farish and his father, Will, the vice chairman of the Jockey Club, lobbied heavily with the members and trustees to keep Santulli and Sikura off the board. Ironically, Santulli has been a client of Lane’s End, keeping mares at the Versailles, Ky., farm. Both Santulli and Sikura have been outspoken in their criticism of various aspects of the Breeders’ Cup in recent years. NetJets, the company Santulli founded and which is now part of the Berkshire Hathaway empire, was a Breeders’ Cup sponsor for several years but did not renew its sponsorship in 2008.
New Jersey-based Thoroughbred Daily News publisher Barry Weisbord, a close associate of Santulli, is believed to have lobbied to get Santulli elected. In addition, a number of Kentucky-based members and trustees pushed for the election of Sikura.
Simply put, Farish had the most juice in this election, and sources say it wasn’t even close.
The two new board members, Alexander and Jackson, represent old money. Alexander is an heir to the massive King Ranch, which raced 1946 Triple Crown winner Assault. She is widely respected for her independence and toughness, and support for her candidacy likely reached across the various factions.
Jackson, an heir to the Standard Oil fortune through his grandfather, William D. Rockefeller, is best known as the owner-breeder with wife Gretchen of Barbaro, the Kentucky Derby winner whose injury in the Preakness and unsuccessful battle to survive was a closely followed national drama two years ago. Having the conservative and low-keyed Jackson seek election was a stroke of genius by whoever convinced him to run. He and his wife, along with trainer Michael Matz, jockey Edgar Prado and veterinary surgeon Dean Richardson, were the human elements in the Barbaro story, and the Jacksons received plaudits from all corners for their handling of the horse’s post-Preakness struggles.
I’ve never heard anyone compare Jackson’s business experience with that of Richard Santulli, or his knowledge of the horse industry with John Sikura. But he is without enemies in the business and doesn’t make waves: a sure-fire qualification for an endorsement from the Farishes.
The respect for Alexander and the affection for Jackson notwithstanding, the rejection of a highly successful businessman like Santulli is mind-boggling. If he is good enough to be a candidate to run Berkshire Hathaway, it’s almost comical to think he would not be an asset on the Breeders’ Cup board.
The only conclusion I can make is that the most influential board members, led by Bill and Will Farish, are interested only in maintaining power by preventing individuals with different points of view from getting elected.
“Billionaires run the industry,” one horseman said to me after the election. “The only way to beat them is on the racetrack.”
By Ray Paulick
Copyright ©2008, The Paulick Report
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Tags: Antony Beck, b. wayne hughes, Barbaro, berkshire hathaway, Bill Farish, Breeders' Cup, donald dizney, g. watts humphrey jr., Greg Avioli, Helen Alexander, Horse Racing, John Sikura, Joseph Shields, king ranch, lael stables, netjets, Paulick Report, R.D. Hubbard, Ray Paulick, reynolds bell jr., richard santulli, Robert Clay, robert manfuso, Roy Jackson, satish sanan, Terry Finley, tracy farmer, Warren Buffett, Will Farish
July 14th, 2008 at 8:33 am
Ray,
Why don”t you write about how Santulli opposed another term for Avioli as BC president and how Avioli went out and secured another fractional ownership private jet sponsor in retaliation? It’s great to read about the inside doings but why does Avioli get off unscathed? His work at ntra in Washington was abysmal and he’s leading the BC into oblivion. After last year’s debacle at Monmouth, they learned nothing with even higher prices at Santa Anita. His boy Thayer embarrassed himself on WFAN by saying that there would be absolutely no general admission sold for Monmouth and when tickets weren’t selling they quietly went on sale. I could go on and on but hard-hitting means not pulling punches for some.
Bill
July 14th, 2008 at 10:12 am
Ray,
When you blog do Barry Weisbord’s lips move? Just wondering…
Santulli balked at renewing his BC sponsorship and then got all huffy when one of his competitors stepped in. And if Barry wants to run a slate of candidates, he shouldn’t go around insulting all the people who have to vote for them.
July 14th, 2008 at 10:45 am
Despots cannot be deposed by democratic methods. This is especially true when the despots hold power through a sham election system. Case in point: Zimbabwe.
The Breeders’ Cup rulers cannot be ousted through the election process. What other courses of action are available to the disenfranchised? As I see it, there are two possible ways.
The legal system. BC is a New York corporation. ( *See another comment on that below)
Check if it is being run in strict compliance with NY law. Were the rule changes, made behind closed doors, legal? There are many other questions that could be answered by a good lawyer if given a few leads and avenues to check. Obviously this course requires a few monetarily capable people to get together and finance the proposal.
Alternatively, hit BC in the pocket. Boycott this years foal nominations. Despite claims that BC nomination improves a horse’s market value, there is no real statistical evidence to support the claim. Therefore, if mare owners refuse to finance the Breeders’ Cup, the rulers will quickly come around. The objective should be to install an honest, democratic way to directly elect the Board.
I must add to the comment by Bill about Greg Avioli. How did he manage to cling to the BC when his previous carrier, NTRA, is such an awful failure? I asked Avioli why BC had an address in Atlanta. He was not aware of it - or so he said. When I asked if it was a convenience of some kind for former NTRA people, he dismissed the idea. The Atlanta office has since vanished from the address book. I asked why the BC was a New York corporation. He said it was what John Gaines wanted because all Mr. Gaines’s legal affairs were handled in NY. When I pointed out that Mr. Gaines is no longer with us and the BC is physically quartered in Kentucky, there was no response.
There is something curious about the Avioli - BC relationship.
July 14th, 2008 at 1:01 pm
I am compelled to clear up one opinion on this blog. I am not “Avioli’s boy” nor am I currently affiliated with Breeders’ Cup except as a small nominator and state legislator who would like to see the event return, on a regular basis, to Kentucky, where it has met with its best financial success.
At this time last year, I WAS a consultant to Breeders’ Cup and DID make that statement about general admission in an interview on WFAN. At that time, that was the policy of Breeders’ Cup Limited.
July 14th, 2008 at 4:21 pm
Damon,
The problem with what you said on the radio was that fans heard it and went ahead and bought overpriced seats based on information that you provided. When it rained, those fans were standing in the same areas as the people that paid general admission asking themselves why did I pay five times to get here? For your future political aspirations, I would play down the “consultant to the BC” part.
Bill
July 17th, 2008 at 1:09 am
I’m afraid all this reminds me of something.
Did the BC-Avioli management at any time after the 2007 BC ever issue an apology for what a multi-faceted disaster the event turned out to be?
It is possible that they had, but I don’t recall seeing one.
I am fairly certain that New Jersey Account Wagering, whose system crashed - resulting in the loss of millions in wagering handle - never had the decency to apologize for the fiasco.
If anyone can guide me on this, I’d appreciate it.
The reason why I ask is that if the various people responsible for this mess last year didn’t acknowledge what had gone wrong, they’ll continue making the same mistakes again on future dates.
And if there’s ever another BC like the one in 2007, regardless of where it’s held, the franchise will take a hit that will be an exact replay of Indy Mac going belly-up last Friday in California.
August 15th, 2008 at 7:22 am
[...] G. Watts Humphrey. The battle over control of the Breeders’ Cup board has been detailed by previous articles in the Paulick [...]