Shareholders in Injured Kentucky Derby Horse Sue Other Owner

July 20, 2009

A group that owns a share of one-time Kentucky Derby favorite I Want Revenge has sued the colt’s other owner, claiming he didn’t disclose an injury that caused the horse to scratch the morning of the race.

IEAH Stables accuses David Lanzman of fraud, negligence and breach of fiduciary duty for failing to let his ownership partners know about a right front ankle injury and various efforts to treat it.

Inflammation was detected in the ankle hours before the Derby and Lanzman decided to pull him from the race. He was the first morning-line Derby favorite to scratch on race day in at least 60 years.

But Lanzman’s attorney, Michael Meuser, said Lanzman wasn’t hiding anything from his co-owners and that he was as surprised as anybody when the injury was discovered on Derby morning.

“We had the same amount of information they had about the treatment this horse was receiving,” Meuser said. “These racehorses are treated every day at the racetrack. They’re fragile animals. But this horse was never lame until the morning of the race.”

IEAH claims in its lawsuit filed Fayette Circuit Court that an injury to the same ankle was discovered three weeks earlier, days after the colt won the Wood Memorial with an impressive last-to-first charge to establish himself as a top Derby contender. Lanzman sold IEAH a 50 percent share of the horse in a sale that was completed on April 1, three days before the Wood.

IEAH’s lawsuit was a counterclaim to Lanzman’s own suit last month accusing IEAH of breach of contract for other issues related to the sale. IEAH president Michael Iavarone referred questions to his attorney, Andre Regard.

Regard said Lanzman not only failed to notify IEAH about an existing injury but may have ignored health concerns to make sure the colt stayed on the path to the Derby.

“Because of the focus of getting a horse to Derby and the hysteria that surrounds it, it’s IEAH’s contention that clouded the judgment of how to handle the situation,” Regard said.

He received a filling in his ankle on April 10 after Regard says the horse pulled up lame, and the ankle subsequently received an x-ray and two injections. Iavarone and IEAH never learned about either the injury or the treatment, the lawsuit claims.

After the horse scratched from the May 2 Derby, other tests were conducted –including an MRI. The lawsuit argues the tests should have been done earlier, after the injury was discovered.

IEAH claims the undisclosed injury cost it thousands of dollars in transporting the horse to the Derby and likely means others who have invested in the colt will need to have their money refunded. The lawsuit seeks punitive damages and undetermined compensation for the decrease in value of the animal.

“Because he was not taken out of training and continued to run on the injured ligament, the colt was further injured and is now unable to race,” the lawsuit says. “This injury has caused a significant financial injury to IEAH including the loss of race earnings and the loss of income as a future stallion.”

Churchill Downs put the morning line into the racing program in 1949, and since then no favorite had scratched on race day. The last major contender to do so was second choice A.P. Indy in 1992. Coincidentally, I Want Revenge is a grandson of A.P. Indy, who went on to win the Belmont Stakes that year.

Three other Derby contenders were withdrawn the week of the race this year, including possible favorite Quality Road with a hoof problem, Win Willy with an ankle injury and Square Eddie with a shin injury.

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