Report: Zayat Sued, Zayat Stables in Receivership

Fayette County (Ky.) Judge Kim Bunnell has ordered a receiver to oversee Ahmed Zayat's Zayat Stables, including all of its horses, after an emergency hearing was conducted Jan. 22 in connection to a lawsuit filed against the prominent Thoroughbred owner and breeder. 

According to a report from the Lexington Herald-Leader, Zayat and his Zayat Stables have been named as defendants in a lawsuit seeking at least $23 million in damages. The Herald-Leader reported that the lawsuit, filed Jan. 21 in Fayette County Circuit Court by MGG Investment Group—a New York-based investment firm—claims Zayat's breeding rights to 2015 Triple Crown winner American Pharoah  were being held as collateral against previously outstanding debts incurred by the owner, who once settled a lawsuit with Fifth Third Bank in a federal bankruptcy court.

According to the Herald-Leader, the lawsuit states MGG made several loans to Zayat Stables, which he defaulted on in September 2019. The loans were secured by all of Zayat's assets, horses, and breeding rights.

According to the story, the judge granted a motion by the plaintiff to have a receiver oversee day-to-day operations of Zayat Stables. The investment group requested the motion to protect its interests in the horses as collateral.

The story said Zayat could not be reached for comment and his attorney didn't immediately respond to a request for comment.

The Herald-Leader went on to add that the lawsuit claims the Zayat family sold off nine breeding shares to American Pharoah without telling the firm and hid $3.3 million in proceeds rather than using the money to pay back part of the loan as required.

American Pharoah stands at Coolmore's Ashford Stud in Versailles, Ky., for a private fee. Coolmore purchased the breeding rights to the son of Pioneerof the Nile in January of 2015—long before he won the Kentucky Derby Presented by Yum! Brands (G1), Preakness Stakes (G1), and Belmont Stakes Presented by DraftKings (G1), becoming the first Triple Crown winner since Affirmed in 1978. American Pharoah was retired to stud at Ashford after closing his career with a victory in the 2015 Breeders' Cup Classic (G1) at Keeneland. 

Angst: Zayat Calls Gambling Debt Lawsuit Extortion

Angst: Zayat, Fith Third Reach Settlement 

In an email to the investor included in the lawsuit, Zayat indicated he planned to meet with Fasig-Tipton about a potential dispersal sale, the Herald-Leader reported.