Laoban Mortality Claim Denial Tied to Veterinary Care

A letter denying a mortality insurance claim following the death of Laoban  which says the stallion died because a veterinarian gave him a risky compounded injection of four different medications has been made public in court documents.

The letter, filed June 7 in a lawsuit by Cypress Creek Equine and previously obtained and reported by The Courier Journal, was penned Aug. 4, 2021, by attorney Harvey A. Feintuch on behalf of North American Specialty Insurance Company and directed to named insureds Kevin Moody's Cypress Creek Equine and Michael Moreno's Southern Equine Stables.

The letter says the veterinarian involved, Dr. Heather Wharton, provided care for horses at WinStar Farm, where Laoban stood at stud from the latter part of 2020 until his death on May 24, 2021.

Resident veterinarians at WinStar were interviewed and surveillance videos reviewed as part of a post-mortem investigation by the insurance company. The letter alleges:

• Wharton did not read the labels on the four medications;
• Three medications were expired, one of them by almost nine years, and it was indicated for the treatment of iron-deficient anemia in baby pigs;
• Two of the labels had warnings of anaphylaxis, a potentially fatal allergic reaction;
• The medications were used in a manner contrary to label instructions in 10 different ways;
• Wharton had never administered such a combination before and did so outside applicable federal regulations; and
• Wharton failed to properly monitor Laoban after the injection.

"This was an unbalanced risk that Dr. Wharton undertook on behalf of WinStar and not a risk that is covered under the policies," the letter concluded in a summary of findings.

June 7 court filings by Cypress Creek say North American Specialty is not applying the policy terms correctly and that Southern Equine Stables has no insurable interest in Laoban after selling its shares in the horse before the policies were issued, adding that Southern Equine's successor, Hometown Services, filed for Chapter 7 bankruptcy relief.

The claim denial letter says, in essence, the policies do not cover loss caused by or resulting from the inoculation of drugs or medication to the horse unless certified by the veterinarian to have been of a preventative nature or necessitated by accident, sickness, or disease of the horse. During the investigation, Wharton said the injection was not given for any of those reasons.

The letter said further treatment policy provisions require the insurer to be notified in advance, which did not happen.

The letter recounts that WinStar managers met with Wharton, leading to an agreement that Laoban would be given a vitamin B12 shot, as the stallion's enthusiasm for breeding had tailed off.

Allegedly without consulting the managers further, Wharton unilaterally decided to combine vitamin B12, vitamin C, vitamin B complex, and iron in what she called the "Black Shot."

The denial letter says Wharton left Laoban's side about 30 seconds after the injection, and soon afterward Laoban experienced complications and collapsed. Learning of the trouble, Wharton returned about five minutes later, but an effort to save Laoban with steroid injections failed.

Dr. Laura Kennedy of the University of Kentucky performed a post-mortem examination and concluded that a presumptive diagnosis of anaphylactic shock can be made with a reasonable degree of certainty. According to the denial letter, in July 2021 Wharton said under oath in a recorded statement that it was her opinion that Laoban died as a result of anaphylactic shock.

Beyond the threshold issue of whether the medication was preventative or necessitated by accident, sickness, or disease, the denial letter also says the policy doesn't apply to loss caused by or resulting from failure to provide proper care and attention for the horse.

The Courier-Journal reported no animal cruelty charges will be filed against Wharton due to the statute of limitations expiring, but Woodford County Animal Control supervisor Susan Jones told the Louisville paper she expects the Kentucky Board of Veterinary Examiners to take action against the vet, potentially including the loss of her license. The Courier-Journal reported Wednesday that the Kentucky Board of Veterinary Examiners has opened an investigation into the case.