Zayat files motion to rescind third party takeover of his horses

A motion filed Monday by representatives of Ahmed Zayat in Kentucky's Fayette County Court seeks to rescind or modify an earlier court order placing his Zayat Stables under third party control.

The ruling last week against Zayat was the result of a civil lawsuit filed by MGG Investment Group, which claims Zayat defaulted on $23 million in loans. According to the Daily Racing Form's Matt Hegarty, the motion filed by Zayat’s attorneys this week noted Zayat both was not represented at the hearing and that a “strongly skewed version of events” was presented to the court. The motion seeks for the receivership order to either be dissolved or modified in order “to effectuate an orderly liquidation.”

“MGG and its lawyers ran into court without so much as providing notice to Zayat Stables in an effort to unlawfully seize control of the stables, despite the fact that the parties were in the midst of workout discussions that would have ensured MGG received back every cent of its investment,” the motion reads, according to DRF.

Zayat’s attorneys do not dispute that he defaulted on his loan from MGG Investment near the end of 2019. MGG Investment also claimed in its lawsuit Zayat had sold numerous shares in racehorses and stallions -- including 2015 Triple Crown winner American Pharoah -- and they were not notified.

Attorneys for Zayat denied the allegation, noting: “Far from the active concealment now claimed by MGG, Zayat Stables cooperated and was fully transparent regarding the sales of the American Pharoah breeding rights.”

The motion seeks for the two parties to reach a liquidation agreement of Zayat's horse racing assets, noting it would potentially cover the $23 million in outstanding debt.