Ahmed Zayat

New Court Filings in Zayat Bankruptcy Proceedings

The trustee overseeing owner, breeder Ahmed Zayat's personal bankruptcy proceedings made several court filings Tuesday to recover roughly $90,000 in allegedly fraudulent payments to various law firms. According to the court filings, Zayat was insolvent at the time the transfers were made, and therefore, the law firms who are the defendants in the suits received more than they would have done through the Chapter 7 bankruptcy proceedings "had the Transfer[s] not been made." Trustee Donald Biase alleges in his court filings that the largest transfer of money Zayat fraudulently made...

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Proposed $5M Zayat Settlement Gives Only $30K to 'Unsecured' Claimants

The court-appointed trustee in the nearly two-year-old Zayat Stables involuntary bankruptcy case is proposing a settlement in which Ahmed Zayat and his family members would pay $5 million to be allocated between MGG Investment Group and the trustee. Of that amount, only $30,000 is earmarked to eventually go to "unsecured creditors," some of whom are Thoroughbred industry participants owed money by Zayat Stables and are much further down the legal pecking order for otherwise getting repaid. MGG will also get a disbursement from the funds in the bankruptcy trustee's account...

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$1.5m Zayat Settlement to Make Small Dent in Overall $19m Debt

The trustee in Ahmed Zayat's personal bankruptcy case has negotiated a $1.5-million settlement to be paid by the debtor's brother, Sherif Zayat, that a court document stated will "resolve all claims and causes of action" related to the multiple mortgages on Zayat's home. The motion for approval of that settlement, if so ordered by a judge in a New Jersey federal bankruptcy court July 6, doesn't mean the end to the complicated, now 21-month-long Chapter 7 petition by the allegedly insolvent former Thoroughbred owner and breeder. But it does mean...

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Filing Could Trigger Foreclosure on Zayat's $3.5M Home
Filing Could Trigger Foreclosure on Zayat's $3.5M Home

On the same day that the federal judge overseeing Ahmed Zayat's two intertwined bankruptcy cases ordered the 13th consecutive extension of time for the trustee poring over Zayat's racing stable finances to file a complaint objecting to the dischargeability of any debt, the company that services the mortgage on Zayat's $3.5-million New Jersey home on Friday filed a separate motion asking the court to remove the automatic stay on that property. Such a request, if granted at a Feb. 1 hearing, could pave the way for the financial institution to...

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This Should be Required Reading for Every Trainer and Owner

by Andrew J. Mollica, Esq and Len Green, CPA What an industry! The recent, well-publicized ongoing legal sagas of both Ahmed Zayat and Ken Ramsey have brought issues surrounding owner-trainer financial relationships into clear focus. Yet, the truth is that no-pay or slow-paying owners probably have been a small, but existing part of racing since the game was invented. Despite its topical nature, the problem is not going away anytime soon, and the reason is simple: horse racing is a 21st-century industry that is based on an 18th-century business model....

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New Fraud Allegations Against Zayat Over $400K Mortgage

In a bankruptcy case already brimming with fraud allegations that has languished in federal court for over a year, the trustee pouring over the finances of Ahmed Zayat filed a new complaint alleging wrongdoing Friday. This latest court action in the twisted saga of the owner and breeder of Triple Crown champ American Pharoah alleges that Zayat and his wife, Joanne, secured a $400,000 mortgage on two back lots adjacent to their New Jersey home in 2018, then had the money wired to the bank account of Zayat's fiscally troubled...

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Judge Orders Zayat Brother to Comply With Subpoena

The judge handling the Zayat Stables bankruptcy case has ordered Ahmed Zayat's brother, Egyptian businessman Sherif El Zayat, to comply with a subpoena that directed him to turn over documents relating to the family's businesses and finances. This comes after Donald V. Biase, the trustee overseeing Zayat's bankruptcy case, charged last month that Zayat and members of his immediate family were engaged in "an exercise in gamesmanship, obstruction and delay" to prevent the trustee from having access to financial documents. Blaise is clearly zeroing in on Sherif El Zayat because...

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It's All About the Horses..And Their Trainers at HOF Induction Ceremony

SARATOGA SPRINGS, NY--To punctuate his acceptance speech that concluded the Hall of Fame induction ceremony Friday, trainer Todd Pletcher used a favorite line of the late Cot Campbell, the Thoroughbred owner and colorful racing personality who was one of his longtime patrons. "It's not going to sound nearly as cool coming from me, he was a cool guy," Pletcher said, "but most of all, I want to thank the horses, the horses and the horses." Campbell's words were a fitting coda for racing's annual feel-good day that salutes the best...

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Zayat's Bankruptcy Lawyers Want to Sever Ties Over $368K in Unpaid Fees

The law firm representing Ahmed Zayat in his $19-million bankruptcy pleading asked a federal judge Monday for permission to walk away from the case based on Zayat's alleged non-payment of $368,273 to the firm in outstanding legal fees. "The representation of the Debtor has consumed an extremely significant amount of the available resources of our firm," wrote attorney Jay Lubetkin of Rabinowitz, Lubetkin & Tully, LLC, in a July 26 "motion to withdraw" filed in United States Bankruptcy Court (District of New Jersey). "The Debtor has been consistently advised that...

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Zayat Bankruptcy Trustee Alleges 'Ongoing Pattern of Delay, Obstruction, and Gamesmanship'
Zayat Bankruptcy Trustee Alleges 'Ongoing Pattern of Delay, Obstruction, and Gamesmanship'

Ahmed Zayat's attempt to get out from under $19 million in debt has reached yet another--and purportedly intentional--legal bottleneck. The trustee assigned to the case is now alleging that three children and the wife of the financially strapped owner and breeder of Triple Crown champ American Pharoah are refusing to cooperate in providing documentation the trustee had subpoenaed from them to try and trace millions of dollars in possibly fraudulent transfers. "[T]he Trustee's investigation reveals that the Debtor and his family members have engaged in a pattern of intermingling of...

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Trustee Alleges Zayat Transferred $200K+ Just Before Bankruptcy Filing

In an effort to claw back at least $200,000 in transfers by Ahmed Zayat that allegedly constitute "fraudulent conveyance" because they occurred just prior Zayat's filing for Chapter 7 bankruptcy protection, the trustee in charge of vetting Zayat's case filed two complaints in federal court Wednesday that aim to recover that money so it might instead go toward paying creditors. Zayat claims to be $19 million in debt, and a massive chunk of that money is owed to Thoroughbred-related individuals and entities. According to documentation filed Apr. 21 in United...

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Bankruptcy Trustee Warns of Risk that Zayat Will Wipe Away Electronic Records

Two weeks after being granted an extra month to determine if Ahmed Zayat is hiding assets while seeking Chapter 7 bankruptcy protection, the court-assigned trustee in the case told a federal judge Friday that the allegedly insolvent owner and breeder of Triple Crown champ American Pharoah (Pioneerof the Nile) is still trying to evade scrutiny by withholding records. And trustee Jeffrey Testa further warned that the longer the case drags on, the higher the risk is that Zayat will wipe away cloud-storage financials before the trustee can examine those documents....

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