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As the court battle between Triple Crown-winning owner Zayat Stables and New York investment firm MGG Investments rages on, court documents filed this week show the receiver tasked with managing the diminishing stable has faced a challenge from indicted trainer Jorge Navarro.

Elizabeth Woodward, director of forensic accounting and litigation support at Dean Dorton Allen Ford, was appointed by a Fayette Circuit Court in January to manage the stable's assets. This primarily involves selling horses at public auction or overseeing the continued racing careers of some in hopes of increasing their value. As news spread earlier this year of the suit, which is based on more than $24 million in loans MGG claims Zayat Stables did not repay, other creditors began to emerge

Woodward filed a motion before Judge Kimberly Bunnell this week, asking the court to certify her calculation of money Navarro is owed by the stable. Woodward claims she was in contact with Navarro over the training of Zayat runners Paynted, Mony, and Perlman after being appointed to run the stable in January. Days before his federal indictment in March on charges related to doping of racehorses, Woodward says Navarro asserted a legal claim on the horses for unpaid bills by Zayat. Upon news of his arrest, Woodward said she immediately sought to remove the three horses from Navarro's barn.

Ten days after his arrest by the Federal Bureau of Investigation, Navarro informed Woodward through attorney Bradford Beilly he planned to sell the horses to pay off the debt, which he claims exceeds $51,000.

“Contemporaneously with sending its Claim Notice, Navarro transported the Zayat Horses to an undisclosed location, without notice or permission from the Receiver, and in direct violation of the [Court] Order on or around March 19, 2020,” read Woodward's motion. “Escalating the conflict, on April 7, 2020, Navarro then scheduled a public sale for April 17, 2020 … Though it was unclear how Navarro could hold a commercially reasonable public sale as required by Florida statute at a time in which the state was closed for commerce by executive order and the horses themselves were secreted away to an unknown location, the Receiver took immediate steps to stop the proposed sale.”

Woodward secured a bond for the amount Navarro claimed he was owed and secured the horses nine days later and sold them at the Fasig-Tipton July Horses of Racing Age Sale for a combined $112,000.

Because of the specific expenses allowed and disallowed by Florida laws governing liens, Woodward now says the stable owes Navarro less than he claims. Previous findings in the case suggest the receiver isn't subject to bills incurred by the stable under Zayat's control, and only certain types of expenses such as feed and stabling (but not training) are permitted for agister's liens in Florida, according to Woodward's motion.

Rudy Rodriguez was awarded a $394,437.19 judgment for unpaid training bills by a New York court, and is hopeful he can collect his money before MGG is paid back from proceeds of sales or race purses by Zayat horses.

In other news related to the case this week, Judge Bunnell dismissed with prejudice MGG's claims against Bemak International, which facilitated a sale of American Pharoah breeding rights from the Zayat family to Orpendale. MGG is appealing that dismissal.

The post Unpaid Bills And Disappearing Horses: Court Filings Detail Dispute Between Navarro, Zayat Receivership appeared first on Horse Racing News | Paulick Report.

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The pool of people seeking money from Zayat Stables got more crowded in recent weeks as a judge in Kentucky's Fayette County Circuit Court consolidated two civil cases against the 2015 Triple Crown-winning owner. Trainer Rudy Rodriguez won a motion in late June to combine his civil case in Fayette County with an existing case between MGG Investments and Zayat Stables over $24 million in unpaid loans.

Rodriguez won a judgment against Zayat Stables in a New York court in late 2019 for $394,437.19 in unpaid training bills that his legal team says went back years.

MGG had objected to the motion before Judge Kimberly Bunnell, questioning whether the two cases had enough in common to be combined. After all, the company argued, Rodriguez had a judgment in his favor from a New York judge, but had nothing to do with the loan Zayat took out from MGG in 2016.

“Zayat Stables undoubtedly owes a lot of money to a lot of people,” read paperwork filed by MGG ahead of the judge's order to consolidate. “Allowing Rodriguez Racing into the case will only open up Pandora's box and cause all of Zayat Stables' other creditors to come out of the woodwork to join this case, regardless of the irrelevance of their claims to the matters before the Court in this case.”

Attorneys for Rodriguez Racing disputed that assertion and pointed out that in one monthly report alone, over $137,000 had been paid to creditors of Zayat Stables by the receiver in charge of winding down the Zayat Stables operation.

Rodriguez no longer trains horses for Zayat, according to court filings. In mid-October 2019, he alleged the stable owed him more than $600,000 in unpaid bills, and filed an agister's lien on Lezendary and Majid, the two Zayat horses still in his possession at the time. Justin Zayat, son of Zayat Stables founder Ahmed Zayat, told media the two sides had come to an agreement over the amount owed.

“He's a wealthy man. I'm a working guy,” Rodriguez said at the time. “It costs me a lot to run the stable, with salaries and workers' compensation. Whenever I talk to him, he says he's going to pay, he's going to pay. I told him, 'I can't carry you anymore.'”

Ahmed Zayat would later announce in a tweet in late October that Rodriguez was “back on the team,” showing Rodriguez with Ahmed and Justin Zayat in what would seem to be the Zayat Stables offices in New Jersey. That tweet has since been deleted.

The post Rudy Rodriguez Gets $394K Judgment Against Zayat Stables, Joins MGG Investments Civil Case appeared first on Horse Racing News | Paulick Report.

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