Trainer Reed Gets 5-Day Suspension For Bute Positive At Turfway

Trainer Eric Reed has been penalized with a five-day suspension and a $1,000 fine for a phenylbutazone positive in a $15,000 claiming winner last month at Turfway Park.

According to a Feb. 1 Kentucky Horse Racing Commission (KHRC) stewards' ruling, the 2022 GI Kentucky Derby-winning trainer waived his right to a hearing and will serve his days Feb. 10-14 without lodging an appeal.

The ruling stated that the offense was Reed's second for a Class C positive within the past year. The KHRC classifies drugs on an A (most severe) to D (least severe) scale.

Phenylbutazone, also called Bute, is a non-steroidal anti-inflammatory drug. The test reported a finding of .62 micrograms per milliliter. According to rules posted on the KHRC website, bute is permitted on race day in concentrations at or less than three-tenths (0.3) micrograms per milliliter.

The disqualified winner was Golden Text (Danza), who wired the field in the fourth race Jan. 19, got claimed from owner Jackie Willoughby, Jr., and then had the claim voided because of the drug ruling.

Reed responded to a Friday voicemail request asking for his side of the story by texting that he had already issued statements to two other publications and did not wish to comment further.

Reed told Horse Racing Nation's Ron Flatter earlier in the week that, “I waived my rights because I know I gave the horse Bute paste [which takes longer to clear a horse's system]. I apologize to my friend Jim Willoughby, who owns the horse and had the win taken away. I also apologize to the racing industry. I used a Bute paste instead of the injection because he's the kind of horse who fights you every time you give him a shot.”

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Jamie Eads Officially Named Executive Director of KHRC

Gov. Andy Beshear has appointed Jamie Eads–who served as interim executive director of the Kentucky Horse Racing Commission (KHRC) for the past six months–the executive director of the KHRC, effective Dec. 1.

After graduating from the University of Kentucky with dual degrees in marketing and management, Eads worked for both the National Thoroughbred Racing Association (NTRA) and the Breeders' Cup LLC. She has been with the KHRC since 2008, when she joined the organization as the director of the Division of Incentives and Development. She then moved into the deputy director position in 2016.

“Jamie has done a wonderful job in leading a talented team at the Kentucky Horse Racing Commission since July of 2022 when she was named interim director,” said Beshear. “Her 15-year tenure at KHRC has prepared her to lead Kentucky horse racing into the future.”

Eads has been responsible for the administration of several popular incentive programs that have boosted the racing industry in Kentucky. She oversaw $16 million in breeder incentive funds and $47 million in state purse development funds and harness racings' Kentucky Proud Series.

“I am honored to serve Gov. Beshear and the Commonwealth, along with the members of the Commission and everyone on the KHRC team as we work together to further cement Kentucky as the world leader of breeding and racing,” said Eads.

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The Week In Review: For Syndicate Partners, What’s In A Name (Or Ten)?

Right now within TDN's Top 12 rankings for the GI Kentucky Derby, seven horses are owned by multiple-entity partnerships. One syndicate maxes out at 10 individual owners, another at eight.

If the horses from those larger partnerships (or other syndicates-there are plenty of them and they are growing in number worldwide) make it into the Derby field, they won't have to worry about getting the satisfaction and distinction of seeing their names in print as owners. But that's only because as a courtesy, Churchill Downs takes the extra step of hiring a graphic designer to rework the traditional program page for America's most historic and important horse race so that no owner of a Derby runner gets left out.

Technically, that practice is at odds with a Kentucky regulation that limits the number of individual owners who can appear on the printed program page to five. At a meeting last week of the rules committee of the Kentucky Horse Racing Commission (KHRC), commission staffers and industry stakeholders tried to take a first pass at updating that rule so that every member of a syndicate (or at least more of them) might get recognized as listed owners in all Kentucky races, not just on Derby day.

“I've been approached by several ownership groups that we make room for more names,” said KHRC commissioner Charlie O'Connor. “As syndicate groups in this country are becoming a big deal, [people] who invest their money in the horse business want to see their name on a program.

“These ownership groups and syndicates are spending a large amount of money in Keeneland and Fasig-Tipton and all the sales houses around the world, and I think it's a fair thing for them to ask for their name to be on the program, and I think that we should be able to accommodate it without any huge, big issues,” O'Connor said.

Others in on the discussion thought so too. But it turns out there are practicality limitations and potential unintended consequences that come into play if the KHRC paves the way for more individuals to get inked into ownership lines.

As for the existing rule itself, KHRC chief state steward Barbara Borden explained it this way: “Currently, our regulation says more than five individual persons shall not be licensed as owners of a single horse. That's why we have limited the number on the program to five. It goes on to say if more than five individual persons own interests, then they shall name one person to be the licensed representative.”


Signator | Chelsea Durand

Still, even within that parameter of five, the ownership line on a Kentucky program does get crowded. Several stakeholders at the meeting referenced the trouble being related to a 200-character limit that is a requirement of the Equibase system. The number for that data field was selected some time ago, well before the proliferation of partnerships in roughly the past decade, and it was once reasonable to assume every ownership entity would fit within that amount of space.

But that equates to just 40 characters per syndicate member if five owners are listed, and even then, to make everything fit, the characters are often squished together without spacing to the point where, as Borden said, the line is “illegible” to anyone trying to decipher the program.

“Part of the problem is two things,” Borden said. “First of all, the owners that want to see their names, they might know their name is on the program. But you can't read it, and neither can anyone else. And the other thing is, the reason we put the ownership on the program to begin with, is for public disclosure. So if it's not legible because we have too many names or the font is too small or whatever, we're defeating our purpose of listing the owners at all.”

Frank Jones, Jr., a KHRC commissioner who chairs the rules committee, wondered if it would be feasible to include a “side document” in the program that would fit all the names in full, while the program page itself got printed in a less cluttered way.

Anna Seitz, who works with Fasig-Tipton and with international syndicates, said that in Australia, “they list all the names. They just do smaller fonts. I know it makes a huge difference. Those owners, that's part of the reason they buy in, because they want their name on there.”

Gary Palmisano, Jr., the executive director of racing for Churchill Downs, Inc., said his company is “all for” syndicates. “But just understand that it is space-limited” and the issue is a “bigger-picture problem” than just learning to deal with the limitations of 200 characters.

“We live this every year with the Derby,” Palmisano said. “Obviously, in the Derby, every owner partnership wants to see their names. Equibase currently doesn't have the capability of putting in more than 200 characters. So we have to physically, manually, white-out portions of the owner [line, and then string together] the text, and try to put it in [with everyone listed].”

But if the rule got changed to list more owners, Palmisano cautioned, “tracks every single day are going to have to have a graphics design person, as we do for the Derby, [to] recreate the program line. [That task] is certainly something that takes our team, manually, a lot of time to do for the Derby program.”

Palmisano continued: “Right now [the rule] says five [owners are the maximum listed]. With the racetracks, assuming Equibase can help us with the language, we can figure out the program piece. We're already actively engaging with Equibase to try to figure out the program piece. But I think the [rules] committee, more so than looking at the program piece, should take a hard look if it should be five, eight, seven, ten [owners listed]. Because that helps us frame what we need to do with Equibase.”

O'Connor said 10 names might be the sweet spot, because he's seeing many partnerships now constructed at the 10% buy-in level aiming for 10 syndicate members.

Borden said that brings up another issue related to disclosure.

“This takes us back two years ago when we had partnership forms, which we no longer require,” Borden said. “Every syndicate would have to report to us all the participants in the syndicate.”

While the partnership forms might raise the unwelcome prospect of more paperwork for everyone involved, Borden said there is an upside to those forms that relates to better transparency.

“We currently don't always know the exact ownership of every horse, so that would probably be a bonus for us,” Borden said. “But it would entail us being advised of all the ownership and the [percentages each entity owns].”

But, Borden said, no matter what expanded number the rule night eventually state, common sense inevitably has to intervene.


Gulfport | Coady Photography

“At some point there has to be, in my opinion, a limit,” Borden said. “It's not infinity. If 100 people own a horse, we can't put 100 names on there.”

Keeneland's vice president of racing, Gatewood Bell, raised another potential red flag related to numerous owners being listed: Although Kentucky has recently loosened its rules regarding coupled mutuel entries in an attempt to bolster field sizes, a single owner still can't run two horses in the same race if it excludes another owner's horse from getting in. So what if one individual was a small-percentage owner in one syndicate and owned another horse either outright or as part of a second partnership? How would preference be fairly determined?

“You wouldn't want to discourage the owners from joining these syndicates and also having horses on their own,” Bell said.

Borden pointed out that any overlapping ownership in a single race, even a tiny percentage, still counts as an owner having an interest in two horses.

The committee ended up not proposing or voting on any rule change. Jones, the committee chair, said the entire issue needed more study, but that it would likely be brought up again in the near future.

“The more you listen, the more you see how complicated a problem this could become,” Jones admitted.

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KHRC Greenlights $79M Ellis Sale to CDI

The pending sale of Ellis Park to the gaming company Churchill Downs, Inc. (CDI), cleared a necessary regulatory hurdle Tuesday when the Kentucky Horse Racing Commission (KHRC) swiftly approved the transaction by a unanimous voice vote.

The KHRC members in attendance at the “special” meeting greenlighted the $79-million transaction in just 6 ½ minutes after a perfunctory read-through of the basic terms of the deal and a statement that the commission expects CDI to follow through with development projects that had been agreed to by the outgoing owner, which is the business entity for the Pueblo of Laguna tribe in New Mexico.

There was zero debate prior to the approval and not a single member of the KHRC posed any questions to CDI executives.

The transaction, which hinged on the KHRC's approval, is expected to close in the near future.

The intended sale was first publicly announced last Thursday, Sept. 15.

Within Kentucky, CDI already owns Churchill Downs Racetrack and Turfway Park.

Using the current schedule of Kentucky racing as a template, when the deal is finally inked, it will give CDI control of the vast majority of dates on the state's annual calendar. The Keeneland Race Course meets in April and October and the Kentucky Downs boutique meet in early September will be the only exceptions.

The only pre-vote comment at the Sept. 20 meeting was made by KHRC commissioner C. Frank Shoop, who said, “It is not only a great move for Churchill Downs, it's a tremendous economic enhancement for the state of Kentucky, and it's also great for Kentucky horsemen. It's a win-win for everybody.”

After the no-opposition vote, chairman Jonathan Rabinowitz said, “Thank you to Churchill Downs for its commitment to our year-round circuit, and for everything they do for the commonwealth. It's really exciting for Ellis.”

The transaction will be CDI's second attempt at owning Ellis, which it bought in 1998 but offloaded eight years later, describing it as an “underperforming asset” in Securities and Exchange Commission filings.

Ellis Park opened as Dade Park in 1922, and it's currently the state's only Thoroughbred venue in the western part of the state. From a demographics perspective, its unique geographic location in a little slice of Kentucky on the northern bank of the Ohio River that is contiguous with Indiana makes it more of an extension of the roughly 450,000-person Evansville, Indiana, metro market.

For much of the 20th Century, Ellis-with its folksy nickname “the pea patch”-was a summer staple of the Kentucky circuit that catered primarily to lower-level racing.

But the advent of historical horse race (HHR) gaming over the past decade has boosted its stature as a business opportunity, and in recent years other tracks in the state have come together to share gaming revenues from the Kentucky Thoroughbred Development Fund with Ellis an effort to shore up year-round racing statewide.

When CDI bought Ellis in 1998, it became only the fifth owner in track's history. Once this latest CDI re-buy closes, it will mark the fourth different owner for Ellis in the past 16 years.

CDI paid  $22 million in cash, plus stock, to acquire Ellis from Racing Corporation of America back in 1998. That deal also included what was then known as the Kentucky Horse Center, a training facility in Lexington that in 2000 was bought by Keeneland for $5 million.

In September 2006, CDI sold Ellis to Louisville businessman Ron Geary for undisclosed terms.

Two years later, Louisville Business First reported that “Ellis Park has been in the red for eight consecutive years, including all seven it was owned by Churchill Downs.” The publication also quoted Geary as saying that CDI lost $17 million during its time running the track, and that Geary himself lost $2.7 million in his first full year at the helm.

Geary persisted, eventually teaming with the Saratoga Casino and Hospitality Group (SCHG) by selling that entity a 30% stake in Ellis for $4 million. Geary then invested that money into bankrolling the launch of HHR at Ellis.

In 2018, Geary sold his remaining 70% stake in Ellis to SCHG for undisclosed terms.

One year later, Ellis was flipped again, this time for $11 million to Ellis Entertainment, LLC, a subsidiary of Laguna Development Corporation in New Mexico. The Pueblo of Laguna Tribe later held Ellis under a different gaming subsidiary, Enchantment Holdings, Inc.

Waqas Ahmed, the KHRC's director of pari-mutuel wagering and compliance, read into the record details of the pending transaction at Tuesday's meeting, noting that beyond the $79 million purchase price, CDI plans to “further invest $75 million” to develop Ellis and its off-site HHR facility in Owensboro, although specifics on exactly how that money would be spent were scant.

“Due to the preliminary nature of the project CDI was not able to provide further details, but I would like to note that upon review of the purchase agreement, Ellis Park will maintain responsibility for the capital improvements promised to the KHRC earlier this year,” Ahmed said.

The installation of lights for twilight or night racing and the expansion of the turf course were big-ticket items that the outgoing Ellis management had previously told the KHRC were in the pipeline for improvements.

Ahmed said CDI is expected to make “substantial changes” operationally, but that the gaming corporation intended to honor the 2023 race dates request for 24 programs (up one date from 2022) that Ellis had already submitted to the KHRC for next year.

Earlier this month, CDI unveiled its completely rebuilt Turfway Park, which in recent years has hosted Kentucky's December-through-March portion of the circuit. That massive project has been viewed positively in Kentucky as a way to bolster winter racing in the state.

But although CDI appears to currently enjoy a benevolent reputation among regulators in Kentucky, its history of acquiring then shutting down other racetracks has been a major cause for concern for the sport in general over the last two decades.

Under CDI's stewardship this century, the gaming corporation closed Hollywood Park and Calder Race Course, and it is in the process of finalizing the sale of Arlington International Racecourse so the property can be potentially used for a new football stadium. All three closures have strained or wreaked havoc upon their respective circuits in California, Florida, and Illinois.

In particular, the shutdown of Arlington last year capped a decade-long series of acrimonious relations with horsemen, who are still reeling from CDI's decision to sell off one of America's most historic and aesthetically beautiful racing venues, even while the corporation continues to pursue other gaming interests in the very same Chicago market.

Earlier this spring, CDI entered a $2.4 billion agreement to buy Colonial Downs and its network of HHR gaming facilities in Virginia.

In July, before that deal was even formally finalized, CDI's chief executive officer, Bill Carstanjen, said during an earnings conference call that the corporation planned to nearly double Colonial's race dates over the next few years, from 27 to 50, to comply with a Virginia law that ties HHR expansion to live racing dates.

In response to Carstanjen's comments, Frank Petramalo Jr., the executive director of the Virginia Horsemen's Benevolent and Protective Association, told TDN back in July that such a drastic expansion might be detrimental to the overall circuit and the spirit of cooperation that exists in the mid-Atlantic region, given the “diminishing number of horses” and a horsemen's desire for the Virginia track not to be “running over other race meets.”

In addition to the aforementioned three Kentucky tracks and Colonial Downs, CDI also has two other Thoroughbred tracks in its portfolio-Fair Grounds in New Orleans and Presque Isle Downs in Pennsylvania.

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