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J.T. Lundy Passes at 82

J.T. Lundy, the controversial former president of Calumet Farm, passed away Tuesday. He was 82.

The news was reported on Facebook by his sister, Kathy Lundy Jones, and his son, Robert. According to Robert's post, Lundy fell in November, suffered from a head injury and never fully recovered.

According to the BloodHorse, Lundy was a native of Georgetown, Ky. and grew up on a farm working primarily around show cattle. He told the magazine in 1990 that he eventually steered into the horse business because it appeared to be more lucrative than cattle and “it was more fun.”

After operating his own farm, Lundy got his foot in the door at Calumet when he married Lucille “Cindy” Wright, the granddaughter of Calumet founder Warren Wright, Sr. Lucille Wright died in 1982, which paved the way for Lundy to take over the day-to-day operations of the farm.

With Lundy at the helm, Calumet enjoyed success on the racetrack and in the breeding business. In Alydar, Calumet was home to one of the top sires in the sport. Calumet's best horse at the time turned out to be homebred Criminal Type, who was named Horse of the Year in 1990. Another star was GI Shuvee H. winner Tis Juliet. Calumet Farm won the 1990 Eclipse Award for Outstanding Breeder.

Things took a turn in the wrong direction starting in November of 1990 when the then 15-year-old Alydar kicked his stall door and fractured his leg. He was euthanized two days later. Alydar was insured for $36 million, which raised suspicions about his death that persist today.

Though it might have seemed that Calumet was in sound shape financially, that turned out to be untrue. Under Lundy, Calumet was deep in debt due to his fraud and mismanagement. Calumet filed for bankruptcy protection in 1991 and was losing $1 million a month. Lundy resigned as the farm's president in April of 1991. Then under former trainer John Ward, Jr., Calumet was forced to sell off property and reduce its holdings.

In 2000, Lundy, along with Gary Matthews, Calumet's former attorney and chief financial officer, was convicted of fraud and bribery and sent to prison. Along with a 4 1/2-year prison sentence, Lundy was ordered to pay $20.4 million in restitution. A jury found that Lundy and Matthews had committed fraud when acquiring $65 million in loans made to Calumet by the First City National Bank of Houston through bribery and deceit.

According to the BloodHorse, federal prosecutors argued Lundy deserved a stiffer penalty because he was responsible for the death of Alydar, which was the main asset securing the loans. On that latter allegation, United States District Court Judge Sim Lake would conclude: “There is some physical evidence, and circumstances surrounding the event are suspicious, but I cannot conclude he is responsible.”

Lundy was released from prison in 2005.

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‘A Small Pharmacy’s Worth of Drugs’: Harness Trainer Allard Gets 27 Months

The former Standardbred trainer Rene Allard, 35, who was third in North America in both wins and purse earnings in the year before he was arrested and indicted in the March 2020 international doping conspiracy investigation, on Tuesday got sentenced to 27 months in a federal prison after having previously pleaded guilty to one felony count of misbranding and altering drugs.

Allard's sentence was handed down Nov. 15, shortly after the same judge in United States District Court (Southern District of New York) sent the racetrack veterinarian Louis Grasso to prison for 50 months for his role in the doping ring.

Prosecutors had been prepared to go to trial with evidence proving that Allard and Grasso conspired in tandem to drug harness horses.

“Allard, for years, trained and raced horses through use of a covert 'doping' scheme intended to corruptly gain a competitive advantage in races through the administration of performance-enhancing drugs (PEDs),” the feds wrote in a sentencing submission. “Allard obtained from co-defendant Louis Grasso and others unapproved, untested, novel PEDs that he caused to be administered to his horses, despite the inherent risks of administering unnecessary medications to the animals under his control. Allard was motivated by greed, fraudulently earning tens of millions of dollars in purse winnings through his craven efforts to manipulate races.

“As a reflection of Allard's commitment to his doping regimen, Allard maintained in his barn a small pharmacy's worth of drugs, including the ingredients he used to mix his own 'drenches,' and a 'shockwave' machine, which only licensed veterinarians may own. Many of Allard's drugs were stored in a room that had been misleadingly marked as if it belonged to Grasso, in a calculated effort by Allard to divert scrutiny if Allard's barn was ever inspected, by making it appear that the drugs and veterinary equipment belonged to, and were used by, a licensed veterinarian, rather than by Allard,” the sentencing submission stated.

As part of his plea agreement back on June 2, Allard had agreed to pay a $628,553 money judgment, which represents the value of the forfeited drugs. Grasso, by contrast, was ordered to pay a forfeiture totaling $412,442.62 and restitution in the amount of $47,656,576.

Allard faced up to five years in prison. The government had argued for a sentence of 30 months, based on the term that another Standardbred trainer in the same conspiracy, Richard Banca, received back on Sept. 20. Allard's own attorney had lobbied for an 18-month term.

“For most of his adult life, Mr. Allard has made a living training horses to compete in harness races. Part of his job was to treat horses with vitamins, drugs, or other substances to ensure that they recovered from injuries and remained in good health,” Allard's lawyer wrote in the defendant's sentencing submission.

The defense filing continued: “During the period of time charged in the Superseding Information, in order to maintain a competitive edge, [Allard] did something that was wrong and that he never should have done: he obtained prescription drugs for horses in bulk, rather than on an individually prescribed basis, with the understanding that the way he was obtaining the drugs would mislead regulators.

“Although Mr. Allard always purchased drugs from licensed veterinarians, he knew that what he was doing was wrong, and he was motivated in part by a desire to improve the performance of the horses he was training and thus to win more races. By engaging in this conduct, he compromised the…potential well-being of the animals that he loves and around whom he has lived his entire life. He is deeply sorry for what he has done [and] bears total responsibility,” his lawyer wrote.

During its investigation of Allard prior to the nationwide sweep 2 1/2 years ago, the Federal Bureau of Investigation intercepted a phone conversation in which two other alleged conspirators in the harness industry discussed the deaths of horses trained by Allard after they had been given illegal drugs. One reference caught on wiretap callously described the trainer's operation as the “Allard death camp.”

Allard, a citizen of Canada, may face immigration issues that affect his sentence. His lawyer wrote that Allard could be precluded from serving his sentence at a minimum-security prison, and that he will likely be ineligible for “earned-time credits” that would reduce the practical length of time he must serve.

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SGF-1000 Salesman Kegley Gets 30 Months in Prison

Michael Kegley, Jr., the former sales director for the company that sold the purportedly performance-enhancing drug (PED) SGF-1000 that is at the heart of a years-long investigation of an international racehorse doping conspiracy, got sentenced to 30 months in prison on Thursday.

Kegley, 41, had pleaded guilty in July 2021 to one count of drug adulteration and misbranding. He had admitted in open court at that time that as sales director for the Kentucky-based MediVet Equine, he sold SGF-1000 and other products to trainers and veterinarians, knowing that there was “no medical prescription for those products” and that the substances were “not manufactured in an FDA-approved facility [nor] approved for sale by the FDA.”

Kegley's Jan. 6 prison sentence was six months shy of the maximum allowable term under federal sentencing guidelines. Just 24 hours previous to his sentencing, the same judge in the same court had handed down a maximum sentence for similar charges to Kristian Rhein, the defendant who is both Kegley's business associate and brother-in-law.

On Jan. 5, Rhein, a suspended veterinarian formerly based at Belmont Park who married Kegley's sister, got sent to prison for three years by Judge Mary Kay Vyskocil in United States District Court (Southern District of New York).

Prosecutors had previously acknowledged in a sentencing recommendation that Kegley should get a somewhat lighter sentence than his brother-in-law because of Rhein's standing as a veterinarian.

“Unlike Kegley, Rhein was a licensed veterinarian who predominantly treated racehorses; as such, Rhein was a more sophisticated actor than Kegley, and well-acquainted with the various legal regimes governing the sale and distribution of an adulterated and misbranded drug,” the government stated in its sentencing recommendation. “Likewise, Rhein, unlike Kegley, personally administered SGF-1000 to racehorses, concealed bottles of that drug, instructed others to do the same, and falsely billed customers for SGF-1000 under a false billing code.”

As a condition of Kegley's plea-bargained sentence, he was required to forfeit $3,310,490, which is a sum equal to the amount of the illegal substances seized by the government. But a court order accompanying the sentence stated that Kegley will only have to pay $192,615 if he does so within two years of his release from prison. If Kegley does not pay that amount by that time, he will be liable for the full sum.

One admitted doper of Thoroughbreds, the former trainer Jorge Navarro, last month got sentenced to five years in prison for administering myriad alleged PEDs, including SGF-1000.

Another barred trainer under indictment for alleged doping, Jason Servis, is scheduled to face trial in early 2022. Prosecutors have produced numerous intercepted communications involving Servis discussing using SGF-1000 on “almost every” horse under his care, including the disqualified 2019 GI Kentucky Derby winner Maximum Security (New Year's Day).

In one wiretapped call from July 16, 2019, Rhein and Kegley discussed how Servis and his associates were “buying literally as much” SGF-1000 as Rhein was able to source from MediVet.

It was further alleged that MediVet later in 2019 attempted to trick the Racing Medication and Testing Consortium (RMTC) into delisting SGF-1000 as a prohibited substance after Kegley's firm had already “reaped millions of dollars in revenue” by selling it illegally.

According to the government's evidence, MediVet and its associates emphasized “the potent effects of SGF-1000,” which were supposedly derived from “an innovative formulation consisting of Regenerative Proteins, Cytokines, Peptides, potent Growth Factors and Signaling Molecules derived from Ovine Placental Extract.”

Court documents filed by the feds had stated that SGF-1000 was explained to trainers as being similar to a vasodilator that would “increase stamina, performance, and overall health.” The materials even listed the growth factors that were purportedly found in SGF-1000, including some that were explicitly prohibited in many major racing jurisdictions.

The feds also alleged that despite what Kegley, Rhein, and other MediVet representatives claimed when they were parroting the company's marketing materials, no one pushing the product really had any accurate idea of what was in it.

“Notably, Kegley and his coconspirators did not know the precise contents of SGF-1000 until at least in or about August 2019–years after MediVet had started marketing and selling the drug,” court documents stated. “But [they] believed that no matter the component parts of the drug, it would enhance a horse's performance.”

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