Zayat bankruptcy

In effort to recoup money from the buyers of horses and bloodstock interests from the financially embattled Zayat Stables, the New York-based lender MGG Investments has taken its case to the Kentucky Supreme Court. Dick Downey of The Blood-Horse first broke the story. "The Kentucky Supreme Court heard oral arguments Feb. 8 pitting MGG, a lender of millions of dollars to Zayat Stables, against buyers of some of the now-defunct Zayat operation's Thoroughbreds and breeding interests. The parties landed in court when money generated by purchases did not turn up...

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...

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...

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...

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...

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...

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...

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....

The federal judge overseeing Ahmed Zayat's Chapter 7 bankruptcy petition has ordered that the trustee in the case will now have through Apr. 30 to pore over financial documentation to make sure the allegedly insolvent owner and breeder of Triple Crown champ American Pharoah isn't hiding assets. In a court order dated Mar. 31 that was filed Apr. 2 in United States Bankruptcy Court (District of New Jersey), Judge Vincent Papalia wrote that "the Trustee's time to file a complaint objecting to the Debtor's discharge is further extended..." In the...

On Mar. 16, Ahmed Zayat asked a federal judge not to grant the trustee in his bankruptcy case extra time that had been requested to scrutinize Zayat's finances so the trustee could make sure the owner and breeder of Triple Crown champ American Pharoah was telling the truth about not being able pay $19 million in debts because he allegedly only had $314.22 to his name. Now, one week later, MGG Investment Group, LP, the lender who is separately suing Zayat and his family members for allegedly obtaining a $24...

Attorneys representing MGG Investment Group, LP, which is the plaintiff in a $24.5 million Kentucky civil lawsuit alleging fraud and loan defaults against Ahmed Zayat and his family's Zayat Stables, LLC, disclosed in a legal document filed Sept. 18 that the court-appointed receiver in that case intends to hold a November auction to sell off horses that are being held as collateral against the unpaid debts. News about this anticipated November auction was made public in the form of a letter dated Friday and filed in United States Bankruptcy Court,...

Ahmed Zayat's former financial advisor is among the entities now initiating an "involuntary bankruptcy" petition against Zayat's family-owned racing stable. This Sept. 14 court action comes six days after the allegedly insolvent Triple Crown-winning breeder and owner voluntarily filed for his own personal Chapter 7 bankruptcy protection. Although once prevalent, involuntary bankruptcy proceedings are now relatively uncommon in United States courts. They are designed to protect creditors, not debtors, and are often filed against companies (as opposed to individuals) as an attempt to get paid when it is believed that...