June 16, 2007 in Business

Preakness winner’s co-owners indicted

Brett Barrouquere Associated Press
 

LOUISVILLE, Ky. – When Curlin won the Preakness, the colt’s owners split $650,000.

Now, some of those winnings – as well as ownership of Curlin – are potential assets that could be grabbed by federal prosecutors and angry plaintiffs.

A federal grand jury this week indicted two attorneys who own 20 percent of Curlin, charging them with conspiring to commit wire fraud in representing more than 400 people in the suit over the diet drug fen-phen.

Federal prosecutors want the men to forfeit any assets they have to pay restitution to their former clients. And, a lawyer for the former clients claims Curlin was bought with money that belonged to the fen-phen clients.

Shirley Cunningham Jr., 52, and William Gallion, 56, bought Curlin for $57,000 as a yearling through their Midnight Cry Stable. They sold controlling interest in the horse in February for a reported $3.5 million to a group comprising Jess Jackson, founder of Kendall-Jackson wines; Satish Sanan’s Padua Stables; and George Bolton, an investment banker. Gallion and Cunningham retained a minority interest and were in the winner’s circle after the 3-year-old won the Preakness on May 19.

Curlin was third in the Kentucky Derby on May 5 and second in the Belmont Stakes on June 9.

Angela Ford, a Lexington, Ky.-based attorney representing many of the people in a civil case against the two lawyers who are part-owners of Curlin, said if the attorneys bought the racehorse with money taken from their former clients, it could lead to all or part of the horse being sold, with the money being used to repay the former clients.

To lay claim to Curlin, both the former clients and prosecutors would have to show Gallion and Cunningham used money that rightfully belonged to the fen-phen clients to purchase the horse.”It’s one asset we know they have,” Ford said. “If they never owned the money that bought the horse, they couldn’t convey it away.”

© Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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