War Emblem Derby Bonus Case Heads for New Year Hearing
Updated: Friday, November 22, 2002 12:59 PM
Posted: Wednesday, November 20, 2002 2:43 PM
Five months before the Pick Six Scandal began dominating headlines, the Illinois Derby-Kentucky Derby bonus controversy was making news. A hearing to determine just who will collect the cool $1 million payout should be set soon after the New Year. The case is currently in federal court in Chicago in an interpleader.
The wrangling began when Sportsman's Park offered the $1 million bonus to any horse that won the Illinois Derby and won of the Triple Crown races. War Emblem captured the former in the silks of Chicago industrialist Russell Reineman. However, when Reineman sold 90% of War Emblem to Prince Ahmed Salman's The Thoroughbred Corp. three weeks before the Kentucky Derby, the sale contract didn't specifically mention the bonus. When War Emblem won the Kentucky Derby, both sides claimed they were entitled to the cash.
Weinstein, Jones & Associates, the Florida-based insurer of the bonus for Sportsman's Park, quickly punted the ball, saying Sportsman Park's management was responsible for making the final decision regarding disbursement of the bonus. Sportsman's, in turn, flipped the hot potato to the court system in an interpleader, which basically acknowledges they have money that doesn't belong to them, and gives the court the decision-making power to disperse the funds among those parties who, in its opinion, file a valid claim for it.
"We filed to get the money, and Mr. Reineman filed that we shouldn't get it, and we'll figure it out at a hearing, which should be set for sometime in January," said Neil Papiano, attorney for The Thoroughbred Corp.
Reineman was quoted last spring as saying he was prepared to sue Sportsman's Park unless he received at least 50% of the bonus. "If I had agreed to sign over the possible bonus, I would have essentially been giving them a free chance to win the Kentucky Derby with my colt. The bonus would have immediately covered the sale price. Am I supposed to be that bad a businessman?" he said.
However, Papiano countered that one of the selling points when Reineman sold 90% of War Emblem was that The Thoroughbred Corp. had a chance to make the bonus money. "When you sell title and interest in the horse, you sell whatever goes with the horse," Papiano said. "The contract states in part: 'The seller warrants the title to the colt will be conveyed as clear without any liens, without any encumbrances, or without any claims by the seller.' "
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