A Lexington, Ky. jury heard conflicting testimony Wednesday as the principals involved in the purchase of a high-priced 2-year-old colt at auction last year testified in connection with a lawsuit filed by the buyers of the horse.
Among those testifying were Peter Callahan, who bought the colt named Saints Cup in partnership with Barry Golden; trainer Billy Badgett, the trainer who represented Callahan and Golden in the purchase; Robert (Country) Roberts, who, with his wife, Bea, sold the colt as part of a dispersal; and trainer Stanley Hough, who acted as agent for the sale of Robertses' horses in training.
Callahan and Golden, who bought Saints Cup for $850,000 on the first day of the 1999 Keeneland November breeding stock sale, filed the suit against the Robertses, alleging fraud and misrepresentation in connection with the transaction. In addition to the purchase price and other related damages, Callahan and Golden are seeking punitive damages. The Robertses have countersued, seeking the full purchase price.
Much of the testimony during Wednesday's lengthy session centered around what, if any, representations were made by Roberts and/or Hough regarding Saints Cup. At the time of the sale, the Saint Ballado colt had won his only start in impressive fashion during the Saratoga race meet.
Badgett returned Saints Cup to the Robertses' Post Time Training Center in early December after an ultrasound examination revealed the presence of a lesion--tear--in the tendon of his left front leg. The colt has not started since.
Callahan, who has had horses with Badgett for about 15 years, said he was influenced in his decision to try to buy Saints Cup by the extensive print and Internet marketing campaign that accompanied the Roberts dispersal, as well as by articles reporting on the upcoming sale. Callahan cited aspects of the advertising that noted the horses in training that were being sold did not include those with problems. Callahan said he was also motivated to buy from the Robertses' dispersal by the advertisements attesting to the care the horses had received from Roberts and Hough.
"It heightened my enthusiasm because you can be sure the horses had been managed properly," the owner said.
Because of Saints Cup's potential as a classic contender, Callahan said he took on a partner in Golden and paid more than he normally does for a racehorse. "We bought this horse because he was a serious Kentucky Derby contender."
Although he was not directly involved in drafting or wording of advertisements for the sale, Roberts stood by the promotion of the horses as having been well-cared for under his ownership and Hough's training.
The testimony Wednesday revealed Saints Cup had no officially recorded workouts following his Saratoga victory. Hough said he stopped serious training on the colt when he discovered Saints Cup had developed a "curb," a minor injury to the hock. Hough said a subsequent ultrasound examination done on his behalf also revealed a tear in the colt's tendon, a more serious problem affecting the left front leg.
Under intense questioning from attorneys for Callahan-Golden, Hough reiterated that the curb, and not the tendon problem, was the reason Saints Cup was not being given serious training leading up to the sale. Hough said he could not say that the tendon tear was a problem that affected Saints Cup's running ability because he did not know how long it had been present. He said there was a possibility that Saints Cup had the problem when he zipped six furlongs in 1:10 to win his maiden race.
Callahan's and Golden's attorneys outlined the types and frequency of medication given Saints Cup leading up the sale, noting that drugs could have relieved pain and/or swelling in the colt's tendon. The drugs could mask, or hide, the problem, they contended.
Badgett said he did not hire a veterinarian to either examine or conduct an ultrasound on Saints Cup prior to the sale. The trainer said he could not detect any problem with the tendon when he looked at the colt three times before he was purchased.
The trainer acknowledged that in a deposition prepared for the trial, he incorrectly stated that he had obtained the services of a veterinarian to examine Saints Cup and the x-rays of the colt that were on file in Keeneland's repository and to conduct an ultrasound on the colt. In fact, Badgett said, he relied upon a veterinarian who had conducted the tests on behalf of another potential buyer.
"I was a little bit embarrassed because I should have had the horse vetted out," Badgett testified Wednesday. "I made a mistake."
Based on a conversation he overheard between Roberts and a veterinarian at the sale, Badgett said he was operating under a belief that if there was any problem with any of the horses bought out of the dispersal that the individual could be returned to the seller. Badgett said he had discussed Saints Cup in general with Hough prior to the sale and the trainer noted the curb problem, but did not mention the tendon injury. The trainer said he did not specifically ask about Saints Cup's soundness or the condition of his tendons. He said that to his knowledge there is nothing in
the Conditions of Sale that require disclosure of such a problem.
Badgett and Callahan both testified they would not have bought Saints Cup had they been aware of the tendon problem.
In their separate testimony, Badgett and Hough disagreed on the effects of the type of tear in Saint's Cup's tendon on his racing ability and his potential for future success.
Although he has not thoroughly read all of the Conditions of Sale published in the front of the Keeneland sales catalog, Badgett said to his knowledge there is nothing precluding the administration of medications to sales horses.
The trial, being heard by a 12-member jury and two alternates, continues Thursday and is expected to conclude Friday.