You Scratch My Back and I'll Scratch your Legal Ethics...

I am currently reading "Wild Ride" by Ann Hagedorn Auerbach, sub-titled "The rise and tragic fall of Calumet Farm, Inc., America's premier racing dynasty."  Anyone who has been to Lexington, KY has seen on Versailles Road the miles and miles of white fencing, the red cupolas atop white barns.  If you keep up on racing news you know of the many rumors that crop up about a possible sale of Calumet Farms.  

I had no idea how much legal scandal there has been in the Calumet rise and fall.  It actually started as a  harness racing farm under its founder Warren Wright and became a Thoroughbred racing powerhouse after he died and the farm was passed to his son.

It is a "you scratch my back I'll scratch yours" kind of industry, creating incentives for fraud, manipulation, inside deals, and legal wrongdoing.

I've started listing out some of the legal scandals I've seen in the Calumet story:

Partnership fraud
Securities fraud
Insurance fraud
Huge debts (up to $40 million) acquired through nefarious means
Having fake bidders bid up the price of Calumet horses at auctions for insurance and breeding reasons
Agency fraud
Syndicate fraud
Stud fee fraudulent inflation
Declaring leveraged horses free of liens
Tax fraud
Illegal tax shelters
Wire fraud
Breach of fiduciary duties to Wright heirs
Legal malpractice/ ethical violations
Accounting violations
Theft from company assets
Employment law breaches
Wrongful commingling of assets
Banking fraud
Mafia ties

And that is just the tip of the iceberg!  Many of those categories even have subcategories.  My theory is that Thoroughbred racing has the largest financial aspect in the horse world, which is why it is so rife with violations.  Interestingly, the book hasn't addressed any horse drug or welfare violations, except potentially for requiring Calumet's star stallion Alydar to cover (breed with) far more mares than was generally accepted in the industry.

The book of course only provides its own view on the decline of Calumet, but one reason why I love the study of law is because so much of the learning comes through stories.  Reading case law is often like reading a novel filled with greed, stupidity, intrigue, cleverness, spitefulness, and emotion.   It shows that the truth is often far more shocking than fiction.

But this post is not intended as a book review!  I think it is interesting for all horse people to understand the potential for a dark underbelly to our great equestrian passion, pastime, and sport.  The law is so intrinsically united with engagement in the horse world and can help prevent much of the double-dealing, thieving, falsifying reputation that horse sellers and riders can have.
"The truth is often far more shocking than fiction"
I'm curious- what is your horse industry (Dressage, Reining, Endurance, backyard hacking etc.) and what is the one biggest legal corruption you have seen, or that you see as the potential?  
Anything from the list above?  Perhaps judicial corruption (why is it certain riders always pin the blue?) Drugging? (Which the hunter/jumper world has been scrutinized for lately.) Cloning? (hello AQHA!) 

For me, I see a great deal of the "bully" effect where certain parties gang up to put pressure on a rider or owner to try to get him or her to act in a certain way.  Lawyers might call this collusion and/ or agency breaches.

Let me know, I'd love to hear!