Report: MGG Brings New Motion In Bankruptcy Case Alleging Zayat Committed Fraud

The lengthy legal battle between New York firm MGG Investment Group and Triple Crown-winning trainer Ahmed Zayat continued with a new move last week, according to Thoroughbred Daily News.

Zayat declared bankruptcy earlier this year, seeking Chapter 7 protection. Now, MGG is asking a federal judge to order that Zayat can’t get his debts to the investment group forgiven because the company says the $24 million in loans Zayat still owes were acquired fraudulently.

“[I]t is a debt…that was obtained by use of a series of statements in writing that were materially false, respecting an insider’s (Zayat Stables) financial condition, on which MGG reasonably relied, and that Ahmed Zayat caused to be made or published with the intent to deceive MGG,” read a complaint filed by MGG. “[I]t is a debt for willful and malicious injury caused by Ahmed Zayat to the property of MGG within the meaning of [the] Bankruptcy Code.”

MGG’s suggestion that Zayat was dishonest in his representations to the company isn’t new; the basis for its much-publicized suit against Zayat in Fayette Circuit Court in Kentucky is based partly on allegations that Zayat failed to disclose the sale of nine breeding rights to American Pharoah or turn over the proceeds to the lender.

Read more at Thoroughbred Daily News

The post Report: MGG Brings New Motion In Bankruptcy Case Alleging Zayat Committed Fraud appeared first on Horse Racing News | Paulick Report.

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