Navarro, Servis among 27 indicted on federal charges

by | Mar 9, 2020 | Breaking, Business, National news, Top Stories

Jorge Navarro

Jorge Navarro won his seventh straight Monmouth Park training title in 2019. Photo courtesy of Monmouth Park.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), Dermot Shea, Commissioner of the New York City Police Department (“NYPD”), Catherine A. Hermsen, U.S. Food and Drug Administration Assistant Commissioner for Criminal Investigations (“FDA-OCI”), and Troy Miller, Director of Field Operations for U.S. Customs and Border Protection in New York (“CBP”), announced the unsealing of four indictments charging 27 individuals with offenses relating to the systematic and covert administration of illegal performance-enhancing drugs (“PEDs”) to racehorses competing across the United States and abroad. The Indictments unsealed today each allege the shipment and administration of adulterated and misbranded drugs designed to secretly and dangerously enhance the racing performance of horses beyond their natural ability, a dishonest practice that places the lives of affected animals at risk.

Of the 27 defendants, 19 – including trainers JORGE NAVARRO and JASON SERVIS – are charged in an indictment detailing four conspiracies to manufacture, distribute, and administer adulterated or misbranded drugs as set forth in United States v. Jorge Navarro, et al., 20 Cr. 160 (the “Navarro Indictment”), which has been assigned to U.S. District Judge Mary Kay Vyskocil. Of those defendants, 13 were taken into federal custody and are expected to be presented in the Southern District of New York today before U.S. Magistrate Judge Ona T. Wang. Defendant SETH FISHMAN was previously charged by complaint in United States v. Seth Fishman, 19 Mag. 10120, and arrested on October 28, 2019, in Miami, Florida, and was presented in U.S. District Court for the Southern District of Florida. The remaining defendants were arrested today outside of the Southern District of New York and adjacent districts, and will be presented today before the appropriate District Courts.

Four additional defendants are charged in United States v. Louis Grasso, et al., 20 Cr. 163 (the “Grasso Indictment”), which has been assigned to U.S. District Judge P. Kevin Castel. Two defendants are charged in United States v. Scott Robinson and Scott Mangini, 20 Cr. 162 (the “Robinson Indictment”), assigned to U.S. District Judge J. Paul Oetken; and two defendants are charged in United States v. Sarah Izhaki and Ashley Lebowitz, 20 Cr. 161 (the “Izhaki Indictment”), assigned to U.S. District Judge Mary Kay Vyskocil.

Manhattan U.S. Attorney Geoffrey S. Berman said: “Today’s unsealing of four indictments for widespread doping of racehorses is the largest ever of its kind from the Department of Justice. These defendants engaged in this conduct not for the love of the sport, and certainly not out of concern for the horses, but for money. And it was the racehorses that paid the price for the defendants’ greed. The care and respect due to the animals competing, as well as the integrity of racing, are matters of deep concern to the people of this District and to this Office.”

FBI Assistant Director William F. Sweeney Jr. said: “These men allegedly saw the $100 billion dollar global horse racing industry as their way to get rich at the expense of the animals that were doing all the hard work. Our investigation reveals the cruelty and inhumane treatment these horses suffered all to win a race. The FBI New York Joint Eurasian Organized Crime Task Force worked along with our law enforcement partners at the New York State Police, FDA, and DEA to stop this ring of criminals from abusing helpless animals simply so they could cheat the odds and rake in millions of dollars.”

Police Commissioner Dermot Shea said: “I want to commend our NYPD investigators, working with our federal partners, for carrying out a meticulous and important investigation. Putting the lives of horses at the center of an alleged plot to cheat professional horseracing around the world can never be accepted.”

FDA Assistant Commissioner for Criminal Investigations Catherine A. Hermsen said: “The FDA is responsible for protecting not only the health of humans, but also of animals. The manufacturing and trafficking of misbranded and unapproved animal drugs, and the administering of such drugs to racehorses to enhance their performance at the track, seriously endangers the health of these animals in pursuit of financial gain. Today’s announcement should serve as a reminder of our continued focus on those individuals and companies that put profits ahead of the public health.”

CBP Director of Field Operations Troy Miller said: “U.S. Customs and Border Protection is proud to have collaborated with our fellow law enforcement partners during this investigation. We value our partnerships and the arrests today demonstrate that together, no matter how complex the case, we will do what it takes to bring those who violate the law to justice.”

According to the allegations contained in the Indictments,[1] other filings in this case, and statements during court proceedings:

The charges in these four Indictments arise from an investigation of widespread schemes by racehorse trainers, veterinarians, PED distributors, and others to manufacture, distribute, and receive adulterated and misbranded PEDs and to secretly administer those PEDs to racehorses competing at all levels of professional horseracing. By evading Food and Drug Administration (“FDA”) rules and regulations, as well as prohibitions against the use of PEDs, and by deceiving regulators and horse racing officials, participants in these schemes sought to improve race performance and obtain prize money from racetracks throughout the United States and other countries, including in New York, New Jersey, Florida, Ohio, Kentucky, and the United Arab Emirates (“UAE”), notwithstanding the detriment and risk of the health and well-being of the racehorses. Trainers who participated in the schemes stood to profit from the success of racehorses under their control by earning a share of their horses’ winnings, and by improving their horses’ racing records, thereby yielding higher trainer fees and increasing the number of racehorses under their control. Veterinarians and drug distributors simply profited from the callous sale and administration of these medically unnecessary substances.

The Navarro Indictment

The Navarro Indictment charges 19 individuals representing a cross-section of corruption throughout the Thoroughbred and Standardbred racing industries. As alleged, JORGE NAVARRO, a racehorse trainer, has participated in the doping of horses under his control using a variety of PEDs, including customized PEDs designed in part to evade normal anti-doping tests administered by racing regulators. NAVARRO operated his doping scheme covertly, using a straw man to receive certain products designed to mask the presence of PEDs, avoiding explicit discussion of PEDs during certain telephone calls, and working with others to coordinate the administration of PEDs at times that racing officials would not detect such cheating.

NAVARRO trained and doped XY Jet, a thoroughbred horse that won the 2019 Golden Shaheen race in Dubai. As alleged, NAVARRO was intercepted during telephone conversations discussing his doping practices, and administered PEDs to XY Jet. Among NAVARRO’s preferred PEDs were various “blood building” drugs, which, when administered before intense physical exertion, can lead to cardiac issues or death. NAVARRO announced XY Jet’s death, as the result of an apparent heart attack, in January of this year. Investigation of the circumstances of that death remains ongoing.

NAVARRO was assisted by many of the charged defendants in the Navarro Indictment, and also assisted others, including JASON SERVIS, in obtaining adulterated and misbranded drugs to dope racehorses.

As alleged, SERVIS doped virtually all horses under his control, including Maximum Security, the horse that crossed the finish line first in the 2019 Kentucky Derby before being disqualified for interference. Among the misbranded and adulterated PEDs used by SERVIS was the drug “SGF-1000,” marketed and sold by defendant MICHAEL KEGLEY JR., among others, and which is compounded and manufactured in unregistered facilities. SGF-1000, like many other customized PEDs, may cause racehorses to perform beyond their natural abilities, thereby increasing the risk of injuries. SERVIS and others working with him, including veterinarians KRISTIAN RHEIN and ALEXANDER CHAN, attempted to conceal SERVIS’s doping practices through the use of falsified veterinary bills and fake prescriptions. SERVIS also tipped off NAVARRO to the presence of racing officials searching for signs of illegal doping. NAVARRO expressed his relief regarding SERVIS’ “tip”: “[The track official] would’ve caught our asses fucking pumping and pumping and fuming every fucking horse [that] runs today.”

The Navarro Indictment also includes charges against veterinarian SETH FISHMAN who also created and shipped adulterated and misbranded drugs. As alleged, SETH FISHMAN, along with LISA GIANNELLI, JORDAN FISHMAN, and others, developed and distributed multiple illegal PEDs. Those included “blood building” drugs specifically designed to evade anti-doping testing regimes. On one occasion, SETH FISHMAN touted precisely this deceptive aspect of his illegal PEDs: “[D]on’t kid yourself: if you’re giving something to a horse to make it better, and you’re not supposed to do that. . . . That’s doping. You know, whether or not it’s testable, that’s a different story.”

Finally, the Navarro Indictment includes charges against trainer NICHOLAS SURICK who, among other things, distributed the adulterated and misbranded PED “red acid” (an anti-inflammatory drug) to NAVARRO. SURICK also obtained and administered other adulterated and misbranded PEDs to horses under his care, including administering the blood building drug Epogen to the racehorse Northern Virgin. SURICK and others then took extraordinary steps to physically conceal Northern Virgin from New Jersey state regulators seeking to test horses under SURICK’s control, for which SURICK is also charged with obstruction.

The Grasso Indictment

The Grasso Indictment charges four defendants, including veterinarian LOUIS GRASSO, with conspiring to violate the misbranding laws of the United States. As alleged, GRASSO manufactured, sold, and distributed adulterated and misbranded PEDs for use on racehorses. GRASSO also obtained and distributed other PEDs, including snake venom, a type of pain blocking substance. GRASSO worked with DONATO POLISENO, a Delaware-based distributor of PEDs manufactured by GRASSO and others. The Grasso Indictment also charges two horse trainers, THOMAS GUIDO III and CONOR FLYNN, with, among other things, causing the shipment of adulterated and misbranded PEDs prior to administering those drugs to horses under their control. The dangers of that practice are reflected in the death of a horse doped by GUIDO in or about October 2019, about which GRASSO commented: “I’ve seen that happen 20 times.”

The Robinson Indictment

SCOTT ROBINSON and SCOTT MANGINI are each charged with misbranding and adulteration conspiracies in the Robinson Indictment. As alleged, the two defendants previously collaborated in running online marketplaces selling adulterated and misbranded PEDs for racehorses. The drugs distributed through the defendants’ websites were manufactured in non-FDA registered facilities and carried significant risks to the animals affected through the administration of those illicit PEDs. In one instance, on January 2, 2016, ROBINSON forwarded a customer complaint to MANGINI: “I [i.e., a customer contacting ROBINSON] ordered some [PED-1] . . . starting bout 8 hours after I give the injection and for about 36 hours afterwards both my horses act like they are heavily sedated, can barely walk. Could I have a bad bottle of medicine, I’m afraid to give it anymore since this has happened three times.” Commenting on this complaint, ROBINSON wrote, “here is another one.”

The Izhaki Indictment

The fourth Indictment unsealed today, the Izhaki Indictment, charges SARAH IZKAHI and ASHLEY LEBOWITZ in connection with their distribution of an adulterated and misbranded blood builder sourced illegally from a Mexico-based pharmaceutical company. As alleged, IZHAKI has obtained this substance by smuggling the drug into the United States, where IZHAKI and LEBOWITZ distribute the drug to horse trainers in and around the New York City area.

* * *

Mr. Berman praised the outstanding investigative work of the FBI and the FBI’s Integrity in Sports and Gaming Initiative. Mr. Berman also thanked the New Jersey Attorney General’s Office, the New York State Police, and the New York City Police Department for their support of this investigation, and Customs and Border Protection, the Food and Drug Administration and Drug Enforcement Administration for their assistance and expertise.

This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit. Assistant United States Attorneys Sarah Mortazavi, Benet J. Kearney, and Andrew C. Adams are in charge of the prosecution.

The charges contained in these Indictments are merely accusations and the defendants are presumed innocent unless and until proven guilty.

WHO ARE THE MAJOR PLAYERS INDICTED?

  • Jorge Navarro — Trainer of millionaires X Y Jet, Sharp Azteca, War Story, and Private Zone, among many other fast horses, Navarro has won seven consecutive Monmouth Park training championships and has won between 26 and 35 percent of his races each year since 2012.
  • Jason Servis — Trainer of Eclipse champion three-year-old of 2019 Maximum Security, Servis has wn at least 20% of his starts every year since 2005 and at least 27% of his starts in each of the last four years. He’s also trained four millionaires, with Firenze Fire, Sunny Ridge, and World of Trouble joining Maximum Security.
  • Marcos Zulueta — The Parx Racing-based Zulueta finished third at that track by earnings (and fourth by wins) among all trainers in 2019.
  • Veterinarians Seth Fishman and Gregory Skelton allegedly illegally manufactured performance enhancing drugs (PEDs), while veterinarian Erica Garcia allegedly illegally administered them to horses at Navarro’s direction.
  • Christopher Oakes, Marcos Zulueta, Michael Tannuzzo, and Nicholas Surick allegedly assisted Navarro by obtaining, shipping, and administering so-called “misbranded and adulterated” PEDs for Navarro’s benefit. That’s a legal term applied to drugs that are a) not approved for animal use; or b) is administered without a prescription despite requiring one; or c) actually mislabled, or whose label is lacking required information; or d) manufactured in a facility that is not registered by the FDA.
  • Jordan Fishman allegedly manufactured PEDs to Seth Fishman’s specs.
  • Lisa Giannelli allegedly distributed Seth Fishman’s PEDs.
  • Harness trainer Rick Dane, Jr. allegedly both purchased and assisted in the distribution of Fishman’s PEDs.
  • Kristian Rhein is a veterinarian who allegedly obtained and administered misbranded and adulterated PEDs to horses trained by Servis; among those PEDs was one called SGF-1000, whose sales rep, Michael Kegley, Jr., is also indicted.
  • Alexander Chan is a veterinarian who allegedly worked at the direction of Servis and others to administer misbranded and adulterated PEDs, including administering without a valid medication reason medications requiring a prescription.
  • Henry Argueta is an assistant trainer to Servis who allegedly assisted the trainer in obtaining and administering PEDs.
  • Nicholas Surick is a harness trainer who, in addition to his role in the Navarro scheme above, allegedly conducted a scheme of his own to administer misbranded and adulterated PEDs to horses he trained. He was allegedly assisted in his scheme by assistant trainer Christopher Marino and veterinarian Rebecca Linke.
  • In addition to the 19 on the Navarro-Servis indictment, there are several more named in three additional indictments. These include:
    • veterinarian Louis Grasso; Donte Poliseno, owner of a veterinary supply business; harness trainer Thomas Guido; and assistant trainer Conor Flynn, all indicted together in one indictment.
    • Sarah Izhaki and Ashley Lebowitz, a mother-daughter team indicted in a separate indictment for allegedly distributing a mislabeled and adulterated version of the drug erythroprotein, more commonly known as Epogen.
    • Scott Robinson and Scott Mangini, indicted together for allegedly operating “a series of online marketplaces at which the public, including racehorse trainers and owners, could procure misbranded and adulterated PEDs for administration to racehorses.”

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