11/24/2009 1:00AM

Bank had sued banned agent


LEXINGTON, Ky. - The case of banned bloodstock agent Jim Cullen traces back to a suit filed last year by National City Bank and has unraveled a complicated web of horse-related transactions, partnership deals, and unpaid bills.

Keeneland and Fasig-Tipton banned Cullen in October, a development that came to light publicly last week. The ban was the first under the Sales Integrity Program established in 2007 by a cross section of consignors, buyers, and auction houses. National City Bank filed suit against Cullen for defaulting on loans totaling $343,721.78. National City Bank's attorney and some of Cullen's former partners say Cullen oversold shares in horses, used horses he didn't own as collateral, and collected payments from clients without passing the money on to the appropriate vendors.

But Cullen denies those allegations and said Tuesday that he has filed a police report alleging harassment on the part of three former clients - John Trumbulovich of Chicago, Kevin Geiger of Denver, and Vincent Colbert of Boston. He also intends to file a slander suit, he said.

National City Bank attorney Emily Cowles said her investigations into Cullen, Cullen Bloodstock, and a Cullen's former racing partnership, Four Board Stables, turned up "almost 50" individuals or entities that had interests or liens on bloodstock that Cullen used as collateral for the National City note.

"There were a number of horses that the bank initially had a lien of 100 percent on and slowly, through my investigation, we learned that he had sold many, many interests in these horses," Cowles said. "We've been dealing with instances where he had pledged 100 percent of a horse to the bank, or 50 percent of a horse, and through the litigation . . . finding out that he sold 125 percent of a horse. This case is what brought all of this out. That's how all of the partners found out that their stud fees weren't paid."

Cullen acknowledged he is having financial difficulties but denied any wrongdoing.

"These allegations are coming from three individuals who have been trying to sue me for the better part of the last two years," Cullen said. "They have bombarded me with e-mails and harassing communications to the point that I have filed a police report against them. . . Those charges will be forthcoming, along with other charges."

Geiger and Trumbulovich have been outspoken in their allegations against Cullen.

In one case involving a Distorted Humor gelding named Astaire, Geiger said, Cullen sold "at least 25 percent to two other people," William Guest and Kevin Gobbi, after Geiger's 5280 Stable purchased Astaire at Keeneland's 2007 November sale.

Geiger said Cullen's far-flung clients rarely communicated with each other, their trainers, or the farms from which they were buying stallion seasons, a situation he alleges helped Cullen keep the parties in the dark.

Geiger initially became suspicious over billing on a partnership filly, Love You Crazy, and contacted the farm where the filly was located. Comparing the farm's bills with those Cullen sent the partners, he said he found Cullen was charging for a training rate when the filly was out of training, a difference of $50 a day. Cullen maintains the difference was for "ancillary expenses."

"That created questions about Astaire, and then I called Coolmore to see whether they had ever been paid for my portion of a Grand Slam season I had paid through Jim," Geiger said.

The answer, Geiger said, was no. Other farms also have confirmed Cullen or partnerships he represented have not paid fees, although Geiger and Trumbulovich say they have canceled checks proving they paid their share to Cullen.

"They keep saying I screwed them but don't provide any details," Cullen said. "The fact of the matter is they got everything they paid for, and now they are attempting to embarrass me by exposing my financial situation."

Geiger, Trumbulovich, and Colbert have gotten a court judgment against Cullen, but Trumbulovich says they have little hope of recovering money.

"We're probably number eight or nine on the list," Trumbulovich said. "We're probably never going to see a dime."