03/08/2007 12:00AM

Fraud suit said to be settled

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LEXINGTON, Ky. - Stonestreet Stable owner Jess Jackson and California-based trainer Bruce Headley have reached a settlement over a lawsuit in which Jackson alleged Headley had defrauded him in transactions for horses, according to Jackson's lead counsel, Richard A. Getty.

Getty said on Thursday the amount of the settlement was $900,000.

Headley's attorney, Barry West, did not return calls seeking comment.

In 2005, Jackson sued his former bloodstock advisors Headley, Emmanuel de Seroux, and Brad Martin, claiming that the three had inflated the values of horses they purchased on his behalf and obtained secret commissions on transactions. Jackson's suit alleged that the agents defrauded him of "at least $3.2 million" on transactions, including the purchase of Afleet Alex's dam, Maggy Hawk. Jackson later added bloodstock agents Frederic Sauque and Fernando Diaz-Valdez and the Buckram Oak Holdings company to the list of defendants.

"Mr. Jackson set out to get his money back from Mr. Headley, and he did just that," said Getty.

Getty said that Headley also had "agreed to provide testimony and cooperate on behalf of Mr. Jackson" in Jackson's ongoing suit against his other former advisors.

De Seroux denies the claims against him and has counter-sued, alleging Jackson owes him commissions for a number of bloodstock transactions.

Jackson, a founder of the Kendall-Jackson winery in California, has been a high-profile buyer at auction in the last five years. Since filing his suit in October of 2005, he also has been a vocal proponent for change in the bloodstock business. In 2006, a bill he lobbied for became law in Kentucky, specifically banning dual agency - a practice in which a single agent receives payment from both buyer and seller - in equine transactions. Under the banner of a group he founded, the Horse Owners' Protective Association, Jackson is now pushing for licensing of bloodstock agents and for increased transparency in horse deals.

Headley is a longtime California horseman who trains the 4-year-old Arson Squad, winner of this year's Strub Stakes. He also trained champion sprinter Kona Gold.