Lukas's primary owner today, retired Kentucky industrialist William T. Young, is a breeder seeking to win the classics, so a yearling's pedigree is crucial. Lukas's carte-blanche era has become a memory, and with it all those modestly bred bargains who could fly. Indeed, according to Equine Line, Lukas bought only 34 yearlings for $8.6 million in 1991, his smallest numbers since 1984, and last year he purchased just 18 for $3 million. His three current strings of racehorses—at Belmont Park, Churchill Downs and Hollywood Park—are no longer major factors at those tracks.
He has not won a Breeders' Cup race since 1989, and remarkably, he has not won a Grade I stakes since October 1991. Lukas led the earnings list last year with $9.8 million, about the sum he needs to break even, but he'll fall far short of that in 1993. Through May 26, Lukas had won only one minor stakes race—the Grey Lag Breeders' Cup at Aqueduct—and his horses had earned only $1.6 million, placing him ninth in earnings. Among the more than 130 horses Lukas has in training, nary a one is a recognizable name.
"We hit a couple of bad classes," Lukas says. "We've taken some hits and had some bad luck. It isn't as if we just caved in. We're still Number One."
For three years rumors have been rampant in the racing community that Lukas was in difficult financial straits. He has repeatedly denied them. He clearly, however, lost a fortune in the summer of 1991, when Calumet Farm filed for bankruptcy. His claims against the farm range from $411.33 for training to $2.6 million for, among other things, breeding seasons to Alydar and Criminal Type, and money Lukas and his son say they are owed for Badger Land, a horse they sold to Calumet. In another claim, for $2.1 million, Lukas, French and Barry Beal, co-owners of Capote, the 2-year-old champion in 1986, say they sold Capote to Calumet but have never been paid. "Do you know many trainers that could take that big a hit and keep going?" says Lukas.
The Calumet bankruptcy came at a bad time for Lukas. Not only was Klein gone, but it occurred just a year after the financial blow Lukas had suffered when Grand Canyon—"Probably the best male horse I ever had," he says—developed laminitis, a fatal hoof disease, and had to be destroyed at the start of his 3-year-old year. Says Lukas: "He won $1 million as a 2-year-old and would have probably won $4 or $5 million more, and I owned 35 percent of him. You didn't have to be an Einstein to figure out he was going to change my whole financial picture."
Lukas had faced hard times before. In 1986, when he was rising to the summit of the sport, he took out $4 million in loans from a bank in Oklahoma City, securing them with quarter horses he owned with Jeff and a longtime friend and financial adviser, David Burrage. When the bank went under, Lukas and Burrage had to come up with $1.8 million to satisfy the FDIC, so they went public with a stock issue, telling investors that Lukas would run the company and train and race thoroughbreds as well as quarter horses. Although the enterprise, called Mid-America Racing Stable, Inc., failed, the stock offering got Lukas out of his financial hole. Proceeds from the stock sale allowed him to pay off the $1.8 million to the FDIC and to repay $700,000 that he had lent to the quarter-horse partnership. During the three years the company operated, Lukas paid himself $600,000 in commissions and fees. As for the dozens of angry investors who had lost more than $4 million in Mid-America Racing, Lukas settled with them, refunding a total of $250,000.
Lukas has since made millions by sticking to training thoroughbreds. However, while former assistants say he has always made the payroll, they also say that a few years ago he began falling behind in his payments to some racetrack vendors and to some assistants who were to receive commissions from purses. Lukas has also had difficulty collecting training bills from delinquent owners, though, says Burrage, "he has worked the past-due bills owed to him down from more than $500,000 to less than $200,000."
Lukas will not reveal the size of his debt, but he says he has been cutting back on horses and employees. "He is current with the bank," says Burrage. "His program must be to reduce his debt and liabilities. Everyone will be paid."
It was against this somber financial backdrop that Union City came to Baltimore. Lukas insisted nothing was wrong with his horse, despite the speculation that had swirled all week. There is a widely held perception among horsemen that Lukas is hard on horses. "He dances close to the fire," says one veteran trainer.
When Lukas brought his 1980 Preakness winner, Codex, to the Belmont Stakes, one observer noted that the colt appeared to be sore during training in the days leading up to the race. Codex finished seventh and never raced again. Five years later Lukas brought Preakness winner Tank's Prospect to the Belmont amid murmurs that the horse was unsound. Tank's Prospect broke down during the race and was retired to stud.