If you believe Seth Hancock quit the Churchill Downs board of directors simply to “move on and embrace new challenges,” as his official statement said, then you don’t know much about Hancock’s values, his family’s history, or the bottom-line mentality of the track’s current administration.

Hancock, president of the world-famous Claiborne Farm and a Churchill director for 35 years, believes that racing is a sport more than a business. He’s the son and grandson of horsemen who had much to do with building and creating Kentucky’s signature industry, thoroughbred racing and breeding.

The suspicion here is that he quit the board as a form of protest against the current administration’s cold and heartless pursuit of the almighty dollar. He probably got tired of going to board meetings and never hearing a word about horses. He probably got sick of empty suits who view Churchill as a profit center more than a hallowed place where humans and horses fulfill their destinies.

This isn’t to say that Seth is some kind of starry-eyed romantic. He’s always been a no-nonsense guy who understands the need to balance the sporting side and the business side of a unique industry. But beginning with the Tom Meeker regime in 1984, that balance has grown steadily out of whack.

It was under Meeker, after all, that the track underwent the renovation and expansion that virtually destroyed its unique historical charm. The historic twin spires became dwarfed on either side by luxury-suite towers, a grating symbol of corporate greed and tastelessness.

But it’s only gotten worse, much worse, under Meeker’s successor, Bob Evans, who might as well be the famed sausage-maker for all he seems to care about nurturing the fragile relationships – between track and the horsemen, track and the patrons, track and the community — that are vital to Churchill’s health and welfare.

Although only announced yesterday, Hancock’s resignation actually happened shortly after this year’s Kentucky Derby. Who knows what the last straw was for him? It could have been Churchill’s declaration of war against its own horsemen over how the profits from account wagering are divided.

When the track refused to get its way, it retaliated by slashing purses 20 per cent across the board and filed a suit against the Kentucky Horsemen’s Benevolent and Protective Association, which represents the majority of the owners and trainers. It was old-fashioned union-busting, pure and simple, and the result has been a lot of short fields at the current meet because of horsemen defections to other tracks.

Or maybe the final straw for Hancock was when Churchill’s Board of Directors got into a similar battle with the Breeders Cup over the 2009 event, which was scheduled to be held at Churchill.

The track demanded more of the profits, claiming it made little more from the Breeders Cup than it did a routine fall Saturday. But the Breeders Cup refused to revise its profit-distribution formula to accommodate one track. The resulting impasse led the Breeders Cup to give the 2009 event to Santa Anita, costing Louisville-area restaurants, hotels, and other businesses a huge windfall.

The bottom line, since that’s what Churchill understands better than anything, is that the track has become a lousy corporate citizen under the Evans regime and an even worse partner to the horsemen who put on the show.
Who could blame the son of A.B. “Bull” Hancock Jr., from walking away in disgust?

Unfortunately, Seth isn’t as outspoken as his brother, Arthur B. Hancock III, who resigned from Keeneland’s board of directors a few years ago in a dispute over various policies. For 30 years, Arthur has been warning the industry about the dangers inherent in permissive medication. In countless speeches to various racing forums, he has predicted that over-medicating horses will lead to a general weakening of the breeder, which will lead to increased breakdowns.

Mostly, the game’s power brokers laughed and dismissed Arthur’s dire predictions. He was a prophet without honor. Now he is merely a prophet. When the filly Eight Belles broke down and had to be euthanized after this year’s Kentucky Derby, the sport’s decades of negligence and inbreeding finally caught up to it.

Arthur’s catchiest line was that the sport needed to rid itself of “drugs and thugs.” Both became issues this year during Big Brown’s bid for the Triple Crown. While perhaps not exactly a thug, the colt’s trainer, Rick Dutrow, had a long rap sheet of rules violations, some involving positive drug tests, and a well-documented disregard for the game’s image and reputation, not to mention his fellow horsemen.

But different as they are, both Seth and Arthur share the values instilled in them by their father, who inherited Claiborne from his father, A.B. Hancock Sr., and built it into arguably the world’s greatest breeding operation through the acquisition and syndication of some of the world’s greatest stallions.
The fate of the Hancocks and of Churchill has long been entwined.

In February, 1969, the track was shaken to its foundation when National Industries, a five-year-old conglomerate, attempted to take over Churchill by offering to buy all 383,292 shares of the track’s stock at $30 per share, or about $10 per share more than the bid price the previous week.

Caught off guard, track management and the board of directors rallied to prevent the hostile takeover. One of the more outspoken board members was A.B. “Bull” Hancock Jr., who then owned 2,110 ½ shares of Churchill stock. He warned against the dangers of letting the Kentucky Derby fall into corporate hands.
“If necessary,” said Hancock, “we’ll form a new group and buy it ourselves. We’ve run it all right so far, maybe not so good for the stockholders, but in the best interest of the Derby. I’m not willing to sell to the first outfit that comes along. We don’t want to become part of a conglomerate.”

The president of National Industries, which reported $320 million in sales only five years after its founding in 1963, was Stanley Yarmuth, father of current U.S. Congressman John Yarmuth. A skilled accountant, Yarmuth went to work for his father-in-law, Samuel H. Klein, then president of Royal Bank & Trust Co., as a salaried salesman at the National Auto Sales used-car lot owned by Klein at Eighth and Broadway in downtown Louisville.

Yarmuth eventually bought the used-car lot from his father-in-law and founded a new company named Globe Industries, Inc. In 1963, Yarmuth became president of a new corporation, National Industries, a conglomerate with holdings in retail business, manufacturing, transportation, oil, and services. In Louisville, it operated Southern Tank Lines, Louisville Yellow Cabs, and G.E.S. Department Stores.

Critics of the takeover began spreading the rumor that National Industries intended to take the Derby out of Louisville, an allegation that Yarmuth flatly denied. He said the corporation’s interest in Churchill was mainly to add an important entertainment venue to its portfolio.

“We fell that National Industries can bring back a little of the glamour that once was a party of the Kentucky Derby,” he said, pledging that the conglomerate would not move the Derby or change the configuration or the track. He further promised that if the bid was successful, the Churchill management team and board of directors would be asked to remain.

“All we would be doing is add a director or two,” Yarmuth said. “We have no intention of stacking the board. The members of the board are all reasonable men. We feel they will agree to the offer. In fact, a number of members feel it would be in the best interest of the track (to accept) National Industries’ offer.”

But his assessment proved wrong. The track’s board of directors met on March 3, 1969, and nine of the 11 members present voted to “not accept the tender offer of National Industies as to any shares of Churchill Downs stock that they may own. Those directors also unanimously voted to recommend to stockholders of Churchill Downs that they likewise not accept the tender offer of National Industries.”

The news of National Industries’ bid caused Churchill’s stock to rise by 50 per cent. On March 13, however, it was announced that seven horsemen, with the tacit support of the track’s board of directors, had organized a $3 million effort to head off National Industries’ bid for control of the track. The seven, which formed an unincorporated organization called the “Kentucky Derby Protection Group,” included Warner L. Jones Jr., Leslie Combs II, John W. Galbreath, Frank L. McMahon, Arnold Hanger, John C. Clark, and, of course, A.B. “Bull” Hancock II.

Obviously, the racing establishment had circled the wagons to thwart National Industries’ takeover, and, on March 21, after threatening a lawsuit when Churchill refused to turn over its list of stockholders, National Industries folded its tent and abandoned its effort.

Yarmuth said that his company would begin legal proceedings in federal court to recover damages allegedly suffered through the actions of the Downs directors and the Kentucky Derby Protection Group. He maintained that the company had been offered enough stock to assure it several seats on the Churchill board, but said, “We just couldn’t do business with this group…Our actions are inconsistent with the way they do business.”

When the news of National Industries’ withdrawal got out, Churchill’s stock dropped precipitously. But Hancock and others were generally regarded as heroes throughout Kentucky for saving the Derby from corporate raiders.

Well, it took a few more decades, but the corporate raiders finally won. And just as the track’s board of directors feared in 1969, they have shown little or no regard for the track’s history, tradition, or special place in the community. Under Evans, Churchill has forfeited whatever goodwill that wasn’t killed during the Meeker regime. It has systematically insulted the bettors and the horsemen.

Small wonder, then, that A.B. “Bull” Hancock Jr.’s younger son finally walked away. The betting here is that he was disgusted, even though it doesn’t say so in the official statement.