Groom Convicted of Lying in Probe of Alydar’s Death

Despite pervasive sympathy for the defendant, jurors on Thursday convicted a former Kentucky groom on two counts of lying to a federal grand jury investigating the 1990 death of Alydar, the most heavily insured thoroughbred in history.

Alton Stone, 39, initially appeared unmoved by the guilty verdict as U.S. District Judge David Hittner read it aloud nine hours after jurors began deliberations. But minutes after the verdict, Stone appeared to be teary-eyed as he met in another room with his attorney, Chris Goldsmith.

Stone must return to Houston on Sept. 18 for sentencing. He faces up to five years in prison and a $250,000 fine on each of the two counts.

“There was so much sympathy for Alton Stone,” jury foreman Sheila Donley, 49, of Houston, said. “They really felt strongly that he was in the wrong place at the wrong time. But it doesn’t matter. He willingly told a lie.”

Stone was called before a federal grand jury in Houston last summer during an investigation into defunct Houston-based First City Bancorp., which failed in 1988 and again in 1992.

He was asked about the night of Nov. 13, 1990, when Alydar, insured for $36.5 million, was found with a broken right rear leg inside his stall at Calumet Farm in Lexington, Ky.

The charges against Stone involved questions about why he replaced the horse’s regular watchman and how he discovered Alydar’s injury.

Two days after the injury, Alydar had to be destroyed and First City received $20 million from the insurance payout.

The death of the 1978 Triple Crown runner-up may seem arcane, but Alydar’s owners were heavily in debt and First City was Calumet’s biggest creditor. Less than three weeks before the accident, First City warned Calumet that at least $15 million was due by February 1991 or foreclosure could begin.