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raised, bred, and raced them. The costs for the caring of
petitioners’ horses at the Kerr farm were included as part of
petitioners’ wages. Petitioners hired professional trainers for
the racing of the horses. Their horses were racing at Los
Alamitos, Golden Gate, and Bay Meadows racetracks.
Petitioners left the Kerr farm in 1987 and moved back to
their house in Whittier with their horses. Petitioner was
employed at Lawyers Mutual Insurance Co., and Mr. Pitts,
suffering from a muscle-wasting disease which required drug
therapy, stayed home.
Around 1988, petitioners decided that racing quarter horses
was too expensive. The trainer’s fees were high, and the purses
were small. Petitioner owned a thoroughbred with five other
people which had won $25,000 in a race in 1987. Petitioners
decided to switch to thoroughbred horses because stakes races
(such as the Kentucky Derby) paid higher purses. Petitioners
sold some of their quarter horses and started acquiring
thoroughbreds.4
Initially, petitioners acquired two thoroughbred mares and
Ding Dong Daddy, a thoroughbred stallion that came from good
blood lines. Petitioners offered Ding Dong Daddy for stud.
According to a promotional flyer that petitioners distributed,
Ding Dong Daddy had earned $24,964 in his first 2 years of
racing. The flyer also detailed the horse’s sire and female
4 Petitioners did retain one quarter horse that they raced,
and another that they bred.
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