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Dr. Harrington had no formal plan for making a profit from
the horse-breeding activities. Dr. Harrington’s goal was to
produce foals with Appaloosa characteristics. A foal with
Appaloosa characteristics is worth as much as $2,500, while a
foal without Appaloosa characteristics is worth only about $500
at a sale barn, where the animals are auctioned off for about 50
cents per pound.
Dr. Harrington bred Provoking, the single stallion, to only
one or two mares a year. Therefore, even if Dr. Harrington’s
horse activity had been able to generate two foals with Appaloosa
characteristics per year, and he had been able to sell them for
the maximum price of $2,500 each, the horse operation would have
generated revenues of only about $5,000 per year--less than one-
half of the annual expenses from the horse-breeding activity.
Despite Dr. Harrington’s efforts, petitioners were unable to
produce two foals per year with Appaloosa characteristics.
During the 7 years between 1992 and 1998, petitioners produced a
total of six foals with Appaloosa characteristics. Of those, one
died, and another was injured. Dr. Harrington testified that he
expected a foal with Appaloosa characteristics approximately 50
percent of the time.
Dr. Harrington made no attempt to expand the horse operation
to have the potential of earning a profit because he did not
believe he could find suitable brood mares at a price he could
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Last modified: May 25, 2011