In a significant development, John Stewart, owner of Resolute Racing, has agreed to settle a breach-of-contract lawsuit brought against him and his private-equity firm. The legal action was initiated by Archean Capital Partners, an investor that provided funds for Stewart’s company, MiddleGround Management. According to reports, the case, which began in December 2022, has now concluded with both parties reaching an agreement. While details of the settlement remain undisclosed, the court has confirmed that the matter will be finalized by February 23. This resolution marks the end of a contentious dispute that involved allegations of financial mismanagement and contract violations.

The conflict between Archean Capital and MiddleGround Management stemmed from accusations of improper use of investment funds. Archean alleged that MiddleGround and its partners acted in bad faith by failing to allocate a portion of the company’s revenue as stipulated in their agreement. Instead, it was claimed that these funds were redirected for personal or business purposes unrelated to the original investment. Additionally, Archean argued that MiddleGround did not seek the required consent before acquiring other businesses, a violation of the terms outlined in the investment contract. The investor asserted that it was owed over $22 million under this agreement.

Archean also raised concerns about the time commitment of MiddleGround’s principals, particularly John Stewart. The investor contended that Stewart was supposed to dedicate a substantial amount of his time to managing the fund but instead spent considerable effort in the Thoroughbred industry, notably through Resolute Racing. Despite this, Archean clarified that it did not accuse Stewart of using its funds specifically for Resolute Racing operations. However, the investor maintained that it should have been informed of any new business ventures undertaken by MiddleGround’s principals, including Stewart’s racing investments.

Since its inception in 2023, Resolute Racing has made notable strides in the horse racing world. The organization acquired Shadwell’s former Shadayid Stud, now known as Resolute Farm, along with a prestigious broodmare band. This acquisition includes several high-profile mares such as Puca, Queen Caroline, and multiple Breeders’ Cup winners. Resolute Racing has also fielded successful racehorses, including Grade 1 winner Didia and Kentucky Derby starter Just a Touch. Moreover, the company is set to sponsor the 2025 Eclipse Awards, further solidifying its presence in the industry.

The settlement brings closure to a complex legal battle that had the potential to impact both the financial and operational aspects of MiddleGround Management and Resolute Racing. With the resolution in place, all parties can now focus on moving forward and continuing their respective endeavors without the distraction of ongoing litigation. The future looks promising for Resolute Racing as it continues to expand its influence in the Thoroughbred industry.