What is an appropriate penalty for an honest mistake? Should there be a penalty at all?

When Marble Cliff went through the 2005 Keeneland Fall Breeding Stock Sale, the weanling attracted some attention because of his status as a Thoroughbred foaled in Ohio, one of two designations making him eligible to run in races limited to Ohio-bred horses. Ohio, like many other states, offers supplemented purses in some restricted races where the competition might not be as stiff as that in events open to all comers. Marble Cliff drew a final bid of $40,000.

Racing for Foxwood Stables, Marble Cliff developed into one of Ohio’s best runners. The gelding won the Cleveland Gold Cup for Ohio-breds and by summer of his 3-year-old year had amassed more than $100,000 in earnings.

Just about the time Marble Cliff was starting to look like a really good investment, troublesome questions about exactly where he had been foaled started to come up. The Ohio State Racing Commission certified Marble Cliff as an Ohio-foaled horse based on an application received from the gelding’s breeders in 2005, but in June 2008 the commission started an investigation to determine whether the information in the application was accurate. The commission ultimately ruled that Marble Cliff had not been foaled in Ohio as claimed, and his Ohio-foaled certificate was revoked. The gelding was disqualified from all his victories and $110,140 in earnings was forfeited.

Almost overnight, Marble Cliff went from being an Ohio-bred stakes winner of more than $100,000 to a Kentucky-bred maiden.

Not unexpectedly, a lawsuit followed. Charles Ruma, one of Marble Cliff’s owners