Trump stiffed casino builders as he spent $1 million per week on personal expenses by S.A. Miller
http://www.washingtontimes.com/news/2016/mar/7/donald-trump-stiffed-casino-builders-while-spendin/
Marty Rosenberg has sat across the negotiating table from Donald Trump, and he says it cost his business nearly a half-million dollars when the man who currently reigns as the Republican presidential front-runner didn’t live up to his end of the deal.
The year was 1990, and Mr. Trump’s newly constructed Taj Mahal hotel and casino was hurtling toward bankruptcy, while Mr. Rosenberg’s Atlantic Plate Glass (APG) and scores of other contractors who built the lavish megacasino in Atlantic City, New Jersey, waited for more than $60 million in overdue payments.
Mr. Rosenberg, who was vice president of Atlantic Plate Glass at the time, helped form a committee of construction firms and suppliers stiffed by Mr. Trump. He then served as a member of the so-called Group of Seven leading the committee’s negotiations that resulted in the contractors getting partial payments.
Atlantic Plate Glass lost about $450,000 in the settlement, said Mr. Rosenberg, adding that his personal finances took a hit because of his minority stockholder stake in the firm, and that the company struggled but overcame the loss.
Others fared worse, he said, including smaller businesses that didn’t survive.
“From my experience, he is definitely ego-driven, disingenuous and will say whatever he has to say at the time,” Mr. Rosenberg, 73, said of the billionaire businessman. “Trump says whatever is on his mind at the time that will get him off the hook.”
Mr. Trump questioned Mr. Rosenberg’s motives for telling his story now. He said he didn’t remember Mr. Rosenberg, but he remembered the glass job at the Taj Mahal cost a total of about $10 million.
“To the best of my knowledge, I never even met him. Just another publicity-seeker,” Mr. Trump said in an email to The Washington Times.
Newspaper reports from the time corroborate the version of events related by Mr. Rosenberg, who said he was registered as an independent and voted for President Obama in 2012.
Mr. Rosenberg, who is retired and lives near Atlantic City, said he wasn’t motivated by partisanship or a desire to boost another presidential candidate, although he vowed that he would never vote for Mr. Trump.
Still, his misgivings about Mr. Trump echo criticism leveled by the front-runner’s rivals and GOP leaders desperate to derail his candidacy.
At the Conservative Political Action Conference last week, Republican presidential contender Sen. Ted Cruz warned the crowd of conservative activists that Mr. Trump would “stick it to ya” if he makes it to the White House.
Back in the summer of 1990, Mr. Trump was hustling to keep the Taj Mahal afloat and juggling roughly $3 billion in debt to banks and junk bond holders.
His empire of casinos, Trump Airline and real estate holdings were not generating cash fast enough to pay debts and support his extravagant lifestyle. He was spending nearly $1 million per week on his homes, yacht, Boeing 727 and other personal expenses, according to news reports.
He eliminated the equivalent of 1,000 jobs at the Taj Mahal and bargained with Mr. Rosenberg and other contractors to pay them a fraction of what they were owed.
All these years later, Mr. Rosenberg still fumes about his dealings with Mr. Trump, first when they negotiated the price for the job and then later when forced to haggle over getting paid.
“The bottom line is negotiations are when you start a job and you come up with a price, and they want to cut you down, not at the end of the job,” he said. “That’s not negotiations. You’re under duress. What are you going to do? You take what you can get. And that’s what happened.
“His art of the deal is getting to the point where you have no choice but to do what he says,” said Mr. Rosenberg, referring to Mr. Trump’s best-selling business book “The Art of the Deal.”
In addition to the partial payment, the agreement gave the contractors and suppliers the right of first refusal for future jobs at the Taj Mahal. But Mr. Rosenberg said he never worked for Mr. Trump again for fear of another shakedown.
The deal with the construction firms and suppliers allowed Mr. Trump’s casino venture to avoid an involuntary bankruptcy lawsuit. But Mr. Trump filed for bankruptcy about six months later, the first of his four bankruptcies for his hotels and casinos.
Mr. Trump and the bondholders emerged from the Taj Mahal bankruptcy relatively unscathed.
By 1996 the publicly traded Trump Hotel and Casino Resorts bought the Taj Mahal, paying the bondholders $40.5 million for their half of the equity, while Mr. Trump pocketed $40.5 million in THCR stock for his half.
When challenged about his record of repeated bankruptcy filings for his businesses, Mr. Trump has defended himself by saying he has “taken advantage of the laws of this country.”
Mr. Rosenberg has a different view.
“If ethics and morality have nothing to do with business, then he’s a phenomenal businessman,” he said.
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