Did Republican House Candidate Deceive the Public About Her Wealth?

Michele and Ted Rollins

Documents in an Alabama-related divorce case indicate a 2010 GOP candidate for a U.S. House seat made deceptive statements about her family wealth.

Michele Rollins ran for Delaware's at-large House seat and lost in the Republican primary. Before bowing out in a race that ultimately went to Democrat John C. Carney, Rollins tried to downplay her wealth. In the process, she seemingly presented deceptive information to Delaware voters.

If that's not the case, then it appears someone was playing fast with the facts in a high-stakes divorce case with Alabama ties.

Had Rollins won the Delaware House seat, she immediately would have become one of the wealthiest members of Congress. With assets between $90 million and $350 million, Rollins would have been in the rarefied financial air occupied by Sen. John Kerry (D-MA), worth at least $184 million, and Rep. Darrell Issa (R-CA), worth at least $156 million.

Rollins, however, apparently decided that her chances of winning would be enhanced if she downplayed her wealth. An article on the financial disclosure forms of Delaware candidates, described Rollins assets:

Rollins' disclosures, for example, tell you that she is a wealthy woman, with personal assets of $30 million to $141 million and her name attached to total property and investments worth at least $92 million and maybe as much as $350 million.

The forms don't tell you, though, that the estate of her late husband, businessman John W. Rollins Sr., was placed in trust for his 10 children and is inaccessible to her. John Rollins, a former lieutenant governor of Delaware, made his fortune with a truck-leasing firm, an entertainment complex that included Dover Downs and Dover Motorsports, and the lavish, 7,000-acre waterfront Rose Hall Resort in Montego Bay, Jamaica. Michele Rollins' income comes largely from the dividends and interest emerging from the trusts Rollins set aside for the children.

That last sentence appears to be a reference to RMT Trust, the largest shareholder of Dover Motorsports  Inc. of Delaware. RMT Trust is controlled by a man named Henry B. Tippie, of Austin, Texas, who long has been the "money man" behind various Rollins ventures. Dover Motorsports Inc. has not been performing well, as the Bush recession has hurt a number of NASCAR venues, and one unhappy investor commissioned a study titled "Dancing on the Deck of the Titantic: Henry B. Tippie and Dover Motorsports Inc." Here is how that study described RMT Trust:

Following the death of John W. Rollins, Senior on April 4, 2000, Henry Tippie (at the time, Vice Chairman of Dover) was named executor of Mr. Rollins’ vast estate, and thereafter, Mr. Tippie possessed more than 50% voting control of the Company. The Last Will and Testament of John W. Rollins, Senior, established the RMT Trust as the primary vehicle to transfer assets to his wife, Michele M. Rollins. Among many of its stakes in property and operating assets, the RMT Trust held 8 million shares of Class A Common Stock in 2009, which represented approximately 39.4% of the voting control of Dover Motorsports. The Last Will and Testament stipulated that the RMT Trust would be administered by three trustees, presently Michele M. Rollins, R. Randall Rollins, and Henry B. Tippie. Through an agreement which renews annually, Michele Rollins and Randall Rollins yielded sole discretion over the voting power of shares held by RMT Trust to Henry Tippie. Therefore, at the behest of the Rollins, Henry Tippie maintained the dual role of Chairman of the Company and voting trustee of RMT Trust and was able to single-handedly determine the outcome of any and all shareholder votes.

As you can see, Rollins family finances can get complicated. But we have tried to sort them out because the Rollinses have strong connections to Alabama--and we have seen signs that they tend not to play fair.

One of John Rollins' 10 children is Ted Rollins, the CEO of Campus Crest Communities and the subject of numerous posts here at Legal Schnauzer. Our interest in Ted Rollins stems mostly from a divorce case that Sherry Carroll Rollins launched against him in 2001. It also should be noted that Ted Rollins has strong business interests in Alabama. His primary corporate law firm is Birmingham-based Bradley Arant, and Campus Crest Communities recently announced that it plans to develop a $26.3 million student-housing project at Auburn University.

As for the Rollins v. Rollins divorce case, it was filed in Greenville, South Carolina, where the couple lived, and was litigated there for roughly three years. When Ted Rollins failed to make court-ordered payments on the former marital residence, Sherry Carroll Rollins and the couple's two daughters were kicked out of their house and forced to flee to Alabama, where Ms. Rollins had relatives.

Ted Rollins proceeded to sue Sherry Rollins for divorce in Alabama, even though jurisdiction already had been established in South Carolina and could not lawfully be changed. Ted Rollins wound up with an extraordinarily favorable judgment at the Shelby County Courthouse in Columbiana, the same venue where Mrs. Schnauzer and I have repeatedly been cheated by corrupt lawyers and judges. Hence, our interest in Rollins v. Rollins, which I've called the worst case of courtroom abuse (civil division) in my experience.

Why should Rollins almost induce vomiting in anyone who is remotely familiar with jurisdictional law? There are several reasons, but here is the biggie: Ted Rollins was ordered to pay the grand sum of $815 a month in support for two children. And this is for a guy who owns multiple private jet craft and is CEO of a company with a $380 million Wall Street IPO in hand.

Because of that judgment from Shelby County Circuit Judge D. Al Crowson, who could not lawfully hear the case, Sherry Rollins and her two daughters are on food stamps. As for Ted Rollins, his ties to the highest levels of the Alabama legal community, through Bradley Arant, apparently paid off big time.

How well did those ties pay off? Let's consider the math. Ted Rollins' efforts to reduce his family-support obligations actually began in South Carolina--and that is where Michele Rollins entered the picture. A South Carolina judge issued a temporary order calling for Ted Rollins to pay $8,355 a month in overall support. Upon a motion to reconsider from Ted Rollins' lawyer, that amount was reduced to $4,500 a month.

How did Ted Rollins justify the motion for reconsideration? He more or less blamed it on Michele Rollins, stating that she controlled his trust account with an iron fist. Here's how a court order dated October 17, 2002, sums it up:

[Mr. Rollins] also presented evidence that he is among nine (9) contingent remainders to his deceased father's marital trust estate and that his access to this possible source of funds is permanently restricted to the discretion of his deceased father's widow who does not intend to give him an advance.

I don't claim to be an expert in estate law, and marital trusts can be a tricky subject because they come in several varieties. Something, however, seems incongruent here. We have Ted Rollins stating in court that access to his trust funds are strictly controlled by Michele Rollins. But we have Michele Rollins stating that the trust funds for John Rollins' children are inaccessible to her.

Could Michele Rollins have control over her late husband's trust without having access to it? Does that make sense?

This much is clear: Ted Rollins got one heck of a deal by shifting the divorce case against him from one state to another. It looked at first, in South Carolina, like Ted Rollins would be paying somewhere in the neighborhood of $8,300 a month in family support. By the time the case was finished in Alabama, he was paying $1,315 a month ($815 in child support, $500 in alimony). And the Alabama court, in its final judgement, never mentioned any marital assets--businesses, property, investments, etc.--to which Sherry Rollins might have been entitled to a share over 14 years of marriage.

I'm not a mathematician, but it looks like the unlawful shift of the Rollins divorce case to Alabama helped reduce Ted Rollins monthly support bill by about 640 percent. And that doesn't count any marital assets that should have been divided up, but were not.

Rollins-family finances can create a tangled web, but we do know this: Sherry Rollins and her daughters are on food stamps in Alabama because of the paltry support sum ordered by Judge Crowson. And public documents indicate Michele Rollins played a prominent role in making that happen. We also know that Ted and Michele Rollins are very much aware that their relatives in Alabama are on food stamps; we know that because I notified both of them via e-mail. Neither one of them seems to give a damn because they have done nothing about it.

When I questioned Ted Rollins about the Rollins divorce case, he said--in so many words--that it was litigated long ago, his ex wife received a fair hearing, and it's all a private matter anyway.

That, of course, is a bunch of horse feces. Sherry Rollins' appeal to the Alabama Supreme Court was denied in 2008, which isn't that long ago. The case could not be lawfully heard in Alabama, so it clearly was not handled in a fair fashion. And it was litigated in courts that are funded by taxpayers, including me, so it is a public matter.

As for Michele Rollins, she asked voters to make her a member of the U.S. House of Representatives, helping to form policy that affects all Americans. Clearly, her affairs are a matter of public interest.

The public has every right to ask, "Do Ted and Michele Rollins conduct their business in a fair, honest, and open way?" When a reasonable person looks at matters connected to RMT Trust and the Rollins v. Rollins divorce case, he can conclude that the answer is no.

Best we can tell, someone is playing fast with the facts on matters of the family trust. It seems Michele Rollins fudged regarding her financial disclosure forms, in an effort to disguise her true wealth. Or Ted Rollins fudged regarding Michele Rollins' control over his trust funds, in an effort to reduce his family-support payments. Which one was it?

Either way, the Rollinses appear to be sending disturbing messages about the business methods that make them one of the nation's wealthiest families.

In an effort to clear up confusion, I sent several questions regarding RMT Trust to Ted Rollins, with a copy to Michele Rollins. I received no response to my queries, which can be viewed below.


Ted Rollins E- Mail--RMT Trust