Subject: POLITICO Magazine: The Man Who Beat Donald Trump
From: "Sarge, Matthew" <[email-masked]>
To: Comm_D <[email-masked]>
Date: Mon, 25 Apr 2016 17:54:30 -0700

The Man Who Beat Donald Trump<http://www.politico.com/magazine/story/2016/04/donald-trump-marvin-roffman-casino-lawsuit-213855>

REHOBOTH BEACH, Del.—Sitting here the other day in the library of his house with 40 rooms, 11 fireplaces, four pianos, a wine cellar, a movie theater and an elevator, Marvin Roffman talked about the time Donald Trump tried to destroy him for telling the truth.

“Brutal,” said Roffman, 76, wearing loafers, khaki shorts and a pink polo, his elaborate gardens and the sixth hole of the Kings Creek Country Club golf course visible through the windows.

“I’m telling you,” he said. “Trump is a brutal guy.”

This was March of 1990. Roffman was a veteran securities analyst. He had focused on the gaming industry in Atlantic City since the first casinos opened in 1978. He knew the market as well as anyone and had watched closely as Trump made a typically bold entrance with Trump Plaza and Trump’s Castle in 1984 and ‘85. Now the New York real estate tycoon was about to open his third casino, by far his biggest, most lavish and most shakily financed one yet, the Trump Taj Mahal. Roffman was skeptical. He told a reporter from the Wall Street Journal the Taj would fail.

What happened next was straight out of Trump 101. The “people I don’t take too seriously,” he had written in 1987 in The Art of the Deal, “are the critics—except when they stand in the way of my projects.” Roffman was in the way. Trump bombarded him with invective, threatened to sue his employer, demanded his firing and then publicly assailed him some more. That Roffman’s assessment was grounded in reality—that he would prove to be right—didn’t stop Trump from attacking Roffman. It was the reason for it.

Three days after the quote in the Journal, Roffman was fired. What happened after that, though, was unusual. In the long history of the leading Republican presidential candidate’s use of disparagement, intimidation and forceful warnings of litigation, there is no person quite like Roffman. He sued Trump and won a clear victory—a fat check drawn on a Donald Trump account.

How does one beat Trump? For Roffman, it took time and money, gumption and conviction. Trump v. Roffman was a noisy, blustery harangue in the court of public opinion. Marvin B. Roffman v. Donald J. Trump and Trump Organization, Inc., on the other hand, was a longer, fact-based slog in an actual court.

“If you have a brand that strong, associated with success, power and class, that brand name must never be tarnished, ever,” Roffman told me, attempting to explain Trump’s motive for trying to ruin the life and reputation of a person he knew was right. “You must defend it. You must protect it. I was the monkey wrench in the gears. I was the monkey wrench threatening the integrity of the brand.”

[Roffman's 40-room house in Delaware includes 11 fireplaces and an eight-seat movie theater.]

Roffman's 40-room house in Delaware includes 11 fireplaces and an eight-seat movie theater. | Matt Roth for Politico Magazine

Roffman smiled. “I’m glad I did it. Otherwise,” he said, “I wouldn’t be sitting here in this chair.”

***

“Marvin,” Trump said.

It was the middle of that March. “I know you’re down on the Taj,” Trump said over the phone from New York, according to Roffman’s recollection.

“He said, ‘I want you to see this property in its full splendor,’” Roffman recalled. “‘I’m going to have someone call you and arrange a tour of the Taj. And after the tour, I want you to call me. And I know what you’re going to tell me. You’re going to tell me you have just seen the greatest property ever.’ I swear to God. That’s what he said.”

The tour was set for March 20.

That morning, the Journal ran an article about Trump and the much-anticipated early April opening of the 1,250-room, 120,000-square-foot Taj, which had 70 eye-catching minarets on its roof and a payroll of some 6,500 employees. Roffman, then working for a Philadelphia brokerage firm called Janney Montgomery Scott, was quoted prominently.

“When this property opens,” Roffman told the Journal, “he will have had so much free publicity he will break every record in the book in April, June and July. But once the cold winds blow from October to February, it won’t make it. The market just isn’t there.” He called Atlantic City in general “an ugly and dreary kind of place.”

[Trump's Taj Mahal casino, the biggest and most shakily financed of his three, opened in 1990.]

Trump's Taj Mahal casino, the biggest and most shakily financed of his three, opened in 1990. | AP Photo

When Roffman arrived at the casino for his tour that day, Trump’s brother, Robert, stopped him at the door and cursed him—“I’d never heard so many four-letter words in my entire life,” Roffman told me at his house—and yelled at him to “get the fuck off the property.”

Back in Philadelphia, on the fax machine at Janney’s offices, a letter arrived from Trump Tower.

Trump in the letter called Roffman “hair-trigger” and “somewhat unstable in his tone and manner of criticism.” He continued, without regard for spelling: “For Mr. Roffman to make these statements with such definity is an outrage. I am now planning to institue a major lawsuit against your firm unless Mr. Roffman makes a major public apology or is dismissed. For a long while I have thought of Mr. Roffman as an unguided missle.”

Roffman by this point had been a securities analyst for 25 years and at Janney for 16, developing a reputation as an outspoken, tell-it-like-it-is analyst. Trump had noticed, according to Roffman, calling on occasion to quiz him about competing casinos and other executives.

In 1987, Trump even had hired Roffman as an expert witness. In testimony in front of New Jersey’s Casino Control Commission, Roffman acknowledged the “tremendous risk” involved with the Taj because of its size and cost—it was more than two years from completion—but he also told the agency’s members he was “excited” about its prospects. He called Trump’s first two casinos, the Plaza and the Castle, “very efficient” and “well managed,” according to a transcript of the hearing. He believed the Taj, he said, could help finally revitalize the perpetually downtrodden small city on the shore.

That fall, though, Wall Street crashed. The gaming industry started to stall. Roffman grew pessimistic. He warned in a report for Janney clients in May 1988 of “Trouble Ahead With A Capital ‘T’”—a reference to Trump and the Taj. “Trump has only experienced an economy that is growing. Let’s see how he does in a real turndown,” he told the Boston Globe that October. “Donald Trump’s style is not cash, it’s to borrow,” he said in December to the Associated Press, noting that Trump now was shouldering more than a billion dollars of debt just with his casinos. The Taj debt was $675 million in junk bonds, the only form of financing he could secure. For the Taj to service its debt and simply break even, Roffman calculated, the operation would have to take in around $1.3 million a day, unprecedented in the history of casinos.

Throughout 1989—in reports for clients, speeches to trade groups and conversations with reporters—Roffman said versions or in some cases nearly word-for-word previews of what would run in the Journal the following March. He even had said similar things earlier in the month in other high-profile publications. “I have serious reservations about the financial success of the Taj Mahal,” he told Newsday. Trump “will have to do over steady basis something no other casino in the world has ever been able to do,” he told Newsweek. If Trump had been angered by these comments, he never complained privately to Roffman, nor did he bother to publicly rebut them.

It was the March 20 story in the Journal that triggered Trump’s wrath.

He was on edge already.

[“I’ve got some fabulous things,” Roffman says.]

“I’ve got some fabulous things,” Roffman says. | Matt Roth for Politico Magazine

Trump at the time was the subject of relentless, tabloid-led coverage of the disintegration of his marriage to Ivana Trump, the mother of his first three children, in part because of his affair with his younger, leggy mistress, Marla Maples. For going on six weeks, the drama had been front-page fodder for New York’s tabloids. LOVE ON THE ROCKS. WAR OF THE TRUMP$. IVANA IN TEARS. MARLA RAGES!

Trump was asked by the New York Post if he considered adultery a sin. “I don’t think it’s a sin,” he said, “but I don’t think it should be done.”

He told the Journal the crush of publicity about his personal life was actually good for his bottom line, citing 1,500 requests from reporters to cover the opening of the Taj. “A divorce is never a pleasant thing,” he said, “but from a business standpoint, it’s had a very positive effect.”

It was a bluff. Almost everybody was fixated on his personal failings; almost nobody knew the perilous state of his finances. Trump had racked up massive debt—not only with his casinos, but in 1988, too, with a manic jag of buying trophy properties<http://www.politico.com/magazine/story/2016/03/1988-the-year-donald-lost-his-mind-213721>, such as Manhattan’s Plaza Hotel and the Eastern Air Shuttle, which he renamed the Trump Shuttle. With the onset of a recession, it was becoming unsustainable.

“He had to know it,” Roffman told me. “But he didn’t want anybody else to know it.”

Hence the hostile letter.

The next day, Jim Meyer, Janney’s director of research, detailed in an internal memo Roffman’s punishments: He was to have “no direct contact with members of the press,” no possibility of a bonus to his base salary in 1990 and a review of his employment status at the end of the year. Edgar Scott, the chairman of the board, called Trump, according to court records, informing him of the nature of the censure. He asked Trump what kind of apology he wanted. Trump, according to the records, directed that Roffman write him a letter saying the Taj would be “the greatest success ever.” Roffman didn’t want to write a letter like that. His bosses did it for him. The obsequious letter said the opening of the Taj “unquestionably” would be “the grandest and most successful” in the annals of Atlantic City. “I do hope that you will let me continue to cover your companies,” it read. Roffman wanted to save his job. He reluctantly signed it. He was “a team player,” he said later in a deposition. “I wanted to go long with the firm because I liked working there.”

After a sleepless night, Roffman got a call from Trump’s secretary, according to court records. Trump, she said, wanted him to make some adjustments to the letter. He wanted, for instance, the phrase “every hope that the Taj will ultimately be very profitable” changed to “every expectation,” Roffman said. Roffman stewed. That afternoon, he wrote a new letter to Trump, a letter of his own.

“I did not write the letter,” Roffman wrote. “I retract the letter.”

Roffman showed the letter to Meyer, according to court records, saying he was going to send it to Trump. Meyer logged his response in an internal memo: “Regarding the proposed attached letter to Donald Trump, after discussion with senior management of our firm, we are directing you not to send the attached letter to Mr. Trump while you are an employee of this firm. As long as you remain an employee of ours we insist on the right to review and authorize all correspondence of yours related to anything or anybody associated with the casino industry.”

Around 4:30, Roffman sent it, anyway.

Trump’s response was quick and terse. “Only a fool, a highly unstable one at that, would send a letter such as your second one negating your original letter. You have proved by these strange and irrational actions to be a great liability to your firm,” he wrote to Roffman. “I look forward to seeing you and your firm in court.” That was March 22.

Roffman was fired on March 23.

“Because I wanted to tell the truth,” he told a United Press International reporter.

Wrong, according to Janney. Roffman was let go, according to company documents, because he gave his opinion about the Taj in a quote to a reporter before writing a report for paying clients—a dubious assertion considering he had been saying pretty much the same thing for weeks at least—and “for failure to follow his supervisor’s direct instruction.”

From Barron’s to Fortune, from Institutional Investor to Vanity Fair, from the New York Post to the Philadelphia Inquirer, Trump in the wake of Roffman’s firing unleashed a torrent of criticism against him, calling him “a bad analyst,” “a very unprofessional guy,” “a totally mediocre guy with no talent,” “not a good man,” “a man of little talent,” and “a disgrace to his profession.”

“I have a right to be a critic of a critic,” Trump said to Institutional Investor.