Hundreds allege Donald Trump doesn’t pay his bills
Donald
Trump casts himself as a protector of workers and jobs, but a USA TODAY
NETWORK investigation found hundreds of people – carpenters,
dishwashers, painters, even his own lawyers – who say he didn’t pay them
for their work.
During
the Atlantic City casino boom in the 1980s, Philadelphia
cabinet-builder Edward Friel Jr. landed a $400,000 contract to build the
bases for slot machines, registration desks, bars and other cabinets at
Harrah's at Trump Plaza.
The family cabinetry business, founded in the 1940s by Edward’s father,
finished its work in 1984 and submitted its final bill to the general
contractor for the Trump Organization, the resort’s builder.
Edward’s son, Paul, who was the firm’s accountant, still remembers the
amount of that bill more than 30 years later: $83,600. The reason: the
money never came. “That began the demise of the Edward J. Friel Company…
which has been around since my grandfather,” he said.
Donald
Trump often portrays himself as a savior of the working class who will
"protect your job." But a USA TODAY NETWORK analysis found he has been
involved in more than 3,500 lawsuits over the past three decades — and a
large number of those involve ordinary Americans, like the Friels, who
say Trump or his companies have refused to pay them.
At least 60 lawsuits, along with hundreds of liens, judgments, and
other government filings reviewed by the USA TODAY NETWORK, document
people who have accused Trump and his businesses of failing to pay them
for their work. Among them: a dishwasher in Florida. A glass company in
New Jersey. A carpet company. A plumber. Painters. Forty-eight waiters.
Dozens of bartenders and other hourly workers at his resorts and clubs,
coast to coast. Real estate brokers who sold his properties. And,
ironically, several law firms that once represented him in these suits
and others.
Trump’s companies have also been cited for 24
violations of the Fair Labor Standards Act since 2005 for failing to pay
overtime or minimum wage, according to U.S. Department of Labor data.
That includes 21 citations against the defunct Trump Plaza in Atlantic
City and three against the also out-of-business Trump Mortgage LLC in
New York. Both cases were resolved by the companies agreeing to pay back
wages
In addition to the lawsuits, the review found more than 200 mechanic’s
liens — filed by contractors and employees against Trump, his companies
or his properties claiming they were owed money for their work — since
the 1980s. The liens range from a $75,000 claim by a Plainview, N.Y.,
air conditioning and heating company to a $1 million claim from the
president of a New York City real estate banking firm. On just one
project, Trump’s Taj Mahal casino in Atlantic City, records released by
the New Jersey Casino Control Commission in 1990 show that at least 253
subcontractors weren’t paid in full or on time, including workers who
installed walls, chandeliers and plumbing.
The actions in total paint a portrait of Trump’s sprawling
organization frequently failing to pay small businesses and individuals,
then sometimes tying them up in court and other negotiations for years.
In some cases, the Trump teams financially overpower and outlast much
smaller opponents, draining their resources. Some just give up the
fight, or settle for less; some have ended up in bankruptcy or out of
business altogether.
Trump and his daughter Ivanka, in an
interview with USA TODAY, shrugged off the lawsuits and other claims of
non-payment. If a company or worker he hires isn’t paid fully, the
Trumps said, it’s because The Trump Organization was unhappy with the
work.
“Let’s say that they do a job that’s not good, or a job that
they didn’t finish, or a job that was way late. I’ll deduct from their
contract, absolutely,” Trump said. “That’s what the country should be
doing.”
'Visibly winced'
To be sure,
Trump and his companies have prevailed in many legal disputes over
missing payments, or reached settlements that cloud the terms reached by
the parties.
However, the consistent circumstances laid out in
those lawsuits and other non-payment claims raise questions about
Trump’s judgment as a businessman, and as a potential commander in
chief. The number of companies and others alleging he hasn’t paid
suggests that either his companies have a poor track record hiring
workers and assessing contractors, or that Trump businesses renege on
contracts, refuse to pay, or consistently attempt to change payment
terms after work is complete as is alleged in dozens of court cases.
In
the interview, Trump repeatedly said the cases were “a long time ago.”
However, even as he campaigns for the presidency, new cases are
continuing. Just last month, Trump Miami Resort Management LLC settled
with 48 servers at his Miami golf resort over failing to pay overtime
for a special event. The settlements averaged about $800 for each worker
and as high as $3,000 for one, according to court records. Some workers
put in 20-hour days over the 10-day Passover event at Trump National
Doral Miami, the lawsuit contends. Trump’s team initially argued a
contractor hired the workers, and he wasn’t responsible, and
counter-sued the contractor demanding payment.
“Trump could have
settled it right off the bat, but they wanted to fight it out, that’s
their M.O.” said Rod Hannah, of Plantation, Fla., the lawyer who
represented the workers, who he said are forbidden from talking about
the case in public. “They’re known for their aggressiveness, and if you
have the money, why not?”
Similar cases have cropped up with
Trump’s facilities in California and New York, where hourly workers,
bartenders and wait staff have sued with a range of allegations from not
letting workers take breaks to not passing along tips to servers.
Trump's company settled the California case, and the New York case is
pending.\
Trump's Doral golf resort also has been embroiled in
recent non-payment claims by two different paint firms, with one case
settled and the other pending. Last month, his company’s refusal to pay
one Florida painter more than $30,000 for work at Doral led the judge in
the case to order foreclosure of the resort if the contractor isn’t
paid.
Juan Carlos Enriquez, owner of The Paint Spot, in South
Florida, has been waiting more than two years to get paid for his work
at the Doral. The Paint Spot first filed a lien against Trump’s course,
then filed a lawsuit asking a Florida judge to intervene.
In
courtroom testimony, the manager of the general contractor for the Doral
renovation admitted that a decision was made not to pay The Paint Spot
because Trump “already paid enough.” As the construction manager spoke,
“Trump’s trial attorneys visibly winced, began breathing heavily, and
attempted to make eye contact” with the witness, the judge noted in his
ruling.
That, and other evidence, convinced the judge The Paint
Spot’s claim was credible. He ordered last month that the Doral resort
be foreclosed on, sold, and the proceeds used to pay Enriquez the money
he was owed. Trump’s attorneys have since filed a motion to delay the
sale, and the contest continues.
Enriquez still hasn’t been paid.
Unpaid hourly workers
Trump
frequently boasts that he will bring jobs back to America, including
Tuesday in a primary-election night victory speech at his golf club in
suburban New York City. “No matter who you are, we're going to protect
your job,” Trump said Tuesday. “Because let me tell you, our jobs are
being stripped from our country like we're babies.”
But
the lawsuits show Trump’s organization wages Goliath vs David legal
battles over small amounts of money that are negligible to the
billionaire and his executives — but devastating to his much-smaller
foes.
In 2007, for instance, dishwasher Guy Dorcinvil filed a
federal lawsuit against Trump’s Mar-a-Lago Club resort in Palm Beach,
Fla., alleging the club failed to pay time-and-a-half for overtime he
worked over three years and the company failed to keep proper time
records for employees.
Mar-a-Lago
LLC agreed to pay Dorcinvil $7,500 to settle the case in 2008. The
terms of the settlement agreement includes a standard statement that
Mar-a-Lago does not admit fault and forbids Dorcinvil or his lawyers
from talking about the case, according to court records.
Developers
with histories of not paying contractors are a very small minority of
the industry, said Colette Nelson, chief advocacy officer of the
American Subcontractors Association. But late or missing payments can be
devastating for small businesses and their employees.
“Real
estate is a tough and aggressive business, but most business people
don’t set out to make their money by breaking the companies that they do
business with,” she said, stressing she couldn’t speak directly to the
specifics of cases in Trump’s record. “But there are a few.”
In
the interview, Trump said that complaints represent a tiny fraction of
his business empire and dealings with contractors and employees,
insisting all are paid fairly. “We pay everybody what they’re supposed
to be paid, and we pay everybody on time,” he said. “And we employ
thousands and thousands of people. OK?”
The slot-machine cabinets
Despite
the Trumps’ assertion that their companies only refuse payment to
contractors “when somebody does a bad job,” he has sometimes offered to
hire those same contractors again. It’s a puzzling turn of events, since
most people who have a poor experience with a contractor, and who
refuse to pay and even fight the contractor in court, aren’t likely to
offer to rehire them.
Nevertheless, such was the case for the
Friels. After submitting the final bill for the Plaza casino
cabinet-building in 1984, Paul Friel said he got a call asking that his
father, Edward, come to the Trump family’s offices at the casino for a
meeting. There Edward, and some other contractors, were called in one by
one to meet with Donald Trump and his brother, Robert Trump.
“He
sat in a room with nine guys,” Paul Friel said. “We found out some of
them were carpet guys. Some of them were glass guys. Plumbers. You name
it.”
In the meeting, Donald Trump told his father that the
company’s work was inferior, Friel said, even though the general
contractor on the casino had approved it. The bottom line, Trump told
Edward Friel, was the company wouldn't get the final payment. Then,
Friel said Trump added something that struck the family as bizarre.
Trump told his dad that he could work on other Trump projects in the
future.
“Wait a minute,” Paul Friel said, recalling his family's reaction to
his dad’s account of the meeting. “Why would the Trump family want a
company who they say their work is inferior to work for them in the
future?”
Asked about the meeting this week, Trump said, “Was the
work bad? Was it bad work?” And, then, after being told that the general
contractor had approved it, Trump added, “Well, see here’s the thing.
You’re talking about, what, 30 years ago?”
Ivanka Trump added that
any number of disputes over late or deficient payments that were found
over the past few decades pale in comparison to the thousands of checks
Trump companies cut each month.
“We have hundreds of millions of
dollars of construction projects underway. And we have, for the most
part, exceptional contractors on them who get paid, and get paid
quickly,” she said, adding that she doubted any contractor complaining
in court or in the press would admit they delivered substandard work.
“But it would be irresponsible if my father paid contractors who did
lousy work. And he doesn’t do that.”
But, the Friels’ story is
similar to experiences of hundreds of other contractors over the
casino-boom decade in Atlantic City. Legal records, New Jersey Casino
Control Commission records and contemporaneous local newspaper stories
recounted time and again tales about the Trumps paying late or
renegotiating deals for dimes on the dollar.
A
half-decade after the Friels’ encounter, in 1990, as Trump neared the
opening of his third Atlantic City casino, he was once again attempting
to pay contractors less than he owed. In casino commission records of an
audit, it was revealed that Trump’s companies owed a total of $69.5
million to 253 subcontractors on the Taj Mahal project. Some already had
sued Trump, the state audit said; others were negotiating with Trump to
try to recover what they could. The companies and their hundreds of
workers had installed walls, chandeliers, plumbing, lighting and even
the casino’s trademark minarets.
One of the builders was Marty
Rosenberg, vice president of Atlantic Plate Glass Co., who said he was
owed about $1.5 million for work at the Taj Mahal. When it became clear
Trump was not going to pay in full, Rosenberg took on an informal
leadership role, representing about 100 to 150 contractors in
negotiations with Trump.
Rosenberg’s mission: with Trump offering
as little as 30 cents on the dollar to some of the contractors,
Rosenberg wanted to get as much as he could for the small businesses,
most staffed by younger tradesmen with modest incomes and often families
to support.
“Yes, there were a lot of other companies," he said of those Trump left waiting to get paid. "Yes, some did not survive."
Rosenberg
said his company was among the lucky ones. He had to delay paying his
own suppliers to the project. The negotiations led to him eventually
getting about 70 cents on the dollar for his work, and he was able to
pay all of his suppliers in full.
Unpaid based on 'whimsy'
The
analysis of Trump lawsuits also found that professionals, such as real
estate agents and lawyers, say he's refused to pay them sizable sums of
money. Those cases show that even some loyal employees, those selling
his properties and fighting for him in court, are only with him until
they’re not.
Real estate broker Rana Williams, who said she had
sold hundreds of millions of dollars in Manhattan property for Trump
International Realty over more than two decades with the company, sued
in 2013 alleging Trump shorted her $735,212 in commissions on deals she
brokered from 2009 to 2012. Williams, who managed as many as 16 other
sales agents for Trump, said the tycoon and his senior deputies decided
to pay her less than her contracted commission rate “based on nothing
more than whimsy.”
Trump and Williams settled their case in 2015,
and the terms of the deal are confidential, as is the case in dozens of
other settlements between plaintiffs and Trump companies.
However,
Williams' 2014 deposition in the case is not sealed. In her sworn
testimony, Williams said the 2013 commission shortage wasn't the only
one, and neither was she the only person who didn't get fully paid.
“There were instances where a sizable commission would come in and we
would be waiting for payment and it wouldn’t come,” she testified. “That
was both for myself and for some of the agents.”
Another broker,
Jennifer McGovern, filed a similar lawsuit against the now-defunct Trump
Mortgage LLC in 2007, citing a six-figure commission on real-estate
sales that she said went unpaid. A judge issued a judgment ordering
Trump Mortgage to pay McGovern $298,274.
Turning the tables on lawyers
Even Trump’s own attorneys, on several occasions, sued him over claims of unpaid bills.
One
law firm that fought contractors over payments and other issues for
Trump — New York City’s Morrison Cohen LLP — ended up on the other side
of a similar battle with the mogul in 2008. Trump didn’t like that its
lawyers were using his name in press releases touting its representation
of Trump in a lawsuit against a construction contractor that Trump
claimed overcharged him for work on a luxury golf club.
As Trump
now turned his ire on his former lawyers, however, Morrison Cohen
counter-sued. In court records, the law firm alleged Trump didn’t pay
nearly a half million dollars in legal fees. Trump and his ex-lawyers
settled their disputes out of court, confidentially, in 2009.
In
2012, Virginia-based law firm Cook, Heyward, Lee, Hopper & Feehan
filed a lawsuit against the Trump Organization for $94,511 for legal
fees and costs. The case was eventually settled out of court. But as the
case unfolded, court records detail how Trump's senior deputies
attacked the attorneys' quality of work in the local and trade press,
leading the firm to make claims of defamation that a judge ultimately
rejected on free speech grounds.
'Tons of these stories out there'
Trump
claims in his presidential personal financial disclosure to be worth
$10 billion as a result of his business acumen. Many of the small
contractors and individuals who weren’t paid by him haven’t been as
fortunate.
Edward
Friel, of the Philadelphia cabinetry company allegedly shortchanged for
the casino work, hired a lawyer to sue for the money, said his son,
Paul Friel. But the attorney advised him that the Trumps would drag the
case out in court and legal fees would exceed what they’d recover.
The
unpaid bill took a huge chunk out of the bottom line of the company
that Edward ran to take care of his wife and five kids. “The worst part
wasn’t dealing with the Trumps,” Paul Friel said. After standing up to
Trump, Friel said the family struggled to get other casino work in
Atlantic City. “There’s tons of these stories out there,” he said.
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