Defrauding Investors Out Of Millions Of Dollars Is So Hot In Pickleball Right Now, This Time With A Pickleball Facility In Arizona Allegedly Pulling Off A $280 Million Scam
Bruce Yeung. Getty Images.The Dink -- This week, the SEC and Department of Justice announced charges against Randy Miller, Chad Miller, and Jeffrey De Laveaga, the executives behind Legacy Cares and its for-profit affiliate, Legacy Sports. They’re accused of defrauding investors out of more than $280 million by using forged documents, inflated revenue projections, and fictitious commitments from sports organizations—including some from the pickleball world—to sell municipal bonds funding the project.
The SEC alleges that the defendants faked letters of intent and contracts from sports organizations, some of which didn’t even know they were being included in investor decks…They claimed the park would be booked solid from Day 1, projecting $100 million in first-year revenue—enough to make municipal bond investors rich and comfortable. Instead, Legacy Park opened in early 2022, struggled with attendance, failed to meet its revenue goals, defaulted on its bonds in October of that year, and filed for bankruptcy by May 2023. The facility, which cost nearly $300 million to build, sold for less than $26 million. Less than $2.5 million was returned to investors.
It was just a few short months ago that the FBI was raiding the home of Rodney "Rocket" Grubbs, who had allegedly defrauded investors out of more than $50 million in his pickleball company.
Turns out that Rodney "Rocket" Grubbs was just small potatoes to the FBI. He was merely the tip of the iceberg. He was just a quick warmup for the main event. $50 million? That's hardly even a dent in what the executives behind "Legacy Sports" were allegedly able to pull off.
This place is absolutely massive. It's 320 acres and has 41 pickleball courts. But it's not all just pickleball. There are 35 soccer/lacrosse fields, 20 basketball courts, 12 beach volleyball courts, 8 baseball/softball fields, an outdoor stadium, and indoor stadium, and a gymnastics/dance studio.
These dudes decided they were just going to build absolutely everything. That there would never be another sporting event anywhere else in Arizona besides at this massive, massive complex. I'm sure it sounded like the most kick ass idea in the world when they were designing the blueprints for the facility. Everything is all fun and games when you're building. Once that first invoice comes in, however…well that's a different story.
The fellas got carried away and before they could even blink, they burned through over $300 million to build the place. So what do you do when you're in a pinch and need to find a way to come up with millions and millions of dollars in a hurry? You start scamming the pickleball community, of course.
It makes sense. Out of every sports demographic out there right now, pickleball has definitely cornered the "flush with cash boomer" market. You got a bunch of old people who are sitting on a ton of money, are gullible as shit, and they want to see the sport continue to grow. You forge up a couple of documents, fake a few letters, give them a massive number like "$100,000,000 in first year revenue" to really grease up those wheels. They're not going to realize you've swindled the shit out of them for years.
Heck, that even gave these guys enough time to start buying a few cars and properties for themselves.
The Kitchen -- According to a grand jury indictment, Randy Miller and Chad Miller then used the money to buy multiple vehicles for themselves and a family member and used more than $400,000 in July 2021 to buy a home for Randy Miller.
The Millers also each paid themselves more than $100,000 over their expected salaries that they had disclosed to investors and also withdrew "hundreds of thousands of dollars separate from, and in addition to, their salaries," according to the indictment.
If you know you're going to eventually get caught and have all of your assets seized anyway, you might as well go big while you still can. And I'm pretty sure a $400,000 home in Arizona is a disgustingly massive mansion anywhere in the northeast. It had to be a great time for a few years. Maybe not so much for the next decade or so if they end up getting convicted. But it has to be better than the alternative of getting charged with fraud and not driving around a sick new whip for a few years.
Moral of the story here is that I don't think pickleball is some gigantic house of cards. The sport is going to continue to grow, and there is a legitimate market there worth hundreds of millions. But $300+ million in fraud over the last few months isn't great.