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Published Monday, May 4, 2009 | 4:40 p.m.
Updated Tuesday, May 5, 2009 | 2:46 p.m.
Jim and Glynda Rhodes at the 2007 Rock for the Cure event, where they made the pledge.
Sun Archives
- Rhodes faces lawsuit separate from bankruptcy case (5-1-2009)
- Rhodes' lenders want him out (4-25-2009)
- Rhodes Homes files for Chapter 11 (4-10-2009)
- Rhodes homebuilding companies file for Chapter 11 (4-1-09)
Sun Blogs
- Kats Report: Bankruptcy's a beach as Jim and Glynda hit Cabo (4-9-2009)
- Kats Report: No more $20,000 guitars? Rhodes' bankruptcy to be felt in uncharitable ways (4-3-2009)
The Nevada Cancer Institute, one of the state's premier medical research institutions, is suing beleaguered home builder Jim Rhodes and his wife, Glynda, for allegedly reneging on more than $10 million in philanthropic pledges.
The lawsuit, filed late this afternoon in Clark County District Court, alleges that the couple pledged money to improve their public image after Jim Rhodes was accused of "improper dealings" with Clark County Commissioners and other public officials.
The failure to fulfill commitments of $1 million and $10 million also hurts the Nevada Cancer Institute's mission to perform research and treat patients, the lawsuit said.
The lawsuit is the latest problem confronting Rhodes.
In April the creditors for more than $370 million in outstanding loans to Rhodes Homes accused Rhodes of misappropriating funds and wanted him out to prevent what they say is continued mismanagement.
In Chapter 11 bankruptcy proceedings, attorneys for Credit Suisse and other lenders allege Rhodes directed millions in loans to Rhodes Homes to finance companies not covered by the loans. That included Harmony Homes operated by Rhodes through a trust in his children’s names, the bankruptcy filing said.
According to the Cancer Institute complaint, Rhodes has been the subject of negative publicity since 2003, including allegations that he bribed Clark County Commissioner Erin Kenny, who later was sentenced to federal prison for taking bribes.
The lawsuit accuses Rhodes of using philanthropy to leech onto the Nevada Cancer Institute image. It started with a $1 million commitment by the Rhodes to the start-up institution in 2005 that was never paid in full, the lawsuit said. Rhodes paid $600,000 of the pledge, the lawsuit said.
On February 24, 2007, the Rhodes met with Cancer Institute officials, including founder and chairman of the board Heather Murren, to discuss a large commitment, but it allegedly came with strings attached. The complaint said that Rhodes sought positive publicity for his donation, and presented as an example a scrapbook detailing the philanthropic commitments of others, including New York Mayor Michael Bloomberg. The couple said they wanted a similar public reputation for philanthropy, the lawsuit said.
In the next months, the couple repeatedly met with Cancer Institute officials, saying they wanted to make a $10 million commitment, the lawsuit said.
"In return, the Rhodes required publicity related to the binding agreement and the prominent display at Nevada Cancer Institute of the names of Jim and Glynda Rhodes," the complaint said.
The Cancer Institute had never before recognized a primary honoree at their annual Rock for the Cure fundraising event, but did so for the Rhodeses at the 2007 gala, where the $10 million pledge was announced, the lawsuit said.
Nevada Cancer Institute spokeswoman Lisa Stark called the lawsuit "an unfortunate situation."
"After 18 months of ongoing attempts to resolve this situation, it became apparent that Jim and Glynda Rhodes have no intention of honoring their personal obligation so NVCI had no choice but to take this legal action. We are simply acting according to the highest standards of fiduciary responsibility as we pursue our mission of reducing the burden of cancer in Nevada," Stark said in a statement. "NVCI works with our donors to give them every opportunity to create a giving structure that allows them to fulfill their obligation in a way that works for both of us and adheres to IRS guidelines. The failure of Jim and Glynda Rhodes to meet their obligation impacts all facets of our organization, and all the avenues we utilize to serve the community and cancer patients across the state.”
The Cancer Institute said that before it could announce a major philanthropic pledge at its Rock for the Cure fundraising gala, it needed a written confirmation of the gift. On Nov. 15, 2007, the day of the gala, the attorney for the Rhodes sent a letter detailing the arrangement. That night, the pledge was announced to a crowd of well-heeled attendees, and it led to many favorable stories in the media, the lawsuit said.
In 2008, the lawsuit alleges, it became clear the couple never intended to fund the $10 million commitment. Their attorney tried restructuring the agreement to place liability on Rhodes' companies, instead of with the couple personally, the lawsuit said.
The motive became clear when the Rhodes' companies filed for bankruptcy, the lawsuit said.
The restructuring attempts also included tying the $10 million commitment to the receipt of land use entitlements for a Rhodes' development near Red Rock National Conservation Area, the lawsuit said.
"In other words, the Rhodes were attempting to give Nevada Cancer Institute a financial interest in making sure the subject land received the entitlements the Rhodes previously had been unable to obtain," the lawsuit said.
After a year of discussion, the Rhodes refused to communicate with Cancer Institute representatives, the complaint said.
The lawsuit alleges breach of contract for the $1 million and $10 million commitments, fraud and negligent misrepresentation.
Rhodes' attorney, David Lyon, said in a statement: "Jim and Glynda Rhodes fully believe in the mission of the Nevada Cancer Institute, and they made their pledge at a time when the Las Vegas economy was booming. Obviously, the situation has changed. It is clear that the downturn in the economy has hurt non-profits as much as it has for profits, and like many other donors in our community, the Rhodes’ have had to seek alternatives to meet their obligations. We are disappointed that the Nevada Cancer Institute would publicly announce plans to file a lawsuit against a donor, particularly during these difficult times. Jim and Glynda hope that the issue can be resolved amicably."
May have to lay off the pool boy and the plumber, Glynda. But hey, as long as Jim is upright, life will be good, and you can look forward to a bountiful future.
Suing for charitable contributions? That is low-class on behalf of the NCI. After all, they're CHARITABLE CONTRIBUTIONS, not obligations.
This will make me think twice the next time they come calling for a donation. Heaven forbid I should pledge some money and then fall on hard times.
Rhodes is a crooked, soon to be worthless pos.
But why was his wife wearing a shower curtain?
The complaint is one of the most well written, factual-but-venal ones I've ever seen. Whether its allegations are true will be proven in court.
However, I have one question. I was looking at the Clark County Assessor's records, and I couldn't find any land owned by Rhodes or his entities in the Blue Diamond Ridge/Red Rock Canyon Area. Does anyone have the Assessors Parcel numbers for the land referred to in The Sun's story? The reason I ask is that when the Rhodes/Laing development on Blue Diamond Ridge failed due to passage of State legislation, either The Sun or the RJ reported that the gypsum mining company still owned the land, and all Rhodes had was an option.
How then, could payment to NCI by the Rhodes be conditioned on the granting of entitlements to land near the Red Rock Conservation Area? By pure sophistry perhaps?
Our_Linn,
I agree. It is a contribution, and its really on yourself to stand up to your word.
But.....you think that he didn't deduct that donation from his taxes already?
The man is in serious trouble. You can't hold someone to a "pledge".... It's their word, but that's it. I doubt if it is legally enforceable. And I don't think you can write off a charitable contribution until you actually make it. That said, maybe he is a crook and they'll catch him. But that won't do NCI any good...
I think the Rhodes' spent the money on upgrading Rhodes Ranch Golf Course, which is actually in great shape.
my guess is there's two sides to this story. rhodes is the current whipping boy in the press, and from what i've read, very little of it tells even close to the full story. i'm still struggling with how the cancer institute thinks its going to enforce a "pledge", and also why they would trash their own reputation by going after rhodes like mafia leg breakers when the guy has clearly been battered by the implosion of las vegas. i for one will not give this organization another dollar if that's how they treat their donors - rhodes did give them $600,000 after all. God forbid i had some financial trouble, they'd probably burn my house down.
Our_Linn come on Jim/Glynda, come up with a better fake-name. Low class on the part of NCI? Once you sign your name, they become obligations. What about asking for good PR, that's not low class? Please Jim/Glynda, find something better to do with your time than being a fake responder on a Pulitzer Prize winning Paper's website.
Cynical:APN 16432301001 is the parcel. Hardy still owns the land around the plant at the bottom of the hill. BLM owns the easement for access from BDR, but it is only usable for mining purposes, so access would have to come from the east.
You can't deduct what you haven't paid (theoretically), but you can burn yourself some wonderful PR in the interim.
NCI wouldn't do this unless they had no other choice. These are classy hard-working people who don't take actions like this lightly and don't need the Publicity for something like this. Given time, Rhodes will pay a price, it may not be cash unfortunately.
I thought it went without saying the Rhodes ALSO were low class -- no, make that no class -- for promising a donation and not coming through on it. And if he had fallen on hard times, as most developers have in this economy, I'm sure he could have worked something out with NCI.
That said, I still believe it shows little class on behalf of the NCI to sue because it didn't get a DONATION. Plus, now it's a PR nightmare for NCI, which comes off looking like a child that is pouting because it didn't get the bike it wanted for Christmas.
It's difficult to be sympathetic to either party. Jim Rhodes is one of many greedy developers in Las Vegas and NVCI only provides cancer treatment to the rich and famous (despite accepting millions from taxpayers).
They deserve each other.
Don't know about anyone else but I've noticed many local real estate mavericks that once played $5.00 max coin slots in unison with the ATM machines now losing at $0.01 single play slots.
LOL
I agree both parties have done wrong; the NVCI even more so.
How is Glynda's side company blackbook702 doing? heard MResort pays her to send girls to MResort Pool during the week to "hang out".
She has some pretty telling photos of herself and her lifestyle on her myspace blog: http://www.myspace.com/blackbook702
Rhodes has had 2 years to come up with his "donation." Their situation did not change over night. Jim & Glynda obviously pulled this publicity stunt off to curry favor and try to create an image of a people of substance who care and give back to the community. I hope that the Rhodes family is made personally responsible for making good on their donation. If they are not willing to pay, the lawsuit will make people aware of the character of Jim & Glynda Rhodes.
MaybeVegas -- Although your intent is cuddlesome towards the Nevada Cancer Institute ("NCI"), comments like yours may result in further damaging NCI. Jim Rhodes has never had a positive public image and his company is bk, therefore he has nothing left to lose here! You couldn't overlook this perspective if you weren't overly emotional and intimate with NCI.
I bet you're still blinded and you're thinking I'm attempting to hide an agenda here? Think about it this way: You're now wandering into a hometown Bully's part of the playground and calling him out ("I challenge you to a game of tetherball, you big Sissy!"). It's not wise to back a wild animal into a corner, especially if that animal has suffered an injury! With nothing positive to gain, why risk being bite in the rear?
How could NCI become further damaged following this embarrassing and childish PR miscalculation? Easy, he takes you to the street! He's comfortable operating in this neck of the woods and he will school any newcomers! If you keep it up, NCI might be investigated for possible collusion for their role in offering to use political capital to obtain unwarranted land use entitlements. Is this something NCI has dealt with in the past (etc, etc")? Keep in mind Rhodes has nothing to lose. It would be pretty hard to litigate against Rhodes for defamation following NCI's participation/ sponsorship of this article!
CONTINUED"
CONTNIUED"
After reading this article, I was left wondering what in the world NCI was thinking and why did they leave him such an obvious f-u-2? If Rhodes wishes to give NCI the old f-u-2, all he needs to do is come out publicly that NCI didn't deliver on their end of the deal in delivering the entitlements. Everyone would assume the truth is in the middle, which would be another loser for NCI. Who has more at stake and which party is more likely to lose if this continues?!
I hope this may have assisted you in seeing the light. Mrs. M and NCI can only attempt to reduce their downside now (at a minimum they have lost the moral high ground)! The sooner this issue disappears from the public's attention the better for NCI.
If this was a real battle, Jim Rhodes won by default! Too funny! Mrs. M and the NCI took the field all fired up and looking to push someone around. In their haste, they shot themselves in the foot and were forced to retreat before the true battle began!
Or if NCI must win regardless of ethics and professionalism, they did take Rhodes $600,000 and then orchestrated a smear campaign in return. It's a small victory if NCI and their LV Sun Author want to claim it?
Ps. You pontificated that this is a "Pulitzer Prize winning Paper's website" -- you wouldn't know it by reading this Author. This Author is more like a pimple faced teen age Blogger, writing to the world from his Parents basement. I smell a fake college degree obtained via the internet ("Degree-In-PJ's . Com")!!!
Sticks & Stones, you're as phony as Glynda's bumpers. The Sun won a Pultzer, and you are just another useless blogger living in Momma's attic. New Star Trek movie coming. I'm sure you're sweating big time waiting for it to open. Get out the light sabre.....
Classic Vegas Tale;
fake people with fake boobs and fake smiles who strike it rich, got greedy, & went broke.
She might get some dough at the pawn shop for those baubles, however. Unless they are fake, too.
Sticks&Stones;
I'm not remotely attached to NCI in anyway, but nice try. Typical for you to try and attack me (and the author) and not the facts. Do you really, in your wildest dreams, think that anyone, regardless of your obvious disdain for Ms. M and NCI, would agree to something as dumb as working on his behalf knowing Jimbo's history with corruption and officials? Not even Erin Kenny would take that deal today.
She's cute, even though she can't put a complete sentence together and giggles a lot.
"Just get people to stop smoking, drinking, and eating junk; that'll eliminate 85% of all cancers."
Any chance you have a reliable source to back up that stat? Do you mean to imply that only 15% of all cancers are due to environmental factors (e.g., asbestos, toxic waste, chemical treatments, poorly-researched/tested drugs, etc.)?
I had the opportunity to some work with Glynda Rhodes a few years ago, and can attest to the fact that she's a kind and thoughtful individual with an honest desire to make Las Vegas a better place for those less fortunate. She does a lot of this work for people without looking for any credit or accolades. The same holds true for Jim Rhodes.
The nice things I've seen Glynda do, I know she didn't do in hopes that someone like me would let people know about it - or the paper would write about it. I just feel compelled to say something, in light of her character being questioned by people I'd guess don't do much of anything for the community, other than complain about how it falls short of their expectations.
For whatever shortcomings they may have (like all of us do in our own special ways), the Rhodes' commitment to service has made the community a better place for all of us. With that, I hope the NCI/Rhodes issues are resolved where they should be resolved - out of the public eye.
I can totally understand someone's confusion about a charitable gift somehow not being an obligation. That may be true when you're giving $25 to the Salvation Army.
But, when you've agreed to give $10 million to an orgnization, there's a contract that's drawn up and plenty of lawyers involved. The charity then uses the pledge to get a loan - that's how places like the NCI get built in the first place.
Whether you like the Rhodes or not, they made a serious commitment that they clearly do not intending to live up to. That's sad for everyone. I have to believe if they had made any serious attempt to work something out with NCI, it would have been kept out of the press.
What's annoying and suspicious is the possibility that the Rhodes never intended to pay on this and were simply using it to further their social/business interests.
We'll see.
MWCRob sez: "the Rhodes' commitment to service has made the community a better place for all of us"
PLEASE, their commitment to service? Do a google on Rhodes and his failure to pay for a school at Rhodes ranch until the County froze new permits there in 2004. Or, read about his problems in Mohave County AZ after trying to influence County employees.
Rhodes has done little for the community, although he does provide good entertainment occasionally.
Rhodes may not be the most popular guy in town, and he's certainly been sued plenty of times. However, he's given many millions to a dozen charities over the years, and his wife volunteers on the boards of several of those. The trash talking blogs above undoubtedly are from people who give nothing back to this community - very easy to sit back and throw stones, and fault others who have stepped up in the past for not stepping up in this economy. I've participated in many of the local charities over the years, and the Rhodes' have been staples and could always be counted on to give. i think the whole situation is shameful and an embarrassment to rhodes, nci and especially heather - this is a PR disaster for her. Rhodes has been in financial trouble before and he's always comes back, but i'm sure when that happens, he won't be giving to nci again. so who's the ultimate loser? there aren't that many big donors in this town, and to kick one of them while he's temporarily down is incredibly stupid and short sighted.