One of Jimmy Haslam’s legal headaches may be coming to an end.
In 2000, Haslam, working through an entity called Rocky Top Investments, partnered with a businessman named Harold Rosbottom on a venture that aimed to develop several truck stops in Louisiana that included video gaming machines.
In 2009, Rosbottom filed for bankruptcy protection, with the ownership entities behind the truck stops becoming part of the bankruptcy case.
The case now is winding down, but not before Rosbottom was convicted last September of concealing nearly $2 million from creditors in the course of the bankruptcy and of a conspiracy to launder money in order to purchase a 65-foot boat and a half-interest in a private jet.
He now is serving time at a federal correctional institution in North Carolina.
Haslam was not implicated in the bankruptcy fraud case.
Todd Ellis, an accountant for Haslam, said Haslam had become involved in the investment after Rosbottom approached him about being a passive investor in developing the truck stops that would not compete with Pilot stations.
Haslam had met Rosbottom while doing business in Louisiana, said Tom Ingram , a spokesman for Haslam. “At the time Rosbottom was an active community person,” Ingram said. “Married, three kids, and featured in Businessweek. Respected as an entrepreneur.”
The bankruptcy filing came in the midst of a bitter divorce battle, and Rosbottom’s girlfriend also was convicted in 2012 on charges including conspiracy to commit bankruptcy fraud.
Not all of the truck stops were developed, and Ellis said that only two are still operating, including one identified in Louisiana records as I-220 Travel Plaza & Casino LLC.
Ingram said the facilities included gaming space that was leased to a different owner. He said Haslam has never had an ownership interest in gaming anywhere.
“It’s machine gaming in a small fashion,” Ingram said. “It’s not a casino with multiple gaming opportunities that we think about normally when we see that word.”
In the wake of Rosbottom’s bankruptcy, Haslam had to pay certain amounts to Regions Bank because of guarantees made in connection with the joint venture entities. Ingram declined to identify the amount of those payments, but said that “it wasn’t a lot.”
Ellis said the bank called those guarantees because Rosbottom’s bankruptcy was an event of default. Ingram said the LLCs themselves were not bankrupt.
The bankruptcy case appears to be nearing a conclusion. In May, U.S. Bankruptcy Judge Stephen Callaway signed an order confirming a reorganization plan in the case.
That plan encompassed a settlement in which Rocky Top Investments would assign its interests in five of the LLCs to a new entity created by the trustee. A portion of that transaction must still be approved by the Louisiana Gaming Control Board, which regulates gaming in Louisiana.
Louis Phillips, an attorney for the bankruptcy trustee, said Haslam does not have an interest in the new entity.
Ingram said Haslam’s connection to the truck stop casinos created no issues with his ownership of the Cleveland Browns, which his family bought in 2012 for a price reported at more than $1 billion. Earlier the family owned part of the Pittsburgh Steelers.
“(The) NFL did a background check on Jimmy twice that would make your hair curl,” Ingram said. “They knew about everything, including this, and they approved him knowing it.”
An NFL spokesman could not be reached for comment on Tuesday.
Truck stop gaming had come up before in connection with the Haslam family. When Bill Haslam, the brother of Jimmy Haslam, ran for governor in 2010, his Republican primary opponent highlighted the fact that Pilot Travel Centers had video gaming machines at its locations in Louisiana, where such games are legal.
At the time, Jimmy Haslam said Pilot simply leased space to another company that operated the video poker machines. Jimmy Haslam’s wife, Dee Haslam, also was an officer in a company called FootTraffic Promotional Gaming LLC, according to an annual report filed in March.
Dee Haslam said that company created promotional gaming machines aimed at drawing customers to merchants. Dee Haslam said FootTraffic hasn’t been active in several years and was shut down in May. She said her father developed the business with a partner, and that she had nothing to do with it.