Pickleball Players Accuse Scam Artist of Merch-Based Ponzi Scheme
Investors in a pickleball company are now worried they were taken for a ride after giving money to Rodney "Rocket" Grubbs' "Pickleball Rocks" company.
The brand was, ostensibly, meant to raise awareness for the booming sport, itself sort of a hybrid of tennis and table tennis, by selling T-shirts with the company's message on it.
According to the Indianapolis Star, Grubbs traveled around the world to tournaments to serve as an ambassador for the sport, and trademarked his "Pickleball Rocks" slogan in 2009 for the purpose of using it on merchandise.
Pickleball Rocks projected revenue of more than $1 million in 2022, but to do so, Grubbs told potential investors that he needed capital, so he appealed to well-off friends within the sport, promising exclusive investment opportunities for big returns.
Citing one investor's estimation, the Indianapolis Star reported that approximately 120 people from the U.S., Canada, and Portugal had invested millions into Grubbs' company.
"He traveled around and used his good reputation, and also the reputation of others that he surrounded himself with, in order to take advantage of good people,” said Teri Siewert, an investor, told the Indy Star. “None of them were stupid. They were doctors. They were lawyers. They were professors. One was a financial consultant. She really feels terrible. That's how trusted he was in the pickleball community."
Siewert said that Grubbs offered a handful of $25,000 investment slots, which would go toward $150,000 of apparel.
Grubbs, obviously, did not ever cash out his investors as promised.
Grubbs is also actually saying this is a "coordinated" social media attack by investors meant to diminish his Pickleball Rocks intellectual property value, and said in a written response to a lawsuit filed in December that he's still hopeful that the Pickleball Rocks brand will grow through merchandise, and will inspire others to get involved in pickleball, thus buying even more merchandise.
"Those new players will shop and buy," Grubbs said, according to the Indy Star.
While Grubbs hasn't technically been charged with any crime or securities violation, court records show that he's facing judgment for more than $9 million from three investor lawsuits already.
The rest of this doesn't particularly relate to the promotional products industry. But, it shows a few things: For one, there are still bad actors in the world who will use things like branded merchandise as the basis for scams.
Also, it shows that pickleball is growing at a rate that people can theoretically scam wealthy people out of large sums of money in the promise of bringing in even more money through the sport's natural growth. And, though Grubbs' methods of doing so were unsavory at best, it shows the power of a good branded campaign to grow an audience for something, as this was supposedly meant to use branded apparel to grow a sport to new heights.