Pickleball business owner claims to owe $47M. What happened to investors' money?

Disgraced pickleball entrepreneur Rodney Grubbs claims to owe a staggering $46.9 million to creditors, including defrauded investors and his two adult sons, according to records filed recently in his forced bankruptcy case.

The vast majority of the debt is due to unsecured creditors. Grubbs, of Brookville, said in the 224-page summary of his assets and liabilities that only slightly more than roughly $382,000 of the sum is due to secured creditors — individuals and entities who are first in line to get paid from his bankruptcy.

Grubbs, whom IndyStar first wrote about in February, also claims to have just $1.6 million in assets, the majority of which is real estate. The disproportionate debt-to-asset ratio raises questions about how Grubbs will repay investors who say he solicited them for tens or hundreds of thousands of dollars for his real estate or pickleball company, All About Pickleball LLC., and saw their money disappear.

The list offers little clarity about what exactly happened to the investors' money. Grubbs did not respond to request for comment.

His business, also known as Pickleball Rocks, sells pickleball apparel and equipment for the increasingly popular sport. He traveled to tournaments across the U.S. to sell his products and play.

Hundreds of people have lined up to claim a stake in Grubbs' estate after a federal court forced him into involuntary bankruptcy last month. Among the several hundred individuals, couples, entities and trusts listed as creditors in Grubb's statement are his two sons Josh and Zack Grubbs and their respective wives. Fort Wayne attorney James O'Connor of Barrett McNagny LLP is representing the foursome.

"All four of my clients are surprised at the depth and scope of Rodney's alleged conduct, and the four of them are owed money," O'Connor said. He declined to state how much Grubbs' sons and daughters-in-law are seeking to recoup from him.

Grubbs claims to owe son Zack and daughter-in-law Amy nearly $1 million and son Josh and daughter-in-law Abby nearly $250,000, according to the court document.

Rodney Grubbs outlines his assets and debts

Grubbs claimed to be broke during the bankruptcy hearing. As noted in the filing, Grubbs has seven accounts with two banking institutions. Three of those accounts have negative balances of roughly $222, $150, $329. Two others have as little as $1.81 and $6.32, respectively, while two others hold less than $200.

Other assets include an individual retirement account that owns property valued at $50,000; a 2005 Ford Freestyle valued at $3,113; household goods such as a stove, refrigerator, washer and dryer; an Apple MacBook Pro; iPhone 15; a Dell desktop computer; clothes; used pickleball paddles; a wedding band; and a 5-year-old Shi Tsu. He claims some of personal household items, life insurance policies, vehicle, dog and at least two bank accounts are exemptions.

In an amended summary, Grubbs said he had roughly $41,100 in sellable goods at Pickleball Rocks Brookville retail store and about $222,000 in inventory at a Fort Wayne warehouse and storage.

Grubbs' children got in line to stake their claims on his assets early on, joining the case Feb. 6, a day before he faced his investors in an Indianapolis federal court, according to court records.

Those investors claim that Grubbs asked them to invest in his company Pickleball Rocks and never repaid them. When he pitched the opportunity to invest in Pickleball Rocks, Grubbs allegedly misrepresented the size and nature of the investment opportunity by offering prospective investors the last available spot in exchange for a $25,000 loan.

He then gave them promissory notes, which he wasn't legally licensed to issue in Indiana, that offered short-term, high-interest yields if he defaulted. Grubbs often did. But instead of repaying his investors, he rolled over their money into new promissory notes or invested more into his business.

Teri Siewert, an investor who managed to get repaid, took to social media to warn others about Grubbs and his investment pitches last year. "At least we stopped him and that was the most important thing," she said in a telephone interview. "At some point, he will have to pay for his crimes, you know. It's just not going to be on our timeline. It's going to be on the authorities' timeline."

Grubbs has not been charged with any crimes.

Search is on for pickleball investors' money

Meanwhile, the search is on for the millions in missing money. Investors and their attorneys do not believe Grubbs' claim that he is broke.

In a filing earlier this month, after Grubbs missed one court deadline and asked for another to be extended, an attorney representing many of the creditors in the case filed a request to compel U.S. Bank and FNC Bank to turn over bank records for Grubbs dating back to 2010.

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They are seeking to investigate his assets, wire transfers, withdrawals, deposits, financial communications, and checking activity as well as any businesses directly or indirectly controlled by Grubbs.

It's "likely that Grubbs has tried to hide, launder, or fraudulently transfer assets to keep large sums of money and other property out of the reach of creditors," the attorney said in the filing.

The court gave the banks 21 days to turn the records over to the attorney, who is now also seeking records from several other banks and financial institutions. A court-appointed trustee is overseeing the estate. A real estate agent has been retained to sell several properties Grubbs owns in Dayton, Ohio.

Sons are 'frustrated and embarrassed,' attorney says

O'Connor said Grubbs' sons and their wives did not know how far and wide their father cast a net seeking money, adding that they found out about the depth of the allegations from investors testifying in court.

"Zack and Josh are experiencing a betrayal of trust perpetrated by their dad," he said.

They also don't want to publicly air their grievances against father.

In an earlier conversation, O'Connor declined to say whether Josh and Zack Grubbs earn any income from their father's pickleball business and real estate ventures, and if they knew how Grubbs spent the money. The sons have not spoken their father in months, he said.

"I can tell you that they're frustrated and embarrassed and disappointed that the allegations," he said, "even if not true, even if they're just allegations, but if they are true, it will compound their embarrassment, disappointment and frustration."

Contact IndyStar investigative reporter Alexandria Burris at aburris@gannett.com. Follow her on X, formerly Twitter, at @allyburris.

This article originally appeared on Indianapolis Star: Pickleball booster claims to owe $47M. Where did investors' money go?