Clarence Thomas and a $267,230 RV And The Friend (Plaintiff At Times) Who Financed it
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| In a 2007 interview, Justice Thomas told Steve Kroft of “60 Minutes” that the motor coach enabled him to escape the “meanness that you see in Washington.”A Nice Gift from Plaintiff...Credit...CBS News |
Justice Clarence Thomas met the recreational vehicle of his dreams in Phoenix, on a November Friday in 1999.
With some time to kill before an event that night, he headed to a dealership just west of the airport. There sat a used Prevost Le Mirage XL Marathon, eight years old and 40 feet long, with orange flames licking down the sides. In the words of one of his biographers, “he kicked the tires and climbed aboard,” then quickly negotiated a handshake deal. A few weeks later, Justice Thomas drove his new motor coach off the lot and into his everyman, up-by-the-bootstraps self-mythology.
There he is behind the wheel during a rare 2007 interview with “60 Minutes,” talking about how the steel-clad converted bus allows him to escape the “meanness that you see in Washington.” He regularly slips into his speeches his love of driving it through the American heartland — “the part we fly over.” And in a documentary financed by conservative admirers, Justice Thomas, who was born into poverty in Georgia, waxes rhapsodic about the familiarity of spending time with the regular folks he meets along the way in R.V. parks and Walmart parking lots.
“I don’t have any problem with going to Europe, but I prefer the United States, and I prefer seeing the regular parts of the United States,” he told the filmmakers, adding: “There’s something normal to me about it. I come from regular stock, and I prefer being around that.”
But there is an untold, and far more complex, back story to Justice Thomas’s R.V. — one that not only undercuts the mythology but also leaves unanswered a host of questions about whether the justice received, and failed to disclose, a lavish gift from a wealthy friend.
His Prevost Marathon cost $267,230, according to title history records obtained by The New York Times. And Justice Thomas, who in the ensuing years would tell friends how he had scrimped and saved to afford the motor coach, did not buy it on his own. In fact, the purchase was underwritten, at least in part, by Anthony Welters, a close friend who made his fortune in the healthcare industry.
He provided Justice Thomas with financing that experts said a bank would have been unlikely to extend — not only because Justice Thomas was already carrying a lot of debt, but because the Marathon brand’s high level of customization makes its used motor coaches difficult to value.
In an email to The Times, Mr. Welters wrote: “Here is what I can share. Twenty-five years ago, I loaned a friend money, as I have other friends and family. We’ve all been on one side or the other of that equation. He used it to buy a recreational vehicle, which is a passion of his.” Roughly nine years later, “the loan was satisfied,” Mr. Welters added. He subsequently sent The Times a photograph of the original title bearing his signature and a handwritten “lien release” date of Nov. 22, 2008.
But despite repeated requests over nearly two weeks, Mr. Welters did not answer further questions essential to understanding his arrangement with Justice Thomas.
He would not say how much he had lent Justice Thomas, how much the justice had repaid and whether any of the debt had been forgiven or otherwise discharged. He declined to provide The Times with a copy of a loan agreement — or even say if one existed. Nor would he share the basic terms of the loan, such as what, if any, interest rate had been charged or whether Justice Thomas had adhered to an agreed-upon repayment schedule. And when asked to elaborate on what he had meant when he said the loan had been “satisfied,” he did not respond.
“‘Satisfied’ doesn’t necessarily mean someone paid the loan back,” said Michael Hamersley, a tax lawyer and expert who has testified before Congress. “‘Satisfied’ could also mean the lender formally forgave the debt, or otherwise just stopped pursuing repayment.”
Justice Thomas, for his part, did not respond to detailed questions about the loan, sent to him through the Supreme Court’s spokeswoman.
The two men’s silence serves to obscure whether Justice Thomas had an obligation to report the arrangement under a federal ethics law that requires justices to disclose certain gifts, liabilities and other financial dealings that could pose conflicts of interest.
Vehicle loans are generally exempt from those reporting requirements, as long as they are secured by the vehicle and the loan amount doesn’t exceed its purchase price. But private loans like the one between Mr. Welters and Justice Thomas can be deemed gifts or income to the borrower under the federal tax code if they don’t hew to certain criteria: Essentially, experts said, the loan must have well-documented, commercially reasonable terms along the lines of what a bank would offer, and the borrower must adhere to those terms and pay back the principal and interest in full.
Richard W. Painter, a White House ethics lawyer during the George W. Bush administration, said that when it comes to questions of disclosure, the ethics treatment of gifts and income often parallels the tax treatment. But those intricacies aside, he said, “Justices just should not be accepting private loans from wealthy individuals outside their family.” If they do, he added, “You have to ask, why is a justice going to this private individual and not to a commercial lender, unless the justice is getting something he or she otherwise could not get.”
The Times’s unearthing of the loan arrangement is the latest in a series of revelations showing how wealthy benefactors have bestowed an array of benefits on Justice Thomas and his wife, Virginia Thomas: helping to pay for his great-nephew’s tuition, steering business to Mrs. Thomas’s consulting firm, buying and renovating the house where his mother lives and inviting the Thomases on trips both domestic and foreign that included travel aboard private jets and a yacht.
Justice Thomas has pointed to interpretations of the disclosure rules to defend his failure to report much of the largess he has received. He has said he was advised that the trips fell under an exemption for gifts involving “personal hospitality” from close friends, for instance, and a lawyer close to the Thomases contended in a statement that the justice did not need to disclose the tuition because it was a gift to his great-nephew, over whom he had legal custody, rather than to him.
Ethical Issues Inside the Supreme Court
A Crisis of Ethics: A debate over ethical standards for Supreme Court justices has intensified after a series of revelations about lavish gifts and financial largess. Our reporter explains the allegations of misconduct and the growing calls for tighter rules.
Opening Doors: Justice Clarence Thomas’s membership in an exclusive club gave him access to its wealthy inner circle. He also gave them rare access to the Supreme Court.
Alito Under Scrutiny: Justice Samuel A. Alito Jr. used an opinion essay in The Wall Street Journal to defend his luxury trip with a billionaire who often has cases before the Supreme Court hours before ProPublica published a story detailing their ties.
Scalia Law: George Mason University’s law school cultivated ties to some of the court’s conservative justices with generous pay and unusual perks. In turn, the school gained prestige, donations and influence.
The Thomases’ known benefactors include wealthy men like the Dallas real estate developer Harlan Crow, the conservative judicial kingmaker Leonard Leo and several members of the Horatio Alger Association of Distinguished Americans, which honors people who succeed despite adversity. Among them: the longtime Miami Dolphins owner Wayne Huizenga, who flew the justice around on his jet.
Mr. Welters, while also a Horatio Alger member, stands apart. For one thing, the two men’s friendship predates Justice Thomas’s time on the federal bench. They met around 1980 when both were members of a small, informal club of Black congressional aides to Republican lawmakers — Mr. Welters worked for Senator Jacob K. Javits of New York and Justice Thomas for Senator John C. Danforth of Missouri.
ImageAnthony and Beatrice Welters stand against a purple backdrop with the NYU Langone Medical Center logo.
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Anthony Welters, shown with his wife Beatrice in 2016, was a close friend of Justice Thomas’s from their time working as congressional aides. Credit...Astrid Stawiarz/Getty Images for NYU Langone Medical Center
“It wasn’t exactly fashionable to be a Black person working for a Republican, and it was comforting to meet others in the same boat,” the justice wrote in his autobiography, “My Grandfather’s Son.”
They had much in common. Like Justice Thomas, Mr. Welters was raised in poverty, sharing a cramped tenement in Harlem with his parents and three brothers and, after his mother’s death when he was 8, shining shoes under an elevated subway to help make ends meet.
As both men climbed the ladder as political appointees in the Reagan administration, their friendship grew. They stayed close after Justice Thomas joined the federal appeals court in Washington in 1990 and Mr. Welters left the government to found AmeriChoice, a Medicaid services provider that he sold to UnitedHealthcare for $530 million in stock in 2002 and continued to lead until retiring in 2016. Mr. Welters and his wife, Beatrice, named Justice Thomas the godfather of one of their two boys, according to The Village Voice.
When Justice Thomas’s 1991 Supreme Court nomination ran into trouble after a former subordinate, Anita Hill, accused him of sexual harassment, Mr. Welters stood by his friend, providing behind-the-scenes advice, according to a book on the hearings written by Mr. Danforth.
And in 1998, the year before the motor coach purchase, Justice Thomas returned the favor. That is when Mr. Welters and his wife, through their foundation, started the AnBryce scholarship program, which gives underprivileged students a full ride to New York University’s law school, along with networking opportunities and career support. Justice Thomas lent his considerable imprimatur to the program, interviewing applicants in his Supreme Court chambers, mentoring scholars and later hiring one graduate as a clerk.
By that point, the justice had become fixated on owning an R.V., and not just any R.V., but the Rolls-Royce of motor coaches: a custom Prevost Marathon, or as he once put it, a “condo on wheels.”
A Toy for the Rich
Justice Thomas was turned on to the luxury brand by Bernie Little, a fellow Horatio Alger member and the flamboyantly wealthy owner of the Miss Budweiser hydroplane racing boat. Mr. Little had owned 20 to 25 custom motor coaches over the years, Mr. Thomas told C-SPAN in 2001.
Back in those days, a basic Prevost Marathon sold for about a million dollars, and could fetch far more depending on the bells and whistles. It was a rich man’s toy, and the company marketed it that way.
“You drive through a neighborhood in South Florida and you see these $10 million homes,” Bob Phebus, Marathon’s vice president, told The South Florida Business Journal in 2006. “You condense that down, put it on wheels and that’s what we have. It’s the same guy that will have a 100-foot yacht and a private aircraft. They’re accustomed to the finer things in life.”
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| A circa 1991 advertisement for Marathon coaches.Credit...Marathon |
An ad shows the exterior and interior of a Marathon motor coach and features the text, “Marathon — The Motor Coach That Defines Its Own Class.”
A circa 1991 advertisement for Marathon coaches.Credit...Marathon
At the time, the Thomases’ primary source of income was the justice’s salary, then $167,900. He had yet to sell his autobiography and property and other records show that the couple had significant debt: They had purchased their house in 1992 for $552,000 with 5 percent down, then refinanced it two years later, taking out a 15-year mortgage of $496,000. Plus, they had at least one line of credit of between $15,000 and $50,000.
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So, in Justice Thomas’s telling, he began searching for a used Prevost at Mr. Little’s suggestion, one with enough miles on it to depreciate the value. “The depreciation curve — it’s very steep,” he made a point of saying in the 2001 C-SPAN interview.
All these years later, he still hasn’t told some of his closest friends how he was really able to swing the purchase.
“He told me he saved up all his money to buy it,” said Armstrong Williams, a longtime friend who worked closely with Justice Thomas in the Reagan administration.
The title history documents reviewed by The Times show that when the motor coach was sold for $267,230 to the Thomases in 1999, it had only 93,618 miles on it, relatively few for a vehicle that experts say can easily log a million miles in its lifetime. It came equipped with plush leather seating, a kitchen, a bathroom, and a bedroom in the back. In addition to its orange flame motif, it had a large Pegasus painted on the back, according to Jason Mang, the step-grandson of the previous owner, Bonnie Owenby.
“It was a super luxury, really bougie,” he recalled.
On Nov. 19, 1999, after spotting the motor coach on the lot of Desert West Coach in Phoenix and putting a hold on it, Justice Thomas attended a dinner at the conservative Goldwater Institute. In a speech that night, he said he had never yearned to be a federal judge. “Pure and simple, I wanted to be rich,” he said.
Wayne Mullis, the owner of the now-defunct Desert West, said in an interview that Justice Thomas never discussed obtaining traditional financing with him, and that “as far as I know, he paid for it.”
Indeed, Justice Thomas would have been hard-pressed to get a loan from a traditional lender. Banks, and even finance companies that specialize in R.V. loans, are particularly reluctant to lend money on used Prevost Marathons because the customized features are hard to value, according to three leading industry executives interviewed by The Times.
“As a rule, the majority of buyers are cash buyers — they don’t finance the Prevost, generally,” said Chad Stevens, owner of an Arizona-based dealership specializing in high-end motor coaches, whose clients include celebrities and politicians. “In 1999, you would need a very strong down payment and a strong financial portfolio to finance one. It is a luxury item.”
While the terms of Mr. Welters’s loan to Justice Thomas are unclear, rules governing loans of more than $10,000 between friends and family are not.
Loans can be reclassified as gifts or income to the borrower, either of which would have to be reported by the justice under court disclosure rules if any portion of the debt is forgiven or discharged as uncollectable. But even if a lender does not take those steps, a loan can still be considered a reportable gift or income if it doesn’t meet certain standards.
Loan terms should be spelled out in a written agreement, with a clearly defined, regular repayment schedule, tax experts said. Lenders must charge at least the applicable federal interest rate, which was a little over 6 percent in December 1999, when the deal to buy the motor coach closed. And if a borrower is in arrears, lenders must make a good-faith effort to collect, even to the point of going to court.
“Absent that, it’s more of a gift,” said Rich Lahijani, tax director of Edelman Financial Engines, an independent wealth planning and investment advisory firm.
The title history records held by the Virginia Department of Motor Vehicles do not contain detailed information about the loan itself. What they show is that when the Thomases drove their motor coach back home to Virginia, they registered it in Prince William County, which does not charge personal property tax on R.V.s stored there, unlike Fairfax County, where they live.
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A title document reads “Commonwealth of Virginia Department of Motor Vehicles” and contains information about Justice Clarence Thomas’s R.V., along with the names of the justice, his wife, and Anthony Welters.
Mr. Welters said he released the lien on the vehicle in 2008 and provided this photo of the original title to The Times as evidence. (Addresses and vehicle identification numbers have been redacted.)
Credit...via Anthony Welters
And as of late last month, when The Times reviewed the records, they still listed Mr. Welters as the lien holder, notwithstanding the signed release he said he gave Justice Thomas in 2008 so he could obtain a new, clear title.
Mr. Welters said he could not explain why he was still listed as the holder of the lien. After he gave Justice Thomas the paperwork, he said, “I don’t know what process the borrower should have followed.” (To clear the title, the paperwork should have been brought to the D.M.V., where the lien release would have been recorded and a replacement title issued.) As for Justice Thomas, that was among the matters he declined to discuss with The Times.
‘A Warm, Safe Place’
As details about Justice and Mrs. Thomas’s subsidized trips to vacation homes and resorts have become public in recent months, his professed preference for traveling by motor coach has become something of a “yeah, right” punchline.
But by all accounts, he loves the anonymity, the freedom, and the community it affords. He has hosted at least one event at the Supreme Court for a Marathon owners’ club.
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| A crowd of people, in gowns and tuxedos stand on the steps of the Supreme Court. | Members of the Marathon Coach Club International on the steps of the Supreme Court.Credit...via Marathon Coach |
When he hits the road, he often goes unrecognized, which at times has allowed him to travel without a U.S. Marshal’s security detail. Chris Weaver, who worked at Desert West Coach, said the justice had frequently gotten his motor coach serviced there before it closed. “Nine out of 10 times, he was just wearing sweats and a T-shirt,” he said.
Traveling largely through red-state America has also meant that when he is recognized, more often than not it is by fans. Juan Williams, a Fox News commentator who has known Justice Thomas since the Reagan administration, said the motor coach was both the fulfillment of a boyish fantasy and a metaphorical “womb.”
“He talked about the R.V. a lot,” he said. “It was a warm, safe place where he didn’t have to be attacked by liberals and Blacks on the left. What he liked about it was not being pilloried.”
A film still from a 2007 “60 Minutes” interview shows Justice Clarence Thomas behind the wheel of his motor coach, with the journalist Steve Kroft in the passenger seat.
In a 2007 interview, Justice Thomas told Steve Kroft of “60 Minutes” that the motor coach enabled him to escape the “meanness that you see in Washington.”Credit...CBS News
In a 2019 Q. and A. at the court, Justice Thomas said he had made it to nearly two dozen states and declared himself the proud owner of a KOA campground discount card.
But the Thomases’ road trips have hardly been limited to sleeping at campsites and Walmart parking lots.
In a 2009 call-in to a morning radio talk show, for instance, Mrs. Thomas said they were driving their motor coach through the Adirondacks, on their way to “meet some families from Texas.” ProPublica has reported that the Thomases have spent part of nearly every summer for the past two decades in the Adirondacks as a guest of Mr. Crow, who owns a lakeside resort there with more than 25 fireplaces, three boathouses and a painting of the justice, his host and other guests smoking cigars.
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| A stone and wood boathouse, against a backdrop of trees, with small boats docked in and around it. | The boathouse at Harlan Crow’s Adirondack resort, where Justice Thomas and his wife have vacationed.Credit...Nancie Battaglia for The New York Times |
When the Thomases aren’t houseguests, they have stayed at upscale Marathon-endorsed destinations like the Mountain Falls Luxury Motorcoach Resort in Lake Toxaway, N.C.
There, the justice met Larry Fields, who owns a motor-coach-cleaning business. Mr. Fields said that for several days he had had no idea who Justice Thomas was, telling him he would have to wait in line to have his Prevost washed, which he patiently did.
“He was a great guy,” Mr. Fields recalled. “I think we talked about how great Reagan was. He was low-key. It was just him and his wife and a dog.”
Rows of lodges and luxury motor coaches, with trees around the edges and mountains in the distance.
Justice and Mrs. Thomas have traveled to Mountain Falls, a luxury motor coach resort in North Carolina.Credit...Greg Eastman
Upkeep on a motor coach like the justices is an expensive constant, and other friends have chipped in to help. While he did not disclose Mr. Welters’s assistance in buying the motor coach, he did report that some former clerks got together and bought him deep-cycle batteries for $1,200 the year after he acquired it. He also reported that in 2002, Greg Werner, who ran a large, family-owned, Nebraska-based trucking company, gave him tires worth $1,200.
And over time, Justice Thomas made the motor coach his own. In a photo The Times obtained that appears to date back to the early 2000s, picturing his great-nephew as a child, the motor coach no longer sported the sizzling orange flames and Pegasus logo. Instead, it was painted in an elegant black-and-gold geometric pattern.
But if the custom coach changed, the justice’s friendship with Mr. Welters endured.
While Mr. Welters was an executive at UnitedHealthcare, Justice Thomas twice recused himself from cases involving the company, in 2003 and 2005. As is the general custom of the court, he did not explain why.
In 2010, Justice Thomas traveled to the capital of Trinidad and Tobago, Port of Spain, at the invitation of the Welterses. By then, the couple had become major Democratic fund-raisers and President Obama had named Ms. Welters ambassador to the island nation. Local newspapers captured the justice and Mr. Welters talking to students at a school.
Anthony Welters and Justice Clarence Thomas stand with children in school uniforms. On the wall behind them are mottos and words of inspiration, including “Respect & Kindness” and “Striving.”
Justice Thomas at a school in Trinidad and Tobago in 2010 with Mr. Welters, left, whose wife was the ambassador. Flight records show that the Welterses’ private plane flew to and from Dulles Airport on the days' Justice Thomas traveled.
In disclosures, Justice Thomas wrote that the “U.S. Embassy Port of Spain” had paid for his flight. But flight records obtained through the plane-tracking services of MyRadar show that the Welterses’ private Gulfstream G-6 flew from Washington Dulles International Airport and back on the days that Justice Thomas arrived on and departed the Caribbean island.
And Matthew Cassetta, a retired embassy official who helped arrange the visit, said Ms. Welters customarily “offered the plane to people who came down,” always at her own expense to save the taxpayers money.
(Ms. Welters declined to comment on the flights or the loan, except to say, “I just want to tell you that friendships come and go, and that’s what I want to say.”)
The same year, in a speech accepting an award from the Horatio Alger Association, Justice Thomas singled out Mr. Welters as one of his “friends for the whole journey.”
“And for Tony, a special thank you, who understood relationships and who was always there as a friend in the worst times of my life,” he said. “It is a friendship I will treasure forever.”
Jo Becker and
The New York Times
Reporting was contributed by Steve Eder, Riley Mellen, Robin Stein, and Abbie VanSickle.
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