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Occasionally, text annotation in ArcMap will not rotate when the Rotate Data Frame Tool is used. This can happen with both Geodatabase annotation and with annotation stored in the map.
In ArcGIS version 8.2 and earlier, text will not rotate with the data frame if you create your text with the Draw toolbar's New Text tool (the capital 'T' on the dropdown list), the Callout tool (the balloon on the dropdown list), or the Label tool (the tag on the dropdown list).
These tools create 1-point text. That is, the text baseline starts where you click and extends horizontally. The problem is that this kind of text element does not rotate when the data frame rotates.
If you are using ArcGIS version 8.3 or later, refer to the article in Related Information, below: "Annotation is not rotated when the data frame is rotated". For other ArcGIS versions, continue with the following steps.
As its name implies, the New Splined Text tool can create text with a splined baseline, meaning that you can create curved text with many points that define its baseline. However, our goal in this situation is to get straight text 2 point text that rotates with the data frame.
You cannot change the angle of splined text by changing the angle on the Text Symbol Properties dialog box. You can change the angle using the rotate tool on the Draw toolbar.