Lawsuits Against Timeshares by Owners
The timeshare industry has been plagued by allegations of fraud, deception and preying on the elderly. Timeshare developers are subject to and must comply with state and federal laws and regulations, including:
- The Truth in Lending Act
- The Consumer Fraud and Abuse Prevention Act
- The Deceptive Mail Prevention and Enforcement Act
- The Home Mortgage Disclosure Act
- The Florida Consumer Collection Practices Act
- The Federal Trade Commission Act
- The Fair Credit Reporting Act
- The Fair Housing Act
- The Americans with Disabilities Act
- State Elder Abuse Statutes
Disclaimer: While CRT’s summaries attempt to concisely reflect timeshare owners’ allegations, for full context and accuracy, the reader is encouraged to review the court-filed pleadings that are linked for the reader’s reference to the caption for each lawsuit.
Case # CGC-12-526187 | THE SUPERIOR COURT OF THE STATE OF CALIFORNIA IN AND FOR THE COUNTY OF SAN FRANCISCO
This is an order filed in the case of Williams v Wyndham, a whistle-blower complaint brought by Patricia Williams. The judge was asked to rule on Wyndham’s motion for new trial and to reduce the jury’s award of damages. Williams is a former Wyndham employee who presented evidence to a San Francisco jury that she was fired in retaliation for reporting fraud when working at a Wyndham sales office.
After the jury entered a verdict in William’s favor, Wyndham sought to reduce the jury’s punitive damages award from $18.6 million to $130,000. The jury based its punitive damages award on evidence that Wyndham defrauded customers and sold elderly consumers more time than they could reasonably use before death. The evidence presented to the jury included sales representatives telling customers that Wyndham would buy back the timeshares it sold and that maintenance fees would not increase. Additionally, the jury heard evidence that sales persons opened credit cards for customers without their permission. In denying Wyndham’s motion for new trial, the court ruled that Wyndham’s conduct was “highly reprehensible,” and the jury’s award was “dispassionately sound.”
Based on due process considerations, however, the judge reduced the jury’s punitive damages award to $12.8 million.
Case # E2014-00303, TENNESSEE COURT OF APPEALS
In this lawsuit, timeshare owners Nathan and Patricia Overton successfully sued Westgate to get out of their $39,280 timeshare contract (rescission). The timeshare owners testified at trial that at a sales presentation that lasted almost eight hours, Westgate sales manager had promised they could book unlimited “Owners’ Nights” at any Westgate resort for $49-$69 per night and to book a reservation for the same week in December each year at Westgate’s Gatlinburg resort for an annual trip with their extended family to celebrate Christmas and their wedding anniversary. They testified that the sales manager had also promised to purchase a Foosball table to be kept at the resort for them, and to refund a portion of the commission he received on the sale of the timeshare. After the sale, they learned that they did not have unlimited “Owners’ Nights” privileges, and were unable to confirm the promised December reservation. They testified that even after multiple calls to the timeshare developer, and a written request to rescind the contract, Westgate refused to let the Overtons out of their timeshare.
The judge ruled after trial that Westgate was guilty of fraud, and that Westgate knowingly trained its salespersons to promise unlimited Owners’ Nights, even though written documents provided to purchasers did not mention the program. The court granted rescission of the contract, and ordered Westgate to refund the money the Overtons had paid. The judge additionally ordered Westgate to pay the Overtons punitive damages due to the reprehensibility of Westgate’s conduct.
Westgate appealed, challenging the trial court’s refusal to force the Overtons to litigate in Florida, and arguing that the punitive damages award of $600,000 was improper or excessive. On appeal, the reviewing court found that an award of punitive damages was warranted, given the trial court’s findings. The court additionally found that the punitive damages award was reasonable, however, due to the state’s statutory cap, reduced the award to $500,000.
Case # 6:18-cv-02199-PGB-KRS | U.S. DISTRICT COURT MIDDLE DISTRICT OF FLORIDA ORLANDO DIVISION
Couch v. Wyndham is a pending class action lawsuit alleging that after making their purchase, timeshare owners discover that they cannot reserve a room on their desired dates without purchasing additional points. The timeshare owners allege that Wyndham sells timeshares through a sales scheme referred to as “TAFT,” which stands for “Tell Them Any F—ing Thing.” According to the Complaint, Wyndham uses a high-pressure sales pitch that is replete with lies, omissions, and concealment, which may last hours and hours, and Wyndham’s “presentations” and “tours” are designed to coerce a prospective owner to purchase points.
Complaint | CHANCERY COURT OF DAVIDSON COUNTY, TENNESSEE AT NASHVILLE
In this class action lawsuit, Archambeault v. Wyndham, timeshare owners allege that Wyndham made intentional and/or negligent misrepresentations and violated the Tennessee Timeshare Act during a sale by Wyndham occurring in Nashville, Tennessee. According to the complaint: Wyndham violated their timeshare purchase contracts, made material false statements upon which the timeshare owners relied in deciding to purchase Wyndham timeshares, and then misled them into buying additional largely worthless timeshare points without actually offering anything of value in return. The timeshare owners also allege that Wyndham engaged in a variety of other deceptive sales tactics including intentional misrepresentation, fraud, breach of contract, negligent misrepresentation, and elder abuse, and that the timeshare owners were coerced, forced, and/or required to attend “owner update” or other meetings that were intended for no purpose other than to manipulate and pressure the owners to buy additional timeshare points.
CASE # 6:18-cv-02076-JA-TBS | U.S. DISTRICT COURT FOR MIDDLE DISTRICT OF FLORIDA ORLANDO DIVISION
CASE # 6:18-cv-02227-ACC-KRS | U.S. DISTRICT COURT FOR MIDDLE DISTRICT OF FLORIDA ORLANDO DIVISION
In McGhiey v. Orange Lake Country Club and Chapa v. Orange Lake Country Club, husband and wife timeshare owners allege that Orange Lake Country Club’s collection practices violate both the Fair Debt Collection Practices Act, 15 U.S.C. §§ 1692, et seq. (“FDCPA”) and The Florida Consumer Collection Practices Act (“FCCPA”), 559.55 et seq. According to the Complaint, Orange Lake improperly circumvented the McGhiey’s ability to make a request for validation or verification of a debt by using impermissibly small fonts and improper, attention-grabbing threats to distract the timeshare owners from timely exercising their rights to verify and dispute the debts sought by Orange Lake Country Club.
JOSEPH M. DROPP, MARY E. DROPP, et al. v. DIAMOND RESORTS INTERNATIONAL, INC. (CLASS ACTION COMPLAINT)
Case # 2:18-cv-00247-RFB-GWF | US DISTRICT COURT DISTRICT OF NEVADA
In this class action lawsuit, Dropp v. Diamond Resorts, timeshare owners allege that Diamond employs high pressure sales tactics to sell “points” as a real estate investment and is in fact operating a securities investment business in violation of Federal Securities Law.
Case # A-18-773381-C | DISTRICT COURT, CLARK COUNTY, NEVADA
In Rogers v. Diamond Resorts, the Rogers allege that Diamond’s sales presentations are strategically designed to physically, emotionally, and mentally wear down susceptible consumers, and to specifically target elderly persons, like the Rogers.
According to the Complaint: Diamond refused to let the Rogers leave the sales presentations, to take the materials with them to study, and to consult with an attorney or financial advisor. When the Roger’s did not pay a maintenance fee Diamond repossessed the Rogers’ timeshare memberships without providing any accounting. The Rogers allegations against Diamond include: violation of Nevada commercial code statutes, unconscionable contract terms, fraud, theft, deceptive trade practices, and abuse and exploitation of elderly.
Complaint | US DISTRICT COURT EASTERN DISTRICT OF TENNESSEE KNOXVILLE DIVISION
In this class action lawsuit, Moore v. Westgate Resorts, timeshare owners allege that Westgate’s high-pressure sales scheme involves convincing prospective purchasers to buy into its vacation timeshare program while failing to disclose legally required information to buyers and failing to provide purchasers with adequate access to their timeshares. The timeshare owners allege fraud, negligent misrepresentation, breach of contract, and civil conspiracy.
The Coalition to Reform Timeshare is dedicated to reforming the timeshare industry. We advocate that timeshare companies should be subject to a strict code of ethics and transparency in their sales techniques.
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