Judge Presnell dismissed Wyndham Vacation Ownership’s false advertising claims
A Florida federal judge dismissed Wyndham Vacation Ownership’s federal and state false advertising claims against Timeshare Exit Team, a consumer advocacy company that assists timeshare owners in canceling their timeshare contracts, knocking out four of the six causes of action in the complaint.
On May 23, 2019, U.S. District Court Judge Gregory A. Presnell rejected Wyndham’s claims for false advertising under the federal Lanham Act and state law claim for deceptive and unfair trade practices, as well as two related claims for contributory infringement against Reed Hein & Associates (doing business as Timeshare Exit Team), its advertising agency and two law firms that represent Timeshare Exit Team’s customers.
“We are encouraged, but not surprised, that this court clearly recognized which organization was treating its customers ethically and which wasn’t,” said Brandon Reed, CEO/Founder of Timeshare Exit Team and a founding member of the Coalition to Reform Timeshare (CRT), which is advocating to reform the timeshare industry. “The Coalition to Reform Timeshare is battling this behemoth on behalf of frustrated consumers throughout the country. We won’t stop until these companies adhere to a strict Timeshare Bill of Rights and conduct their business fairly and ethically.”
The Coalition to Reform Timeshare is urging timeshare owners and consumers across the country to sign its new Change.org petition demanding reform of the industry through new, pro-consumer legislation and a timeshare Bill of Rights.
In its 2018 complaint, Wyndham claimed that its timeshare owners were subjected to “false and misleading” promises that Timeshare Exit Team could get them out of their unwanted timeshare contracts, and that Wyndham releases timeshare owners from unwanted contracts “for free or at a much lower cost, by appealing directly to Wyndham.”
In his order, however, Judge Presnell said that Wyndham lacked standing to assert the federal false advertising claim because Wyndham’s alleged injuries were “too remote from TET’s advertising and not the type of interest the Lanham Act was intended to protect.” Timeshare Exit Team disputed that Wyndham voluntarily releases its customers from their timeshare contracts. Rather, the consumer advocacy company argued that Wyndham could avoid any of the harms alleged in its complaint if the timeshare developer would simply take back consumers’ unwanted timeshares.
As support, Timeshare Exit Team cited a post-trial order entered in a separate case, Williams v. Wyndham Vacation Ownership, which affirmed a jury verdict against Wyndham and assessed $12.8 million in punitive damages against the timeshare developer based on the jury’s findings that Wyndham’s conduct was “highly reprehensible,” that it “fleeced elderly people,” and that it had a pattern and practice of retaliating against employees who blew the whistle on Wyndham’s “rampant fraud.” The evidence heard by the jury in the Williams trial included testimony that “[w]hen timeshare sales were off, Wyndham had “TAFT Days” – Tell Them Any Frigging Thing.”
In the Williams order, the court described testimony supporting the jury’s large punitive damages award, including that Wyndham’s actions included “falsely telling a prospect that Wyndham guaranteed to buy back timeshares. Wyndham’s salespeople also financed timeshares by opening credit cards in customers’ names without their knowledge. They falsely stated that monthly maintenance fees could not be raised, and sold the elderly more time than they could reasonably use before death.”
Since the Williams lawsuit, at least eleven additional Wyndham employees have brought lawsuits or counterclaims against Wyndham alleging they were retaliated against for complaining about the developer’s fraudulent sales practices and unhappy Wyndham timeshare owners.
The parties in Wyndham v. Reed Hein & Associates, et al., will make their case to a jury on the remaining claims in August of 2020.
Additionally, in March a federal court dismissed Welk Resorts’ lawsuit against Schroeter Goldmark & Bender (SGB), a firm that has worked with Timeshare Exit Team to exit unhappy Welk customers from “unfair or oppressive” timeshare contracts. The court also dismissed a majority of the causes of action against Timeshare Exit Team. The court found that the legal demand letters that SGB sent to Welk Resorts on behalf of “individuals who wanted to terminate their timeshare contracts based on high-pressure or deceptive sales techniques” are privileged.
About Coalition to Reform Timeshare
The Coalition to Reform Timeshare is made up of individuals dedicated to reforming the timeshare industry. We believe that timeshare companies should be subject to a strict code of ethics and transparency in their sales techniques. We advocate for consumer rights to legally exit from timeshares and educate consumers on state, local and federal legislation that may positively or negatively affect timeshare owners. Our goal is to change the industry by holding timeshare companies responsible and advocating for honesty and consumer fairness. For more information, please visit reformtimeshare.org or sign the petition to reform the timeshare industry at Change.org