Lawsuit #4 of 5 in which the court denied Wyndham’s Motions to Dismiss Claims of Fraud or Breach of Contract
It is not the Court’s job “to root through the record, not unlike a pig in search of truffles to uncover any grain of evidence that might support the position of a party that chose to otherwise sit on its hands.” Penn-Daniels, LLC v. Daniels, No. 07-1282, 2010 WL 431888, at *3 (C.D. Ill. Jan. 28, 2010)
JAMES ARCHAMBEAULT AND JULIE ARCHAMBEAULT, ROBERT BARBU AND HOLLY HERRICK, CARL AND DARLA BELL, AGGIE BOY, CHARLES AND CYNTHIA GARNER, HARRY AND DOROTHY HODGES, ELWOOD AND THERESE OCHSNER, BARBARA ROBERTS, DALE GLEN AND MARYILN SLUSSER, MONEKA WILSON, Plaintiffs, v. WYNDHAM VACATION OWNERSHIP, INC., et al., Defendants. IN THE U S DISTRICT COURT FOR THE MIDDLE DISTRICT OF TENNESSEE NASHVILLE DIVISION, Case 6:19-cv-00649-PGB-DCI.
This mass action lawsuit was filed on June 21, 2019, in Chancery Court, Nashville, TN, and was dismissed on April 3, 2023, because the Archambeaults settled. The Court instructed attorneys to “sever” the remaining plaintiffs into 10 individual cases.
During discovery, it was learned that there were Wyndham sales agents with 30, 40 and as high as 57 complaints against the same sales agents. They were not terminated.
- Sales Compliance Reports are prepared quarterly, and they show violations of Wyndham’s sales policies broken down by individual salespersons, including violations for pitching rent.
- These reports show individuals with 30, 40, and even as high as 57 cited violations, including pitching rent violations. Wyndham did not terminate these sales representatives despite these high numbers of violations.
What chance is there of betterment if a sales agent with 57 complaints is not terminated?
Excerpts from the Archambeault MEMORANDUM OPINION April 14, 2021
Wyndham asked the Court to dismiss only Count II, Breach of Contract. Allegations of fraud were not included in Wyndham’s Motion to Dismiss, maybe because in other lawsuits, claims of fraud have been allowed to proceed. Paragraphs italicized are from court documents:
Tennessee District Judge Eli Richardson denied Wyndham’s Motion to Dismiss claims of Breach of Contract
The Complaint asserts claims of fraud by omission against both Defendants (Wyndham Vacation Resorts and Wyndham Vacation Ownership, Inc.) (Count I), breach of contract against only Defendant WVR (Wyndham Vacation Resorts) (Count II), violation of the Tennessee Timeshare Act against both Defendants (Count III), and fraud in the inducement against both Defendants (Count IV).
Throughout their ownership of VOI points, Plaintiffs were repeatedly denied reservations when rooms were available because Defendant WVR was renting them on the open market, such as via internet travel sites, and/or using them for marketing purposes, instead of making sure they were available to Plaintiffs.
One would question why anyone would enter into a Wyndham contract that contained the following language (highlighted in red):
Plaintiffs contend that under the Contract, Defendant WVR was required not to restrict Plaintiffs’ ability to reserve rooms, but Defendants contend that express disclaimer language in the Contract indicated that they were not required to make obtaining reservations easy.
The following clause, highlighted in red, was not considered by Judge Richardson because it did not appear in the contract and it was not included in any exhibits. If a judge can’t find it, what chance has the consumer?
In their Reply, Defendants assert that the Contract contains this express disclaimer:
Neither Wyndham Fulfillment Group nor Wyndham Vacation Ownership, Inc., or its subsidiaries guarantee that a CLUB WYNDHAM Plus Member utilizing the Wyndham Rewards Program will be able to stay at a particular participating Wyndham hotel or resort during any specific time or will be able to redeem Wyndham Rewards points for any particular activity or service.
Notably, the Court’s inability to find this language does not appear to be attributable to Defendants having merely inadvertently omitted filing the page that contained such language. To the contrary, the overall appearance of the proffered copy as filed—including the apparent correct continuity, across page breaks, of the various paragraphs’ contents and numeration—suggests that the proffered copy as filed contained all pages it was supposed to contain.
It is not the Court’s job “to root through the record not unlike a pig in search of truffles to uncover any grain of evidence that might support the position of a party that chose to otherwise sit on its hands.” Penn-Daniels, LLC v. Daniels, No. 07-1282, 2010 WL 431888, at *3 (C.D. Ill. Jan. 28, 2010) (citing Casna v. City of Loves Park, 574 F.3d 420, 424 (7th Cir. 2009))
Thus, the Court cannot consider the Defendants’ quotation because it is not contained in the proffered copy (or, as far as the Court can tell, in any other document that conceivably could be considered on the instant Motion.
Fraud allegations in the Archambeault complaint (commonly reported industry-wide)
Plaintiffs allege that Defendant WVR breached these contracts through misrepresentations and material omissions.
Plaintiffs had to purchase the Club Wyndham Access in order to lower their maintenance fees;
Plaintiffs were told that if they consolidated into a new “Power Deed” their timeshares resale value would greatly increase.
Plaintiffs were told they could rent the timeshare out for profit. That was not the case. In addition, they were told that they could rent their points to offset maintenance fees. This was also not the case.
Plaintiffs were told they had to purchase additional timeshare points to lower their maintenance fees. In addition, they were told that upgrading to more points and getting a better status would allow them to get reservations “Anytime Anywhere,” but they found out that they could not, and they did not have any better success in getting reservations.
Plaintiffs were told that if they were Presidential Platinum members their maintenance would never increase.
They were told by numerous Wyndham sales agents that they did not need to worry about the high-interest rate financing the purchase through Wyndham because when they got home they could just refinance with their bank. They were even told which banks and what interest rates would be available to them. They found out that was untrue and they could not, and they were stuck with a high-interest rate financing their last purchase, which they would not have made had they known the truth that refinancing would not be available to them.
Who is Guarding the Hen House?
ARDA is the timeshare industry’s lobby and ARDA-ROC is ARDA’s Political Action Committee (PAC). ARDA President Jason Gamel commented, in response to a Better Business Bureau report, that “the industry has worked over the past decade to improve practices.” Before assuming his role as ARDA’s president, in 2019, Mr. Gamel was the Senior VP of Legal at Wyndham, the year the Archambeault lawsuit was filed, along with other lawsuits.
What chance is there for improvement if lobby spokespersons will not acknowledge that problems still exist?
We are aware of hundreds of timeshare members who filed complaints with ARDA over the last several years. All received only an auto-reply except one. She was referred to ARDA members who charge an upfront fee to sell timeshare points, despite her points having no resale value.
ARDA-ROC does not mediate disputes, but they have a Code of Ethics their members are supposed to adhere to. As stated:
If a consumer sends a complaint to ARDA, a committee reviews the individual report, as well as patterns of complaints with a resort.
Too many families have suffered harm. With no real consumer’s voice in Washington D.C., it’s doubtful change will happen, so we plug along doing our part to raise public awareness, to educate the consumer that considerable due diligence is required before buying any timeshare and to beware that in signing a timeshare contract, you agree that you did not rely on anything your sales agent and his tag-team said to make your decision to purchase. This begs the question, why attend?
Tennessee attorney Aubrey Givens, representing the Archambeault plaintiffs, commented in a 2018 CISION report, “This lawsuit represents a portion of the 500 senior citizens who are our clients who are alleging financial fraud at the hands of Wyndham.” Another law firm said they had been contacted by 200 Wyndham members.
Kirchners vs. Wyndham
The Federal Trade Commission listed Timeshare Sales at #9 in their 2020 Top Ten Scams list.
Earlier this year the Better Business Bureau issued a disturbing report on timeshare. According to the report, the BBB received 30,000 timeshare complaints from 2020 to 2022.
What is astonishing from all of Irene’s reports on the legal shenanigans, is how similar they all are in the nature of the complaints, no matter which developer is in the frame. So why are they there in the first place?
The simple answer is greed, it all begins at the initial presentation, this is where all the lies are told and the fraud begins. It is the free reign of the developer’s own staff who we know as “Sales Agents”, they are able to hide behind dubious “legal” clauses, which incidentally are not revealed until the very end when it is too late. The most common of these “clauses” is the statement we hear so often, “We are not responsible for what “OUR” sales agents say”.
Then when a consumer does make a complaint, we have another stock answer: “You signed the contract”.
But times are changing, and developers are being brought to task, the first of these as we have said before emanated in Europe, with the EU Directives on Timeshare, and these were further strengthened by Spain in their domestic laws. The industry had ample warning to change its ways, but as usual, they decided to go their own way in the belief they were “untouchable”. How wrong could they have been?
The result is the virtual demise of the timeshare industry in Europe, the sales decks that are still operating are doing abysmally, and in-house upgrades are probably at an all-time low. Anfi in Gran Canaria can only hope to recruit new “sales reps” from people who have no knowledge of timeshare, professional reps know they will not earn anything so don’t even apply. Even the scam operators are now clutching at straws, having to rely more and more on scare tactics, mainly on elderly and vulnerable targets.
For the majority of consumers in Europe, the word timeshare is synonymous with scams and fraud, no matter how it is dressed up timeshare is unlikely to improve its reputation with the public. It is a stark warning that the developers in the US need to heed, the tide is turning in favour of the consumer.
Your comments are welcome, it is through these and sharing your experiences which help others to realise they are not alone, have a great weekend. Baby Dog has been waiting patiently for me to finish so he can go out to play, how can you refuse this?