I have reported on this case several times, so here is my latest update for RedWeek subscribers.
On Sept. 4, one day before last week's scheduled hearing before the court referee, both sides stipulated to continue with the original order, as amended, so the club can make payroll and cover ongoing expenses. They then agreed to take the Friday hearing off calendar --- but did not notify any of the owners who spent good time and money making the trek to Manhattan to attend. When the owners showed up, the court referee spoke to them informally, assuring them that the case was very early in the discovery phase. No determinations would be made, he added, until the AG reviews all of the club's documents about timeshare sales, reservations and rental programs.
As a result of the stipulation, which is now posted on the NY court's online filing system, the ban on new sales and foreclosures continues, along with other restrictions, until further notice. There is no new hearing date scheduled as of yet, according to the AG's press office. The AG's office is staying very close-lipped on the proceedings (as they do with most cases) while they sift through thousands of documents that have already been turned over to them by the Manhattan Club's battery of attorneys. No depositions of the principals, including Ian Bruce Eichner, have been set, either.
Meanwhile, as is evidenced by this string on RedWeek, many Manhattan Club owners are keeping a close watch on the proceedings. In some cases, owners are fearful that the AG will cut a deal with the Manhattan Club that allows them to stay in business. Other owners contend they should be given a seat at the table throughout these proceedings, even though they are not technically a party to the AG's suit. When I asked the AG's spokespeople about this, they said that the AG represents the state of New York, not the owners of the Manhattan Club. That's a strange distinction, since the owners of the club are the ones who have the most at stake in the case. In any case, the owners will have to maintain communications amongst themselves, through this string and other owner sites, because the AG has no intention of sending out mass email updates to owners about the case. They just do not feel that is their mission or obligation.
It is clear, based upon the interviews I have conducted with owners about the case, that they are very frustrated, in general, with just about everything about the club, including the pace of the AG's case. But my guess is they will have to maintain extreme patience before there is any clarity to what happens with the AG's investigation.
The club's attorneys, meanwhile, said this week that they will vigorously contest the AG's allegations if and when the case escalates into a formal "AG sues Manhattan Club for fraud" lawsuit. For now, Eichner's attorney claims that the AG's complaint is rife with "inaccuracies and inconsistencies" that will be exposed at the proper time. When will that time come? Stay tuned.