Manhattan Club Lawsuit

It's also quite easy to see why matters of law take so much time... Hope for the best. Happy New Year!

Can anyone from” Redweek “ tell us exactly who owns the Manhattan Club? There has been no recent updates concerning this. There is much speculation from different owners. Is Blue Green the owner/management company? Thank you for your assistance.

I assume that Redweek is no longer monitoring this site since this question was posted several days ago with no response.

I spoke with the Manhattan Club. Bluegreen no longer involved in management. They said they have until the end of 2021 to get a new management company.

The Manhattan Club is organized as a condo, with a board of three members controlled by the Sponsor, under which The Manhattan Club Timeshare Association Inc., a not-for-profit corporation established as a timeshare, with a board of seven members also controlled by the Sponsor. For the most part, rooms in the facility are owned by members with partial shares, and these interests are pooled in the timeshare association, subject to the reservation rules, etc. There are in excess of 14,000 members, but the number in good standing with the right to vote in elections is not reported.

The Sponsor, who is currently a group of entities related to the Eichners, own certain interests, control the board of both the timeshare association, and the condo. BlueGreen entered into a transaction with the Eichners to assume the role of Sponsor after the NYAG "Assurance of Discontinuance" (AOD), but that agreement was terminated.

BlueGreen describes its current predicament as follows:

On August 30, 2020, over 100 VOI owners at The Manhattan Club (“TMC”) sued BVU and certain unaffiliated entities (the “Non-Bluegreen Defendants”). The complaint includes claims arising out of alleged misrepresentations made during the sale of VOIs at TMC and certain post-sale operational practices, including allegedly charging owners excessive annual maintenance fees and implementing reservation policies that the restrict the ability of VOI owners to use their points to access the resort while allowing the general public to make reservations. The plaintiffs assert in the complaint that Bluegreen acquired operational control of TMC from the Non-Bluegreen Defendants in 2018 and assumed joint liability for any prior wrongdoing by them. We believe this assertion to be erroneous and that the claims against BVU are without merit. Accordingly, we have moved to dismiss the claims against BVU.

Termination of Manhattan Club Purchase and Sale Agreement

On March 15, 2018, BVU entered into an Agreement for Purchase and Sale of Assets (“Purchase and Sale Agreement”) with T. Park Central, LLC, O. Park Central, LLC, and New York Urban Ownership Management, LLC (collectively “New York Urban”), which provided for BVU’s purchase of The Manhattan Club inventory over a number of years and the assumption of the management contract with The Manhattan Club HOA anticipated to occur in 2021. On October 7, 2019, New York Urban initiated arbitration proceedings against BVU alleging that The Manhattan Club HOA (of which BVU is a member) was obligated to pay an increased management fee to a New York Urban affiliate and that this higher amount would be the benchmark for BVU’s purchase of the management contract under the Purchase and Sale Agreement. New York Urban also sought damages in the arbitration proceedings in excess of $10 million for promissory estoppel and tortious interference. BVU denied New York Urban’s claims and terminated the Purchase and Sale Agreement and the related Security Agreement based on, among other things, New York Urban prematurely initiating arbitration in violation of the Purchase and Sale Agreement. On November 25, 2019, New York Urban sent its own Notice of Termination of the Purchase and Sale Agreement and a separate letter containing an offer to compromise if BVU resigned its position on the Manhattan Club HOA board and permitted New York Urban to enforce its rights under the Security Agreement. On November 29, 2019, BVU accepted the offer. BVU has provided New York Urban with resignations of its members on the Manhattan Club HOA board consistent with the parties’ settlement agreement and believes it has fulfilled all of its legal obligations under the settlement.

The AOD requires, in part:

61. Respondents [the Eichners and related entities] and their agents and employees, including The Manhattan Club Timeshare Association, Inc., shall not engage in any act directly or indirectly relating to the offer, purchase, sale, issuance, advertisement, marketing, promotion, distribution, negotiation, exchange or transfer of any timeshare interest; provided, however, that Respondents shall have the right to directly complete the sale of ownership interests in The Manhattan Club, and to provide financing for the purchase of such ownership interests, to the approximately fifteen purchasers of timeshare ownership interests who executed contracts to purchase such interests in May, June and July 2014, and who are offered the option to rescind their contracts for a period of 30 days from receiving notice of the rescission option, but do not elect to so rescind and wish to close. Notwithstanding the foregoing, Sponsors may transfer their current ownership interests in The Manhattan Club solely as provided for herein.

62. Respondents shall enter into an agreement with the third-party operator of timeshare properties (''TMC Purchaser'') [BlueGreen] previously identified to the OAG on or about July 28, 2017, or to such other third party purchaser approved by the OAG to own and sell timeshare interests in New York, whereby (i) T. Park and O. Park shall enter into an agreement with a third-party to transfer timeshare interests from existing owners to TMC Purchaser, all their timeshare interests in The Manhattan Club, and (ii) after three years of management, Urban will transfer to TMC Purchaser or its assignee the Management Agreement (the '"TMC transfer").

63. All Sponsor-appointed current officers and directors will resign from their positions as members of the Board of the Timeshare Association at the time of the first transfer of interests to TMC Purchaser, and TMC Purchaser will appoint replacement officers and directors.

64. In the unlikely event of a default on the agreement by TMC Purchaser, and if TMC Purchaser fails to cure after any required notice is given and any applicable cure period bas expired (a "Default''), and if at the time of the Default Sponsors then continue to own any timeshare interests (the ''Remaining Interests"), then the following provisions shall apply:

a) Sponsors shall notify OAG of the Default;

b) Sponsors shall seek to sell their Remaining Interests to a third party entity unaffiliated with any Respondent and to no other person, consumer, or entity;

c) Sponsors shall advise OAG of the identity of the proposed transferee;

d) Sponsors shall be free to appoint board members to the Timeshare Association Board to replace any members appointed by TMC Purchaser who resign as a result of the Default; the Sponsor appointed board members shall recuse themselves from any and all votes involving in any way any of the Respondents or affiliated entities;

e) Sponsors shall propose an independent monitor ("Monitor'') to ensure that the Manhattan Club is operated in accordance with the offering plan then on file with the OAG and that Sponsor does not sell any timeshare interests except as provided in paragraph 62 above; OAG shall have the right to approve any Monitor proposed by Sponsors before such Monitor shall be appointed. If approval is not given for a proposed Monitor, Sponsors shall propose a different Monitor until such time as OAG approves of the proposed Monitor;

f) The Monitor shall have full and complete access to all books, records, information and personnel of all Respondents to ensure fall compliance with the terms of this Assurance;

g) If the Management Agreement reverts back to Urban or any entity affiliated with any of the Respondents as a result of the Default or for any reason, the Respondents agree that the Management Fee will be limited to 15% of expenses actually paid, not including the Management Fee.

Thank you for the information.

I wrote a letter as well. Although there is nothing specific that can be done, they responded very promptly and politely. We really need everyone to write a letter. I got the sense that not many of us have done this. It is certainly an easy thing to do.

I appreciate this update.

If you can post the correct address or email that you used, as their has been so many addresses given over the last months, this would solidify the correct person or department that it needs to go to. Everyone will appreciate it that you shared this and got a response. I have written to the other addresses given and never received a response. Thanking you in advance. Regards, Hank

It is the address given by Irene on P 333 (the previous page) of this blog. They responded to me by email so make sure you give your email address.

Hi,

The online address to contact the New York Attorney General's Office about the Manhattan Club.

https://ag.ny.gov/consumer-frauds/Filing-a-Consumer-Complaint

Our letters make a difference. The TMC fraud has to be stopped.

We just got involved with this and we sent a letter to her last week. We do not plan on paying our yearly fee this year . Should I also send an email? The postal mail is not up to par these days! Thanks!

The law suit vs Bluegreen / Manhattan Club was outlined in the LAW.COM article:

BlueGreen, Current Operator of NYC Timeshare The Manhattan Club, Sued for RICO, Fraud and Breach of Contract

Sep 14, 2020 8:00 AM ET Legal Newswire POWERED BY LAW.COM September 14, 2020

WESTFIELD, N.J.--Bluegreen Vacations Unlimited Corporation, Inc. (NYSE: BXG), the current operator of NYC timeshare The Manhattan Club (“TMC”) was sued in federal district court in Manhattan on August 30, 2020 by a group of over 100 aggrieved TMC timeshare owners for breach of contract, tortious interference with contract, fraud, breach of fiduciary duty, and most significantly repeated, pervasive acts of fraud at TMC over many years that give rise to liability under the federal civil Racketeer Influenced Corrupt Organization Act (‘RICO”) for continuing acts of illegal behavior in interstate commerce. Also sued were TMC’s disgraced former operator Ian Bruce Eichner, several of his relatives, and entities they used to operate TMC (collectively “the Eichner Defendants”).

The suit against TMC’s former and current operators documents longstanding and persistent wrongdoing in connection with both misrepresentations and deliberate omissions of material facts made during the sale of TMC timeshares, and abusive post-sale operational practices at TMC. These abusive practices include charging owners excessively high annual maintenance fees, and implementing reservation policies that hinder or prevent TMC owners from using their timeshares while allowing the general public to easily make same-day online reservations, which together with other wrongdoing have collectively rendered Plaintiffs’ TMC timeshares unsaleable and therefore financially worthless. Additionally, TMC’s operator has refused to alter its reservation policies or otherwise accommodate difficulties owners are encountering in traveling to NYC as a result of the COVID-19 pandemic.

The complaint filed by the plaintiffs’ attorneys Zimmerman Law Group and Hoffberg & Associates details a plan by the operators of TMC to intentionally divest the timeshare owners of their interests, which were acquired at a cost of over $400 million dollars, using abusive operational practices referenced above. As a result, many owners stop paying the ever-escalating annual maintenance fees - now averaging several thousands of dollars - over which they have no control. The operators then seek to recoup timeshares from such owners, who paid on average several tens of thousands of dollars for their timeshares, for next to nothing by offering to forgive all maintenance fee arrearages and payment of $100 in exchange for the owner deeding their timeshare back to the operator. Many of the operators’ wrongful practices were the subject of a previous investigation by the NY State Attorney General of TMC’s former operator the Eichner Defendants. However, as plaintiff’s lead counsel Jean-Marc Zimmerman pointed out, “this investigation of the Eichner Defendants, and its associated proceeding, were unfortunately prematurely terminated in 2017 by an Assurance of Discontinuance (“AOD”) that provided negligible financial compensation to TMC timeshare owners. Moreover, the AOD failed to stop the wrongdoing that continues unabated, necessitating the filing of this suit.”

The lawsuit seeks redress for various wrongdoing at TMC from the Eichner Defendants and BlueGreen, which acquired operational control of TMC from the Eichner Defendants in 2018 in a private transaction by which BlueGreen assumed joint liability for the prior wrongdoing committed at TMC by the Eichner Defendants, including charging excessively high annual maintenance fees, abusive reservation policies, and the Eichner Defendants’ unfulfilled promises to buy back units from owners for the price paid, potentially creating a nine figure liability undisclosed in filings of Bluegreen, or its 93% parent BBX Capital Corporation (NYSE: BBX) (OTCQX: BBXTB).

Contact: Please direct all inquiries regarding the suit to Jean-Marc Zimmerman at Zimmerman Law Group by e-mail addressed to jmz@tmcsuit.com. URL : http://www.tmcsuit.com

Jean-Marc Zimmerman https://www.law.com/legalnewswire/news.php?news=TGE4YXRHS1RpUWFlN3lVUFpJSVA5dz09

Other law suits were filed against Bluegreen companies. See: "Timeshare Lawyer files Lawsuit against Bluegreen Resorts. Timeshare Attorney Mitchell Sussman takes legal action vs. Bluegreen Resorts."

https://timesharelegalaction.com/bluegreen-timeshare-cancellation-lawsuit.php

Public access to the Lawsuit vs Bluegreen/TMC Complaint filed at the NY Southern Court by the Zimmerman Law Group, titled "Charles Acklin, et al. v. Bluegreen Vacations Unlimited, Inc. et al., Case No. 1:20-cv-07402" is available to view at the PACER lAW engine (required registration and charge) and the Zimmerman website (free of charge).

See http://www.tmcsuit.com

Irene’s post: Yes, write to the new NYAG. Leticia James. Everyone should write. It is the only way the violations of the Assurance of Discontinuance by Eichner and the Manhattan Club will come to the attention of the Attorney General. She can help us. Here is here contact info:

Attorney General Leticia James Office of the Attorney General The Capitol Albany, NY12224-0341

Attorney James is serious about protecting the public.

Irene Smalls

Can you share a sample letter we can adapt to our own situation?

Everyone should file a Civil Suit for Breach of Contract and fraud against the Manhattan Club in New York Civil Court at 111 Centre Street. NYC A Civil Suit preserves your rights to fight the Manhattan Club. The Statute of Limitations is 6 years from when you discovered fraud. Most judges will not give a waiver on the Statute of Limitations. A Civil Suit will enable you to get a stay against any foreclosure action until your case is decided. It cost less than $50 to file a Civil Suit against TMC.

I have paid up on my timeshare.and also my fees up to 20023. I have called the Manhattan club repeatedly to to take the timeshare back because our mom has died from Alzheimer and we can no longer afford to keep it. They keep telling me I would be put on a waiting list. They seem to be ignoring me and hopefully I will be contacting the Attorney General office. Thank you for the information you provided Sincerely Jessie M Owens

Thank you