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Class Action Against Diamond Resorts?
Actually I think taking them to small claims court might just be a good idea. If enough people did that can you imagine how many courts they would have to defend themselves in ? I'm in favor of using every means available to fight the corporate giants who write the legislation that our elected officials rubber stamp for their campaign contributions.
Don P.
As more owners step forward and publicly challenge Diamond's practices a history of harm is established. The larger that public record becomes the more compelling the argument for the AG to engage in meaningful investigations. Diamond is already being scrutinized by regulators. Want something meaningful to happen, it requires engagement by the consumer as well. That goes beyond expressing frustration on this thread, and throwing in the towel because the system is rigged. Small claims court is a streamlined process and depending on state award limits could allow you to recapture your money, not a bad days pay. Until there is a real effort to collectively hold Diamond accountable this thread will continue to grow with no tangible effect on Diamond's practices.
Mark S.
Help us address concerns about DRI!
Disclaimer: The following is not intended to claim or infer that DRI has done anything wrong.
As some of you know, a group of people have been engaged in a long term private investigation of DRI's business practices. We are nearly finished, but the speed and quality of our work is dependent upon our ability to obtain more copies of DRI purchase documents. We'd like to obtain copies of contracts from every year and every state.
We need as many DRI members as possible to contribute their documents and time is of the essence. We have no need to know who you are and we will not ask you for that information. We encourage you to redact all personal identifiers before sharing your documents with us or anyone else.
The DRI contract is far from "iron clad". Although we do not give legal advice, if we see a specific item of interest in your contract we will certainly bring it to your attention. If we all work together on this we WILL be able to make a huge difference for all consumers. If you can spare a few minutes of your time to help, please contact me at Sbharbison (insert the at symbol) gmail.com. I will reply with more information.
Regards, Susan, Consumer Activist
Susan B.
justin184 wrote:Excellent... I think that will help a lot of us who were duped into signing the form that waived all liability down to the written contracts, whereby the written contracts were completely different from what was actually sold at the sales table.
That is the hope Justin! We want to help those that are already in and protect future "buyers".
Susan B.
I've written my letter to them this morning, asking them how they can force a cease and desist from advertising upon me when it was their sales representatives that enticed me along that route, and then used it as part of their sales pitch again in 3 yrs time. If Diamond have decided that they now have a strict 'no rental' policy on their points, it certainly wasn't there in the sales table when I bought. I'm now waiting to see how they respond. In any case, they have taken all value out of these timeshares anyway. All it appears to me is that they want to now function like a bank. When the regulators and govt came up with the bailout, that was just the start of this. If you look at how Diamond now conducts its business, and how it accounts, and how it does everything, it is behaving like a financial company. The failure to prosecute the banks led to an open door policy, and a lot more people are going to get hurt by this now.
Justin S.
The article below was written by timeshare attorney Mike Finn of the Finn Law Group re class action timeshare lawsuits. Diamond has millions and millions of dollars. The timeshare owner does not. Combating a class action for them is like swatting a fly. The two timeshare lawyers I asked about ILX class action said it it not worth it. It is advisable to file a complaint with the Consumer Financial Protection Bureau under the mortgage option (even if there is no mortgage). The CFPB is currently investigating Westgate timeshare and Diamond employs many of the same strategies. Only the NY and TN AGs, as I am aware, are on the side of the consumer. Most are on the side of the timeshare developer, especially in Florida.
This from Mike Finn written and published for a timeshare newsletter:
We all know a little bit about class actions, many of us have received a letter or postcard advising us that we may be potential class members. Again, many of us, perhaps sensing that our individual recovery may not be worth the effort, haven’t taken the plunge. Still, a timeshare purchase could be a horse of another color. If only some enterprising lawyer would consider whether a potential class action could help extricate us from our lifelong timeshare obligation? Of course the beauty in this wish is that as a class member, you wouldn’t have to actually hire the lawyer, he or she would be paid from the proceeds of the case (assuming it’s successful of course).
As a lawyer with some class action experience and who has primarily represented consumer timeshare owners over a considerable period of time, I can report to you that class actions do play a role in our consumer timeshare practice, but that the role is more limited than we would like it to be.
The explanation lies with the kinds of cases that can be effective class action cases, and more so if they’re timeshare related.
Most of our clients tell us that they were deceived during their initial timeshare presentation and that a lot of what they were told was simply not truthful, further that they relied upon the veracity of the sales staff and it was only later, when they attempted to utilize their purchase that they learned a different story. Of course this realization did not come during the 5-10 day rescission period (varying by state) provided by law, and so the hapless owner came to realize that the resort would not help them and that furthermore, the purchase contract they signed is considered to be legally binding and worse, in the absence of a way to unload their purchase on someone else, there is no exit scenario built into the contract. Essentially, in the absence of a viable resale opportunity, these contracts become lifelong obligations!
The above scenario repeated over and over with some variations on the theme is the “staple” fraud in the inducement file we see at Finn Law Group on a daily basis. Per our own internal analysis, these matters occur with amazing frequency mainly because of the manner that the timeshare product is marketed. In nearly all instances the salesperson assigned to the prospective customer, is purely commission based, and perhaps quota based as well. The top sales staff can make a very good living, but they must maintain a high closing rate to do so. This methodology puts the salesperson into a conflict with ethical considerations competing with their own financial needs. Being human and with direct compensation incentives providing the temptation, sales staff may well significantly over embellish the advantages of timeshare ownership over the often 3-5 hours they spend with their sales prospects. After this long sales process, the interested prospects then immediately are ushered into the closing aspect of the transaction attended by different members of the sales team, known internally as “closers” and thereafter shepherd the prospect into and through the closing process. No prospects are ever given the opportunity to take the presented documentation with them to review or consult with an attorney, pre-execution. It’s all completed on the same day and that is by careful design. Given the mountain of paperwork processed at a timeshare closing and the relatively short amount of time a consumer has (or takes) to read and understand the finer points of the transaction, it’s no small wonder that what one legally agrees to via their signature compared to what they were told they were contracting for, are often diametrically different from one another. You spend hours with a sales person who is motivated to determine what is important to you and to tell you that, “yes” your purchase does include that feature, only to later discover that nowhere within those mounds of paperwork you signed and initialed is there any reference to the feature or features your salesperson assured you were included. In fact, to add insult to injury, one of the contractual clauses that wasn’t pointed out to you as you were signing your mountain of paperwork that was pushed in front of you, was a clause that states that the purchasers did not rely on any oral representations when making their timeshare purchase decision. Imagine a salesman knowing that clause exists resisting the temptation to increase his or her income! (I take credit for naming that provision the “salesman’s license to lie” clause and I can pridefully advise that I was so quoted recently in the New York Times!)
So we now have isolated one of the more frequent legal issues with the typical timeshare purchase, and have identified the possible legal cause of action that applies, which we lawyers call “fraud in the inducement”, which translates into the remedy which is that the contract should be rescinded because the purchasers didn’t purchase what they were told they were buying by the sellers. We’ve also identified the defense that the resort developer will undoubtedly utilize if fraud in the inducement is raised in litigation, as it’s unlikely that the salesperson, if called as a witness, will admit they promised items not contained within the pre-printed contract and, when combined with the “salesman’s license to lie” clause just referenced, the plaintiff consumers case is made far more difficult to win. Recall that the burden of proof rests with the party bringing the action. As the consequences of losing the case may mean the loser pays the winners attorney fees and costs, the wisdom of pursuing such a case for any one client becomes questionable as few clients will want to roll the dice, especially if the odds are no better than 50-50.
Its therefore tempting for a lawyer to look to the possibility of filing class action litigation for fraud in the inducement claims for an entire class of timeshare buyers who presumably are in much the same boat having purchased a timeshare interest under the false impression that more attributes were being purchased than what were actually acquired. Surely if everyone reports a similar purchase experience, the court will conclude that all of these purchasers couldn’t be wrong and therefore the developer must be knowingly encouraging its staff to make the false assertions to increase its sales?
At this point we must pause and examine the actual state of the law to understand the legal conclusion that most courts have come to, the sad fact that for the most part, courts do not consider fraud to be the type of case that belongs in a class action scenario.
The best explanation I can provide as to why the courts have adopted this position is that the elements of fraud, the actual deceit done with the intent to deceive, relied upon by the buyer to their financial detriment, are all very individualized factors the underlying facts of which will, by definition, vary with every individual timeshare presentation by each individual timeshare salesperson, and of course presented to individual potential buyers at differing times and that therefore, each separate sales experience constitutes a new and separate set of facts to be evaluated. Courts are loathe to lump together clumps of individualized sets of experiences into one big ball where in every class member theoretically would have suffered the same level and severity of deceit and conclude that all equally relied upon these separate individualized deceptive statements to their detriment.
In short, these fraud based claims in the timeshare arena are not, in the foreseeable future, going to become actionable timeshare based class actions. Of course individual actions are still quite possible and, in fact, we are aware of recent individual litigation in this realm that ended quite successfully for the consumers. Again however, any owner considering individual litigation based upon a theory of fraud, had better be aware that their battle will be costly and the ultimate results unpredictable.
So is class action litigation just another pretty face with no significant place in the timeshare arena? Decidedly not! My firm, Finn Law Group has successfully initiated mulitiple class action litigation against timeshare resort developers. In one concluded case, over eleven thousand former timeshare owners saw foreclosure entries on their credit reports purged, and with another over two thousand owners received extended vacations for no cost. Other class cases are pending as can be determined by visiting our website at www.finnlawgroup.com/english/active-litigation.
In conclusion, class action litigation isn’t going to, on its own, repair the underlying problems with timeshare ownership, but it will make a dent, and more importantly, it will continue to serve notice on the timeshare development community that someone out there is paying very close attention to them, and that can’t be a bad thing!
Irene P.
One thing I know about class action lawsuits is that the attorneys make a ton of money. They usually end in settlements where the parties get a tiny credit and no real money. They take forever dragging through the court system and I challenge anyone to show me a great deal reached on behalf of the plaintiffs. There may be one or two successful class action suits where the plaintiffs received a huge reward but not in timeshare cases.
Don P.
Perhaps the primary discussion should be a civil action to rescind Diamond ownership's/contracts. Sufficient corporate malfeasance has occurred and continues to occur to provide credible grounds. Any interest by a competent attorney to provide contingency representation will be contingent on organization by individuals expressing their unfortunate turn of events on this site. If refunds of purchase monies can be achieved hard to see how that can be viewed as overreaching. What the attorney's make at that point becomes irrelevant.
Mark S.