Wyndham Owners Forced to Assign Interest to Trust, File Lawsuit.

When a timeshare purchase is misunderstood, disappointment usually prevails. This is especially true for those that sign contracts under false pretenses. While ultimate regret isn’t always the outcome, believing in the product before experiencing anything yourself is risky business. When timeshare buyers aren’t critical, incentivised sales people have been known to bend the truth to close the deal. According to Carolyn Nolen, this is what happened to her and a handful of Wyndham owners this past year.

In February, Nolen spearheaded a class action lawsuit against Wyndham Vacation Resorts (Carolyn Nolen, et al. v. Wyndham Vacation Resorts Inc., et al., Case No. 6:20-cv-00330-PGB-EJK) in an attempt to garner restitution for the misrepresentation of assigned interest. Although timeshare companies have been known to use different tactics in the past, this shows how deceptive timeshare sales practices can potentially be. In this case, the Wyndham owners claim they were led to believe that they’d be the beneficiaries of assigned timeshare interest that was placed into a trust.

How Did The Trust Benefit Wyndham?

Once the purchase was complete, Wyndham owners say they were forced to assign 100% of their timeshare interest to Club Wyndham Plus. This was said to be a program governed by the “terms of the Fairshare Trust”. However, it is stated that the real beneficiary and controller of the trust is Wyndham. Not only was Wyndham allegedly marketing its product in an aggressive, misleading manner, but they were accused of unethically profiting from the same misinformation used to close the deal. Pretty confusing stuff.

In other words, the disappointed Wyndham owners admittedly state the Fairshare Trust was not properly explained to them. Had they known the Fairshare Vacation Owners Association (FVOA) was the same thing (a Wyndham entity), they would not have made the purchase. But because it was held from their knowledge and the buyers thought they’d be benefitting from the product– as if it were some sort of investment– they believe they have a case.

What Else Works in the Favor of the Wyndham Owners?

The plaintiffs also pointed to the Arkansas Trust Code, stating, “Trustees cannot profit from the trust, even if they did not breach the trust in profiting from it.” It appears there isn’t much grey area here. A trustee is required to administer the trust solely in the interest of the beneficiaries. The code also goes on to say, “a trust and its terms must be for the benefit of its beneficiaries.” So the allegations that Wyndham and another entity is benefitting from interest but buyers aren’t raises some concerns. 

According to the lawsuit, Wyndham owners also believe that the timeshare company is using their power from these unfair trusts to make decisions outside of their best interests. The board of directors is said to have the control over program updates, important developments and changes to the trust itself without owner consent. The Plaintiffs also accuse Wyndham of appointing their own executives and employees to the board “to control the actions of the Trustee.”

The Tipping Point of Filing a Lawsuit Against Wyndham.

The Wyndham owners further complained that they were required to pay administration and operating costs for the trust. They expressed their dissatisfaction with the binding contract forcing them to keep up with payments or face penalties. Carolyn Nolen and her class action suit against Wyndham is a perfect example of buyer’s remorse due to alleged misleading tactics that altered customer satisfaction. Others names in the lawsuit were Cara Kelley, Paula Litton and Windy Kelley.

While buyer negligence may be thrown in the face of the plaintiffs, the high-pressure sales environment, Arkansas Law and minimal disclosure may play a role in the outcome.