Like we mentioned in last week’s article, regulatory agencies are beginning to hold timeshare companies accountable for persuading potential buyers in misleading ways. Although owners of older timeshare contracts haven’t been able to find much restitution, today’s buyers have a reason to be hopeful. Aside from the growing number of settlements being reached, lawsuits are beginning to rule in the consumer’s favor. A Tennessee couple can attest to this as they left a timeshare company defeated after suing for defrauding them.
How the Tennessee Buyers Were Deceived.
In July of 2011, the Overtons were looking for a family cabin in Gatlinburg when they were persuaded to attend a brief timeshare presentation for Westgate Resorts. After accepting a few gifted bribes and enduring sales pitches for more than eight hours, the couple agreed to pay nearly $40K for a unit at the resort.
In order to make the “deal” too good to pass up, the sales rep assured the Overtons that they’d have access to their timeshare the same week every December and that they could stay at any Westgate resort for $49-69 per night. They even threw in a “free” foosball table and promised to refund $1,500 in commissions if the Overtons would just sign the dotted line.
Although many buyers fail to properly document the transaction, the Overtons did not. After getting everything in writing, they felt pretty good about the purchase. The problem was, the contract they signed wasn’t for a fixed week, it was for a floating unit. So they were never actually guaranteed the same week or unit every December. Because of this, they also found out that the unlimited owner’s rates weren’t valid either.
Unfortunately for Westgate, their sales team didn’t think twice about the ramifications of their assurance. They probably didn’t think a few lies could leave the timeshare company defeated in court someday. The perpetuity of a timeshare contract usually forces buyers to feel trapped. So they must have assumed the Overtons would follow suit. But when the experience unfolded, the couple ended up filing a suit instead.
How the Fractional Owners Won the Timeshare lawsuit.
After reviewing documents from the purchase with an attorney, the couple was informed that Westgate did not comply with Tennessee law by providing them with an up-to-date copy of their public offering statement. Even CD-ROMs that were given to the Overtons were deemed illegal because of accessibility concerns and outdated information.
The unhappy buyers finally decided to formally request a rescission with Westgate after four months of further documentation. But the Overton’s letter wasn’t taken seriously and the resort denied their request – daring the couple to file a lawsuit. So the Overtons did and in June of 2013, Westgate went on trial for fraud.
Disclosure, False Promises Left Timeshare Company Defeated.
As the case concluded, the court determined that Westgate had trained salespeople to break fair disclosure laws throughout the entirety of the sale. In addition to violating the Consumer Protection Act, the ruling stated, “The defendant had violated the respective statutory provisions [of Tennessee’s Timeshare Law] and was guilty of fraud and misrepresentation.” Because of this, Westgate was ordered to refund the Overtons and rescind the contract altogether.
Aside from inadequate documentation of the purchase, the court was especially troubled by Westgate’s refusal to make things right with the Overtons “despite overwhelming evidence” against them. The timeshare company’s profit margins were a focal point during the trial and a big reason why the claimants were awarded maximum punitive damages. The entire lawsuit could have been avoided had Westgate taken responsibility for their actions.
While the initial punitive amount was for $600K, Westgate was able to win an appeal to drop the total by $100K. In the end, the court decided it was important to financially “punish” the timeshare conglomerate for their greedy tactics at the consumer’s expense. The couple also received $136K for legal fees. The Overtons provide everyone with a blueprint on how to avoid being taken advantage of by a timeshare.
Westgate’s Track Record of Misconduct Continues.
Although it’s hard to tell why Westgate challenged the claim, one thing is clear: the timeshare company defeated themselves throughout the process. Shooting yourself in the foot isn’t a good look when you’re trying to acquire new owners. Westgate has yet to acknowledge they’ve done anything wrong as their CEO has only spoken in the form of excuses.
If you feel as though you’ve been misled by a timeshare salesman and are unable to get out of your timeshare agreement, we’d be more than happy to help. Sometimes, you don’t even need to invest in a termination service or lawsuit to be relieved of your obligation.