Paperwork was filed on Friday, 20th May by Anthony and Beth Lennen of Indiana against Marriott Vacation Club and other companies, alleging illegalities that violate the Florida Vacation and Timeshare Act.
The couple own two weeks of timeshare in Marco Island, Florida. This is also where Marriorr Vacation are based and where the suit has been filed.
The Orlando-based company, Marriott Ownership Resorts, is one company named on the suit along with; Marriott Vacations Worldwide Corp. trading as Marriott Vacation Club, Marriott Resorts Travel Company, trading as MVC Exchange Company, Marriott Title Insurance, MVC Trust Owners Association, First American Financial, First American Trust, First American Title Company, Orange County, Florida, and Orange County Comptroller Martha O. Haynie.
The suit alleges that through “a series of convoluted and patently illegal transactions” Marriott engaged in a scheme to convey “illusory real property ownership interests” to purchasers of Marriott’s points-based timeshare product.
A purchase of a Marriott Vacation Club timeshare are said to includes both a title to a Florida timeshare and a beneficial interest in a Florida land trust. The suit alleges that it in fact, conveys neither.
Mr & Mrs Lennen purchased their two weeks of timeshare at Marriott’s Crystal Shores in 2008. The suit says;
“At bottom, the [Marriott Vacation Club] product conveys to its purchasers nothing more than a use license for selected corporately-owned timeshare estates in 44 locations in 11 different states,” For defendants, however, the façade of the [Marriott Vacation Club] product provides significant opportunities for revenue that would not otherwise exist in connection with an awards program”
As well as Florida, the lawsuit also cites timeshare locations such states as South Carolina, New Jersey, Arizona, Colorado and Hawaii, and seeks class action status.
The lawsuit does not seek a specified amount of compensation, but the Lennens’ attorney, Jeffrey Norton of Newman Ferrara LLP, says;
“based on the number of class members and the relief sought, the potential damages are in the hundreds of millions [of dollars].”
When the real estate market collapsed in 2008, Marriott had possession of a rapidly increasing stock of unsold and foreclosed timeshares held in its condominium resorts around the country. The costs of holding this inventory of tens of thousands of timeshare properties skyrocketed.
The lawsuit states that “Marriott devised a way to monetize its inventory” to avoid costs through a new points-based program, the Marriott Vacation Club. The product was pitched as a timeshare estate in real property, coupled with a beneficiary interest in a land trust. The owners were/are “duped into believing they are obtaining title to a real property interest… when in fact they are merely getting a right to use license,” the suit says.
The points based system of Marriott’s Vacation Club product differs from the traditional timeshares that Marriott had been selling since 1984 because while those timeshares entitle the purchaser to a fractional interest in real property in the form of a specific week or weeks at a designated timeshare condo, Marriott Vacation Club owners are allotted increments of points that can be used to book days at various properties that were/are contained in the land trust that forms the basis for the Marriott Vacation Club product, the suit says.
The lawsuit is “about a profit-driven scheme developed by Marriott and First American to sell illusory real property interests through an unlawful timeshare points program,”
Purchasers “acquire no bona fide interest in real property and yet are burdened with all the costs associated with such an interest,” Newman Ferrara, attorney Norton said, adding “the scheme also harms owners of Marriott’s traditional week-to-week timeshares whose interests have been subordinated in favor of the far more profitable and competing points program. In fact, those traditional timeshare owners must now also buy into the points program in order to take advantage of exchange rights they used to enjoy.”
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk