TIMESHARE WARS TAKE AN INTERESTING AND UGLY TURN
It’s a poorly kept secret that buying into a timeshare, as an “investment,” is often of dubious merit. Thus, the incidence of default on acquisition financing for these purchases is extremely high – industry estimates range as high as 20%.[1] But behind these dry numbers are innumerable stories of human interest involving real people whose lives have been affected for the worse – beyond just cases of buyer’s remorse. Often, the financial toll also exacts an emotional and even health-related price as well, particularly in cases involving retirees on fixed incomes.[2]
Thus, those familiar with the timeshare industry will know by now that things have become increasingly confrontational, as into this fray a number of players have stepped seeking to address these issues, largely on a case-by-case basis. And this is where things have become as ugly as they are interesting: Rather than to engage in self-imposed reformation, recrimination, or improvement of any kind, the worst players in the industry have decided instead to kill the messenger – including the law firms taking a stand against abusive sales and administrative tactics.[3] [4] Specifically, they have endeavored to sue the law firms themselves[5], presumably for having the unbridled temerity to legally challenge the probity and motives of these timeshare developers.
In general, these lawsuits allege that the firms have counseled consumers to stop making payments on the timeshares, thus “tortiously interfering” with their contracts.[6] In some cases, the inability of small law firms to effectively fund the defense of these cases has resulted in unmerited concessions, injunctions, and even bankruptcies.[7] In other words, the disparity of resources, particularly financial resources, has allowed the billion-dollar industry bullies to brow-beat the little guys into submission by default.[8] It is not necessarily that these cases against the small firms have merit – quite to the contrary. In each instance that we know of, those firms actually ready, willing, and able to resist have been vindicated.[9]
Thus, it is critically important that any law firm operating in this space be adequately funded and well-insured. Because ultimately, if sufficient light is shed upon the questionable tactics of the timeshare touters, their case can collapse like a house of cards.
In the case of Club Exploria, Inc. vs. Aaronson, Austin, P.A., a federal court in Florida dismissed the suit against the law firm summarily, while issuing a scathing opinion against the timeshare.[10] In it, the Court found that there existed “no issues of material fact”, and that Club Exploria’s arguments against Aaronson, based on the record evidence, were so “implausible” that they could not be presented to a jury.[11]
[1] https://www.bankrate.com/loans/personal-loans/timeshare-loans-primer//
[2] https://www.frbsf.org/community-development/files/choi.pdf
[3] https://www.law360.com/realestate/articles/1416288/law-firm-wants-timeshare-co-s-sham-litigation-enjoined
[4] It’s worth noting that a number of timeshare ‘exit’ outfits that are not real law firms have also become involved, generally adding insult to injury by again taking advantage of vulnerable older adults with false promises of delivery
[5] See, e.g., https://www.law360.com/pulse/articles/1416288/law-firm-wants-timeshare-co-s-sham-litigation-enjoined
[6] Id.
[7] https://www.orlandosentinel.com/business/os-bz-timeshare-castle-diamond-20190719-3zvqhr46yjcnplwm33fyhgm3iy-story.html
[8] Id.
[9] https://www.abajournal.com/news/article/vacation-ownership-company-settles-suit-against-lawyer-over-timeshare-exit-marketing
[10] https://www.abajournal.com/news/article/vacation-ownership-company-settles-suit-against-lawyer-over-timeshare-exit-marketing
[11] Club Exploria, LLC v. Aaronson, Austin, P.A., No. 6:18-cv-576-Orl-28DCI, 2020 U.S. Dist. LEXIS 210098, 12 (M.D. Fla. Nov. 10, 2020)
