Class action lawsuit filed against Wyndham (Worldmark)

[PerryM]

Believe it or Not...

A different, and more likely scenario. You book a cruise with credits and those credits go to Wyndham. You join TravelShare and book Fun Time, the credits that paid for the cruise are used to book the reservation. No Declarant credits are involved. They are merely the middle man for the transfer of credits from one owner to another. Owners do that all the time when renting credits from each other. Let’s not shut down the credit rental market.

In this case, as in most legal actions, the lawyers are the only sure winners.

Fred is correct – there might be many ways for WN to get credits that they can use for TS. (Believe it or not; Fred and I on the same side! That’s how wacky this lawsuit is.)


These are great questions for the WM BOD – they should respond to concerned WM owners. If they don’t then more aggressive steps can be taken. I'd like to see the letters sent in, proof of receipt, and the BOD's response.


My reaction to this class action is that it’s just a scheme for cleaver/////clever lawyers to become rich. The 2 owners who started this have NOT demonstrated ANY injury. They can’t give one single example where they have had ANY adverse outcome because of what WN is doing.

I have many grievances with WN – this is NOT the way to address them.

 

[PA-]

A different, and more likely scenario. You book a cruise with credits and those credits go to Wyndham. You join TravelShare and book Fun Time, the credits that paid for the cruise are used to book the reservation. No Declarant credits are involved. They are merely the middle man for the transfer of credits from one owner to another. Owners do that all the time when renting credits from each other. Let’s not shut down the credit rental market.

In this case, as in most legal actions, the lawyers are the only sure winners.

It's possible, though not necessarily "more likely" that Wyndham is banking on Cruise for Credits generating enough credits to fully fund the Fun Time program. However, that would still pose three problems.

First, in order for the Declarant to be the middleman in this transaction, Wyndham would have to be a Worldmark Member, which they are not.

Secondly, that would definately violate the new Guideline against using "acquired" credits to operate a business.

Third, the other restrictions against the Declarant affecting use and enjoyment of credit reservations or bonus time would still apply.

Also, while it's possible, perhaps likely that the law firm will be a winner regardless of the outcome, it's also possible that they'll expend millions of dollars worth of their time and money to get a losing verdict. In that case, it's my understanding the defendent would be entitled to reimbursement of legal fees. In this type of class action, it's not likely the person bringing the suit will be on the hook for that money.

 

[PA-]

A different, and more likely scenario. You book a cruise with credits and those credits go to Wyndham. You join TravelShare and book Fun Time, the credits that paid for the cruise are used to book the reservation. No Declarant credits are involved. They are merely the middle man for the transfer of credits from one owner to another. Owners do that all the time when renting credits from each other. Let’s not shut down the credit rental market.

In this case, as in most legal actions, the lawyers are the only sure winners.

Just thought of a fourth problem that would pose. Fun Time reservations would probably violate other Worldmark reservation guidelines, such as restrictions on number of weekend only reservations, etc., that a member could book. A Fun Time weekend only could go to the same owner that already has a weekend only on the books.

 

[PA-]

OK, Perry, I sent the following email to the board, as per your suggestion, I'll let you know their response:

I have a couple of questions regarding TravelShare, please.

Where does Wyndham get the right to book units for Fun Time? Do they get them from their inventory of unsold credits, or do they use "acquired" credits that they have gotten from Cruise for Credits, sales of coffee mugs, etc.

If from their inventory of unsold credits, wouldn't that violate the declarations forbidding them from affecting use and enjoyment (sect. 2.5). Also, wouldn't they need to be a worldmark member to book a room for this purpose? According to the declaration, Wyndham is not a member able to reserve rooms. According to the decs, they may reserve rooms for construction, development or sales only. Finally, even in those cases, it seems they wouldn't be able to negatively impact ability to get bonus time.

If the credits they use for Fun Time are "acquired" credits, wouldn't that violate the board's new guideline stating that "acquired" credits may not be used to fund a business?

Thanks in advance.

 

[PerryM]

Great!

OK, Perry, I sent the following email to the board, as per your suggestion, I'll let you know their response:

I have a couple of questions regarding TravelShare, please.

Where does Wyndham get the right to book units for Fun Time? Do they get them from their inventory of unsold credits, or do they use "acquired" credits that they have gotten from Cruise for Credits, sales of coffee mugs, etc.

If from their inventory of unsold credits, wouldn't that violate the declarations forbidding them from affecting use and enjoyment (sect. 2.5). Also, wouldn't they need to be a worldmark member to book a room for this purpose? According to the declaration, Wyndham is not a member able to reserve rooms. According to the decs, they may reserve rooms for construction, development or sales only. Finally, even in those cases, it seems they wouldn't be able to negatively impact ability to get bonus time.

If the credits they use for Fun Time are "acquired" credits, wouldn't that violate the board's new guideline stating that "acquired" credits may not be used to fund a business?

Thanks in advance.

PA,

This is great, although I would not be surprised that your eMail address is linked to the trash file. You might send a letter, certified mail, and this now becomes a basis for more aggressive actions later.

The WM BOD is used to double talking - they need to be held up to the intense spotlight of the truth.

<snip>
If the credits they use for Fun Time are "acquired" credits, wouldn't that violate the board's new guideline stating that "acquired" credits may not be used to fund a business?

Thanks in advance.

This warms my heart; I'll be smiling the rest of the day - this is good stuff.

 

[PA-]

PA,

This is great, although I would not be surprised that your eMail address is linked to the trash file. You might send a letter, certified mail, and this now becomes a basis for more aggressive actions later.

The WM BOD is used to double talking - they need to be held up to the intense spotlight of the truth.

Dang, P, first you ask me to ask them, now you doubt they'll respond. Or if they do respond, it'll be doubletalk. Make up your mind.

You gotta give them the benefit of a reply. It'll probably take a few days, unless they already have a canned response.

Ya know, you could ask them too. There's 2 places on the website, either in THE ANSWER PLACE or there's a form to send an email to the board.

 

[PA-]

...



This warms my heart; I'll be smiling the rest of the day - this is good stuff.

I suspected you might enjoy that reference to the new guidelines.

 

[PerryM]

Dang, P, first you ask me to ask them, now you doubt they'll respond. Or if they do respond, it'll be doubletalk. Make up your mind.

You gotta give them the benefit of a reply. It'll probably take a few days, unless they already have a canned response.

Ya know, you could ask them too. There's 2 places on the website, either in THE ANSWER PLACE or there's a form to send an email to the board.

I would image you have a special notoriety at WN - I don't know if they link your eMail to the trash can or to the legal department.

 

[PA-]

I would image you have a special notoriety at WN - I don't know if they link your eMail to the trash can or to the legal department.

They love me there. They're looking forward to working with me on the board.

 

[PerryM]

They love me there. They're looking forward to working with me on the board.

Do you mean water boarding? I think that's the only board they'd love to see you on

 

[RichM]

If the credits they use for Fun Time are "acquired" credits, wouldn't that violate the board's new guideline stating that "acquired" credits may not be used to fund a business?

Yes, I thought of this, too, when the idea of transferring credits from one to another was mentioned.. it would be funny it they stepped on themselves with their own (i.e. TW-controlled WM BoD-implemented) Guideline.

As far as legal fees in a losing case, if the Plaintiffs are responsible, then the Plaintiffs are the ones "on the hook" I believe... perhaps the law firm has some agreement to pay them if they're not successful, but I think technically the named plaintiffs are the ones who will be ordered to pay in the event of a negative outcome.

___________________
WorldMark Owners' Community -

- www.wmowners.com

 

[PA-]

OK, Perry, I sent the following email to the board, as per your suggestion, I'll let you know their response:

I have a couple of questions regarding TravelShare, please.

Where does Wyndham get the right to book units for Fun Time? Do they get them from their inventory of unsold credits, or do they use "acquired" credits that they have gotten from Cruise for Credits, sales of coffee mugs, etc.

If from their inventory of unsold credits, wouldn't that violate the declarations forbidding them from affecting use and enjoyment (sect. 2.5). Also, wouldn't they need to be a worldmark member to book a room for this purpose? According to the declaration, Wyndham is not a member able to reserve rooms. According to the decs, they may reserve rooms for construction, development or sales only. Finally, even in those cases, it seems they wouldn't be able to negatively impact ability to get bonus time.

If the credits they use for Fun Time are "acquired" credits, wouldn't that violate the board's new guideline stating that "acquired" credits may not be used to fund a business?

Thanks in advance.

OK, I got a response from Peggy Fry, copied to the entire WorldMark board, and she did give me permission to share it. So here it is:

Philip,
Great question, Philip! Wyndham Resort Development Corporation f/k/a Trendwest Resorts, Inc. ("Wyndham") uses Vacation Credit use rights acquired from WorldMark Owners ("FAX Credits") to operate the Fun Time program; although, Wyndham could use its inventory of unsold Vacation Credits.

If Wyndham were to use its inventory of unsold Vacation Credits to operate Fun Time, it would not be contrary to Section 2.5 of the WorldMark declaration so long as Wyndham does not book a reservation more than 45 days before the first day of occupancy.

Wyndham's use of FAX Credits to operate Fun Time is not a violation of the Club Guidelines prohibiting commercial usage of "Assigned Vacation Credits" because FAX Credits are not Assigned Vacation Credits.
Assigned Vacation Credits are defined in the Club Guidelines as Vacation Credit use rights assigned from one "Owner of Record" to another Owner.
The Club Guidelines define Owner of Record as someone who has signed a Vacation Owner Agreement (i.e., purchase contract). Wyndham does not sign a Vacation Owner Agreement; therefore, it is not an Owner of Record. Nor do FAX Credits fall within the definition of Assigned Vacation Credits because the transfer of Vacation Credit use rights is not between Owners (it is between an Owner and Wyndham).

You are very welcome and I trust this answers your questions.

Sincerely,

Peggy Fry


The comments, opinions and acts of an individual WorldMark board of director member are not the comments, opinions or acts of the WorldMark board of directors or the Club, and are not binding on the WorldMark board of directors or the Club.

 

[BocaBum99]

So, the way I read this response is that Wyndham purposefully created a rule that is a double standard. One rule for owners and one rule for Wyndham.

The rule for owners takes away their property rights so that they can NOT elect to transfer FULL ownership rights of assigned credits to another owner like any owner of Real Property in America can do.

But, it DOES Grant Wyndham the right to do it through FUN time.

Isn't this Anti-trust behavior? Isn't Wyndham simply trying to eliminate competition for its FAX program?

 

[PA-]

So, the way I read this response is that Wyndham purposefully created a rule that is a double standard. One rule for owners and one rule for Wyndham.

The rule for owners takes away their property rights so that they can NOT elect to transfer FULL ownership rights of assigned credits to another owner like any owner of Real Property in America can do.

But, it DOES Grant Wyndham the right to do it through FUN time.

Isn't this Anti-trust behavior? Isn't Wyndham simply trying to eliminate competition for its FAX program?

I don't believe they considered Fun Time when they made the rule against owners renting reservations made with "assigned" credits. It's my belief that Wyndham has always believed they had full right to reserve any units they want for any reason they want. Or at least, that they were going to assume that right until challenged in court.

The "assigned" credit abuse (as they termed it) was a nit. About 3 owners and less than 50 condo/weeks per year were involved. That would have nowhere near the impact FunTime could have on owners.

The funny thing about FunTime, is that if most owners became TravelShare owners, your ability to get FunTime reservations would be the same as your current ability to get Bonus Time reservations. But Wyndham woud have transferred huge amounts of money from owner's pockets to theirs.

 

[BocaBum99]

The funny thing about FunTime, is that if most owners became TravelShare owners, your ability to get FunTime reservations would be the same as your current ability to get Bonus Time reservations. But Wyndham woud have transferred huge amounts of money from owner's pockets to theirs.

I never considered this concept. Before I learned this, I was just annoyed. Now, I'm really pissed off.

After reading this thread, considering the allegations against RCI regarding its rental activities and learning of the new Fairfield rules where owners cannot allow guests within 15-days of checkin, I wonder how they can get away with these very egregious, anti-owner actions.

Am I missing something? Or is Wyndham heading in the direction of the mother of all Class action lawsuits?

It just seems so wrong what they are doing. What am I missing?

 

[PA-]

I never considered this concept. Before I learned this, I was just annoyed. Now, I'm really pissed off.

After reading this thread, considering the allegations against RCI regarding its rental activities and learning of the new Fairfield rules where owners cannot allow guests within 15-days of checkin, I wonder how they can get away with these very egregious, anti-owner actions.

Am I missing something? Or is Wyndham heading in the direction of the mother of all Class action lawsuits?

It just seems so wrong what they are doing. What am I missing?

The minute I heard about a new VIP program at Worldmark (which is now called TravelShare) almost 3 years ago, I knew immediately what this meant. That's because I've seen this tactic used many times, primarily by country clubs.

If you build a country club for $10million or so, sell 400 golf memberships at $15 or $20 thousand each, plus all the tennis and social memberships, and turn around and resell to one of the big companies (like American Golf or someone), they'll usually pay big bucks. So say they spend $20million. But they only get revenue from on-going dues, and the occasional member cancelling so they can resell that membership. They're banking on appreciation, and reselling it in a few years. But in the meantime, it's not a good return on their equity.

So the country club industry long ago came up with a cash producer. What they do is create a new level of owner (call it a Platinum or Diamond membership). Charge another $5000 for it. In addition to the normal stuff (reciprocal rounds of golf at other courses they manage, etc), they offer that Diamond owners can book prime tee times at 9 days in advance, instead of 7. After all, they haven't hurt the rights of normal owners. They can still book at 7 days out.

Now, you'll never get a Saturday AM time if other owners have a 2 day head start. So in order to get the benefits you used to have, you have to pay the $5000. Problem is, as soon as most owners upgrade, you have the same exact problem getting a prime time at 9 days out as you used to have at 7 days out. Except you're $5000 poorer.

Fortunately, there are safeguards against this activity in our bylaws and declarations. Oops, the board hasn't read the Declarations or bylaws? Oh well, what's a few thousand dollars among friends.

 

[RichM]

Now, you'll never get a Saturday AM time if other owners have a 2 day head start. So in order to get the benefits you used to have, you have to pay the $5000. Problem is, as soon as most owners upgrade, you have the same exact problem getting a prime time at 9 days out as you used to have at 7 days out. Except you're $5000 poorer.

Thanks for an excellent, concise summary of the flaw in the design... Makes complete sense.


__________________
WorldMark Owners' Community -

- www.wmowners.com

 

[kapish]

How many FAX credits were available to TW in '05 and '06?

Ms. Peggy Fry talked about FAX credits being the only credits/time that are used against "Fun Time". Are there records available that show how many FAX credits are available for this? Has anyone seen this information?

 

[PA-]

Ms. Peggy Fry talked about FAX credits being the only credits/time that are used against "Fun Time". Are there records available that show how many FAX credits are available for this? Has anyone seen this information?

Peggy Fry's response says that unsold credits may be used to book rooms for FunTime. So it's a moot point. According to our board, Wyndham has virtually unlimited access to our rooms to give to TravelShare owners using FunTime. Bonus time may be a thing of the past, if that's true.

 

[PA-]

The lawsuit has now been greatly expanded.

1) The suit now includes both our beloved developer (Wyndham), and the individual members of the Board of Directors.

2) The original suit alleged that Travelshare (and specifically FunTime) was a violation of the declaration and bylaws. Now the complaint has been expanded to include these areas, which should be of GREAT interest to those of us that have alleged the exact same things for years:

- Violation of the "relative use value" clause in the declaration. In other words, raising the credit values at the new resorts. Several owners have been working on calculating damages based on this violation. Current estimates are at about 1/2 $BILLION$. If it can be shown that the board and Wyndham colluded on this (which should be self-evident), it may become an anti-trust issue, with treble damages.

- The expanded complaint alleges that the Wyndham dominated board violated their fudiciary responsibility to the owners, instead catering to the profit needs of Wyndham. Go figure? Who woulda guessed that?

There is much more. The details can be found on the TRAVELSHARE DISCUSSIONS section of wmowners.com Finally, after all this time, perhaps, just perhaps, justice may be served.

 

[PerryM]

Will the "Answers" just be new "Problems"?

The lawsuit has now been greatly expanded.

1) The suit now includes both our beloved developer (Wyndham), and the individual members of the Board of Directors.

2) The original suit alleged that Travelshare (and specifically FunTime) was a violation of the declaration and bylaws. Now the complaint has been expanded to include these areas, which should be of GREAT interest to those of us that have alleged the exact same things for years:

- Violation of the "relative use value" clause in the declaration. In other words, raising the credit values at the new resorts. Several owners have been working on calculating damages based on this violation. Current estimates are at about 1/2 $BILLION$. If it can be shown that the board and Wyndham colluded on this (which should be self-evident), it may become an anti-trust issue, with treble damages.

- The expanded complaint alleges that the Wyndham dominated board violated their fudiciary responsibility to the owners, instead catering to the profit needs of Wyndham. Go figure? Who woulda guessed that?

There is much more. The details can be found on the TRAVELSHARE DISCUSSIONS section of wmowners.com Finally, after all this time, perhaps, just perhaps, justice may be served.

(This is not for anyone in particular - open to ALL WM owners)

And just how much money will make all this correct - and we know who will pay for this; we, the WM owners will pay for all this in one way or another.

Are there any guesses as to:

1) How much will the law firm make? A hard number, rounded to the nearest Million is ok.

2) What will WM owners get in coupons or other forms of compensation. A hard number, rounded to the nearest nickel is ok.

3) What will WM/WN have to do to correct these allegations - programs cancelled or modified.

4) What possible "new" programs can replace what WN had and how these new programs could be worse.


If we can't answer these questions just why would anyone be happy - I'm not, I know exactly what will probably be the outcome. Higher MFs or "New" fees to pay for "New" worthless benefits.


Before any of us think we can outsmart a billion dollar company with a few lawyers-for-hire we should try to envision how WN will retaliate - because they will.


I'm perfectly happy with sticking with the status quo and finding ways to exploit WN to my benefit. I don't know how to react to forced unknowns that will, undoubtedly, benefit those slick lawyers on both sides of the fence.

 

[PA-]

...

1) How much will the law firm make? A hard number, rounded to the nearest Million is ok.

Don't care. As a died in the wool capitalist, I assume you don't care either?

2) What will WM owners get in coupons or other forms of compensation. A hard number, rounded to the nearest nickel is ok.

Some unethical ambulance chasers may operate that way, but that wouldn't be a typical form of compensation for the clients of this particular firm. If you look at other judgments against billion dollar corporations, they've been able to get meaningful compensation for their clients; not worthless coupons.

3) What will WM/WN have to do to correct these allegations - programs cancelled or modified.

My guess is they'd have to get rid of funtime as a minimum. I know you don't care much about that. I believe they'll also, at a minimum, have to agree to go back to 48 weeks sold per condo (rather than the current 51), and make some concessions as to the number of credits generated per condo. That is the absolute least I would expect WOrldmark to gain in a settlement. Of course, if it goes to court, we could get a lot more or a little less. A conservative estimate of damages (assuming allegations are proven to be correct in court) total around $500,000,000 at this time, and they grow every year. So the potential is there for a much more meaningful settlement.

4) What possible "new" programs can replace what WN had and how these new programs could be worse.

I'm assuming a big part of ANY settlement or judgement will be a close look to verify that Wyndham doesn't merely steal money from us using some other source to make up for the losses. I sincerely doubt that any judge (or the lawyers) will stand by and let Wyndham make us pay the costs of the settlement in any way.

If we can't answer these questions just why would anyone be happy - I'm not, I know exactly what will probably be the outcome. Higher MFs or "New" fees to pay for "New" worthless benefits.

nobody has to be happy, just thought some owners might be interested.

Before any of us think we can outsmart a billion dollar company with a few lawyers-for-hire we should try to envision how WN will retaliate - because they will.


I'm perfectly happy with sticking with the status quo and finding ways to exploit WN to my benefit.

Great. I'm sure everybody's glad that you're perfectly happy. I don't believe that represents the majority view of owners. Most of the owners I've talked to are MOST unhappy with TravelShare and with the increase in the number of credits it takes to stay in worldmark condos. It's destroying our trade value; I expect you'll see big increases in the number of credits required to get a II or RCI exchange over the next year or two. Once again, perhaps you don't care, but other owners do. Remember, nobody here brought this suit; it was put forward by two couples who don't (as far as I know) subscribe to the forums. I'm just reporting on it with publicly available info.

....

I'm sorry that it had to come to a lawsuit. It would have been far better if our Board would challenge some of the unlawful changes Wyndham has brought, rather than colluding with them on the changes.

A couple of people mentioned at the owner's meeting that if it can be shown that the Board intentionally colluded with Wyndham, that could be a violation of anti-trust laws. In that case, criminal charges could be brought, and any damages proven would be subject to triple payment from Wyndham to Worldmark. I have no idea if any of that is true. Does anybody have knowledge on this point?

 

[PerryM]

Bowling Ball fees are my first guess....

I'm sorry that it had to come to a lawsuit. It would have been far better if our Board would challenge some of the unlawful changes Wyndham has brought, rather than colluding with them on the changes.

A couple of people mentioned at the owner's meeting that if it can be shown that the Board intentionally colluded with Wyndham, that could be a violation of anti-trust laws. In that case, criminal charges could be brought, and any damages proven would be subject to triple payment from Wyndham to Worldmark. I have no idea if any of that is true. Does anybody have knowledge on this point?

Ok, $500 M at the least.

Ok, that's $500,000,000/250,000 members or $2,000 per WM owner that will somehow be added to our bill in the future. Increased MFs and new charges for management.

What do we get back? Two free DVD rentals per owner? Let's see - that comes out to $1,000 per DVD rental. Is this what we are shooting for? Have the lawyers even taken the time to present what's in it for the WM owners?

The lawyers are busy throwing everything at the wall - WN is keeping track of all their inflated legal bills and will ask the lawyers for it if they should win.

Does anyone think that WN is going to eat these charges?

And in the mean time how will WN start to accrue the legal fees - who wants to guess at the creative new fees that suddenly get approved by the WM BOD? How about a new fee for keeping the parking lot free of bowling balls - that should cost $10k per year per resort. Can you imagine how a bowling ball would ruin a WM owner's rental car?

It will be fun to see what new creative ways WN can come up with.

 

[tombo]

If they were only selling weeks it would be a moot point, they couldn't manipulate anything. Instead Wyndham is trying to make owners pay more for something they already own, and making what you sell less valuable than the same thing sold by them. Many Tugger's didn't understand why I was so concerned that Wyndham bought Pahio resorts in Hawaii and began trying to convert it to points. I guess their current actions and the need for a lawsuit to stop them should give some legitmacy to my fears.

Developers like Wyndham only exist for more profit, not for the owners. I have no problem with them building new resorts and selling points at these new locations/ I do have problems with them buying resorts and fleecing the current owners by reducing the value of what you own unless you pay to "upgrade". I hope this suit costs Wyndham a lot of money and makes them think twice before they start cheating owners out of what they own in the future.

 

[JudyS]

I haven't yet read all 23 pages, but I haven't come across any allegations of Samonella poisoning yet.

That'll be next year's lawsuit, over Wyndham's new policy of giving owners Salmonella poisoning if they try to actually use a desirable week themselves, rather than depositing it with RCI.

I haven't read this thread carefully, but I don't doubt that Wyndham is doing something fishy. (No salmonella pun intended.) I hope the lawsuit works.