Hundreds of timeshare owners have had enough of timeshare developer Westgate Resorts sales practices by filing a $5 million dollar lawsuit in the United States District Court in the Eastern District of Missouri in June 2020. The 130-page lawsuit details the history and pattern of Timeshare sales practices as well as Westgate’s alleged malfeasance.
The petition raises ten separate claims that Westgate violated Missouri and Tennessee laws regulating timeshare and sales practices, some of these laws Westgate is accused of violating include potential criminal penalties.
Westgate is currently embattled in multiple lawsuits in federal and state courts over allegations it continues to deliberately misrepresent timeshare purchases to consumers.
It is a regular occurrence when vacationing to a resort destination that as a tourist you will be approached to take a 90- minute tour of a resort and will be pressured to lay down thousands of your hard earned dollars to own your own vacations. After a long day of seeing the resort and hearing champagne corks popping apparently celebrating a happy new timeshare owner. The price comes down and it just seems to good to pass-up. Resorts like Westgate train their sales staff to convince you that the only reason you will say no, is the price. They work to get you excited, get your children excited, and get you dreaming of all the fun and time you can spend at their resort. Once you agree that its all about the money, they find a number that gets you to buy. The Plaintiffs cite a statement by Vice President Richard Siegel, the son of owner David Siegel, in the documentary, “Queen of Versailles” where Mr. Siegel says to his sales staff, “You should own at least one week yourselves—and if you don’t, lie and say you do! Don’t let these people leave here without buying something!” He goes on to say, “We do 100% of our sales on the first day…They will not buy today if they don’t get a ‘great deal’ [making air quotes]—if they don’t believe that they are getting a great deal.” Typically, in a timeshare purchase, there will be a high price initially offered. This price is simply to set the high value in the mind. When you decline that price due to the cost, they find a way to lower it. Clients have reported for example that the manager for Westgate will come up with a week that was just sold back and say today only Westgate can lower the price to something you can afford. The problem is they rarely if ever sell for the listed price and there is no intrinsic value for a timeshare, Westgate has been known to even refuse to take back a timeshare through their “legacy” take-back program unless the owner pays Westgate. Something, Westgate has sold for thousands of dollars, they want thousands of dollars more, so that they can then turn it around and sell it again for thousands of dollars.
The lawsuit continues to state that while, every purchaser of a timeshare has a right to rescind or cancel their purchase within a certain amount of time, these laws require that the resort provide you with a disclosure on the contract that informs you how many days you have and how to rescind. The claim filed by these hundreds of unhappy timeshare owners alleges that Westgate provides all the documentation, but that it includes these disclosures in a sealed envelope in a “secret pocket” located in the seam of a large folio. This folio is typically a leather styled binder that holds pamphlets for the resort and has what appears to be a lining, sealed by Velcro where they store these contract documents and disclosures. The dilemma is that many people when they get back from the presentation and take the time to review what they just agreed to, are not reminded their time is limited to cancel. Once you fail to cancel in this time-period. You now are the owner of a real estate deed. You will own that forever and be liable for the maintenance fees every year, until someone accepts it from you or a court orders a rescission after a lawsuit.
The petition continues to list a plethora of complaints about Westgate’s sales practices, from one of hundreds of online commenters calling it a “Westgate Scam” saying you aren’t getting out of the sales presentation without agreeing. Additionally, the petition lists an investigation in 2016 by the U.S. Consumer Financial Protection Bureau, investigating Westgate Resorts for violations of the Consumer Financial Protection Act, Fair Debt Collection Practices Act, Electronic Funds Transfer Act and Fair Credit Billing Act.
These complaints and investigations against Westgate for their sales practices are not a rare occurrence. Consumers won a major case against Westgate Resorts in 2015 for Westgate’s fraudulent conduct. The judge ordered that the Plaintiffs are owed $40,000 for their purchase and a damages in the amount of $500,000 to punish Westgate Resorts for their behavior. The Court found in Overton v. Westgate Resorts, that Westgate willfully violated the Tennessee Timeshare Act, and that it desired to do so simply so it could sell more timeshare. In the judge’s opinion, amongst other violations, the judge found that Westgate promised additional nights for $59, known as “Owner’s Nights”, but later the Overtons found they did not qualify. Westgate Resorts appealed this, and the appeal was denied. The Overtons won.
The lawsuit claims that Westgate did not stop these fraudulent sales practices. That, in order to sell more timeshare weeks, they continue to violate the law hoping that few others will file such lawsuits and take it to trial to hold them accountable.
If you have a similar story and feel that you bought a timeshare under false pretenses or even just feel something was not right about how the sale went down, contact Neally Law at 417-520-1221 or by email at Joshua@neallylaw.com to discuss.
Always remember that past results do not guarantee the outcome in your case would be the same. Each case is different.