It can be hard to keep track of all the timeshare companies that are in the news, or featured on Consumer Affairs or the FTC website. It seems like every year, there are new timeshares that run into customer service or legal issues that make the news, based on hundreds or even thousands of online complaints and testimonials from unhappy consumers. Complaints about BlueGreen have escalated and they now join the ranks of timeshare companies significant legal backlash.
Many of our clients ask us how timeshares can stay in business, while earning themselves such an unfavorable reputation online. While not true for every disreputable vacation club, some timeshares simply merge with other larger organizations, or rebrand themselves under a different name. The practice helps the timeshare continue to draw in new buyers, without the negative publicity, which is easy to research for informed consumers.
BlueGreen Corporation (Boca Raton Florida)
Located in Boca Raton Florida, BlueGreen Corporation is a vacation ownership company that was founded in 1966 by a man named Harry Patten. According to online sources, the vacation membership club employs more than 4,500 people, and is lead by CEO Chanse Rivera.
Since 2004, Aconsumercredit™, has represented consumers on a case-by-case basis with different timeshares across the United States. Because of our service relationships with our clients, our team is professional informed about different timeshares, including problems and complaints that resort companies experience. And we are always disappointed to see a local and established timeshare develop a negative online reputation, based on poor consumer and service relationships.
The Class Action Law Suit Against BlueGreen Corporation
Last fall, the BlueGreen Vacations Unlimited Inc., the timeshare division of BlueGreen Corporation, was named in a class action lawsuit in California, and it made the news. In Kyle Miles, et al. v. BlueGreen Vacations Unlimited Inc., Case No. 1:16-cv-00937, the plaintiffs made a number of allegations that were common with many fraudulent timeshare practices, but there were a number of other factors alleged by the plaintiff’s that were disturbing.
The first allegation was that consumers were enticed into a sales presentation, and promised that the sales pitch would not take longer than two hours. For the plaintiffs, the high-intensity sales tactics they claim they were subjected to, lasted over five hours in each case.
The class action suit alleges that the plaintiffs were advised that they could return the timeshare to BlueGreen Vacations Unlimited, Inc., in the event that they did not enjoy their timeshare, or if they decided at a future point, that they did not wish to own the timeshare. According to the suit, the plaintiffs were promised that the ‘buy back’ or refund would be upon request, and easy to accomplish, even after signing their binding long-term timeshare contract.
BlueGreen Vacations Unlimited Inc., sales representatives allegedly told the plaintiffs that the timeshare contract and lease would cost $15,000 amortized over a period of five years, at a 15.99% interest rate. However, the contract allegedly provided to the plaintiffs resulted in a cost obligation of $25,000 over a ten-year period; a substantial increase in overall cost and interest charges.
The plaintiffs allege that they were instructed to go into a different room than the main presentation area, and were verbally read the terms of a contract they agreed to, and required to verbally accept those terms. However, the written and final contract details per the law suit, were not like the verbal contract read to the buyers.
Timeshare sales representatives from BlueGreen Vacations Limited allegedly misinformed buyers, by promising them that the maintenance fees were a fixed rate, that would not increase in time. Several members of the legal suit indicated they asked specific questions about long-term affordability (concerned about increasing fees) and were falsely assured that maintenance fees would not increase. Due to resort maintenance, storm damage, wear and tear and other events, maintenance fees for virtually ever timeshare increase on an annual basis, representing a 3% to 10% increase (or more) on average, industry wide.
The class action suit alleges that timeshare buyers were pressured to open two new credit cards through BlueGreen Vacations Unlimited, Inc., as private financing for the minimum $5,000 down payment required.
Among the issues named in this new class action suit, the timeshare company is faced with charges of false advertising, fraudulent sales practices and misrepresentation of contractual obligation. It is important for consumers to know that timeshares can hire aggressive sales teams, but in many cases, the timeshare may or may not be aware of the conduct of the individual sales locations. Nonetheless, while large resort organizations comply with state and federal legal requirements (and provide compliance training to their staff), the actions of individual sales people representing the timeshare are a legal liability for the vacation club.
Can Timeshares Be Sued for Continuing Financial Harm to Consumers?
This particular case is very interesting, because there is a possible new precedent being set, that could impact the timeshare industry in a positive way, and increase buyer protection. According to an article in Law 360, the Miles family alleges that they experienced “significant and continuing harm” financially and emotionally, as they were unable to sell back their timeshare contract, despite being assured they could, at the sales presentation.
The class action suit (Kyle Miles, et al. v. BlueGreen Vacations Unlimited Inc., Case No. 1:16-cv-00937) seeks $5 million dollars in damages for the group of plaintiffs. Since the lodging of the class action suit, there have been many more filed against BlueGreen Vacations Unlimited Inc., in 2017 including:
Williams et al v. Bluegreen Resorts Management, Inc.
Fischer v. Bluegreen Corporation
We think that the legal action is encouraging, as it begins to look at cases where consumers have been exceptionally careful during timeshare contract review. Smart consumers do ask all the right questions about signing a long-term lease, and they believe the answers that they are given as an assurance before signing. However, if the information provided is intended to deliberately mislead them into signing a contract, there should be (and is) legal protection for consumers.