UPDATE: RCI CLASS ACTION LAWSUIT - must read for all RCI members [Includes Results]

[Fredm]

As the previous post notes, most (and quite possibly all) the rental figures refer to a collection of European operations. When you look at some of the investor presentations, RCI speaks of setting up some rental operations in the United States. My suspicion is that all the timeshare rental money is listed under their timeshare figures and none of it under rentals.

Why would you suspect that?
Timeshare figures may (but may not) include resort rentals where Wyndham is acting as an agent for the owner, or renting developer owned inventory. But, Group RCI inventory is none of those.

As for setting up rental operations int he US, they already have a number of venues that do just that.
An example is http://veteransholidays.com/
There are a number of "focused" discount sites like this one that pretend to be an altruistic service to various communities.

Point is LOTS of inventory is being rented. Prime season weeks, low season weeks, and fill in days. This is not European based property, though a few may be.

 

[Carolinian]

No, just an attorney trying to do a good job. Thus, I further share with you that not surpisingly the court agreed with me and indicated "to the extent that Susan Collins has been retained" in their decision dated October 7, 2009 "the objections vary, [and] it is improbable that one lawyer could represent all of them without a conflict of interest arising". Let me emphasize "retained" above and the professional ethics the profession requires.

The official attorneys for the weeks class are not very ethical at all, having sold their clients down the river for a cool $4million in their own pockets.

The next step in the Weeks class action saga will be the ethics complaint.

 

[Carolinian]

Why would you suspect that?
Timeshare figures may (but may not) include resort rentals where Wyndham is acting as an agent for the owner, or renting developer owned inventory. But, Group RCI inventory is none of those.

As for setting up rental operations int he US, they already have a number of venues that do just that.
An example is http://veteransholidays.com/
There are a number of "focused" discount sites like this one that pretend to be an altruistic service to various communities.

Point is LOTS of inventory is being rented. Prime season weeks, low season weeks, and fill in days. This is not European based property, though a few may be.

And if you look, for example at summer HHI, RCI offers almost no exchanges but a fair number of rentals. They are diverting exchange inventory, no matter what those who think RCI can do no wrong may say.

 

[Tia]

Oh ya I too am a class member as found our 2003 RCI book and search results from 2001 that I had printed still in another book.... don't recall being notified of being in the class via a letter and hadn't even dawned on me until I read here the 2000 cut off.

I might even be a member of the class since the date is 2000....going to have to look at my old RCI books.

 

["Roger"]

Why would you suspect that?
Timeshare figures may (but may not) include resort rentals where Wyndham is acting as an agent for the owner, or renting developer owned inventory. But, Group RCI inventory is none of those.

As for setting up rental operations int he US, they already have a number of venues that do just that.
An example is http://veteransholidays.com/
There are a number of "focused" discount sites like this one that pretend to be an altruistic service to various communities.

Point is LOTS of inventory is being rented. Prime season weeks, low season weeks, and fill in days. This is not European based property, though a few may be.

Take a look at page 3 of this presentation by Wyndham Worldwide to Goldman Sachs. Notice what is listed under the title "Vacation Rentals." Also notice that the sites like veteran holidays are NOT listed. In short, when Wyndham is reporting "Vacation Rental" income, they are referring to the profits from the listed operations.

Note: I have been looking at Cedent and Wyndham financials for years. I don't want to take the time to track them down, but prior presentations have talked about how they hope to start a vacational rental operation in the United States similar to what they have in Europe (the companies listed on page 3.) They have been telling investors that this is an untapped market for them. Many of their financial filings have also noted how the "Vacation Rental" income is affected by the current exchange rate for the dollar. That is because the income comes from their European rental operations.

Don't assume that the word "Rentals" in an accounting statement means what you think it does. Look to see what is included.

 

[Fredm]

And if you look, for example at summer HHI, RCI offers almost no exchanges but a fair number of rentals. They are diverting exchange inventory, no matter what those who think RCI can do no wrong may say.

Well of course they are. I didn't think that was even in question any longer. The question is how much. Does anyone believe that Wyndham would agree to any settlement if they could demonstrate otherwise?

This is a grinding tactic to wear limited resources down. Too much is at stake for RCI. $150,000,000 a quarter, give or take 10 million, is not some quaint alpine cottage rental operation as some portray.

Forget all the real outlets for these rentals. Just look at what's here:
http://www.wyndham-vacations.com/vacation-packages.html

 

[Fredm]

Take a look at page 3 of this presentation by Wyndham Worldwide to Goldman Sachs. Notice what is listed under the title "Vacation Rentals." Also notice that the sites like veteran holidays are NOT listed. In short, when Wyndham is reporting "Vacation Rental" income, they are referring to the profits from the listed operations.

Note: I have been looking at Cedent and Wyndham financials for years. I don't want to take the time to track them down, but prior presentations have talked about how they hope to start a vacational rental operation in the United States similar to what they have in Europe (the companies listed on page 3.) They have been telling investors that this is an untapped market for them. Many of their financial filings have also noted how the "Vacation Rental" income is affected by the current exchange rate for the dollar. That is because the income comes from their European rental operations.

Don't assume that the word "Rentals" in an accounting statement means what you think it does. Look to see what is included.

Roger,

My computer locks up trying to download that compressed pdf.

All revenue, not just rental revenue, is adjusted for dollar valuation when compared to prior periods. So, that is not validation of your premise.

Nonetheless, you may be right. Does that imply that Wyndham is hiding its timeshare rental revenues? Even though they are clearly rentals of RCI timeshare inventory?

Veteransholidays is an RCI site. Not a third party site. As, of course, is Wyndham Endless Vacations.

I am not trying to argue for the sake of it. (again, I can't see the documents)
If I understand you correctly, you are saying that a sales pitch to Goldman Sachs which highlights European rental activity as a growth opportunity in the US, means that the rental revenue stated in the Group RCI segment of the financials excludes other rental activity? Even though there is no footnote, or other reference to it anywhere in the official Wyndham financials.
Indeed, the financial tables appear clear cut. VOI sales are just that.
There is no where else to state the rental revenues unless they are being buried. And, why would they do that?
After all, you assume that they are being perfectly transparent in the Goldman presentation. Why not elsewhere in the real financials?

No, it's easier for me to assume they mean what they say. RCI rental revenue is the ONLY place any rental revenue is disclosed.

 

[Goofyhobbie]

RCI Notice To Members of a "Proposed" Settlement To The Weeks "Class" Action Lawsuit

You may not ever receive an E-Mail or Post Card from RCI telling you that your rights have been extended until November 20, 2009.

At this point in time, if you are a member of the class and have NOT already "opted-out" or objected you have a second bite at the apple.

The opportunity to object is yours with or without an official communication of that right from RCI.

Unless you have previously "opted-out" you have until November 20, 2009 to object to the proposed settlement.

The NEW opportunity to object is available to you even if you have previously made a choice of the benefits and have alredy notified the administrator of that choice.

IF YOU WERE AND STILL ARE A MEMBER OF THE "CLASS" IN THE WEEKS LAWSUIT YOU HAVE UNTIL NOVEMBER 20 TO SEND IN YOUR OBJECTION TO THE PROPOSED SETTLEMENT!

I look forward to seeing posts from anyone who has already sent in their objection to the proposed settlement and/or from anyone who needs instructions, a Form Letter or any other information on how best to proceed.

 

[JustAllie]

I feel like a doofus for failing to learn about this class action suit until I got the postcard this week.

 

[Goofyhobbie]

Posted by Justallie: I feel like a doofus for failing to learn about this class action suit until I got the postcard this week.

Justallie,

Please don't feel that way their are literally thousands in the same situation.

To the best of my knowledge you are the first to announce here on TUG that you have actually received a Post Card. That is a good sign. Each and every class member is supposed to receive the same card.

Stay tuned. Posts will be forthcoming regarding your options should you consider objecting to the proposed settlement.

By the way there will also be updates on Twitter. Just access: GoofyHobbie.

 

[bunny217]

mmm...

I'm just jumping in here to say that TODAY for the first time ever...
I got a post card informing me of the suit.....well...at least they know I'm alive now.. ..this is the first time I've gotten anything from RCI at all....
if it wasn't for this forum I wouldn't have known what the heck was going on. (Not that I fully understand it all as you all do!!)
Thank you for all you're doing...keep posting!!

adding to say...It's NOT from RCI....it's from the Settlement Administrator......
so......I THANK YOU all - so........I guess we're still on the "invisible" RCI list......

 

[exyeh]

I'm just jumping in here to say that TODAY for the first time ever...
I got a post card informing me of the suit.....well...at least they know I'm alive now.. ..this is the first time I've gotten anything from RCI at all....
if it wasn't for this forum I wouldn't have known what the heck was going on. (Not that I fully understand it all as you all do!!)
Thank you for all you're doing...keep posting!!

adding to say...It's NOT from RCI....it's from the Settlement Administrator......
so......I THANK YOU all - so........I guess we're still on the "invisible" RCI list......

I got the same post card, too. Should I do what the card said (submit a claim form)? Sorry, I am busy and have not read all the post about this lawsuit. Thanks.
Emily

 

["Roger"]

Roger,

...
All revenue, not just rental revenue, is adjusted for dollar valuation when compared to prior periods. So, that is not validation of your premise.

....

Agreed. If you look at my original post, I did not say that I was absolutely sure that the kind of rental income that drives TUGGERs crazy is not part of the rental income listing. What I said is that I suspect not. Having read numerous Cedent and Wyndham financial statements and messages to investors (the Goldman Sach is just the most recent), I have never seen any reference in the discussions of rental income to the success of Points rentals, the various rental sites in the US, etc. The references are always all oriented toward the listed rental operations in Europe (the ones that you can't see -- English cottages, RV parks in Europe, etc.) with occasional notes that figures need to account for the change in the valuation of the dollar.

Even if I am wrong, it is clear that these European operations pull in lots of money and constitute the lion's share of what is being reported as "rental income."

Roger,
...
There is no where else to state the rental revenues unless they are being buried. And, why would they do that?
....

The cynical answer would be that RCI doesn't want anyone to find out how much is being made from their rentals of deposits, the rental of developer inventory, switches between developer inventory and deposits (with the deposites then rented), and properties acquired via trades with other exchange companies (they do all of this) and there is probably some truth to this cynical response. (Hell, for the longest time you couldn't get any financial information on II - none!) However, if you understand how corporations are usually organized (various divisions with each division financially accountable for its own turf), it is also probably true that the entities listed under Vacation Rentals (the European outfits) are placed under one corporate executive who is responsible for making that division profitable and another corporate executive is responsible for making the exchange part of the operations profitable. As such, the rentals that TUGGERs are upset with would fall under the purview of the latter executive and any financal transactions (the ones that TUGGERs don't like) would be part of his division and subsummed in that part of the financial reporting.

Could I be wrong about this? Sure. But, knowing what I do about how corporations normally operate and having looked at lots of Cedent and Wyndham financial announcements, it where I put my money.

 

[STEVIE]

Hi,
I received the post card in the mail yesterday about the class action settlement. I'm sure it has already been mentioned so please accept my apology for asking. What should I do? Please advise me. Sue

 

[Tia]

Hi, go to posts #418 &#419 , numbers in the right upper corner of each post, for a suggestion as to how to proceed.

Hi,
I received the post card in the mail yesterday about the class action settlement. I'm sure it has already been mentioned so please accept my apology for asking. What should I do? Please advise me. Sue

 

[Simoncc]

This is a grinding tactic to wear limited resources down. Too much is at stake for RCI. $150,000,000 a quarter, give or take 10 million, is not some quaint alpine cottage rental operation as some portray.

Presumably referring to me there. I am not defending RCI's practices in any way but anyone quoting figures should be sure that they've got their facts straight or they just end up weakening their valid argument.

 

[marion10]

Got my postcard yesterday. I no longer own any timeshares and got a refund of my extra years in RCI a while ago. Not sure what I will do yet.

I will be following this and want to do what is best for TUGGERS overall. I only had two SA weeks which I bought resale. I certainly got a great value for my money- but realize I am in the minority.

 

[Fredm]

Presumably referring to me there. I am not defending RCI's practices in any way but anyone quoting figures should be sure that they've got their facts straight or they just end up weakening their valid argument.

I am indeed quoting figures. Not fabricating them.
The facts are as straight as Wyndham reports them.
View the Q2 Financial Tables

I do not make any guesses about the origin of stated revenue.
Others have claimed that almost all, if not all, is the result of European activity. However, such guesses are not supported by any detail Wyndham chooses to disclose.

The financials do show that RCI rental revenues grew from 498 million in 2006 to 624 million in 2008.

Fact is that we do not know the portion of the reported amount that represents deposited inventory. All we do know is that a substantial web-based effort exists to rent them.

 

[Fredm]

Agreed.

Even if I am wrong, it is clear that these European operations pull in lots of money and constitute the lion's share of what is being reported as "rental income."

I am sorry, it is not clear that European operations constitute the lion's share. It may, but we have no way of knowing.

The cynical answer would be that RCI doesn't want anyone to find out how much is being made from their rentals of deposits, the rental of developer inventory, switches between developer inventory and deposits (with the deposites then rented), and properties acquired via trades with other exchange companies (they do all of this) and there is probably some truth to this cynical response.

My premise is to not take a cynical view. I choose to believe them.

However, if you understand how corporations are usually organized (various divisions with each division financially accountable for its own turf), it is also probably true that the entities listed under Vacation Rentals (the European outfits) are placed under one corporate executive who is responsible for making that division profitable and another corporate executive is responsible for making the exchange part of the operations profitable. As such, the rentals that TUGGERs are upset with would fall under the purview of the latter executive and any financal transactions (the ones that TUGGERs don't like) would be part of his division and subsummed in that part of the financial reporting.

I do understand how corporations are organized.
Your entire premise is that these are European revenues aligned with a European executive. However, the corporate reporting structure places them under Group RCI, which is reporting rental revenue apart from membership and exchange fees.
To suggest that the rentals in question are being reported under membership and exchange fees is to say that there are irregularities in the financials, and their representation to the financial community.
A former chief executive of this company is serving time in prison for misrepresenting its financials. I don't believe they are foolish enough to repeat that mistake.

 

["Roger"]

Try this link. It is what Wyndham describes as its Vacation Rental division as part of Group RCI. To throw in income from another division of Group RCI into its income statements under the very same title would be what would really be misleading (and probably forbidden by the SEC).

 

[Fredm]

Try this link. It is what Wyndham describes as its Vacation Rental division as part of Group RCI. To throw in income from another division of Group RCI into its income statements under the very same title would be what would really be misleading (and probably forbidden by the SEC).

Roger, I agree completely. It would be misleading, and probably forbidden by the SEC. And vice versa. That is exactly what my most recent response said.

You assume (incorrectly, I believe) that the Vacation Rental division of Group RCI is only comprised of the European component which is highlighted in their description. It is not. It says what they choose it to say.

Their opening statement "As the largest marketer of European vacation rental properties, Group RCI offers approximately 45,000 independent vacation property owners the opportunity to rent their properties through some of our well known vacation rental brands, including Cuendet®, Endless Vacation Rentals®, Holiday Cottages Group, Landal GreenParks® and Novasol®. "
can certainly lead one to assume that Europe is the focus. It is not all inclusive. It is merely accurate as far as they state it. That is, they are the largest marketer of European vacations. It does not exclude US timeshares.

The visitor is then invited to peruse what is available. First among the options is
Wyndham Endless Vacations. That is where the lions share of availability is.
I won't get into the other RCI rental sites. They obviously have them categorized somewhere in thier rental empire.

 

[TUGBrian]

getting a wee bit off topic here guys

 

[pagla]

Michael Carpenter

Hello
How do I find the Form for Classaction Lawsuit?
Thank You
Michael Carpenter
pagla@roadrunner.com

 

[Stricky]

How do I find the Form for Classaction Lawsuit?

see post 381 and 386 for the information

 

[TUGBrian]

Updates, and important summaries are all avalabile at this page

http://rciclassactionlawsuit.com