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

[JJVmom]

I just found out about this lawsuit. I bought my timeshare, in 1997, under the impression that I could trade it anywhere in the world through RCI. After years of paying membership fees, I was never able to get the resorts I saw in the catalog. I spent the past five years renting out my timeshare and finally just sold it at a huge loss. Let me know if there’s anything I can do to add my part to this lawsuit. Thanks!

 

[Jennie]

Help Needed !!!!!!!!!

Does anyone have any older RCI annual directories handy? We are looking for a copy of the 2 page spread that used to appear prominently near the front of the book (within the first 30 pages) touting the ability to receive exchanges within 45 days of the check-in date without regard to the usual trade power of the week deposited by the owner.

We need this to present to the Judge at the Fairness Hearing tomorrow. The proposed settlement would allow RCI to remove any and all weeks from the spacebank, to rent to the public, anytime within 90 days before the check-in date. This would leave virtually nothing available for member exchange during the 45 day period.

RCI would not be required to replace the week with a week from other sources.

And they would not even have to count the weeks removed within the 90 day period in the annual report they must submit showing that they did not remove more weeks than they replaced, and that the replaced weeks were of equal segment power i.e. red replaced with red, blue with blue, etc...

Of course we all know how unreliable the ratings can be anyhow. Since RCI is the sole arbiter of the ratings, there is much room for error, deliberate or otherwise. As TUGgers have stated for years: "There are many shades of red e.g. bright red, regular red, pink, light pink, etc...."

The annual reports are to be submitted to the Plaintiffs' attorneys, and they readily admit that they will not receive any financial compensation for examining them. Why do we lack confidence that this will be a sufficient incentive/deterrent to RCI following the rules, or not?

Ms. Collins, the attorney representing several "objectors", requested that she be provided with a copy of the report each year. And/or that RCI establish a consumer panel composed of experienced RCI members who could meet a few times a years to discuss issues of mutual concern. Neither suggestion was agreed upon.

There is so much more needed to make the proposed settlement even minimally "fair" to RCI Weeks members. We hope the Court will agree.

 

[crazyhorse]

Jennie - Does anyone have any older RCI annual directories handy? We are looking for a copy of the 2 page spread that used to appear prominently near the front of the book (within the first 30 pages) touting the ability to receive exchanges within 45 days of the check-in date without regard to the usual trade power of the week deposited by the owner.

I am unable to provide you with a copy of the page which you ask as my scanner is u/s.

I cannot see the reference to this Late Exchange offer in the current 2008/9 Directory of Resorts, and I think this benefit may have been replaced by the similarly phrased Late Deals, where it is not an exchange but an opportunity to obtain a holiday within the same 45 days. I assume this is a lower charge rental.

The original option for Late Exchanges, to which you refer, would be the earlier RCI offer which is shown in Directory of Resorts 2001-2, and RCI Community Guide (more recent year perhaps 2004-5?). These both have the same wording under a header "Your Exchange Options" These are European RCI books.

The wording is (barring my mistakes) is

Want a Quick Getaway?
Try a Late Exchange. Bookable from 45 days to as little as 2 days before departure.The Trading Power rules are waived-except for the quality rating-but availability is naturally more limited. With Late Exchange payment must be made by credit card.

(End of entry)

 

[Jennie]

Thanks Everyone,

PMs and posted messages revealed that the pages I'm looking for were in the 2001 book. I sent out an Email SOS to members of the NY timeshare owners group and one member called to let me know that he has the book. The NY members live within a 50 mile radius. As luck would have it, this couple lives within one mile of our home so I will be able to pick it up on our way to court.

 

[DeniseM]

Susan, Jennie, Shep, and everyone going to the hearing tomorrow - GOOD LUCK! Can't wait to hear what happens!

 

[Dori]

Best of luck today. We are all so grateful for your efforts on our behalf. Knock their socks off!

Dori

 

[rci124]

Is there any information from todays court proceedings?

 

[Goofyhobbie]

Update

To All:

I am in Florida; but I have heard by phone from one of our members who was allowed just two minutes to testify this afternoon at the Fairness Hearing.

That's right, each objector in attendance received two minutes to speak. After each speaker or during their statements the Defense and/or the Planitiff's attorneys were allowed rebuttal; but no rebuttal was allowed for the objectors.

The Bad News: Our efforts to get the proposed Settlement quashed as UNFAIR was not successful. The attorneys for the Plaintiffs will get their $1 million 775,000 payday and we as timeshare owners get a reprieve for a very short period of time before RCI is free to do whatever they please with your deposits AGAIN!

The Good News: The judge would have approved a far worse settlement without the very hard fought for last minute changes in our favor that RCI finally agreed to. Your efforts by way of objection were not enough to carry the day; but the fact that you stood up and did object went along way to helping get the changes that were finally made part of the settlement.

Susan, Shep, and Jennie will no doubt fill in the details once they have returned to their respective homes and get a chance to recover.

We all owe a round of thanks for the efforts of Susan Collins, Shep Altshuler, Jennie, Brian Rodgers, Denise and others who worked so hard to make a difference. We have learned a lot from this effort. We are a large voice when we speak. We just need far more of us to take action when the opportunity comes in the future. For those of you who are RCI POINTS owners be prepared to act when your opportunity comes along.

For those of you who deal with RCI from outside the United States organize and keep up the fight. For those of you who do business with other Exchange Companies be prepared for the impact that this class action settlement will have on your ability to get fair exchanges going forward.

Once the active suits are all finalized we need to heed the call of Carolinian and get Consumer Protection agencies on the State level if not the Federal level involved.

We did not get the proposed settlement derailed; but we did win several important concessions that would not have come about without the efforts of Shep Altshuler, Susan Collins, our own Jennie and the overwhelming efforts of all who took the time to object to the proposed settlement.

Once the court participants have a chance to catch their breath more details will be forthcoming. Stay Tuned!

 

[jerseygirl]

I attended the hearing and had my two minutes to speak. Jennie, Susan and Shep did a terrific job and the last minute concessions are an improvement, although I'm certainly still disappointed with the outcome.

I'm sure Jennie, Susan and Shep will correct any inaccuracies, but here's my take on the "best" improvements to the settlement:

The original settlement proposal stated:

1) RCI will hold any deposit made greater than 12 months in advance exclusively for exchange for 30 days

-- This has been changed to "10 months in advance," which at least ensures the float week deposits have a chance of being held exclusively for exchange.

2) RCI will adhere to the terms of the settlement for two years

-- This has been changed to 3 years. As Jennie's wonderful husband said, they're selling ice to eskimos ... but, hey, 3 years is better than 2.

RCI has also agreed that all deposits pulled for rental greater than 90 days will receive substitutions that are equal in quality and quantity. Of course, the fox is guarding the hen house on this one, but it's something.

The biggest disappointment as far as I'm concerned:

No protection whatsoever for deposits made less than 90 days in advance. This basically ensures the official demise of the "45 day window," which I believe had very important economic benefits to the timeshare industry as a whole as it lifted trading power restrictions for those with "bad weeks" and enabled them to pick up good cancellations, last minute deposits, etc. and kept them "in the game" (i.e. paying their maintenance fees).

I was also EXTREMELY disappointed in the judge's final remarks as he stated, not once -- but three times -- that the settlement allowed for greater trading power. It does nothing of the sort, which was very indicative of his lack of understanding of the situation, despite the gallant efforts of the over 300 objectors who wrote letters and those who appeared in person to speak. I think he got "most" of it, but clearly not all -- and he should not have made a decision with that basic lack of understanding still unresolved.

Do you know what I think hurt us the most? All attorneys (RCI's attorneys and the plaintiffs' attorney's were on the same side as their goal was to get the judge to approve the settlement) AND the judge repeatedly mentioned the over 130,000 people who accepted the "trinkets" as evidence that the vast majority of people were satisfied with the settlement. Moral of the story -- don't accept trinkets in a class action lawsuit if you're not satisfied with the proposed settlement.

I walked with my feet a long time ago -- made one deposit about 5 years ago and did one trade. Then, I was educated by Jennie about their rental policies and never made another deposit. In fact, I didn't even think I was part of the class until I received the post card in October (so a great big thanks to Jennie, Susan and Shep for getting the second notification approved). (In the interest of full disclosure, I do have a small points account that I "inherited" when I purchased something that had already been converted to points. I'll probably continue to use that until they start screwing the points owners the same way they screw the weeks owners.) For everyone who is unhappy with the settlement -- show it by making your deposits elsewhere. RCI clearly wants to kill the weeks program -- help them along by using II and the independents for your "weeks" deposits.

 

[jerseygirl]

In re-reading what I posted above, I realize that I left a big hole insofar as what happens to the deposits made greater than 90 days but less than 10 months.

RCI will not pull them for rentals IF there are requests pending with sufficient trading power to qualify for the exchange. Jennie argued vallantly that many people like to "surf for exchanges" and don't place ongoing requests. But, RCI's attorney rebutted and apparently managed to convince the judge that most people prefer to use ongoing requests and that doing so makes the system work better for all. (I tried to rebut that point in my two minutes by stating that his argument was disingenuous -- that it shouldn't matter what method of searching is employed -- ALL deposits should be held exclusively for exchange for some period of time before being pulled for rentals --- but, obviously it didn't work).

So, to summarize:

Deposits made greater than 10 months in advance -- will be held exclusively for exchange for 30 days, then if pulled for rental, "equal" subsitutions will be made hysterical

Deposit made more than 90 days in advance but less than 10 months in advance -- will not be pulled for rental if there are pending requests with sufficient trading power to qualify for the exchange. Again, if pulled for rental, "equal" substitutions will be made hysterical

Deposits made less than 90 days in advance -- they apparently are the sole property of RCI. If they pull them for rentals, they do not have to make substitutions.

 

[RustyS]

So, to summarize:

Deposits made greater than 10 months in advance -- will be held exclusively for exchange for 30 days, then if pulled for rental, "equal" subsitutions will be made hysterical

I agree with the characterization of "equal". They seem to think a Branson studio in February equals a two bedroom summer Lake of the Ozarks because they are in the same state. Actually, the settlement allows them to balance on an annual basis, which explains why ski locations are unavailable when there is snow on the ground, but lots of mud weeks are posted.

Deposit made more than 90 days in advance but less than 10 months in advance -- will not be pulled for rental if there are pending requests with sufficient trading power to qualify for the exchange. Again, if pulled for rental, "equal" substitutions will be made hysterical

And I assume if, at the moment of deposit, no "sufficient" ongoing trade requests are on file, they can immediately move it to the rental pool, swapping in a unit from the mud weeks in the Midwest in exchange? We should all be on notice to load the pending request files well in advance as a net to keep an exchanged week in the exchange pool.

Deposits made less than 90 days in advance -- they apparently are the sole property of RCI. If they pull them for rentals, they do not have to make substitutions.

This is outrageous. With this rule nobody, and I mean NOBODY should EVER spacebank a week less than 90 days out.

If you are donating it to RCI and their shareholders you might as well call the resort and let them rent it and keep the money within your resort. Or let them use it for a prospective buyer. Or a treat for the cleaning staff. Better, donate it to a local Ronald McDonald house near the unit; at least you will do some good, and potentially get a tax break.

I have a couple of banked weeks I am trying to use up (I made them before I realize RCI regarded me as a sheep), and I have pending requests for dates greater than 12 months sitting out there to slurp up anything that matches. Once that happens I'll be requesting my prorated refund of membership fees. I hope everyone does the same, and spreads the word throughout their resorts how RCI has a license to steal "unused" vacations, and the judge is letting them decide the definition of "unused".

On another note, what happened to that Stephen character?

 

[jerseygirl]

So, to summarize:

Deposits made greater than 10 months in advance -- will be held exclusively for exchange for 30 days, then if pulled for rental, "equal" substitutions will be made hysterical

I agree with the characterization of "equal". They seem to think a Branson studio in February equals a two bedroom summer Lake of the Ozarks because they are in the same state. Actually, the settlement allows them to balance on an annual basis, which explains why ski locations are unavailable when there is snow on the ground, but lots of mud weeks are posted.

To be fair, RCI swears they will make substitutions that are equal "quantitatively and qualitatively." (I think if I heard that phrase one more time at the hearing I might have gone postal!). The judge called them out on that point on a few occasions (i.e., kept making them affirm it) and I think they got the message that they will be hauled back into court for violating the settlement terms if they're caught not doing so. What I'm unclear on is whether or not they agreed to send copies to Susan. I know it was discussed, but I need Susan, Jenny, or Shep to clarify. Let's just say there is some question with regard to how carefully the plaintiffs' attorney will check the reports (and understand that there was no mention of future compensation for doing so) and leave it at that.

Deposit made more than 90 days in advance but less than 10 months in advance -- will not be pulled for rental if there are pending requests with sufficient trading power to qualify for the exchange. Again, if pulled for rental, "equal" substitutions will be made hysterical

And I assume if, at the moment of deposit, no "sufficient" ongoing trade requests are on file, they can immediately move it to the rental pool, swapping in a unit from the mud weeks in the Midwest in exchange? We should all be on notice to load the pending request files well in advance as a net to keep an exchanged week in the exchange pool.

Correct -- if there are no ongoing trade requests with sufficient trading power for the deposit, they can immediately move it to the rental pool. However ... see above regarding "quantitative and qualitative" substitution rules.

Also very correct: "Be on notice to load the pending request files well in advance as a net to keep an exchanged week in the exchange pool." If you're going to play, at least beat them at their own game.

Deposits made less than 90 days in advance -- they apparently are the sole property of RCI. If they pull them for rentals, they do not have to make substitutions.

This is outrageous. With this rule nobody, and I mean NOBODY should EVER spacebank a week less than 90 days out.

If you are donating it to RCI and their shareholders you might as well call the resort and let them rent it and keep the money within your resort. Or let them use it for a prospective buyer. Or a treat for the cleaning staff. Better, donate it to a local Ronald McDonald house near the unit; at least you will do some good, and potentially get a tax break.

Couldn't have said it better myself: NOBODY should EVER spacebank a week less than 90 days out.

On another note, what happened to that Stephen character?

Hmmm ... he was there, he spoke. In my opinion, he got nowhere with the judge. The funniest part of the day: He kept standing up (from the spectator area) and asking if he could speak/add something to someone else's commentary. The judge told him NO every time ... along the lines of, "You've had your chance to speak so sit down." It truly got comical as he tried at least 3 or 4 times ... and got the same "sit down" response every time. I almost felt sorry for him, almost.

 

[DeniseM]

Hmmm ... he was there, he spoke. In my opinion, he got nowhere with the judge. The funniest part of the day: He kept standing up (from the spectator area) and asking if he could speak/add something to someone else's commentary. The judge told him NO every time ... along the lines of, "You've had your chance to speak so sit down." It truly got comical as he tried at least 3 or 4 times ... and got the same "sit down" response every time. I almost felt sorry for him, almost.

AND - did the judge award him $250,000???

 

[jerseygirl]

One more important point I just thought of:

RCI's attorney claimed that 75% of all rentals are to RCI members. And, that the members "love the rental program."

People -- stop renting from them !!!!!!!!!! Go to the TUG Classifieds, Redweek, MyResortNetwork and rent from an owner.

That needs to become a new TUG mantra: Don't rent from RCI, rent from an owner.

 

[jerseygirl]

AND - did the judge award him $250,000???

He told him he could submit. If I understand correctly, since it was settled, RCI will have to voluntarily agree to pay him. I don't think they'll do so. I could be wrong, but I don't think the judge has any further say so -- the matter was settled. Perhaps Susan will have a different take on this matter.

Didn't the plaintiffs' attorneys originally ask for $4MM? One of them had to explain their methodology for the amount of $1.6MM+ in fees and ~$75K in expenses. It boiled down to this: Their hours X their normal hourly rate came out to $1.9MM. They voluntarily took a "haircut" down to ~$1.6MM. So -- it's some consolation (not much, but some) that (a) they didn't get $4MM and (b) they didn't get the full amount of their (probably inflated) bill.

 

[RustyS]

To be fair, RCI swears they will make substitutions that are equal "quantitatively and qualitatively." (I think if I heard that phrase one more time at the hearing I might have gone postal!). The judge called them out on that point on a few occasions (i.e., kept making them affirm it) and I think they got the message that they will be hauled back into court for violating the settlement terms if they're caught not doing so. What I'm unclear on is whether or not they agreed to send copies to Susan. I know it was discussed, but I need Susan, Jenny, or Shep to clarify. Let's just say there is some question with regard to how carefully the plaintiffs' attorney will check the reports (and understand that there was no mention of future compensation for doing so) and leave it at that.

While my Branson / Lake of the Ozarks comment was hypothetical (and shows my midwest perspective on things), I was serious about the ski resorts not being available during the ski season (Dec - Mar) yet the same resorts are plentiful before and after, and <gasp> the rental pool overflows with ski weeks.

This is my personal chase in the exchange system, and I have seen this with my own eyes. The RCI phone staff blow it off as "people have yet to make those deposits because it's too early", which is ridiculous because Nov AND April have plenty of weeks in the exchange system. They clearly are diverting the ski weeks to rental and substituting an "equal" week, which to them means the same place sometime during the year. And the settlement in section II.A.2 Balancing of Deposits and Rental says they can do exactly that. I called this one out in my objection, apparently to the deaf ears of the judge.

 

[jerseygirl]

Please know that I don't disagree with you Rusty. There was some discussion of the "months needed to make system changes" before the settlement would actually go into effect. So, we can only hope that the substitutions/balancing will improve ... although, they may have been talking about other changes (such as those needed for members to know their trading power, which was discussed as well -- again, I'm not totally clear on this).

Hopefully Jenny, Shep and Susan will be along shortly to provide more detailed info and correct any misstatements I may have inadvertently made. As stated above, I didn't think I was part of the class until I received the postcard in October. Until then, I paid very little attention to what was going on. But, I love a good "David vs. Goliath" battle ... and had the time to write a letter and attend the hearing. Jenny is a good friend and does so much for the Greater NY timesharing community (most of which you never hear about) -- I attended primarily to support her efforts. To say I understand all aspects of the settlement would be incorrect.

 

[theo]

A sad commentary...

...the judge repeatedly mentioned the over 130,000 people who accepted the "trinkets" as evidence that the vast majority of people were satisfied with the settlement.

...And accordingly, SHAME on each and every person who accepted one of those worthless little trinkets. Those "offerings" were, from the outset, never anything more than a cost-free (to RCI) mechanism to create a phony and misleading statistic suggesting "satisfaction" with the farce of a "settlement". Clearly, RCI succeeded in duping 130,000 non-thinkers. I hope they all enjoy their worthless little trinket... :annoyed:

 

[jerseygirl]

I think that's a little harsh Theo. I didn't accept a trinket on principal, but I didn't realize doing so or not doing so would have an impact until I heard them (the attorneys primarily, but also the judge) use it to their advantage in the courtroom. Lesson learned for future class actions ... but I can't take credit for not having done so for the right reasons (I just didn't want anything from RCI except an honest trading system).

Even here on TUG, people were advised that it was okay to accept a trinket and object -- so I think everyone should be let off the hook this time, but be educated for the next time around.

 

[bnoble]

Even here on TUG, people were advised that it was okay to accept a trinket and object -- so I think everyone should be let off the hook this time, but be educated for the next time around.

Indeed.

What's more, it's important to remember that TUGgers represent a tiny fraction of "all timeshare owners". What we do or don't do, in the grand scheme of things, is in the noise. It's easy to think that we are representative of the average owner, but by definition, we are not.

 

[rickandcindy23]

Indeed.

What's more, it's important to remember that TUGgers represent a tiny fraction of "all timeshare owners". What we do or don't do, in the grand scheme of things, is in the noise. It's easy to think that we are representative of the average owner, but by definition, we are not.

Excellent point! The postcards were sent to everyone, and apparently many people claimed their trinkets. I wish every one of those people knew about TUG and could have written letters. Maybe TUG is something we should all mention to our resorts, and hopefully the thousands of generic resorts will include that information, along with information about alternative exchange companies, in their newsletters.

 

[Egret1986]

Agreed! Trinkets indeed! But I claimed one and now I wish that I had not.

I think that's a little harsh Theo. I didn't accept a trinket on principal, but I didn't realize doing so or not doing so would have an impact until I heard them (the attorneys primarily, but also the judge) use it to their advantage in the courtroom. Lesson learned for future class actions ... but I can't take credit for not having done so for the right reasons (I just didn't want anything from RCI except an honest trading system).

Even here on TUG, people were advised that it was okay to accept a trinket and object -- so I think everyone should be let off the hook this time, but be educated for the next time around.

Enjoy the trinket? Geez, at this point I can't remember which one I claimed since it was so insignificant.

It had nothing to do with being non-thinking. The advice was that it was okay to accept a trinket. At the last minute I put in the claim right after reading that advice. It was well after I sent in my objection letters. Had I known that it would have been used against the Class, I definitely would not have done it. My motivation was that perhaps if enough folks claimed something, it would have some effect on RCI's bottom line. Wrong thinking, perhaps. Non-thinking....definitely not.

I am glad that I did not return the call from one of the Plantiffs' attorneys, although it was suggested here on TUG that I should. Fortunately, someone PMd me and shared their thoughts. It appears that the Plantiffs' attorneys did not have the best interests of the Class.

Thank you to all who made an effort on behalf of the Class. It was a valiant effort Susan, Jennie, Shep and everyone who supported the cause.

 

[AwayWeGo]

Any Way To Pick A Different Trinket ?

Trinkets indeed! But I claimed one and now I wish that I had not.

Same here.

Any way to un-choose the 1 I chose & take a different trinket instead ?

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[Carol C]

Trinkets? Did I miss out on trinkets? Did you have to sit thru a 90 min presentation to get one?

 

[AwayWeGo]

Timeshare Tour Freebies Are Worth Far More Than Any Paltry RCI Settlement Trinkets.

Trinkets? Did I miss out on trinkets? Did you have to sit thru a 90 min presentation to get one?

I would not sit through a 90-minute sales pitch for anything so trivial as the RCI lawsuit settlement offerings.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​