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

[Susan2]

Attorney Disclaimer Ordered by the United States District Court:

I am an attorney who was admitted to represent some of the objectors in a class action pending in the United States District Court for the District of New Jersey. Any statements by an attorney, including myself, should be considered to be the personal opinion of the attorney and are not approved by the Court. As such, my statements contained herein are not approved by the Court. More information is available at www.weeksprogramsettlement.com, the Court-approved website.

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Susan (et al) -

I am in the DC area and may be able to spend the day up and back to Trenton. What is on the docket with the judge that day? (I am no lawyer, but quite against this rental issue, etc.)

Can you give specifics on when and where and the agenda?

thanks,

sjk

The hearing will be held Clarkson Fisher Courthouse at 402 East State Street, Trenton, NJ 08508. The judge's name is Peter Sheridan.

The hearing will start at noon, and there is no scheduled end time, but the judge's law clerk "would be surprised" if the hearing lasted more than three hours. It may not last that long, but the judge does not have any other matters currently scheduled to be heard that afternoon.

My guess is that the judge will treat this issue as seriously as he treated the objections the last time, and that he will give at least some of the RCI members an opportunity to speak.

I do not believe that the new proposal for Notice is adequate. RCI is asking the Court to approve a postcard-sized mailing (rather fine print for some members) which references a website and a telephone number for claims forms or more details. It still says that "RCI denies any wrongdoing," whereas I would like to see it say "RCI maintains that it has the contractual right to rent or otherwise dispose of week deposited for exchange." (I think this is necessary, because RCI employees, including the vacation counselors, deny that RCI ever takes weeks deposited for exchange and puts them in the rental pool or transfers them to other inventories not available to RCI members as exchanges.) Ater all, if RCI claims it's perfectly legal for them to do so, then RCI should ADMIT that it does so! IMO, this would be the best way for RCI to correct their fraudulent statements, and wouldn't take up much more room than the current wording.

The RCI proposal includes thirty days for members to object, opt-out or file a claim form. Last time, they gave 90 days. I see no reason why 90 days should not be given this time, too. After all, the judge deemed the last Notice to be inadequate.

I also feel that the Notice should be sent via first-class mail, email, and available by telephone menu option, publication on the website AFTER one logs in as well as on the home page, and in Endless Vacation Magazine with a large announcement on the cover of the magazine and claim forms inside along with a summary of the details of the settlement. That is what I intend to argue in Court if given an opportunity to speak. (I also included these proposals in a letter to the Court.)

 

[Carolinian]

We need to organize to get as many people as possible to opt out of the settlement / sellout. That is what will get the court's attention that this sellout is opposed by members. Taking ANY of their stupid little trinkets is just interpreted as agreeing with the sellout.

We should also suggest that if the attorneys of record think trinkets have such value, whatever payment they get should be in the same stupid trinkets instead of cash.

 

[Jennie]

We need to organize to get as many people as possible to opt out of the settlement / sellout. That is what will get the court's attention that this sellout is opposed by members. Taking ANY of their stupid little trinkets is just interpreted as agreeing with the sellout.

Agreed!

The next hearing is scheduled for August 12th at noon at the Federal Courthouse, 302 State Street, Trenton, N.J..

Subsequent to the June 16th "Fairness hearing" the Judge ruled that the class members had not received sufficient notice of the terms of the proposed settlement. Both sets of attorneys were directed to submit briefs by July 7th, indicating what form of further notification they would like the Court to consider. On August 12th the Judge is expected to rule on this issue.

RCI requesed that members be notified again through the Endless Vacations magazine, and that the deadline for members to respond should be 30 days from the date of the mailing of the magazine. Note: magazines are not sent via first class mail and usually take many extra days to be delivered, plus it is summertime when a lot of timeshare owners are on vacation. And the Judge has already ruled that the notification sent previously through that magazine was inadequate. Nevertheless the plaintiffs, who are supposed to be representing the class members (that's us!) are in agreement with RCI's notification request.

Attorneys Susan Collins (TUG member "Susan2") and Steve Willett are seeking to be appointed to represent "the objectors." They will request that better forms of notification be sent to the class members, and that members be given at least 90 days to acquaint themselves with the details of the proposed settlement, and to respond if they wish.

Susan and I plan to attend the August 12th hearing. She will be flying in from Cape Cod, in the middle of a family timeshare vacation, to be present. All timeshare owners are welcome to come. However, since the issue that day is very narrow in scope, it is not likely to make a huge difference. But we'd love for you to come if it is not too long a trip

Once the new terms of class notification are spelled out, and the deadline for member response is set, the following weeks will be the best time to make our voices heard. We can all work together to inform as many owners as possible about the proposed terms of the settlement, and what the member options are, including their right to "opt out" which, of course, will get the Court's attention if enough people choose it.

Susan and Steve will determine the most appropriate and effective way or ways for members to communicate with the Court, if they wish to do so, in addition to filling out the class action forms.

It will be a tough battle but we have everything to gain, and nothing to lose, by giving it our best shot. Miracles do happen once in awhile.

 

[JEFF H]

Keep it simple.
If RCI is not serving your Timeshare exchange & rental Needs stop using them!
Why turn yourself into sheep to be hearded around and used by attorneys
to make a huge payday score.
They the Attorneys are doing what they always do. Playing the class members for a payday.
RCI is just going to raise fees to offset their costs in this lawsuit. They likely already figured the costs and have done that already.
stopped be played!
If RCI is not serving your Timeshare exchange & rental Needs stop using them!

 

[Jennie]

Keep it simple.
If RCI is not serving your Timeshare exchange & rental Needs stop using them!
Why turn yourself into sheep to be hearded around and used by attorneys
to make a huge payday score.
They the Attorneys are doing what they always do. Playing the class members for a payday.
RCI is just going to raise fees to offset their costs in this lawsuit. They likely already figured the costs and have done that already.
stopped be played!
If RCI is not serving your Timeshare exchange & rental Needs stop using them!

This is one time when a Judge is taking the objections of class members seriously. He is not letting either RCI or the plaintiffs attorneys get away with the usual nonsense.

Personally I have done very little business with RCI over the past several years. The few times I've needed something they have, I have figured out many little known ways to get it. I've been a TUG member since 1994. A lot of valuable information has been shared here through the years.

But I'm willing to expend time and energy (and some out-of-pocket expenses) to fight for the rights of members who don't have any other options. To tell someone, who was conned by a slick timeshare salesman into buying a low value week at an exorbitant price, to take their business elsewhere is not a viable solution. Most of them bought the week with the promise that they would be able to exchange it through RCI. RCI is supposed to be an exchange company but they are renting out tons of deposited weeks to the general public, at below fair market value, causing the weeks to be unavailable to meet the needs of their dues paying members.

If RCI is not stopped from doing this, it will eventually have a huge ripple effect upon many other areas of the timeshare industry. You will probably suffer too in ways you cannot fathom from your smug vantage point.

 

[timeos2]

Both sides of view are right!

This is one time when a Judge is taking the objections of class members seriously. He is not letting either RCI or the plaintiffs attorneys get away with the usual nonsense.

Personally I have done very little business with RCI over the past several years. The few times I've needed something they have, I have figured out many little known ways to get it. I've been a TUG member since 1994. A lot of valuable information has been shared here through the years.

But I'm willing to expend time and energy (and some out-of-pocket expenses) to fight for the rights of members who don't have any other options. To tell someone, who was conned by a slick timeshare salesman into buying a low value week at an exorbitant price, to take their business elsewhere is not a viable solution. Most of them bought the week with the promise that they would be able to exchange it through RCI. RCI is supposed to be an exchange company but they are renting out tons of deposited weeks to the general public, at below fair market value, causing the weeks to be unavailable to meet the needs of their dues paying members.

If RCI is not stopped from doing this, it will eventually have a huge ripple effect upon many other areas of the timeshare industry. You will probably suffer too in ways you cannot fathom from your smug vantage point.

I find merit in both approaches. First and foremost the idea that no one - even the mythical, bamboozled sucker would was talked into buying a Blue week in Wisconsin in order to freely trade into luxury accommodations in South France - is forced to give RCI their week(s). They DO have options and if in fact they own dog time they can/should only expect dog time in return which, as we all know, rentals or not RCI is awash in year round. All they are owed is an equal trade and in that market RCI can deliver on demand and in spades. They also can take their time to other third parties by simply doing a bit of homework to see if maybe they can do better elsewhere. They are not being hurt to the degree a more valuable week owner may be by RCI's questionable rental procedures. Saying we need to protect them from themselves is disingenuous at best. Educate them yes. Bail them out of a very bad choice - no.

On the other hand, I now see a glimmer of hope that this particular lawsuit, while flawed from the start as nothing more than a way for some grubby lawyers to milk RCI/Owners for millions in unearned fees, has unexpectedly taken a positive turn toward actually making RCI listen to owners concerns about their operation. The participation by volunteers to press owners concerns has been one of the few times that a grassroots effort has had some impact on RCI and we have, at least for the moment, a Judge willing to listen and learn. This may be a one time opportunity to get our voices heard and we should do anything and everything to support those doing the dirty work on thier own dime. Nothing about supporting Shep, Susan and the others precludes taking positive personal steps to avoid RCI by denying them your deposits. We are still members and this is an important fight when it concentrates on the very critical issue of unfair rentals of weeks to non-owners by RCI. We can only hope this unexpected twist results in a change of heart by RCI if they realize how negative the on going uproar can be. Best wishes to those involved and please let us all know of anything we can do to further the cause.

 

[gjw007]

I find merit in both approaches. First and foremost the idea that no one - even the mythical, bamboozled sucker would was talked into buying a Blue week in Wisconsin in order to freely trade into luxury accommodations in South France - is forced to give RCI their week(s). They DO have options and if in fact they own dog time they can/should only expect dog time in return which, as we all know, rentals or not RCI is awash in year round. All they are owed is an equal trade and in that market RCI can deliver on demand and in spades. They also can take their time to other third parties by simply doing a bit of homework to see if maybe they can do better elsewhere. They are not being hurt to the degree a more valuable week owner may be by RCI's questionable rental procedures. Saying we need to protect them from themselves is disingenuous at best. Educate them yes. Bail them out of a very bad choice - no.

On the other hand, I now see a glimmer of hope that this particular lawsuit, while flawed from the start as nothing more than a way for some grubby lawyers to milk RCI/Owners for millions in unearned fees, has unexpectedly taken a positive turn toward actually making RCI listen to owners concerns about their operation. The participation by volunteers to press owners concerns has been one of the few times that a grassroots effort has had some impact on RCI and we have, at least for the moment, a Judge willing to listen and learn. This may be a one time opportunity to get our voices heard and we should do anything and everything to support those doing the dirty work on thier own dime. Nothing about supporting Shep, Susan and the others precludes taking positive personal steps to avoid RCI by denying them your deposits. We are still members and this is an important fight when it concentrates on the very critical issue of unfair rentals of weeks to non-owners by RCI. We can only hope this unexpected twist results in a change of heart by RCI if they realize how negative the on going uproar can be. Best wishes to those involved and please let us all know of anything we can do to further the cause.

John,

I agree. RCI shouldn't be using the units as rentals to non-owners when there is an owner wanting to make an exchange. RCI gets its revenue by the fees charged by the exchanges not by renting out somebody else's property and collecting the money from those rentals. It has an obligation to try match exchanges although it can't guarantee exchanges. By putting exchangeable units on the rental market, it ensures that the main purpose of the organization, exchanges, cannot be met.

There may be times when rentals are justified but it should be far and few between.

 

[Carolinian]

We cannot just bury our heads in the sand and look at our personal exchanging situation. The reason is that RCI's rental program can seriously damage the economics of our resorts and perhaps even threaten their viability. That can kick us in the rear end another way besides exchanging by causing m/f's to rise substantially or even resorts going under.

RCI's flooding the market with rentals often at low prices also decreases the ability of individual timeshare owners to rent out their weeks at a decent price and decreases the demand for resale purchases.

RCI's rental to the public scheme kicks the financial props out from under timesharing in a wide variety of ways.

Keep it simple.
If RCI is not serving your Timeshare exchange & rental Needs stop using them!
Why turn yourself into sheep to be hearded around and used by attorneys
to make a huge payday score.
They the Attorneys are doing what they always do. Playing the class members for a payday.
RCI is just going to raise fees to offset their costs in this lawsuit. They likely already figured the costs and have done that already.
stopped be played!
If RCI is not serving your Timeshare exchange & rental Needs stop using them!

 

[carl2591]

any way to force them to run ads for Timeshare Today Magazine.. they are one of the forces behind this as well. They have published a lot of info about the lawsuit that in my mind is a must read for all RCI members.

that would shake the timbers of RCI for a while.. guess we have to dream on..

 

[Jennie]

any way to force RCI to run ads for Timesharing Today Magazine.. they are one of the forces behind this as well. They have published a lot of info about the lawsuit that in my mind is a must read for all RCI members.

Shep (editor) and Ray (owner) of Timesharing Today Magazine have tried for over 10 years to place ads in RCI's Endless Vacations Magazine but the've been consistently rebuffed. Considering how greedy RCI is, it speaks volumes when you learn that RCI is willing to pass up substantial advertising dollars to keep RCI members away from a magazine that "tells it like it is."

For anyone not familiar with the magazine, a free trial copy of the latest issue can be obtained by requesting it at their web site: www.tstoday.com
One advantage to becoming a subscriber is that you can read all prior magazine issues on-line going back many years (password protected).

Ray and Shep provide free ads for owners groups to post notices in the magazine about meeting times and dates, and they personally attend many of these meetings around the country. They also post detailed information and charts about all of the exchange companies, large and small, so that readers can learn of exchange options other than RCI

 

[Jennie]

First and foremost the idea that no one - even the mythical, bamboozled sucker who was talked into buying a Blue week in Wisconsin in order to freely trade into luxury accommodations in South France - is forced to give RCI their week(s).

They are not "forced" to give their weeks to RCI but many of them do not know they have other options.

I know one highly educated, intelligent couple who bought a week at the Manhattan Club in New York City from the developer at full price. They were given a free one year RCI membership at the point of sale. When I met them for the first time 6 years later, they told me they had been using all 7 nights a year at MC. They thought they had to keep paying the RCI membership fees every year as a requirement of their MC ownership.

The RCI "wish book" has played a large role in developer sales pitches for many years. At the class action court hearing on June 16th, the Judge asked the RCI attorneys why so many timeshare owners seem unhappy about the way the exchange program is working, as evidenced by the 100+ letters sent to the court in response to the article in Timesharing Today Magazine re: the inadequate proposed settlement.

The RCI attorneys had the audacity to say that it's because the timeshare salespeople "over promise" in order to make a sale. When questioned further by the judge, the attorneys said that as part of the proposed settlement, they were going to take steps to prevent this "over promising" from happening. When pressed as to how they would accomplish this, they said they would hold "training sessions" with the sales teams :hysterical: . Note that nowhere in the almost 300 page settlement proposal is there any mention of "training sessions". The attorneys seemed to be "making it up on the spot" to deflect attention away from RCI's role in owner dissatifaction. Perhaps developers should be required to give buyers information about other exchange companies. I have stopped supporting ARDA since I learned that they lobbied against a proposal that would have provided more "truth in exchanging" type of information as part of the sales contract.

But getting back to the issue of people who unwittingly bought blue weeks--many are now seniors without computer skills and do not know about the alternative exchange companies. Some, like my Manhattan Club friends, even think that they must pay RCI fees every year, the same way they must pay annual maintenance fees, in order to be able to use (or even retain ownership of) their week.

I know it's hard for those of us on TUG to realize that there can be people out there who know so little about timesharing. But trust me, there are a lot of them. As a Board member for many years of the volunteer-run Greater New York Timeshare Owners Group, we met and helped hundreds of such people. For those who owned a truly terrible week, the best advice (and often times hands on help) we could give them was to prepare for a trip during the 45 day window when trading power "went out the window" and any week would pull anything in RCI inventory. This really "saved the day" for many of them. Most were seniors who could use a small unit and didn't care how "plain" the resort was.

Many TUG posts keep mentioning owner expectations of exchanging into high end properties. In my experience, the owner of a middling week usually knows not to expect much. But they do expect something-anything. Some space-banked their week up to 2 years in advance. This was supposed to increase the trading power of their week. RCI really should allow this part of the program to remain in effect but the proposed settlement will eliminate it.

I personally own 19 weeks/Points packages. Three of them, fixed weeks, were bought resale (at very cheap prices) in the mid 1990's, when I really didn't know much about timeshares. Trading power on each has changed drastically through the years. Sometimes it went up because of improvements in the property and units, or the location suddenly became a "hot spot" for certain groups (e.g. families with young children or "Spring breakers"). The value went down drastically in one of our units because the small greedy resort started charging exorbitant per diem fees for exchange guests ($18. per day per person including all children over the age of six!). Once RCI revealed this to interested exchangers, they refused to accept it.

But the bottom line is that if all else failed, I was able to get very acceptable trades during the last minute window, which was 90 days at one time, then 60 days, and now I believe it's 45 days.

I can also give them to RCI as pfd's into our RCI Points account That's a strategy I have been helping some owners of doggie weeks to use. Of course that shouldn't exist and will cause major trouble down the road for the entire system, but that's a "whole 'nother story".

The bottom line is that RCI should focus on providing comparable exchanges for its 3.6 million members and not rush to rent out weeks, at any stage of the game, that they can reasonably assume their members will reserve, if given the chance. The annual membership fee of at least $100. per year plus the exchange fee of $139.-$199. should be sufficient profit for them to make on the service they provide. They do not have acquisition and production costs. Many transactions are completed on-line by members. We even have to print out our own confirmations and guest certificates so they pay no postage. If they make a sufficient profit from the ads placed in the Endless Vacations magazine, that's okay. If not, they can safe millions of dollars if they stop sending it to members, most of whom don't even open it up. For anyone who actually likes the magazine well they can get it via a paid subscription.

 

[timeos2]

Whats wrong with learning the ropes?

They are not "forced" to give their weeks to RCI but many of them do not know they have other options.

I know one highly educated, intelligent couple who bought a week at the Manhattan Club in New York City from the developer at full price. They were given a free one year RCI membership at the point of sale. When I met them for the first time 6 years later, they told me they had been using all 7 nights a year at MC. They thought they had to keep paying the RCI membership fees every year as a requirement of their MC ownership.

The RCI "wish book" has played a large role in developer sales pitches for many years. At the class action court hearing on June 16th, the Judge asked the RCI attorneys why so many timeshare owners seem unhappy about the way the exchange program is working, as evidenced by the 100+ letters sent to the court in response to the article in Timesharing Today Magazine re: the inadequate proposed settlement.

The RCI attorneys had the audacity to say that it's because the timeshare salespeople "over promise" in order to make a sale. When questioned further by the judge, the attorneys said that as part of the proposed settlement, they were going to take steps to prevent this "over promising" from happening. When pressed as to how they would accomplish this, they said they would hold "training sessions" with the sales teams :hysterical: . Note that nowhere in the almost 300 page settlement proposal is there any mention of "training sessions". The attorneys seemed to be "making it up on the spot" to deflect attention away from RCI's role in owner dissatifaction. Perhaps developers should be required to give buyers information about other exchange companies. I have stopped supporting ARDA since I learned that they lobbied against a proposal that would have provided more "truth in exchanging" type of information as part of the sales contract.

But getting back to the issue of people who unwittingly bought blue weeks--many are now seniors without computer skills and do not know about the alternative exchange companies. Some, like my Manhattan Club friends, even think that they must pay RCI fees every year, the same way they must pay annual maintenance fees, in order to be able to use (or even retain ownership of) their week.

I know it's hard for those of us on TUG to realize that there can be people out there who know so little about timesharing. But trust me, there are a lot of them. As a Board member for many years of the volunteer-run Greater New York Timeshare Owners Group, we met and helped hundreds of such people. For those who owned a truly terrible week, the best advice (and often times hands on help) we could give them was to prepare for a trip during the 45 day window when trading power "went out the window" and any week would pull anything in RCI inventory. This really "saved the day" for many of them. Most were seniors who could use a small unit and didn't care how "plain" the resort was.

So someone with the money to buy a top resort like MC isn't smart enough to find out if they aren't using a service - RCI - they don't have to pay for it? Sorry, no sympathy for that here. They are simply not doing even the small amount of work needed to find out what they own and how to use it. It is not RCI's fault. Yes there are plenty of owners completely in the dark about their timeshare even after years of ownership. It is not RCI's or anyone elses job to educate them. In a few hours of research or a talk by the pool at a stay they could find out the basics. That they won't even make that effort tells all we need to know.

Many TUG posts keep mentioning owner expectations of exchanging into high end properties. In my experience, the owner of a middling week usually knows not to expect much. But they do expect something-anything. Some space-banked their week up to 2 years in advance. This was supposed to increase the trading power of their week. RCI really should allow this part of the program to remain in effect but the proposed settlement will eliminate it.

I personally own 19 weeks/Points packages. Three of them, fixed weeks, were bought resale (at very cheap prices) in the mid 1990's, when I really didn't know much about timeshares. Trading power on each has changed drastically through the years. Sometimes it went up because of improvements in the property and units, or the location suddenly became a "hot spot" for certain groups (e.g. families with young children or "Spring breakers"). The value went down drastically in one of our units because the small greedy resort started charging exorbitant per diem fees for exchange guests ($18. per day per person including all children over the age of six!). Once RCI revealed this to interested exchangers, they refused to accept it.

Again the resort(s) get greedy with unwarranted fees so you blame RCI? Another red herring. It weakens the legitimate causes of actions to say RCI needs to be a Nanny to owners and resorts to protect them from themselves.

But the bottom line is that if all else failed, I was able to get very acceptable trades during the last minute window, which was 90 days at one time, then 60 days, and now I believe it's 45 days.

I can also give them to RCI as pfd's into our RCI Points account That's a strategy I have been helping some owners of doggie weeks to use. Of course that shouldn't exist and will cause major trouble down the road for the entire system, but that's a "whole 'nother story".

And why should that not exist? PFD offers a way to get value out of otherwise tough to trade time by giving far more flexible points values to owners rather than nearly impossible to use week for week only system. It is the need to deal with one exchange/deposit on a one for basis - no chance to adjust for greater or lesser values - that dooms the week for week system to having excessive and unwanted inventory. That same inventory heavily discounted in Points may be far more attractive and the ability to combine/rent/borrow points means the owner can actually use the tools offered to get a decent trade they can use. Points may be the savior of resorts with highly seasonal weeks that will never be a trade by themselves. Giving those weeks value via points means fees can be collected and the resort made stronger on the all important bottom line.

The bottom line is that RCI should focus on providing comparable exchanges for its 3.6 million members and not rush to rent out weeks, at any stage of the game, that they can reasonably assume their members will reserve, if given the chance. The annual membership fee of at least $100. per year plus the exchange fee of $139.-$199. should be sufficient profit for them to make on the service they provide. They do not have acquisition and production costs. Many transactions are completed on-line by members. We even have to print out our own confirmations and guest certificates so they pay no postage. If they make a sufficient profit from the ads placed in the Endless Vacations magazine, that's okay. If not, they can safe millions of dollars if they stop sending it to members, most of whom don't even open it up. For anyone who actually likes the magazine well they can get it via a paid subscription.

No RCI should not rent weeks out based on "historical data" or gut instinct but rather after they have been through the process and are proven to indeed have no close to equal trade interest. Then and only then - which should be no more than 90 days from the start date - RCI should loosen trade values required slightly (but never a free for all), make them available to MEMBERS for discounted rental rates and, if that doesn't work quickly, to the public as competitively priced rentals. Not deep discounted time to the public that undermines the owners value as that does cut to the underpinnings of the timeshare model. However simply stating that there are "no acceptable trades" for those low value times more often than not means the member doesn't really want an equal value but an upgrade to better time or size or resort. I've never seen any shortage at RCI or II of low value weeks ready for claiming by other low value owners.

 

[Carolinian]

This really needs to be a seperate thread, but this whole premise is flawed.

Weeks and Points need to be seperate systems. I have no problem with Points members getting last minute Points inventory at a discount, which they are not given, but I do have a big problem with giving them last minute Weeks inventory, which depletes the inventory for Weeks members.

The overaveraging present in the Weeks/Points crossover grids are highly unfair to Weeks members. But again all fo this should be another thread. We need to concentrate on the lawsuit in this one.

And why should that not exist? PFD offers a way to get value out of otherwise tough to trade time by giving far more flexible points values to owners rather than nearly impossible to use week for week only system. It is the need to deal with one exchange/deposit on a one for basis - no chance to adjust for greater or lesser values - that dooms the week for week system to having excessive and unwanted inventory. That same inventory heavily discounted in Points may be far more attractive and the ability to combine/rent/borrow points means the owner can actually use the tools offered to get a decent trade they can use. Points may be the savior of resorts with highly seasonal weeks that will never be a trade by themselves. Giving those weeks value via points means fees can be collected and the resort made stronger on the all important bottom line.

 

[Susan2]

Suggestions for Notice

Attorney Disclaimer Ordered by the United States District Court:

I am an attorney who was admitted to represent some of the objectors in a class action pending in the United States District Court for the District of New Jersey. Any statements by an attorney, including myself, should be considered to be the personal opinion of the attorney and are not approved by the Court. As such, my statements contained herein are not approved by the Court. More information is available at www.weeksprogramsettlement.com, the Court-approved website.

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I am preparing to comment at the August 12 hearing in Trenton, NJ, regarding the notice. The Court has already determined that the prior Notice of the RCI Weeks class action proposed settlement was inadequate. Now, new notice needs to be sent.

RCI wants to send all members a postcard with very fine print. (Too fine, IMO, for many people to read without glasses, and perhaps even with glasses for some.)

I am proposing a prominent website posting, an email with links to further information, a telephone menu option (when people call RCI), a multi-page printout in the Endless Vacation Magazine with a postcard to obtain the full proposed settlement, and a direct mailing.

I am interested to know what TUG members feel would be the most useful.

Susan

 

[Stricky]

Thanks again for all your work on this Susan.

Although I am too new of a member to be in the class, I will say I think all your suggestions are great. I really think email needs to be used (I get plenty of other RCI email). I think the phone menu option is a bit much. A hotline where people can call and get answers would be helpfull.

 

[doubleos]

Reasonable Notice

Again, Susan thank you so much for your work. I like all of your ideas for notice, but the email with links for more information would be best for me. It certainly seems to be good enough for RCI to send all of their inane nonsense. I am most interested however in how I should respond, whether it is better to opt out of the class or to object to the settlement.

 

[london]

Final Settlement

Does it appear that a final settlement will be reached by Dec 2009.

One that will have all RCI members notified of their options.

 

[Jennie]

Does it appear that a final settlement will be reached by Dec 2009...One that will have all RCI members notified of their options.

It's impossible to know at this time. We hope to have more information after the August 12th hearing takes place. A lot depends upon the Judge's decisions.

 

[Carolinian]

Does it appear that a final settlement will be reached by Dec 2009.

One that will have all RCI members notified of their options.

A fair and just settlement means a whole lot more than the timing of it.

 

[Jennie]

I believe I understand both of those terms. It's certainly not deceptive, because the practice is spelled out very clearly in the Subscriber Agreement. Only a fool or an idiot would think that somehow RCI could not rent out deposits after reading that language. So, let's dispense with "deceptive".

The Judge in the current proceeding ruled that notice of the proposed settlement was inadequate because it was placed on page 94 of Endless Vacations magazine, and the print size on the index page was too small.

Well guess where the ever-changing "Terms and Conditions of RCI Weeks Subscribing Membership" appears:

In 2003 it is on page 473-476 of the 480 page book. It is readable by me only with glasses prescribed for very close work. I am legally able to drive without glasses (or contacts) and do not need anything for everyday reading of books, newspapers, etc...

In 2006 it is on page 499-501 of a 503 page book. For that one I need reading glasses PLUS a magnifying glass to read it.

In 2008 it is on page 396-400 of the 412 page book. Again I need to wear prescription glasses AND use a magnifying glass to read it.

Meanwhile the following "pollyanna" version of how to obtain an exchange is in much larger, darker print on page M15-16 near the front of the 2008 book.

STEP 1: Deposit your week

Members are advised to deposit their week as early as possible "because depositing early helps increase your vacation options."

STEP 2: Search for your vacation

It advises to "start a convenient, personalized search for the vacation you want. Your request will be compared against newly deposited weeks as they enter the exchange system every day. Once you institute a search, your work is done. There's no need for you to check on the status of your request; we contact you as soon as a match is found."

(My comment: By telling members there is no need to check on the status of their (search) request, it would seem to me that they are depriving members of the opportunity to speak with a Vacation Guide and learn the sad truth if the week they seek "ain't never gonna happen" especially if they had entered the search online without any feedback from a VG. Could it be that RCI hopes to extract another fee from them to "extend" their search after 9 months of no luck?)

Step 3: Confirm your Exchange, then enjoy your vacation.

"Once the system has found a vacation to match your search, you'll exchange your deposited week either online or with a Vacation Guide to close your search and complete the transaction."
(Note they do not say "IF" a match is found).

If they are not trying to be deceptive, why aren't all the other terms and conditions on page 397 about how RCI can use deposited weeks for rental, etc...moved up front next to the the above noted rhetoric. Then members would have a better chance of learning what is really going on and make an informed decision of whether or not they want to continue doing business with RCI.

When I brought this information to the attention of the members of a New York timeshare owners group, their was disbelief, then anger. Most members said they would not deposit any more weeks with RCI. For some it was the deciding factor in selling or giving away their timeshares. Others (like myself) joined other exchange companies and/or began renting our high value weeks and using the rental money to rent what we want directly from other owners.

Besides being unfair, RCI's greed will likely lead to less profit down the road as more and more members learn the truth and take their business elsewhere.

 

[Jennie]

I would be interested to hear from people who traded bonus weeks prior to 2000. Most of what I've heard is similar to my experience.

I believe it was the summer of 1998 when we received a one bedroom unit in July in the heart of Newport, Rhode Island. July is always a very prime time there. In addition, our week was during the famous annual Jazz Festival when people would come from all over the country to attend. They were paying up to $300. a night for dinky hotel rooms at the time.

 

[Susan2]

Attorney Disclaimer Ordered by the United States District Court:

I am an attorney who was admitted to represent some of the objectors in a class action pending in the United States District Court for the District of New Jersey. Any statements by an attorney, including myself, should be considered to be the personal opinion of the attorney and are not approved by the Court. As such, my statements contained herein are not approved by the Court. More information is available at www.weeksprogramsettlement.com, the Court-approved website.

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Only a fool or an idiot would think that somehow RCI could not rent out deposits after reading that language. So, let's dispense with "deceptive".

The . . . "Terms and Conditions of RCI Weeks Subscribing Membership" . . . is readable by me only with glasses prescribed for very close work. . . .

In 2006 it is on page 499-501 of a 503 page book. For that one I need reading glasses PLUS a magnifying glass to read it. . . .

If they are not trying to be deceptive, why aren't all the other terms and conditions on page 397 about how RCI can use deposited weeks for rental, etc...moved up front next to the the above noted rhetoric. . . .
Besides being unfair, RCI's greed will likely lead to less profit down the road as more and more members learn the truth and take their business elsewhere.

Thank you, Jennie, for bringing BNoble's comment to my attention. Your response is very good. However, it doesn't tell the whole story. The truth is even worse.

The terms and conditions of most contracts give more rights to the already empowered party than are ever normally exercised. (You can call them "just in case" clauses.) For example, most people would be surprised to find that the mortgage note on their primary residence says that if the borrower becomes 45 days delinquent on a monthly payment, then the bank has the right to foreclose.

Now, banks rarely, if ever, actually do that. But it IS in the fine print. Of couse, it is extremely rare that any borrower actually READS the entire mortgage agreement. The typical, REASONABLE buyer relies on the verbal interpretations given him/her, his or her past experience, the experience of other homeowners, and an assumption of good faith by the lender.

But if one were to follow BNoble's rule of thumb, only a fool or an idiot would ever sign a mortgage agreement, especially if s/he is a teacher who works only 10 months a year, or a seasonal employee. After all, it's "in the fine print." Nor, under that reasoning, should anyone be surprised to find himself homeless after missing two mortgage payments.

But that's not how life happens. Reasonable people rely on common sense, verbal representations, and the good faith of others. That's a perfectly sensible way to live one's life. In fact, to do otherwise -- that is, to ignore common sense, verbal representations, and to put no trust in the good faith dealing of others -- qualifies one as "paranoid" at best.

In fact, I submit that relying on the verbal representations made by the vacation guides, who CONSISTENTLY state that RCI DOES NOT RENT OUT OR OTHERWISE DISPOSE OF WEEKS DEPOSITED FOR EXCHANGE, is the only reasonable way to act, until informed otherwise. Every one of the Guides will tell you that the weeks in the rental pool are "specially acquired inventory" obtained directly from the resorts, and that RCI does not contract with other vacation associations to give away weeks deposited by members for exchange. Are they all liars? I don't think so. I think that they are just fed untruths. Do most of them investigate their employer's actual practices? OF COURSE NOT! Again, that would be paranoid at best.

People (even people with timeshares) have the right to trust the "social contract" that we live by. No, that doesn't protect us from people like Bernie Madoff. Living completely untrustingly of the social contract might protect people from some losses, but it would not lead to a better life overall.

Now, let's look at the other side of the equation: NOWHERE BUT THE COURTROOM does RCI admit and defend its practice of taking weeks deposited for exchange and disposing of them for profit. Everywhere else (and apparently even to its own employees) RCI denies the practice. That's an inconsistency one could drive a truck through, and completely violates the social contract.

Think about this: If Bernie Madoff put it in the fine print in his "brokerage" contract that he could keep people's money, but verbally represented otherwise, almost no one would have read it, much less questioned it. If people had questioned it, he could have explained that it actually meant that, if in his discretion he thought that a trade should not be made that day, the contract gave him the right to do so. In that case, I think every one of his clients would have still signed it. Are they/were they stupid? No. They just relied unwisely on the social contract and the good faith dealings of someone they knew and liked.

Do you really want to live in a world where no one does that? I wouldn't. I would rather live my life taking only reasonable precautions, and take my chances that most people are honorable. There are people out there who investigate people before dating them. And people who marry people who turn out to be complete frauds. Personally, I fall in between those two extremes, as do most people, and it works most of the time. Most of us rely on the legal system when someone violates the law or the rules we live by.

Yes, Jennie, RCI's actions will hurt RCI and the whole timeshare industry. But I fear that the executives responsible for this fiasco will give themselves golden parachutes and convince themselves they were "good" administrators, who made lots of profit for their shareholders, because they feel no responsibility for adding to the discord and distrust in the world.

The executives who authorized the manufacture and sale of the Pinto, knowing that the gas tank tended to explode even on minor impact were never criminally convicted, either. But the tide is changing, and society is no longer as tolerant of corporate greed as it once was.

And so we move forward, trying to right wrongs, simply because not to do so would be intolerable.

 

[Susan2]

Attorney Disclaimer Ordered by the United States District Court:

I am an attorney who was admitted to represent some of the objectors in a class action pending in the United States District Court for the District of New Jersey. Any statements by an attorney, including myself, should be considered to be the personal opinion of the attorney and are not approved by the Court. As such, my statements contained herein are not approved by the Court. More information is available at www.weeksprogramsettlement.com, the Court-approved website.

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A fair and just settlement means a whole lot more than the timing of it.

Well said!

 

[krj9999]

Not defending RCI here, but am posting latest data from Wyndham's quarterly results. The only things I can read from the data are: RCI membership continues to grow; rental volume is fairly flat; and exchange dues/fees per member is slowly declining. While there had been some creep higher in revenue per rental, it has come down significantly since Q3 2008.

Vacation
Exchange
and Rentals
Average Number
of Members
(in 000s)
2009 3,789 3,795 N/A N/A N/A
2008 3,632 3,682 3,673 3,693 3,670
2007 3,474 3,506 3,538 3,588 3,526
2006 3,292 3,327 3,374 3,429 3,356

Annual Dues
and Exchange
Revenue Per
Member
2009 $134.38 $117.59 N/A N/A N/A
2008 $150.84 $128.91 $124.51 $109.56 $128.37
2007 $155.60 $132.33 $131.38 $124.59 $135.85
2006 $152.10 $130.37 $132.31 $128.13 $135.62

Vacation
Rental
Transactions
(in 000s)
2009 387 324 N/A N/A N/A
2008 387 319 360 282 1,347
2007 398 326 360 293 1,376
2006 385 310 356 293 1,344

Average Net
Price Per
Vacation
Rental
2009 $335.54 $422.00 N/A N/A N/A
2008 $412.74 $477.63 $553.69 $400.09 $463.10
2007 $349.73 $415.71 $506.78 $426.93 $422.83
2006 $312.51 $374.91 $442.75 $356.16 $370.93

 

[AwayWeGo]

Careful . . .

Not defending RCI here, but am posting latest data from Wyndham's quarterly results.

. . . it doesn't take much more than that to get lumped in with the RCI Can Do No Wrong crowd.

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