Marriott Class Action Says Timeshares Are Not Real Estate

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A class action filed on May 19 alleges that Marriott Ownership Resorts Inc. and other Marriott companies sell false ownership in real estate through its points-based timeshare product.

“While purchase of the [Marriott timeshare] Product is said to convey both title to a Florida timeshare estate and a beneficial interest in a Florida land trust, it, in fact, conveys neither,” according to the class action complaint.

The false real estate timeshare class action lawsuit claims that Marriott devised a new way to sell timeshares, after the companies had multiple unsold and foreclosed timeshare properties when the market collapsed in 2008.

In 2010, Marriott started the Marriott Vacation Club, which sells “ownership interests” that is actually just points the owner can use to reserve  any available vacation property that is part of the Marriott Vacation Club.

The complaint alleges that the purely point-based Marriott Vacation Club (MVC) program is not a true timeshare under Florida law.

Comparing the MVC program to Marriott’s older legacy timeshare programs, the members no longer get a partial ownership interest in an actual, specific piece of real estate. Instead, the members purchase a partial interest in every timeshare property owned by the Marriott companies.

The class action asserts that instead of getting a deed with a legal description of the property interest the owner purchased, the MVC program participant is assigned an arbitrary number and a continuously shifting interest in MVC property that is under the sole control of Marriott.

The false real estate timeshare class action contends that Marriott’s new purely point-based timeshare program harms those legacy timeshare owners by infringing on their actual property rights.

In addition, Marriott and the other defendants are able to collect fees and avoid taxes by falsely claiming that the MVC timeshare program is a real estate transaction.

“Of course, if the MVC Product were sold as a legitimate awards-based program, Defendants would be deprived of the signifcant revenue and cost-savings that is derived from real-property timeshare transactions, including closing costs and fees, title policy premiums, maintenance and operational fees, tax revenue, dues, and inventory control,” the complaint asserts.

Plaintiffs Anthony and Beth Lennen state that they purchased a timeshare through Marriott in January of 2008 on Marco Island, Fla.

In 2014, they also purchased points in the MVC Product. The Lennens contend that their “deed” under the MVC program is not a valid real estate transaction, that defendant First American Title did not do a valid title search (that the Lennens paid for), and that Orange County, Fla., negligently allows Marriott and First American Title to record invalid property deeds.

The Marriot false real estate timeshare class action lawsuit seeks the certification of two separate Classes. The first is “all purchasers of the MVC Product from its inception in June 15, 2010, through and including the present,” and the second is “all purchasers of Legacy Timeshare Estates…anytime between June 25, 2010, and the present.”

The class action requests that the court require Marriott to divest all of the real property that is part of the point-based timeshare program, and place it all in an owner’s association under Florida law.

The plaintiffs are represented by Christopher S. Polaszek of The Polaszek Law Firm, PLLC; Lucas A. Ferrara, Jeffrey M. Norton, and Roger A. Sachar, Jr., of Newman Ferrara LLP, and Soomi Kim.

The Marriott False Real Estate Timeshare Class Action Lawsuit is Anthony Lennen, et al., v. Marriott Ownership Resorts Inc., et al., Case No. 6:16-cv-855, in the U.S. District Court for the Middle District of Florida.

UPDATE: On Oct. 7, 2016, the plaintiffs in this Marriott timeshare class action lawsuit are fighting an attempt by Marriott to stop court action and wait for a state agency’s declaration.

UPDATE 2: On Jan. 4, 2018, the plaintiffs in a class action lawsuit accusing a group of Marriott companies of selling improper ownership in real estate have asked a Florida federal judge not to dismiss Orange County, Fla., from the litigation.

UPDATE 3: On May 6, 2019, Marriott timeshare buyers recently requested Class certification in a lawsuit alleging that Marriott points program is a “scheme.”