Judge Won’t Let Hilton Settle Timeshare Class Action with Coupons

Hilton won’t get off the hook regarding class action allegations that it duped timeshare customers with useless vouchers by offering coupons as a settlement, according to a federal judge.

Hilton proposed settling the class action by offering Class Members coupons to stay at a Hilton hotel, including the Hilton Hotel, DoubleTree by Hilton, Embassy Suites by Hilton, Hilton Garden Inn, Hampton Inn and Homewood Suites by Hilton.

The coupons did not account for Class Members’ out-of-pocket expenses, noted U.S. District Court Judge Jon S. Tigar in his order rejecting the proposed settlement.

The Hilton class action lawsuit alleged that prospective Class Members went to a timeshare presentation in exchange for a discounted stay at a Hilton hotel using a “Spend a Night on Us” voucher. However, plaintiff Timothy Elder alleged that when he tried to use his voucher at a Double Tree, the property refused to accept it telling him the voucher was only good for Hilton Hotels or Hilton Clubs.

According to the order rejecting the settlement, Hilton’s offer of a coupon valid for a $50 rebate for a $100 rejected voucher or a $100 rebate for a $200 rejected voucher is insufficient because Class Members likely suffered out-of-pocket expenses.

“The court notes that plaintiff alleges that many class members suffered out-of-pocket damages, by spending money they would not otherwise have spent, based on Hilton’s allegedly misleading representations,” stated the order. “A coupon does not provide a remedy for these injuries.”

The coupons proposed under the Hilton settlement are also valid for only two-years, noted the judge. Further, they are only valid at certain properties – a problem with the original vouchers at issue in the Hilton class action lawsuit.

The judge also disagreed with the class action plaintiff’s assertion that the settlement provides half of the maximum recovery Class Members could expect.

“The only reference plaintiff makes to the overall value of the settlement in relation to what the class may recover at trial in his motion lies in the introduction,” explains the order. “Plaintiff claims that the settlement is an ‘excellent result’ for class members because ‘the settlement provides 50 percent of the maximum recovery they could have hoped to achieve had the case proceeded to trial.’ Because the settlement does not compensate the class in cash, however, that statement does not provide the court with enough information about this variable.”

According to the proposed Hilton class action settlement agreement, Class Members will include “all persons in the United States who received a ‘Spend a Night on Us’ certificate from Hilton that stated it was for use at ‘any Hilton Hotel,’ and that Hilton refused to honor, based solely on the brand of Hilton hotel that the certificate holder had stayed at, during the period from Jan. 15, 2012, through Feb. 28, 2014.”

Top Class Actions will post updates to this class action settlement as they become available. For the latest updates, keep checking TopClassActions.com or sign up for our free newsletter. You can also receive notifications when this article is updated by using your free Top Class Actions account and clicking the “Follow Article” button at the top of the post.

Elder is represented by Jana Eisinger of the Law Office of Jana Eisinger PLLC and Lawrence Timothy Fisher of Bursor & Fisher PA.

The Hilton Rejected Timeshare Voucher Class Action Lawsuit is Elder v. Hilton Worldwide Holdings Inc., et al., Case No. 3:16-­cv-­00278, in the U.S. District Court for the Northern District of California.