Timeshare operator sued by own members
Timeshare operator RCI Europe is being sued for £2.4 million damages by members of its holiday property exchange club.
They have taken their case to the High Court in London, which will consider a class action lawsuit on Monday.
The suit alleges that RCI Europe ‘skims off’ the best accommodation from its pool of available properties and sells them, rather than making them available to exchange club members.
RCI Europe, which is part of the US hotel group Wyndham Worldwide, denies the claims.
In total, there are 487 claimants in the class represented by law firm Edwin Coe LLP. Monday’s hearing is a test case of four members, but the judgment could affect a further 9,000 members, according to the law firm.
Some members of the RCI Europe claim they only signed up in order to be able to swap their property for alternative accommodation available in its exchange pool but that they were often told there were no suitable properties available.
The lawsuit claims RCI’s duty to its members was in conflict with its own interests in profiting from the skimming off of the most desirable properties and for staff incentives, and was undertaken without members’ consent.
It alleges that RCI breached the implied fiduciary duty of care to its club members.
RCI denies it has breached the trust placed in it by its members and claims that all members are told that there is no guarantee that requested timeshares will be available.
It says members might not be able to find properties for exchange because the one they want to swap is not valued as highly as the one where they’d like to stay.
It claims some properties are offered to rent only by RCI and that this income helps RCI to invest in additional properties, which are added to the pool.
Two class action suits have been filed against RCI in the US over the way its exchange pool works.~ One is on-going and one settled recently, which concerned the transparency of its points-based system and property evaluation, said the law firm.
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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