Moore et al v. Westgate Resorts Ltd.

Case Number: 3:18-cv-00410

Last Updated: May 29, 2023


Stayed pending ruling on the Court’s decision on motion to certify class.


USDC, Eastern District of TN Knoxville

Presiding Judge

District Judge Clifton L Corker

Date Filed



The Court rejected developers’ challenges to the pleadings based on “acknowledgments” initialed by timeshare owners; pending rulings on plaintiffs’ motion to certify class and cross-motions to strike expert opinions.

Case Posture

Selected Events:

On 11/18/20, the Court denied in significant part Westgate’s motion to dismiss the timeshare owners’ complaint. [185]

  • The Court began with a lengthy personal jurisdiction analysis, which it resolved in favor of the timeshare owners and against Westgate and CFI based on the court’s finding that CFI is an alter ego of Westgate
  • The Court denied in part, and granted in part Westgate’s Statute of Limitations defense under the Tennessee Timeshare Act re rescission period:
    • Runs from date of purchase, not from discovery because statute of repose
    • dismissal granted as to some plaintiffs, but not to others who commenced their action within four years of purchase
  • The Court denied in part, and granted in part Westgate’s Statute of Limitations defense for Unjust Enrichment
    • dismissal granted as to some plaintiffs, but not to others who commenced their action within four years of purchase
  • The Court denied Westgate’s Statute of Limitations defense for Civil Conspiracy
    • dismissal granted as to some plaintiffs, but not to others who commenced their action within four years of purchase
  • The Court denied Westgate’s Statute of Limitations defense for Breach of Contract
    • dismissal denied as to all defendants
      • some commenced their action within the statutory period of six years of purchase
      • others commenced after, but the discovery rule applies (not a statute of repose issue) and so impossible to tell whether breach inherently discoverable
  • The Court denied in part, and granted in part Westgate’s Failure to State a Claim defense
    • Tennessee Timeshare Act re failure to provide public offering statement – GRANTED (plaintiffs all signed a receipt)
    • Tennessee Timeshare Act re false advertising DENIED (as to plaintiffs not time-barred)
      • DENIED as to failure to deposit into an escrow account for duration of cancellation period as to those plaintiffs who allege an attempt to rescind during cancellation period
      • DENIED because “secret pocket” hid disclosures –
        • Allegations sufficient that Westgate defendants “encourage and/or allow” their sales agents to “conceal material facts” regarding the “lack of unit availability due to Defendant’s practice of overselling the Resort.”
    • UNJUST ENRICHMENT – MOTION TO DISMISS DENIED (as to plaintiffs not time-barred)
      • “The Court finds that Plaintiffs have successfully pled unjust enrichment. First, Plaintiffs allege that they conferred a benefit upon Defendants, namely purchase price for the property interest, fees and in some cases mortgage payments. Second, Defendants appreciated that benefit in that they received those payments from Plaintiffs and have not held them as separate or escrow funds. Finally, it would be unfair for Defendants to retain the benefit of payments conferred by Plaintiffs because, Plaintiffs allege, they have not been able to use their timeshare units.”
    • FRAUDULENT MISREPRESENTATION – MOTION TO DISMISS DENIED (as to plaintiffs not time-barred)
      • Rule 9(b) challenge/heightened pleading standard met: “Each Plaintiff alleges a specific encounter or encounters with Westgate sales agents, in many instances referring to the agents by name. Each Plaintiff alleges the location of their timeshare unit as well as the location and nature of their meetings with Westgate agents Each Plaintiff alleges specific dates for purchase of sale and “upgrades.” Finally, each Plaintiff alleges specific sales tactics and conversations between themselves and Westgate agents that induced them to purchase their timeshare units.”
      • Fraud claim survives challenge based on Defendants’ argument that the “acknowledgement” form initialed multiple times by each Plaintiff provides “specifically that they are releasing their right to reserve a specific unit in exchange for the ability to make a reservation in the floating use plan, subject to availability.”
        • “This is not entirely accurate. Though the acknowledgement form does contain a statement concerning the “floating use plan,” the language “subject to availability” appears in a different section which addresses ‘trading of time’ within the resort. Plaintiffs do not allege that they were unable to trade time at the resort but allege instead that they were unable to reserve time at the resort. Therefore, the ‘subject to availability’ language is part of a section in the acknowledgement that is not at issue here.
      • Fraud claim survives challenge based on “conspicuous rescission language”
        • “Defendants cannot invoke fraudulent documents as a defense to claims sounding in fraud” – applying Overton v Westgate: In that case, the TN Court of Appeals stated that “fraud in the underlying transaction renders a contract clause . . . unenforceable.”
        • “None of the Plaintiffs could have possibly known the true nature of the ‘floating use plan’ within that time frame, since none of them had yet tried to use their timeshare units within that time. Plaintiffs claim that agents misrepresented how and when they could use their timeshare units, and misrepresented what Plaintiffs were actually purchasing. The truth or falsity of these claims would not have become apparent until well after the ten- or fifteen-day rescission window.”
    • FRAUD IN THE INDUCEMENT — MOTION TO DISMISS DENIED (as to plaintiffs not time-barred)
      • Plaintiffs allege that Westgate agents told them they were purchasing specific units that they could use, when in truth Westgate “regularly and systematically oversold the Resort,” making it difficult to impossible to book these units. Together with specific quotations from the various agents to Plaintiffs … these allegations sufficiently state a claim that Westgate agents made false statements to Plaintiffs and had “utter disregard” for the truth of these statements. Plaintiffs further allege that Defendants “engaged in a high-pressure sales pitch designed to induce the Plaintiffs to make a significant financial decision in a short time span with inaccurate information” and that they “intended to induce reliance upon the representations.”
    • It follows that, because Plaintiffs have plausibly pled fraudulent misrepresentation and inducement, they have also plausibly pled the less stringent elements of negligent misrepresentation.
    • Plaintiff successfully pleads that the Defendants, through affirmative statements as well as omissions, led Plaintiffs to believe that they were purchasing specific time share units, or specific types of units. Thus, each Plaintiff reasonably believed that they had purchased a specific unit or type of unit. Each Plaintiff also successfully pleads that they reasonably believed they would be able to reserve their timeshare units at particular times.
  • Plaintiffs allege (1) that they were subject to Defendants’ “high-pressure” sales tactics, (2) that they purchased what they thought were specific units and floor plans, (3) that they made specific attempts to use those units or floor plans, often after a second or third sizeable payment to Defendants, and (4) that they were continually unable to benefit from their performance on those purchases.
  • Plaintiffs have plausibly pled Defendants concealed the true nature of the “floating use plan”
  • CIVIL CONSPIRACY – MOTION TO DISMISS DENIED (as to plaintiffs not time-barred)
    • First, it is apparent from the pleadings that the Defendant companies work together toward the common purpose of selling time share units. The Plaintiffs have pled that Defendants have a close relationship with one another, through common management, parent/subsidiary and partnership relationships, and concerted, centralized sales efforts for the purposes of selling timeshare units to Plaintiffs. Second, Plaintiffs have successfully alleged fraudulent misrepresentation, fraud in the inducement, and negligent misrepresentation, all underlying tortious acts to a civil conspiracy claim. Third, Plaintiffs sufficiently allege that Defendants have done “overt acts” to make timeshare sales, including Westgate’s use of high-pressure sales tactics and their placement of the required documents in difficult to find pockets in sales portfolios. Finally, Plaintiffs have alleged injury in the form of mortgage payments and fees paid for the use and enjoyment of timeshare units that, in most cases, was never delivered.


In response to the timeshare owners’ motion to compel discovery, Westgate agreed to produce “all reservation-related policy documents” and “the sales and closing agents involved with the Named Plaintiffs, as well as their supervisors, their dates of employment and reasons for separation, and current personnel and training manuals for sales and closing representatives;” the court additionally ordered Westgate to produce all training and policy level documents regarding how owners were informed of their right of rescission. [93]

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Docket link

Operative Complaint

Critical Orders

Critical Briefs


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Plaintiffs: Deborah Campbell, Gerold Gallegos, Ellen Gilliland, Larry Gilliland, Cynthia Loveless, Brian Miller, Danyelle Miller, Marilyn Moore, Robert Self, Doris Lashay Smith, Laura Spado, Ryan Spado

Plaintiffs’ counsel: John O Belcher, Belcher Sykes Harrington, PLLC; Kenneth S. Byrd, Mark P Chalos, Christopher E Coleman, John T Spragens of Lieff, Cabraser, Heimann & Bernstein, LLP (Nashville); Kartik S Madiraju of Lieff, Cabraser, Heimann & Bernstein, LLP (NY); Wayne A Ritchie, II, Ritchie, Dillard, Davies & Johnson, P.C.; Richard T Wallace, Richard T. Wallace & Associates, P.C.

Plaintiffs: Tonya Melfi

Plaintiffs’ counsel: Christopher E Coleman, Lieff, Cabraser, Heimann & Bernstein, LLP (Nashville)

Defendant:  CFI Resorts Management, Inc., Central Florida Investments, Inc, Westgate Marketing, LLC, Westgate Resorts Ltd., L.P., Westgate Resorts, Inc., Westgate Vacation Villas, LLC

Defendant’s counsel: Jeffrey A Backman, Richard Wayne Epstein, Benjamin E New  of Greenspoon Marder, P.A. (FL); Gregory C Logue, Robert L Vance of Woolf, McClane, Bright, Allen & Carpenter, PLLC

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