Wyndham

Wyndham v Slattery, Sobel & DeCamp Law Firm, et al.

Case Number: 6:19-cv-01908

Last Updated: June 23, 2022

Status

Pending Motion to Dismiss as to some Defendants

Location

USDC, Middle District of Florida (Orlando)

Presiding Judge

Judge Wendy W. Berger

Date Filed

10/14/2019

Highlights

Case Posture

Claims:

Wyndham’s First Amended Complaint [36], filed in US District Court, Middle District of Florida, alleges violations of the Lanham and Florida Deceptive and Unlawful Trade Practices Acts, tortious interference with contract, and civil conspiracy against California-resident timeshare contract exit attorneys and affiliated marketing companies and individuals. The marketing company has filed a cross-complaint against the exit company for indemnification/contribution.

Posture:

The case is pending rulings on motions to dismiss filed by Slattery, Sobel & Decamp, LLP, Del Mar Group, LLP Carlsbad Law Group, LLP, JL  Slattery (collectively, “the Attorney Defendants”) and Defendants Pandora Marketing LLC, Pandora Servicing LLC, William Wilson and Rick Folk’s (collectively, “Pandora”), and a ruling on Pandora’s related Rule 11 motion. A 5-day Jury Trial is set for 10/24/22; PSC set for 9/15/22

Summary:

In its amended complaint, Wyndham alleges that the Marketing Defendants engage in deceptive and unfair practices, such as (1) offering “guarantees” to Wyndham owners that Defendants will “exit” them from their Wyndham contracts, “even though Defendants know that any such exits rely on Wyndham’s assent and are thus never guaranteed; (2) failing to disclose to and/or concealing from the Wyndham Owners that Defendants’ “exit” “services” often includes a default and foreclosure, and subsequent negative credit impacts, and congratulating the Owners upon foreclosure by lying to the Owners that the ‘exit’ ‘services’ were successful; (3) unscrupulously telling the Wyndham Owners that they are represented by counsel, even though the Owners do not speak to those counsel and those counsel are doing little or nothing to assist the Owners; and (4) concealing from Wyndham Owners that Wyndham has legitimate exit services that the Owners can use without resort to Defendants’ expensive and illusory ‘exit’ ‘services.’ “ Wyndham alleges the advertisements influence Wyndham owners to breach their contracts with Wyndham, diverting payments from Wyndham to the Marketing Defendants and/or engage in fraudulent transfers. Wyndham further alleges that the Marketing Defendants divert Wyndham owners from using Wyndham’s putative voluntary surrender programs, “Wyndham Cares” and/or “Ovation®” which Wyndham alleges “are available to assist Wyndham Owners who may wish to legitimately terminate their timeshare ownership with Wyndham.” Wyndham alleges that the Marketing Defendants’ advertising “causes Wyndham Owners to believe that Wyndham will not help them exit their timeshares. Wyndham alleges that the Wyndham owners “could have used Wyndham’s legitimate trademarked exit services instead of … Defendants’ false exit services, without causing Wyndham to incur fees to foreclose on those timeshares and without causing damage to Wyndham’s goodwill and reputation.” Finally, Wyndham alleges that the Marketing Defendants’ advertising “causes consumers to believe that Wyndham’s business is model and that they were ‘scammed’ into their timeshares, when in reality, their [Wyndham] contracts are legitimate and the [Marketing Defendants] are the ones perpetuating a scam.”

Wyndham alleges that the Attorney Defendants are liable for contributory false advertising because the Marketing Defendants refer Wyndham timeshare owners to the Attorney Defendants. Wyndham alleges that the Attorney Defendants sent demand letters to Wyndham on behalf of “approximately 199 Wyndham owners” who live in various states, but have done “little to nothing to follow-up on those demand letters.” Wyndham alleges that “the Lawyer Defendants undermine any attorney-client relationship by rarely or never filing lawsuits on behalf of those Wyndham Owners related to their timeshares and by rarely or never representing Wyndham Owners in foreclosure proceedings on their timeshare interests,” and that “the lawyers only ‘represent’ timeshare owners for the purpose of breaching contracts under the guise of legality.” [36]

In their Answer, Attorney Defendants admit that they sent 199 demand letters or more on behalf of various clients who were Wyndham Timeshare Owners but deny any advertising was conducted on behalf of the Defendants by a third party.  Attorney Defendants also admitted the Rule 26 disclosures reflected 270 files of Wyndham Owners and three attorneys and a variety of other employees employed by Carlsbad as potential witnesses.  

Attorney Defendants generally denied the Plaintiffs’ allegations of contributory false advertising; false advertising; false advertising against Power Haus; tortious interference with Plaintiffs’ contracts; violations of the FDUTPA; civil conspiracy and asserted thirteen affirmative defenses.  [44]

Selected Events:

11/6/20 – Order entered granting in part, denying part Wyndham’s motion to strike Affirmative Defenses. [244]

Plaintiffs filed a Motion to Strike the Slattery Defendants’ Answer to Plaintiffs’ First Amended Complaint.  In particular, Plaintiffs moved the court to strike the following affirmative defenses:  “privilege to act as attorney and agent of client” (First Affirmative Defense); “litigation privilege” (Second Affirmative Defense); Noerr-Pennington doctrine (Third Affirmative Defense); “void or voidable contracts” (Fourth Affirmative Defense); “unclean hands doctrine (Fifth Affirmative Defense)”; “release/waiver/estoppel doctrine” ( Seventh Affirmative Defense); “privilege for legal advice” (Ninth Affirmative Defense); “lack of due process” (Tenth Affirmative Defense”); and lack of standing as to Plaintiffs SVC-Hawaii, LLC, SVC-Americana, LLC and Shell Vacations, LLC. (Eleventh, Twelvth, and Thirteenth Affirmative Defenses). 

On November 6, 2020, U.S. Magistrate Judge Embry J. Kidd granted Plaintiffs’ Motion to Strike as to the Fourth, Fifth, Seventh, Ninth and Tenth Affirmative Defenses with leave to file an amended Answer on or before November 30, 2020 in compliance with the Court’s order.  The Motion to strike was denied in all other respects.  

The Court found the Third Affirmative Defense (the “Noerr-Pennington Doctrine”) was previously rejected by other Courts when the doctrine was applied at the summary judgment stage.  At that stage,  the Court had evidence alongside the pleadings to determine whether the doctrine should apply.  As such, the Court found it to be premature to strike this affirmative defense at the pleading stage.  The Fourth Affirmative Defense of void or voidable contracts was stricken as the Slattery Defendants did not refute that the defense does not comply with  Fed. R. Civ. P.9(b). 

The Fifth Affirmative Defense was also stricken because the Slattery Defendants could not allege how they were personally injured by Plaintiffs’ conduct.  The Seventh Affirmative Defense of release, waiver and estoppel were stricken due to the improper combining of multiple affirmative defenses in this manner and secondly because the assertion failed to meet the pleading standards under Rule 8. 

The Court found the Ninth Affirmative Defense of privilege for legal advice to also be unsupported by any factual allegations and duplicative of the First Affirmative Defense.  Therefore, the Court struck this affirmative defense.  As to the Tenth Affirmative Defense of due process right to present evidence, the Court also struck this affirmative defense because the Slattery Defendants did not present legal support for this affirmative defense other than California cases which were not controlling or even persuasive authority. 

Of note, as  to the Eleventh, Twelfth, and Thirteenth Affirmative defenses as to the standing of Plaintiffs to file a lawsuit, the court agreed with the Slattery Defendants that Plaintiffs did not have a certificate of authority to transact business in Florida as required by Florida Statute section 605.0904(1), which provides that a foreign limited liability company, such as Plaintiffs, “may not maintain an action or proceeding in this state unless it has a certificate of authority to transact business in this state.”  The Court agreed with the Slattery Defendants that as alleged, the Plaintiffs do more than maintain or settle court proceedings in Florida.  

— 

10/22/20 – Order entered granting in part, denying part Defendant,  Intermarketing Media, LLC’s  Motion to Compel Production of Documents from Plaintiffs. [233]

The Court granted Defendant’s motion in part to require Plaintiffs to respond to revised interrogatories and requests for production within 45 days of the date of the Order. 

10/02/20 – Written Order granting Defendants’ Pandora Marketing LLC, Pandora Servicing, LLC, Rich Folk, William Wilson and Kenneth Eddy Motion for Protective Order and Order to Show Cause as to Plaintiffs’.  [210]

The Court granted and denied  in part Defendants’ Motion for a Protective Order regarding documents Defendants Pandora Marketing LLC, Pandora Servicing, LLC, Rich Folk, William Wilson and Kenneth Eddy inadvertently produced attorney/client privileged documents and attempted to claw back from Plaintiffs.  The Court reviewed the documents at issue in camera and determined that Defendants properly asserted the attorney-client privilege over the disputed documents. 

Plaintiffs were ordered to pay the reasonable expenses including attorney’s fees incurred in responding to the motion for sanctions.

9/24/2020  Defendant Intermarketing Media, LLC,’s Motion to Dismiss the Amended Complaint. [202].

Defendant Intermarketing Media, LLC argued the Amended Complaint should be dismissed as the Court lacked personal jurisdiction over it.  Defendants claimed that Florida was not the appropriate venue for this action as Defendant is incorporated in Wyoming, its principal place of business is in California and the majority of the mutual clients between Plaintiffs and Defendant are located in California.  Defendants  stated that Plaintiffs failed to plead facts with sufficient particularity as required by Rule 9(b) and improperly lumped all Defendants together in violation of Rule 8.  

9/24/20  Defendants, Kenneth Eddy, Rich Folk, and Bo Wilson’s Corrected Motion to Dismiss Plaintiff’s Amended Complaint.   [201].

Defendants, Kenneth Eddy, Rich Folk, and Bo Wilson’s Corrected Motion to Dismiss Plaintiff’s Amended Complaint  claimed the Court lacked personal jurisdiction over Defendants  and the case should be heard in California as nine of the ten defendants are organized, personally reside or the principal place of business is located in California.  Further, none of the key witnesses to Plaintiff’s claims live in Florida.   Defendants asserted the Court also lacked jurisdiction over the Defendants both specifically and generally.  Plaintiffs also failed to sufficiently plead causes of action sounding in fraud for tortious interference with contracts, false advertising under the Lanham Act, Florida’s Deceptive and Unfair Trade Practices Act, and conspiracy, as required by Rule 9(b).

9/24/20  Defendants, Pandora Marketing, LLC and Pandora Servicing LLC’s  Corrected Motion to Dismiss Plaintiff’s Amended Complaint.   [200].

Defendants, Pandora Marketing, LLC and Pandora Servicing LLC’s  Corrected Motion to Dismiss Plaintiffs’ Amended Complaint claims Plaintiffs Amended Complaint should be dismissed on the basis of forum non conveniens as Defendants’ principal place of business, as well as the other entity defendants is located in California, the material witnesses and evidence is located in California and enforcement of judgment would be easier in California than Florida.  Defendants also argued that Plaintiffs failed to plead causes of action against Defendants sounding in fraud with specificity as required by Rule 9(b).  In particular, Plaintiffs failed to plead with specificity causes of action against Defendants for false advertising under the Lanham Act, tortious interference of contracts, violation of Florida’s Deceptive and Unfair Trade Practices Act, and conspiracy.

08/21/2020  Order Denying  Defendants Slattery, Sobel & Decamp, LLP, del Mar Law Group, LLP, Carlsbad Law Group, LLP, and JL Sean’s Motion to Strike Immaterial, Impertinent, and Scandalous Portions of the Complaint in its entirety.[121].

The Court denied Defendants Slattery, Sobel & Decamp, LLP, del Mar Law Group, LLP, Carlsbad Law Group, LLP, and JL SeanMotion to Strike Immaterial, Impertinent, and Scandalous Portions of the Complaint in its entirety.  The Court declined to strike allegations regarding Andris Pukke (“Pukke Allegations”)  and his interactions with the Federal Trade Commissioner as Defendants failed to explain how the Pukke Allegations would prejudice the Court and jury against them.   Secondly, even though Mr. Pukke was dismissed from the action, he remains relevant as Plaintiffs alleged he was part owner of one of the named defendants, Pandora Marketing. 

The allegations regarding Timeshare Exit were also not stricken as Defendants failed to demonstrate how the allegations are immaterial to the case.  The Court agreed with Plaintiffs argument that the Timeshare Exit allegations should not be stricken as it provided an overall context as to how timeshare exit companies operate.

07/23/2020 Transcript of Video Conference of Plaintiffs’ Motions to Compel further responses to interrogatories and production of documents hearing  [109]

The Court heard all parties arguments regarding why certain interrogatories and documents should/should not be compelled.  The Court denied and granted Plaintiff’s Motions to Compel in part.  The Court denied the motions to compel to the extent that the Pandor defendants should have provided the spreadsheets that set forth the financial information contained in underlying documents  and should have included information for the non-Wyndham owners.  The Court ruled that it would not require underlying financial information supporting the spreadsheets at this time and would allow the Plaintiffs to raise the issue again if discovery revealed additional information entitling Plaintiffs to the underlying documents.  

7/9/2020  Order Granting and Denying in Part Plaintiffs’ Motions to Compel Production of Documents from Defendants William Wilson, Kenneth Eddy, Rick Folk, Pandora Marketing, LLC, Pandora Servicing, LLC, and Intermarketing Media, LLC.

The Court granted Plaintiffs Motion in part as to certain requests for production of financial discovery.  Instead of producing the documents response to the requests for production, defendants Wilson, Eddy, Folk, Pandora Marketing, and Pandora Servicing  would be able to provide Plaintiffs with spreadsheets summarizing the information that was contained in the financial documents.

The court granted Plaintiffs’ motion to compel as to Defendant Intermarketing media, LLC in its entirety. 

3/03/2020 Plaintiffs’ Motion to Strike the Slattery Defendants’ Affirmative Defenses and Incorporated Memorandum of Law.   [55] 

Plaintiffs filed a Motion to Strike certain affirmative defenses raised in Defendants Slattery, Sobel & Decamp, LLP; Del Mar Law Group, LLP; Carlsbad Law Group, LLP, and JL “Sean” Slattery’s  (collectively, “Slattery Defendants”) Answer to the Amended Complaint as not being compliant with the pleading requirements of Fed. R. Civ. P. 12(f). 

In particular, Plaintiffs moved the court to strike the following affirmative defenses:  “privilege to act as attorney and agent of client” (First Affirmative Defense); “litigation privilege” (Second Affirmative Defense);; Noerr-Pennington doctrine (Third Affirmative Defense); “void or voidable contracts” (Fourth Affirmative Defense); “unclean hands doctrine (Fifth Affirmative Defense)”; “release/waiver/estoppel doctrine” ( Seventh Affirmative Defense); “privilege for legal advice” (Ninth Affirmative Defense); “lack of due process” (Tenth Affirmative Defense”); and lack of standing as to Plaintiffs SVC-Hawaii, LLC, SVC-Americana, LLC and Shell Vacations, LLC. (Eleventh, Twelvth, and Thirteenth Affirmative Defenses). 

Parties

Plaintiffs:  Wyndham Vacation Ownership, Inc.;  Wyndham Resort Development Corporation; Shell Vacations, LLC; SVC-Americana, LLC; SVC-Hawaii, LLC

Plaintiffs Counsel:  Daniel Joseph Barsky of Holland & Knight LLP; Glennys Ortega Rubin, Jason Brent Gonzalez, Michael James Quinn, Todd Fredrick Kobrin, Christian Leger, Alfred J. Bennington , Jr. of Shutts & Bowen, LLP

Defendants:

Slattery, Sobel & Decamp, LLP and affiliated entities and individual represented by Brian Wagner and Scott Gabrielson of Mateer & Harbert, PA

Pandora Marketing, William “Bo” Wilson, and Rich Folk represented by Robert Klein, Houston Park and Mark Costello of Klein Park & Lowe, P.L.

Intermarketing Media, LLC d/b/a Resort Advisory Group – Daniel DeSouza of DeSouza Law, P.A.

Individual defendant Kenneth Eddy represented by Kyle Berglin and Manuel Centurion of Boyd, Richards, Parker & Colonnelli, PL

Movant: 

Yuge Internet Marketing, LLC represented by Christian Waugh of Waugh Law, PA

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