Manhattan Club Lawsuit

Hi, my parents are long time owners at The Manhattan Club. They have always paid their maintenance fees, and it has become a burden on them. They are both older and unable to deal with their finances/ timeshares, so I've been asked to manage them for them. I had been following some of the earlier forum posts, about the lawsuit/settlement with the soon to be ex nyag, towards the end of last year. But hadn't seen anything new about it until now. I received the maintenance fee notice for 2019 and have been debating about paying it. First of all, should I pay it? Second, I would like to join the coalition and anything else that will fight this injustice, for my parents. Please add me: lizardrain@hotmail.com. Any advice about paying the 2019 maintenance fee would be gladly appreciated. I know it us due Monday, but having a hard time wanting to give TMC anymore of my parents money. Thanks!

nathanz2 wrote:

I have not sold them my time-share interest, so I don't expect any documents of any sort. How about you - have you sold?

I requested the papers back in early November but so far nothing has arrived. I phoned a couple of weeks ago and left my contact info but have had no return call. Either they are overwhelmed with the response or they don't really intend to buy out owners. I'm hoping it's the former.

There never was a lawsuit. Maybe one will develop but I haven't seen a big-time class-action firm weigh in yet. Read (below) the (now-disgraced) AG's settlement and the self-serving press release which describes a slap on the wrist. This is a mess for the average owner who hasn't the energy or resources to take on this large criminal conspiracy. Direct negotiations with TMC are a waste of time, as their only respondents are the financial people whose sole job is to keep "owners" paying. If you fail to pay, you are threatened with exorbitant penalties, foreclosure with resultant damage to your credit rating and a guarantee that you'll never seen a penny of the tens of thousands you "invested" in NYC real estate. A realtor friend and TMC owner stopped paying two years ago, letting the chips fall as they may. That's probably the best option for most of us. Chalk it up to a bad decision, write it off your list of assets and get on with your life.

https://ag.ny.gov/sites/default/files/manhattan-club-aod_0.pdf

A.G. Schneiderman Announces $6.5 Million Settlement With Midtown Manhattan Timeshare That Scammed Purchasers

The Manhattan Club, Timeshare In Midtown Manhattan, Will Pay Restitution To Hundreds Of Purchasers That Were Misled About Their Ability To Reserve Rooms And Resell Shares

Settlement Is The Largest In Recent History Of The AG’s Real Estate Finance Bureau

Schneiderman Reminds New York Residents To Be Wary Of High-Pressure Sales Traps Utilized By Some Timeshare Companies

NEW YORK – Attorney General Eric T. Schneiderman today announced a $6.5 million settlemnt with the owners and operators of the Manhattan Club, a timeshare building in Midtown Manhattan, over the sponsor’s repeated false promises to potential and current share owners. The settlement is the largest in recent history for the Attorney General’s Real Estate Finance Bureau. Under the terms of the settlement, the operators of the Manhattan Club, at 200 West 56th Street, acknowledge that they repeatedly misled shareowners about the club’s reservation process, their ability to sell back their shares, and the details of the club’s state-approved offering plan.

“The owners of the Manhattan Club lured thousands of timeshare buyers with false promises and shady sales tactics that violated New York law,” said Attorney General Schneiderman. “While timeshares can be legitimate enterprises, scams like this one are common. To avoid becoming a victim, always be wary of high pressure sales tactics.”

The club bills itself as a “unique” “residence-style boutique hotel” that blends “a vacation ownership retreat with a luxury suite hotel” and that offers “a hard-to-find haven in the midst of this active city.” The website appeals to people who “frequently visit New York City to enjoy Broadway theatre, fine dining and shopping, [and] classical performances.” The owners and operators in this case are T. Park Central LLC, O. Park Central LLC, Park Central Management, LLC, Ian Bruce Eichner, Leslie H. Eichner, Stuart P. Eichner, Scott L. Lager, Hospitality Advisors, LLC, New York Urban Ownership Management, LLC, and Manhattan Club Marketing Group LLC.

In addition to the $6.5 million restitution to eligible timeshare owners, the settlement requires:

The owners and operators to be barred from the timeshare industry The owners and operators will sell their stakes to a third-party purchaser and relinquish management control Remove all sponsor-appointed current officers and directors from their positions as members of the Board of the Timeshare Association. Eligible timeshare owners will be contacted by a Claims Administrator at a later date about disbursement of the restitution.

The Office of the Attorney General (OAG) began investigating the Manhattan Club in 2014 after receiving repeated complaints from shareowners who paid tens of thousands of dollars to become Manhattan Club “owners,” but were unable to make reservations due to a claimed lack of available rooms by the hotel’s operators. At the same time, rooms in the Manhattan Club were being rented over the internet to the general public, in violation of the timeshare’s offering plan.

In Spring 2014, OAG sent undercover investigators to record the Manhattan Club’s “Vacation Ownership Experience” sales presentation. Investigators found evidence indicating that the Manhattan Club’s sales tactics amounted to a bait-and-switch scheme.

Prospective purchasers were baited by a relentless sales pitch that included a number of misleading promises, including that ownership in the Manhattan Club is “better than money in the bank.” Prospective buyers were also told that the club does not rent rooms to the general public, that reservations were easy to make, and that few restrictions apply to reservations by owners. But these promises were false. For example, contrary to the club’s explicit promises in its offering plan, room availability to owners was greatly limited because rooms were being rented out to the general public. That means that all reservations are subject to availability and owners, in some cases, were unable to use any of the time they purchased. Further, the owners’ annual common charges jumped approximately 200% in the last ten years – to about $2,000 per ownership interest per year for the smaller units – on top of the upfront purchase costs that ranged from just under $10,000 to over $40,000 per ownership interest. Some frustrated owners have sold their ownership interests back for a mere $1, just to escape the burdens of paying these charges.

In July 2014, pursuant to General Business Law section 354, a provision of New York’s Martin Act that confers broad powers on the Attorney General to investigate and halt fraud, a Manhattan Supreme Court justice barred the Manhattan Club from selling timeshare interests, preventing them from withdrawing money from certain bank accounts, and stopping them from foreclosing on Manhattan Club purchasers during the pendency of the investigation.

Carol, as far as getting them to reduce the fee - no that will most likely never happen. The fees are going up - not down. Many of us have joined the lawsuit (Attorney Jean Marc Zimmerman). Mr Z has been working hard, being very aggressive to gain access to the 18000 members (which is the first hurdle).

Sue, What are the specifics of the Zimmerman proceedings? Has a suit actually been filed? Is it too late to join? What's the upfront cost, if any? I assume Z. isn't taking this on contingency even though the scam netted the Eichners tens of millions of dollars and a potential big payday for an attorney if there's a cogent case to be made. I know TMC continues its practices of renting properties to any and all for 50 cents on our dollar; this fact might help the attorney but isn't likely to bring the OAG back into this mess.

has mr tucker had a "sitdown" with the upper echelon of TMC management for a meeting of the minds concerning the list of owners of TMC shares? that i recall, that action was directed by the judge in the december 12 hearing that mr zimmerman arranged.

To JT and other recent arrivals on this thread: this discussion has been ongoing for years. While the questions you raise are of great importance to you individually, all of them have been raised here before. So you can bat ideas back and forth until this reaches 500 pages, or you can read the thread for the last year or so, or you can do a search here for Jean Marc Zimmerman (the knowledgeable attorney representing a group of dissatisfied owners.) Anything posted here by owners is more in the way of opinion than actionable advice. In fact, I would recommend not doing anything you are "advised" here without consulting with your own qualified advisors. For real advice tailored to your own situation, you need to speak to an attorney familiar with NY real estate law, possibly your estate attorney and probably your tax and financial advisors. Good luck!

Thanks, Nathan. I certainly don't take anything said here as legally sound. I know it's just a lot of us letting off steam. I have been reading this stuff for years. Facts are hard to come by but there are some helpful links and experiences. I guess we're all frustrated to realize that we've been victims of a (legally proven) scam and in effect have each lost tens of thousands of dollars of value because of the greed of the Eichners. Further, we're coerced to keep paying money to them or the people who have bought us from them. A little like financial slavery, isn't it?

I pay my maintenance and enjoy my days. They are not always my 'first choice", but I've lost very few over the years. My personal hopes include an owner managed board, transparent reservations, efficient management and a restored secondary market. If you look at timeshare sales generally, you quickly see that resales rarely take place at more than a small fraction of the original price. The seller receives a nominal price, the buyer pays the broker and closing costs. Sometimes the seller pays the broker and closing costs to get out of a less desirable situation. The only exception I've seen where sellers receive more is for high demand fixed weeks. But I just hope the restoration of marketability would allow people who need or want to exit to do so without continuing to be held captive.

I’m afraid that the founders/management has contaminated a great idea and made this a toxic product worth less than nothing. BTW how would we know if some of these posts are from TMC spoofing? We wouldn’t.

rather than "letting off steam" in this forum (as many of us have been doing, including me, ) why has no one responded to my comment/question (not letting off steam, but a reasonable, informational query) about the former owner-board member, mr tucker's meeting with TMC MANAGEMENT (as directed by the judge in mr zimmerman's december 12 hearing) regarding getting access to owners' list and contact information? that's a pivotal issue, directly related to the establishment of mr zimmerman's possible lawsuit. why are we still in the dark about this major scenario? hopefully, someone will come forward with a substantive answer to my question.

fyi,

i received this information regarding the TMC's owners' list in relation to privacy laws from a source that i consider reliable:

It is against privacy laws, otherwise, anyone could spam others directly. However, in a class action lawsuit, where approved by the court, the attorney has access to all contact information.

Is Mr. Zimmerman filing a class-action suit?

J. T.,

He is not.

He is trying to work for the Owners who hired him in a parallel way using the same basic approach for each case. He is trying to keep costs down, sign up as many owners as he can (including me), and, as part of the deal, he also keeps any bonus awards such as punitive damages.

While I can't remember the details, a class action was a non-starter, and he could not afford to work on a contingent-only basis (neither could any other attorney).

While he may or may not be successful, this is the only viable approach the owners have right now. For all the hundreds of pages of venting, nobody has a better approach. The State of New York has no more interest in the case, and the city never did have an interest.

hi craig, i understand your comments; however my question about the success of mr tucker's (court suggested/recommended) meeting with TMC management to work out a method of an attorney using the owners' list (i assume under court supervision) for purposes of establishing a case involving as many owners' as possible, remains unanswered. did or didn't tucker meet with TMC MGMT yet, and what was the outcome if he did? regardless of whether this is a class action suit or not, the list appears to be a key component of whichever type of lawsuit is brought to court. bottom line: owners need an answer regarding the availability of the owners' list to help them make an appropriate decision regarding joining a lawsuit. if the number of owners being part of any court proceeding is essential, that makes the list of owners obviously essential. this issue needs to be addressed.

craigr32 wrote:

J. T.,

He is not.

He is trying to work for the Owners who hired him in a parallel way using the same basic approach for each case. He is trying to keep costs down, sign up as many owners as he can (including me), and, as part of the deal, he also keeps any bonus awards such as punitive damages.

While I can't remember the details, a class action was a non-starter, and he could not afford to work on a contingent-only basis (neither could any other attorney).

While he may or may not be successful, this is the only viable approach the owners have right now. For all the hundreds of pages of venting, nobody has a better approach. The State of New York has no more interest in the case, and the city never did have an interest.

I strongly oppose the high maintenance fees. I was never forewarned prices would increase this much. How can one be assured maintenance prices will not continue to escalate. Let the visitors maintain the property since they are the ones benefiting from the stays and most owners are not, least not me. Thank you alexcrystal22 for taking and stand

hello jt,

it appears that there's no question regarding zimmerman's need for the TMC owners' list. TMC will certainly not relinquish this list, without a court's demand, citing privacy issues, a clever but viable and reasonable way of refusal. PERHAPS if zimmerman convinces the court that he needs the TMC owners' contact information to establish his lawsuit (regardless of the type of suit) he might get use of the list which would likely be only under the court's supervision to protect privacy laws/issues. i agree with you, with reservation, about new york state's lack of interest in our case. however, if the current nysag, barbara underwood takes a close look at how schneiderman bungled his case merely by accepting the nonsensical SETTLEMENT, having proven and having been admitted to by TMC that fraud was committed, there's criminality involved here. my conclusion is that zimmerman has a case, given his ability to use the famous or infamous LIST, and the nysag could also enter this arena of biblical proportions if she wished to do so.

my questions remain unanswered: did tucker confer with TMC management regarding the list of TMC owners' contact information as the court recommended at the december 12 hearing arranged by zimmerman.? if so what was the result of that meeting? did tucker get use of the list? does zimmerman also have access to the list to use in developing his suits?

craigr32 wrote:

J. T.,

He is not.

He is trying to work for the Owners who hired him in a parallel way using the same basic approach for each case. He is trying to keep costs down, sign up as many owners as he can (including me), and, as part of the deal, he also keeps any bonus awards such as punitive damages.

While I can't remember the details, a class action was a non-starter, and he could not afford to work on a contingent-only basis (neither could any other attorney).

While he may or may not be successful, this is the only viable approach the owners have right now. For all the hundreds of pages of venting, nobody has a better approach. The State of New York has no more interest in the case, and the city never did have an interest.

We finally decided to stop paying for something we can't use. Today I put our tax payment in the mail, but declined to pay the fee. Crossing in the mail is a letter from the Manhattan Club threatening us with 16% interest plus a $50 late fee. The reason we haven't stopped our payments before is because we were worried about repercussions once (if ever) this is all settled. Now we have a new concern. For those of you who have stopped paying your yearly fee, what did you do to protect yourselves from this usurious problem, if anything?

what were the results of tucker's meeting with TMC's board of directors regarding access to the owners' contact list? this is critical information needed by owners which hasn't been addressed here since mr zimmerman's court hearing on december 12, 2018. it is assumed that one of redweek.com's contributors will shed revealing light on this matter in the very near future.

I was just billed for the 2019 maintenance fees last week. Like Liz and Carol, I am in a dilemma whether to pay or not. Please advise. I have been paying the annual maintenance fees without fail since 2001. It was less than a thousand during those early years but it has escalated to more than 2.5 times in recent years. I absolutely feel the pinch n certainly feel being robbed and fleeced. I live and work in East Asia and so I always stayed a full week at TMC in the past with so much enjoyment spent at TMC besides California and Florida.

My very busy daughter in New York who works as a young doctor at a large medical center in New York told me that she also worked on Christmas Day and New Year Day recently in 2018/19 and I bet that she worked hard on Thanksgiving Day too. How could I bring myself to ask her to manage my Manhattan Club Time Share at this moment ??

I am feeling helpless, clueless, hopeless......and being faraway. I need some good advice from you guys. First advice is : Pay or not to pay this year ?? My reservation for a Junior suit in May 2019 is still there.