Newton Group Gains Favorable Court Ruling Against Diamond Resorts

PHOENIX, Sept. 18, 2020 /PRNewswire/ -- Newton Group, an industry leader in timeshare exit, received a favorable ruling as a federal court recently denied an argument by Diamond Resorts that a Newton Group advertisement was "literally false." In the July 31, 2020 ruling, the federal court denied Diamond's motion for summary judgement by stating that Diamond Resorts failed to meet its burden of proving that the advertisement is false.

Diamond Resorts asked the Court to find that a Newton Group mail piece stating that timeshare owners "may be affected by new Timeshare Laws allowing developers to raise maintenance fees with no restriction" was literally false. Diamond contended that the mailer is "literally false" because timeshare developers are not permitted to raise maintenance fees and because there have been no laws that permit maintenance fees to be raised without restriction. 

However, in response, the Newton Group presented evidence to the Court showing that the law does permit developers such as Diamond Resorts to raise maintenance fees, and that certain maintenance fees may be raised without restriction, as evidenced by a publication made by Diamond Resorts itself wherein Diamond advises consumers that certain maintenance fees may be raised without limitation. Specifically, Diamond informs consumers that:

"[T]he only limit on any increase in Assessments for Collection Costs is the statutory general limit found in section 721.55(4)(h)2, Florida Statutes, which prohibits the total Assessments for Collection Costs from exceeding 125% of the total Assessments for the preceding fiscal year. This prohibition does not apply to the assessments levied by the Component Site Owners Associations."

The reference to "Assessments" is another way of saying maintenance fees; and by saying that the prohibition (synonymous with "restriction") does not apply to assessments made by Component Site Owners Associations, Diamond is admitting that there is no restriction on the ability to raise maintenance fees on certain timeshares. In other words, while there is a cap prohibiting certain maintenance fees from being raised more than 125% from the prior year, that restriction does not apply to other types of assessments (including maintenance fees) charged by certain resort associations to timeshare owners.

Notably, the federal court stated that it did not have to reach the issue of whether the mailer was true because Diamond Resorts failed to meet its initial burden of presenting evidence "there were no new timeshare laws anywhere in the United States that allowed a timeshare developer to increase maintenance fees without restriction."

The federal court's rejection of Diamond's request to find that the mail piece was literally false, throws cold water on Diamond's publicity stunt in which it insists the advertisement is "undeniably false." Diamond's unjustified smear campaign against the Newton Group is illegitimately designed to confuse and scare consumers from seeking third party assistance when seeking to terminate timeshare ownership.

"Flaskey's position that 'there is simply no need for [exit] companies to exist other than to mislead consumers for their own benefit' is unfair to consumers," said Newton Group President, Gordon Newton. "Flaskey is a salesman, and he has a financial interest in persuading consumers to talk only with Diamond. His position is self-serving and does not solve the problem created by Diamond in the first instance: a percentage of Diamond timeshare owners prefer to work with a third party as they feel they've been burned by Diamond Resorts and no longer trust them."

Newton recently published an Op Ed calling for timeshare exit industry reform to ensure choice and protect consumers when ending their timeshare ownership. Newton Group has many signed and notarized declarations by Diamond timeshare owners who were burned by Diamond, such as a recently published firsthand account of a retired couple asking Diamond to end their timeshare ownership, only to be misled into purchasing an additional $56,000 in timeshare points under false pretenses of being given an exit.

Diamond also misled consumers when it published a false statement about Newton "filing suit against Wesley Financial," when in fact Newton has not filed any lawsuit. Newton has, however, delivered a Cease and Desist demand to Wesley Financial arising from Wesley Financial's plagiarism of Newton's "Consumers Guide to Timeshare Exit." 

Newton Group will continue to vigorously defend itself against the frivolous claims by Diamond Resorts. To date, Newton Group has exposed Diamond Resorts' lawsuit for being based on bogus allegations, including a bogus allegation that Newton Group competes with Diamond, which is an allegation that Diamond was forced to drop midway through the lawsuit; and that Diamond Resorts suffered actual damages because its reputation had been harmed, which Diamond Resorts dropped in the face of a court order requiring it to produce its financials.

Diamond Resorts' false advertising lawsuit against the Newton Group is based on unwarranted allegations.  Newton Group will continue to fight for consumers' right to be free of burdensome Diamond timeshare ownership. 

Newton Group is the #1 trusted name in timeshare exit, serving thousands of timeshare owners for over 15 years, A+ rated at the Better Business Bureau, finalists for the Torch Award for Ethics, authors of "The Consumer's Guide to Timeshare Exit", and has earned countless 5 star reviews at Google, TrustPilot and the BBB.

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SOURCE Newton Group