Time-share company agrees to pay $339,000 settlement

JEFFERSON CITY, Mo. (Legal Newsline)-A North Carolina-based time-share broker has agreed to pay about $339,000 to settle claims by the Missouri attorney general that the company mislead customers into buying time shares.

Attorney General Jay Nixon filed the settlement agreement Wednesday in Cole County Circuit Court. Under the agreement, Festiva Resorts LLC will pay $324,393 in restitution to consumers, $5,000 in civil penalties and $10,000 to the state of Missouri.

Festiva Resorts LLC allegedly used false and misleading sales tactics to sell time shares at the Cabins at Green Mountain near Branson, Mo.

Nixon filed a lawsuit in November 2005 against the Asheville, N.C -based company alleging it violated Missouri consumer protection laws by misleading customers into buying time shares.

The lawsuit alleged that Festiva lured customers by promising to, among other things, help them sell other time shares they owned, help them rent out time shares they bought from Festiva, and help them get discounted deals on condo rentals in attractive locations.

The company was also accused of rushing consumers into sales by creating a high-pressure sales environment.

Under the agreement, Festiva agreed to stop using false and misleading sales pitches to market and sell its time shares.

The company will pay $106,885 to consumers who have filed unresolved complaints with the attorney general's office prior to June 25 and have utilized their timeshare at least once, and $217,508 to consumers who have filed unresolved complaints prior to June 25 and have never used their timeshare.

Consumers who have used their timeshare on at least one occasion have the option of deeding their timeshare back to Festiva and receiving a partial refund, of retaining their timeshare and receiving a small cash payment or of retaining their timeshare and receiving a free status upgrade, the attorney general's office said.

From Legal Newsline: Reach reporter Chris Rizo by e-mail at chrisrizo@legalnewsline.com.

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