FRANKFORT, Ky. (Legal Newsline) - Kentucky Attorney General Jack Conway filed a consumer protection lawsuit on Friday against the developers of Green Farm Resort in Grayson County.
3D Resorts-Bluegrass LLC and 3D Resort Communities LLC allegedly violated the state's Consumer Protection Act and the Recreational and Retirement Use Land Sales Act. In addition, the lawsuit alleges that the developers breached a 2008 agreement with Conway's office.
The lawsuit alleges that the companies engaged in unfair, false, misleading or deceptive acts in the marketing and selling of lots at Green Farm Resort in Falls of Rough, Ky.
The defendants are under a suspension notice that was issued by the U.S. Department of Housing and Urban Development ordering them to cease sales and marketing activity. Conway has issued a cease and desist notice to the defendants to stop marketing and sales until they comply with the laws that require the developers to be bonded, registered and approved by Conway before any marketing or sales.
"Businesses that engage in deceptive or unfair marketing practices are not only misleading consumers, they are in violation of the law," Conway said. "My office is committed to enforcing Kentucky's consumer protection laws and protecting consumers from unfair business practices."
Green Farm Resort has been under development since 2001. The original developers, GF Resort LP and Texas developer Samuel D. Ware and others, were sued in 2005. The lawsuit resulted in approximately $2.5 million being placed in escrow for the purpose of infrastructure like waterlines, roads and electric service. The litigation was resolved in 2008 upon the sale of the development to the new developers.
3D Resort Communities LLC and 3D Resorts-Bluegrass LLC then entered into an agreement with Conway's office obligating them to complete additional projects, to escrow an additional $1.2 million for the projects, and to comply with all local, state and federal laws in future sales.