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1 ELECTRONICALLY FILED 6/15/2009 4:12 PM CV CIRCUIT COURT OF TUSCALOOSA COUNTY, ALABAMA MAGARIA HAMNER BOBO, CLERK IN THE CIRCUIT COURT OF TUSCALOOSA COUNTY, ALABAMA JACK MEADOWS, on behalf of himself and ) all those similarly situated, ) ) PLAINTIFF, ) ) v. ) CIVIL ACTION NO.: ) RESORTQUEST INTERNATIONAL, INC.; ) ) ) DEFENDANT. ) CLASS ACTION COMPLAINT COMES NOW Plaintiff Jack Meadows ( Plaintiff ), on behalf of himself and the class of persons defined below, and brings this Complaint against Defendant ResortQuest International, Inc. (referred to herein as Defendant or ResortQuest ), alleging as follows: PARTIES 1. Plaintiff Jack Meadows is a resident citizen of Tuscaloosa County, Alabama. Plaintiff Meadows, on various occasions, has vacationed at and rented ResortQuest managed property. 2. Defendant ResortQuest International, Inc. is a corporation organized and existing under the laws of Delaware with its principal place of business in Nashville, Tennessee. Upon information and belief, Defendant ResortQuest International, Inc. does business in Tuscaloosa County, Alabama. Courthouse News Service JURISDICTION AND VENUE 3. This Court has jurisdiction over this action. The Plaintiff and certain other members of the proposed class are citizens of Alabama, and Defendant does business in Alabama. The injuries and damages suffered by the Plaintiff occurred in Alabama. Moreover,

2 some of the Defendant s conduct that gives rise to this action occurred in Alabama. 4. Venue is proper in this Court because the Plaintiff resides in Tuscaloosa, some of the injuries and damages sought occurred in Tuscaloosa, and the Defendant does business in Tuscaloosa. FACTUAL ALLEGATIONS 5. ResortQuest is the nation s largest rental property management company with over 17,000 units managed world-wide. 6. ResortQuest manages vacation rental properties which are independently owned. Each participating property is exclusively managed by ResortQuest. ResortQuest markets, manages, processes, and oversees the rental of each single unit at all its participating properties. ResortQuest s activities include: solicitation of renters, charging and collecting rent, facilitating guest check-in and check-out, customer service, and other day-to-day activities required to manage the rental units at its participating properties. ResortQuest does not own the rental units or the contents of the rental units. 7. Plaintiff has rented vacation properties managed by ResortQuest in Gulf Shores, Alabama. In these and all other ResortQuest rental transactions, Plaintiff and other renters enter into rental contracts with ResortQuest. ResortQuest collects rental fees from the renters, like Plaintiff, and, in turn, pays some portion of these rental fees to the actual owners of the properties. 8. As part of the rental contract, ResortQuest charges customers, including the Plaintiff, rent and other fees identified as Amenities Package, Reservation Processing Fee, and Damage Waiver Fee. ResortQuest describes Damage Waiver as protection for potential damage caused to the rented unit. According to ResortQuest, the Damage Waiver protects up to

3 $2,500, or $3,000 at some properties, of damage caused to the rented unit. The Damage Waiver Fee is mandatory on all ResortQuest managed rental units. The Fee is set at either 4% of the unit s total rental fee or $25.00 or $50.00, depending on the length of the rental. A claim for coverage under the Damage Waiver Fee must be made by the Renter at or before check-out or the coverage is void. 9. The mandatory Damage Waiver Fee is not a waiver but is instead insurance. First, ResortQuest does not have any ownership or other interest in the rented property. Therefore, it has no rights which it can waive with respect to the rented property. Second, because the Damage Waiver is mandatory and because ResortQuest does not own the property, it operates as insurance by shifting the risk for expenses associated with property damage to a third-party (ResortQuest), as opposed to the renter or the owner being responsible. 10. ResortQuest retains the entire Damage Waiver Fee. None of it is paid to the actual owners of the rental units. In fact, the decision to charge the Damage Waiver Fee is made by ResortQuest at its corporate headquarters in Nashville, Tennessee and not by the owners of the units. 11. The Damage Waiver Fee is an unreasonably high charge when compared to the amount of coverage provided to the customer. Moreover, because the Damage Waiver Fee is based on the total rent due or the length of the rental, it has no rational or reasonable relationship to the amount of coverage or the risk associated with the particular renter. 12. Upon information and belief, ResortQuest knows that the mandatory Damage Waiver Fee operates like insurance but would likely not be approved by any state insurance department because of the unreasonably high amount of the fee as compared to the coverage

4 provided. ResortQuest has mislabeled the insurance as a waiver in order to avoid regulatory scrutiny. 13. ResortQuest does not have a license to sell insurance in the state of Alabama, Tennessee or any other state. Therefore, the Damage Waiver Fee is an illegal charge. 14. The Damage Waiver Fee is also a fraudulent charge or scam charge because, upon information and belief, ResortQuest has no obligation, contractual or otherwise, to repair or replace any property damaged by a renter. Waiver. 15. The Plaintiff has not made any claim for payment of damages under the Damage 16. ResortQuest, not the independent property owners, makes the determination to assess and collect the Damage Waiver Fee at its corporate headquarters and principal place of business in Nashville, Tennessee. At the direction of ResortQuest management in Nashville, Tennessee, ResortQuest employees assess and collect the Damage Waiver Fee at all of its participating properties in the United States. The Damage Waiver Fees are, upon information and belief, forwarded to ResortQuest s headquarters in Nashville. In addition, ResortQuest mails advertisements and solicitations from its Nashville headquarters to customers all over the United States. CLASS ACTION ALLEGATIONS 17. The Plaintiffs bring this case as a class action pursuant to Rules 23(a), 23(b)(2), and 23(b)(3) of the Alabama Rules of Civil Procedure. The Plaintiffs seek certification of this case as a class action on behalf of the following class of individuals: All United States residents who have paid ResortQuest the Damage Waiver Fee or a fee for any other similarly described service and who have not made a claim under the Damage Waiver (referred to herein as Damage Waiver Fee Class ).

5 18. The Plaintiff is a member of the Damage Waiver Fee Class. 19. Membership in the Damage Waiver Fee Class is so numerous that separate joinder of each member is impracticable. The exact number of class members in the Damage Waiver Fee Class is unknown to the Plaintiff. ResortQuest s records should be able to identify all members of the Damage Waiver Fee Class. 20. There are numerous and substantial questions of law and fact common to the Damage Waiver Fee Class. Included within the common questions are: (a) Whether ResortQuest was legally entitled to charge a Damage Waiver Fee to the class members; (b) Whether the Damage Waiver operates as insurance; (c) Whether the Damage Waiver is not a waiver; (d) Whether ResortQuest has a waiveable interest in the property it rents; (e) Whether ResortQuest breached the valid agreement between itself and the class members by charging the Damage Waiver Fee; (f) Whether Defendant unlawfully profited by charging the class members the Damage Waiver Fee; (g) Whether the Damage Waiver constitutes an unconscionable contract; (h) Whether the Damage Waiver Fee is unreasonably and unfairly inflated; (i) Whether ResortQuest was unjustly enriched by charging the class members the Damage Waiver Fee; (j) Whether ResortQuest breached any contracts with the class members; (k) Whether ResortQuest committed fraud by charging the class members the Damage Waiver Fee;

6 (l) Whether ResortQuest committed fraudulent concealment or suppression by charging the class member the Damage Waiver Fee without informing the class members that it does not have a license to sell insurance in any state; (m) Whether ResortQuest should be permanently enjoined from charging the Damage Waiver Fee; (n) Whether ResortQuest committed wanton conduct by charging the class members the Damage Waiver Fee; (o) Whether ResortQuest should be required to disgorge, for the benefit of the class members, all monies it has collected as a result of the Damage Waiver Fee; (p) Whether the ResortQuest violated the Tennessee Consumer Protection Act, Tennessee Code Ann , et seq., by assessing and collecting the Damage Waiver Fee. (q) In the event of certification of a class pursuant to Rule 23(b)(3), the proper measure of damages that ResortQuest should be required to pay the class members. 21. The Plaintiff s claims are typical of the members of the Damage Waiver Fee Class. 22. The Plaintiff will fairly and adequately represent and protect the interests of the Damage Waiver Fee Class. The Plaintiff has retained counsel experienced and competent in prosecution of class actions and complex litigation. The Plaintiff has no interests that are adverse to the interests of the Damage Waiver Fee Class. 23. Final class injunctive and/or declaratory relief under Rule 23(b)(2) of the Federal Rules of Civil Procedure is appropriate in this case because ResortQuest has acted on grounds

7 generally applicable to the Damage Waiver Fee Class. Final injunctive or corresponding declaratory relief barring ResortQuest from charging its customers the Damage Waiver Fee is appropriate with respect to the Damage Waiver Fee Class as a whole. 24. This action qualifies for certification under Rule 23(b)(3) of the Federal Rules of Civil Procedure because questions of law and fact common to the members of the Damage Waiver Fee Class predominate over any questions affecting only individual members, and a class action is superior to other available methods for the fair and efficient adjudication of the controversy. 25. Absent a class action, members of the Damage Waiver Fee Class will continue to suffer damage, and the wrongful conduct and violations of law by ResortQuest will proceed without remedy while ResortQuest continues to retain the proceeds of ill-gotten gains. 26. Most individual members of the Damage Waiver Fee Class have little ability to prosecute an individual action due to the comparatively small, although significant, actual damages suffered by the class members individually and the significant cost associated with litigation against ResortQuest as a large and sophisticated business. 27. This action will result in an orderly and expeditious administration of class claims. Economies of time, effort, and expense will be fostered and uniformity of decisions will be ensured. 28. This action presents no difficulty that would impede its management by the Court as a class action, and a class is superior to other available methods for the fair and efficient adjudication of the claims. 29. Plaintiff seeks preliminary and permanent injunctive and equitable relief on behalf of the Damage Waiver Fee Class to stop the wrongful conduct described herein.

8 COUNT I BREACH OF CONTRACT 30. The Plaintiff repeats and realleges all of the other paragraphs in this Complaint as if fully set forth herein. 31. The Plaintiff and the other members of the Damage Waiver Fee Class entered into contracts with ResortQuest to rent independently owned vacation property. 32. ResortQuest s assessment and collection of the Damage Waiver Fee constitutes a breach of the rental contract described herein because it required the Plaintiff and the other class members to pay an illegal and unconscionable charge. 33. ResortQuest s assessment and collection of the Damage Waiver Fee caused damage to the Plaintiff and other members of the Damage Waiver Fee Class by forcing the payment of excessive, unearned, illegal and unnecessary fees. 34. The Damage Waiver Fee is excessive, unearned, unnecessary and illegal since Defendant had no waiveable interest in the independently owned rental property, no license to sell insurance, and because the Damage Waiver Fee is an unreasonably high and inflated charge when compared to the relatively small amount of benefit or coverage provided to the Plaintiff and the other members of the Damage Waiver Fee Class. 35. As a proximate result of ResortQuest s breach of contract, the Plaintiff and other members of the Damage Waiver Fee Class have suffered damages. COUNT II UNJUST ENRICHMENT 36. The Plaintiff repeats and realleges all of the other paragraphs in this Complaint as if fully set forth herein. 37. ResortQuest does not have a license to sell insurance in any state. The Damage Waiver Fee is an insurance product. Therefore, the Damage Waiver Fee charged to the Plaintiff

9 and the other members of the class is an illegal charge that ResortQuest had no right to collect. 38. ResortQuest has been unjustly enriched by charging the Plaintiff and the members of the Damage Waiver Fee Class the Damage Waiver Fee. 39. The Plaintiff, and the members of the Damage Waiver Fee Class, are entitled to restitution of all Damage Waiver Fees collected by Defendant. COUNT III MONEY HAD AND RECEIVED 40. The Plaintiff repeats and realleges all of the other paragraphs in this Complaint as if fully set forth herein. 41. ResortQuest holds money which in equity and good conscience belongs to the Plaintiff and the members of the Damage Waiver Fee Class and which the Plaintiff and the members of the Damage Waiver Fee Class paid to ResortQuest because of mistake or wrongful conduct by ResortQuest. 42. The Plaintiff and the members of the Damage Waiver Fee Class are entitled to restitution of all Damage Waiver Fees collected by ResortQuest. COUNT IV SUPPRESSION/CONCEALMENT 43. The Plaintiff repeats and realleges all of the other paragraphs in this Complaint as if fully set forth herein. 44. ResortQuest intentionally failed to disclose to the Plaintiff and the members of the Damage Waiver Fee Class that the Damage Waiver is insurance, that the Damage Waiver Fee is an unreasonably high and inflated charge when compared to the relatively small amount of benefit or coverage provided to the Plaintiff and other members of the Damage Waiver Fee Class, and that ResortQuest had no rights in the rented property which it could waive. 45. ResortQuest had a duty to disclose this information based upon, among other

10 reasons: (1) the charge was mandatory, (2) ResortQuest represented to customers that the Damage Waiver Fee is a waiver when in fact it is insurance, (3) ResortQuest did not have a license to sell insurance in any state, and (4) ResortQuest had sole possession of information about its lack of interest in the rented property and the fact that it had no rights to waive. 46. The Plaintiff and the members of the Damage Waiver Fee Class reasonably relied upon ResortQuest to disclose material facts relating to the fees charged by Defendant. 47. Without the benefit of this information, the Plaintiff and the members of the Damage Waiver Fee Class acted to their detriment by paying the Damage Waiver Fee. 48. As a proximate result of ResortQuest s fraudulent suppression and concealment, the Plaintiff and the members of the Damage Waiver Fee Class have suffered damages, including the illegal payment of Damage Waiver Fees. COUNT V FRAUD 49. The Plaintiff repeats and realleges all of the other paragraphs in this Complaint as if fully set forth herein. 50. ResortQuest represented to the Plaintiff and the members of the Damage Waiver Fee Class that the Damage Waiver Fee was a legal charge by ResortQuest for the waiver of its right to recover for damage to the rented property. 51. ResortQuest made this representation to Plaintiff at the time of the rentals. In addition, ResortQuest repeatedly and continually makes these representations on its website and in written materials made available to the public. These representations are false because the Damage Waiver Fee is an illegal charge, is actually insurance, and because ResortQuest has no interest in the rented property that it can waive. ResortQuest knew that the representations were false at the time they were made, and ResortQuest made the misrepresentations with the

11 intent to deceive the Plaintiff and the other members of the Damage Waiver Fee Class. 52. The Plaintiff and the members of the Damage Waiver Fee Class reasonably relied upon these representations by paying the Damage Waiver Fee and renting the subject vacation properties. 53. As a proximate result of ResortQuest s fraud, the Plaintiff and the members of the Damage Waiver Fee Class have suffered damages, including the payment of the illegal Damage Waiver Fee. COUNT VI WANTONNESS 54. The Plaintiff repeats and realleges all of the other paragraphs in this Complaint as if fully set forth herein. 55. ResortQuest s conduct, as described herein, constitutes wantonness. 56. As a proximate result of ResortQuest s wanton conduct, the Plaintiff and the members of the Damage Waiver Fee Class have suffered damages. COUNT VII TENNESSEE CONSUMER PROTECTION ACT, TENN. CODE ANN , ET SEQ. 57. The Plaintiff repeats and realleges all of the other paragraphs in this Complaint as if fully set forth herein. 58. ResortQuest s actions, as described herein, of assessing and collecting the Damage Waiver Fee violate the Tennessee Consumer Protection Act, Tenn. Code. Ann , et seq. ( the Act ). 59. The Plaintiffs, and members of the Damage Waiver Fee class, are consumers pursuant to the Act, , and therefore are entitled to protection under the Act. 60. ResortQuest s assessment and collection of the Damage Waiver Fee represents unfair and/or deceptive acts prohibited by the Act, Specifically, but not exclusively,

12 ResortQuest has violated through the following prohibited actions: Causing likelihood of confusion and misunderstanding as to the source, sponsorship, approval or certification of goods or services; (b)(2); Representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits or quantities that they do not have; (b)(5-6); Representing that goods or services are of a particular standard, quality or grade or that goods are of a particular style or model, if they are of another; (b)(7); Advertising goods or services with intent not to sell them as advertised; (b)(9); Representing that a consumer transaction confers or involves rights, revenues or obligations that it does not have or involve or which are prohibited by law; (b)(12); Failure to disclose that a charge for the servicing of any goods in whole or in part is based on a predetermined rate or charge, or guarantee or warranty instead of the value of the services actually performed; (b)(15); Representing that a guarantee involves rights or remedies which it does not have or involve; (b)(19). Engaging in any act or practice which is deceptive to the consumer or to any other person; (b)(27). 61. ResortQuest s violations of the Act were done knowingly, as defined in the Act, (6). 62. As a result of ResortQuest s violations of the Act, the Plaintiff, and other

13 members of the Damage Waiver Fee class, have suffered damages. 63. Plaintiff, and other members of the Damage Waiver Fee class, seek actual damages pursuant to the Act, (a)(1); treble damages pursuant to (a)(3); attorneys fees and cost pursuant to (e)(1); declaratory and equitable relief, including an injunction prohibiting ResortQuest from assessing and/or collecting the Damage Waiver Fee, pursuant to (b); and all other relief pursuant to the Act deemed appropriate by the Court. COUNT VIII FLORIDA DECEPTIVE AND UNFAIR TRADE PRACTICES ACT 64. The Plaintiff repeats and realleges all of the other paragraphs in this Complaint as if fully set forth herein. 65. ResortQuest s actions, as described hereinabove, of assessing and collecting the Damage Waiver Fee violate the Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. ch , et seq. ( FDUTPA ). 66. The Plaintiff, and members of the Damage Waiver Fee class, are consumers as that term is defined under FDUTPA (specifically, pursuant to Fla. Stat. ch (7), and therefore are entitled to protection thereunder. 67. ResortQuest s assessment and collection of the Damage Wavier Fee represents a deceptive, unfair and/or unconscionable trade practice prohibited under Fla. Stat. ch (1) for the reasons described in paragraphs 1 through 64 of this Complaint. 68. ResortQuest s violations of the FDUTPA were knowing and intentional. 69. As a result of ResortQuest s violations of the FDUTPA, the Plaintiff and other members of the Damage Waiver Fee class have suffered damages and seek individual remedies prescribed under the FDUTPA including a declaratory judgment prohibiting ResortQuest from

14 assessing and/or collecting the Damage Waiver Fee, together with actual damages, attorney s fees, and court costs, all pursuant to Fla. Stat. ch COUNT IX RECISSION AND RESTITUTION 70. The Plaintiff repeats and realleges all of the other paragraphs in this Complaint as if fully set forth herein. 71. The Damage Waiver constitutes insurance. 72. ResortQuest is not licensed to sell insurance. 73. As a result, the Damage Waiver Fee is an illegal charge and the Plaintiff and the members of the Damage Waiver Fee Class are entitled to recission and restitution. COUNT X DECLARATORY, INJUNCTIVE, AND EQUITABLE RELIEF 74. The Plaintiff repeats and realleges all of the other paragraphs in this Complaint as if fully set forth herein. 75. The Plaintiff, on behalf of himself and the members of the Damage Waiver Fee Class, seeks a declaration that it is inequitable, unconscionable, unlawful, and illegal for ResortQuest to charge the Plaintiff and the members of the Damage Waiver Fee Class a Damage Waiver because the Damage Waiver is, in truth, insurance and the ResortQuest does not have a license to sell insurance in any state and because the Damage Waiver Fee is an unreasonably high charge based on the amount of benefit provided. 76. The Plaintiffs and the members of the Damage Waiver Fee Class have no adequate remedy at law. 77. The Plaintiff, on behalf of himself and the members of the Damage Waiver Fee Class, seek disgorgement of the fees collected by ResortQuest as a result of this wrongful and illegal activity.

15 78. The Plaintiff, on behalf of himself and the members of the Damage Waiver Fee Class, seek restitution of ResortQuest s ill-gotten gains from this wrongful and illegal activity. 79. The Plaintiff, on behalf of himself and the members of the Damage Waiver Fee Class, seek the establishment of a constructive trust and an order for ResortQuest to disgorge the Damage Waiver Fees it has collected and its other ill-gotten gains into the constructive trust for the benefit of Damage Waiver Fee Class. 80. By reason of the foregoing, the Plaintiff and the members of the Damage Waiver Fee Class are entitled to the declaratory, injunctive, and equitable relief set forth above. WHEREFORE, the Plaintiff, on behalf of himself and the members of the Damage Waiver Fee Class, demand judgment against ResortQuest as follows: A. An Order determining that this action is a proper class action pursuant to Rule 23 of the Federal Rules of Civil Procedure; B. An Order requiring ResortQuest to disgorge all the Damage Waiver Fees that it has collected and provide restitution to the Damage Waiver Fee Class; C. To the extent a class is certified pursuant to Rule 23(b)(3), awarding the Plaintiff and the members of the Damage Waiver Fee Class compensatory and punitive damages in an amount to be determined by a jury for the wrongful acts complained of; D. Awarding the Plaintiff and the members of the Damage Waiver Fee Class their costs and disbursements incurred in connection with this action, including reasonable attorney fees, expert witness fees, and other costs; E. Awarding the Plaintiff and the members of the Damage Waiver Fee Class all damages sought pursuant to the Tennessee Consumer Protection Act, Tenn. Code.

16 Ann , et seq., including actual damages; treble damages; reasonable attorney fees, expert witness fees, and other costs; and all other relief pursuant to the Act deemed appropriate by the Court F. Granting extraordinary equitable and/or injunctive relief as permitted by law or equity; G. Granting the declaratory, injunctive, and equitable relief described in Paragraphs 74 through 80; and H. Granting such other and further relief as the Court deems just and proper. s/ Albert G. Lewis III Albert G. Lewis, III OF COUNSEL: ADCOX, LEWIS, SMYTH & WINTER, P.C. P. O. Box Tuscaloosa, AL Phone: (205) Facsimile: (205) OF COUNSEL: BADHAM & BUCK, LLC 2585 Wachovia Tower th Street North Birmingham, Alabama Phone: (205) Facsimile: (205) s/ Brannon J. Buck W. Percy Badham III Brannon J. Buck s/ James M. Terrell Robert G. Methvin, Jr. James M. Terrell Rodney E. Miller Attorneys for the Plaintiff

17 OF COUNSEL: MCCALLUM, METHVIN & TERRELL, P.C Arlington Avenue South Birmingham, AL Ph: (205) Fax: (205) DEFENDANT HAS WAIVED FORMAL SERVICE OF PROCESS AND COUNSEL FOR THE DEFENDANT HAS AGREED TO ACCEPT SERVICE AT THE FOLLOWING ADDRESS: Douglas F. Halijan BURCH, PORTER & JOHNSON 130 N. Court Avenue Memphis, Tennessee 38103

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