IN THE CIRCUIT COURT OF THE NINTH JUDICIAL CIRCUIT ORANGE COUNTY, FLORIDA CIVIL ACTION OFFICE OF THE ATTORNEY GENERAL, STATE OF FLORIDA, DEPARTMENT OF LEGAL AFFAIRS, CASE NO: Plaintiff, v. PRIME RESORTS INTERNATIONAL, LLC, a Florida For Profit Corporation; and JOHN PICCIONE, an individual, Defendants. / COMPLAINT FOR INJUNCTIVE RELIEF, DAMAGES, CIVIL PENALTIES AND OTHER STATUTORY RELIEF Plaintiff, Office of the Attorney General, State of Florida, Department of Legal Affairs, ( the Attorney General ) sues Defendants, Prime Resorts International, LLC ( PRI ) and John Piccione ( Piccione ), and alleges that: JURISDICTION AND VENUE 1. This is an action for injunctive relief, restitution, civil penalties, and other relief against Defendants, in excess of $15,000.00, pursuant to the Florida Deceptive and Unfair Trade Practices Act ( FDUTPA ), Chapter 501, Part II, 1
Florida Statutes (2015), and the Timeshare Resale Accountability Act, Vacation Plans and Timesharing ( TRAA ), Chapter 721, Part I, Florida Statutes (2015). 2. This Court has jurisdiction over the subject matter pursuant to the provisions of FDUTPA. The granting of injunctive and other equitable relief is within the jurisdiction of the Circuit Court and the amount in controversy satisfies the jurisdictional threshold of the Circuit Court. 3. The principal place of business and residence of Defendants is in Orange County, Florida. The violations alleged herein affect or occurred in more than one judicial circuit in the State of Florida, including Orange County. Accordingly, venue is proper in Orange County in the Ninth Judicial Circuit pursuant to the provisions of the Act and Sections 47.011 and 47.021, Florida Statutes (2015). 4. All actions material to this Complaint have occurred within four years of the filing of this action. 5. All conditions precedent to this action have been performed or have occurred. PLAINTIFF 6. The Attorney General is the enforcing authority pursuant to Section 501.203(2) of FDUTPA and is authorized to bring this action and to seek injunctive and other statutory and civil relief pursuant to that chapter. 2
7. The Attorney General conducted an investigation of the matters alleged herein and has determined that this enforcement action serves the public interest, as required by Section 501.207(2), Florida Statutes (2015). DEFENDANTS 8. At all times material to this action, Defendants were engaged in trade or commerce as defined in Section 501.203(8), Florida Statutes (2015). Prime Resorts International, LLC ( PRI ) 9. PRI is a for-profit Florida corporation with its principal place of business located at 4700 34 th Street, Suite 201, Orlando, Florida 32805 in Orange County, Florida. 10. PRI is engaged in the timeshare resale and rental advertising business. It employs telephone salespersons to call consumers who own timeshare properties and solicits them to pay PRI an upfront fee ranging from $595.00 to more than $4,300.00 for its services. John Piccione ( Piccione ) 11. John Piccione is an individual residing in Orange County, Florida. He is the President and owner of PRI and controls, participates in, or possesses the authority to control PRI s acts and practices. 12. At all times material to this action, Piccione received proceeds from PRI s bank accounts, which contain fees derived from PRI s deceptive acts and 3
practices. FACTUAL ALLEGATIONS 13. Sometime after April 2014, Defendants began engaging in a plan, program, or campaign to deceptively advertise, market, promote, offer for sale, or sell timeshare resale and rental services through unsolicited telephone calls to consumers in the State of Florida and throughout the United States. 14. Defendants, directly or through their agents or employees, made unsolicited telemarketing calls to consumers who own timeshare properties. Defendants had information about these consumers timeshare properties, such as the names and locations of the properties, when making the calls to consumers. 15. Consumer complaints reveal that Defendants telemarketers made specific misrepresentations which induced consumers to purchase Defendants timeshare resale services. These misrepresentations included, but were not limited to the following: a. Consumers timeshares have a specific resale value, which are often inflated; b. Defendants have ready renters or buyers for consumers timeshare properties; c. That these renters or buyers are willing to pay consumers a specific dollar amount for their timeshare properties; 4
d. Defendants guarantee the rental or sale of consumers timeshare properties; and e. The rental or sale will occur within a specific time period, such as 90-180 days. 16. Defendants website continued the misrepresentations to consumers by claiming: a. to drive buyers and sellers through our elite marketing methods which enhances the exposure of your resort and gives you the greatest chance of receiving the best offer; b. that their database of inventory is available world wide [sic], to interested buyers; c. to help timeshare owners by providing programs that bring buyers, renters and sellers together, utilizing cost effective advertising and marketing; and d. that they are a cooperative advertising company that pools the resources of our advertisers into a single focused initiative to match timeshare sellers with timeshare buyers and renters worldwide. 17. Defendants website also contained false affiliations with the purpose of convincing consumers that it was a reputable and legitimate business. For example, Defendants website contained the following false statements: 5
a. Defendants are members of the Orlando Regional Chamber of Commerce; b. Defendants are a trusted site according to the Online Business Bureau (when, in reality, PRI has a negative record according to the Online Business Bureau); and c. Defendants rent booth #142 at the Orange County Convention Center. 18. During the telephone solicitation, Defendants informed consumers that they must pay an up-front fee, generally ranging from $595.00 to over $4,300.00, to sign-up for Defendants advertising services. 19. Defendants induced hundreds of consumers to pay up-front fees during telephone solicitations and obtained credit card and payment information from consumers during the telemarketing call. 20. Once consumers provide their credit card or checking account information, Defendants charged the consumers credit card or account and told them that a written contract confirming the terms and conditions of their agreement would be sent to them shortly by either mail or email. A sample copy of a contract is attached as Exhibit A. Consumers are instructed to sign the written contract and return the documents to Defendants. 21. Despite Defendants repeated oral representations, the written contract disclaimed or omitted the promises and guarantees made by Defendants. 6
22. Despite Defendants promises and guarantees during the unsolicited telemarketing call, consumers timeshare properties remained unrented or unsold. 23. Defendants contract states that a consumer has ten (10) business days to notify PRI in writing of an intent to cancel the contract. Despite that unwaivable clause, Defendants failed to honor consumers cancellation requests, even when made in writing within ten (10) business days. 24. As of the date of this Complaint, Defendants widespread unfair and deceptive practices have resulted in a minimum of $119,547.00 in losses to consumers. COUNT I VIOLATION OF THE FLORIDA DECEPTIVE AND UNFAIR TRADE PRACTICES ACT, CHAPTER 501, PART II, FLORIDA STATUTES (2015) THROUGH VIOLATIONS OF THE TIMESHARE RESALE ACCOUNTABILITY ACT, VACATION PLANS AND TIMESHARING, CHAPTER 721, PART I, FLORIDA STATUTES (2015) 25. Plaintiff incorporates and re-alleges paragraphs 1 through 24 above as if fully set forth hereinafter. 26. TRAA is a consumer protection statute and was enacted to require the full and fair disclosure of terms, conditions, and services offered by timeshare resale service providers. TRAA prohibits certain oral statements by telemarketers 7
and also sets forth specific disclosure and cancellation requirements for timeshare resale contracts. 27. Effective July 1, 2012, Section 721.205 (2), Florida Statutes (2015), precludes timeshare resale advertisers, in offering timeshare resale advertising services, from stating or implying, the following: a. the resale advertiser will provide or assist in providing any type of direct sales or resale brokerage services other than the advertising of the consumer resale timeshare interest for sale or rent by the consumer timeshare reseller. b. the resale advertiser has identified a person interested in buying or renting the timeshare resale interest without providing the name, address, telephone number of such represented interested resale purchaser. c. to the extent that a resale advertiser states or implies to a consumer timeshare reseller that the resale advertiser has sold or rented any specific number of timeshare interests, the resale advertiser must also provide the consumer timeshare reseller the ratio or percentage of all the timeshare interests that have resulted in a sale versus the number of timeshare interests advertised for sale by the resale advertiser for each of the previous 2 calendar years if the statement or implication is about a sale or sales, or the ratio or percentage of all the timeshare interests that have actually resulted in a rental versus the number of timeshare interests advertised for rental by the resale advertiser for each of the previous 2 calendar years if the statement or implication is about a rental or rentals. d. the timeshare interest has a specific resale value. 28. Additionally, Section 721.205(2)(e), Florida Statutes prohibits a timeshare resale advertiser from charging a consumer any amount greater than $75.00 in a one-year period before obtaining a written contract that fully complies with Section 721.205(2)(f) and has been executed by the consumer. 8
29. Defendants are timeshare resale advertiser[s] and resale service provider[s] offering timeshare resale advertising service[s] to consumer timeshare reseller[s] as defined in Sections 721.05(49), 721.05(44), 721.05(50) and 721.05(46), Florida Statutes (2015). 30. In the course of offering resale advertising services, Defendants have represented, directly or indirectly, that Defendants: a. will provide or assist in providing direct sales or resale brokerage services to the consumer timeshare reseller; b. have identified an interested renter or buyer without providing the contact information of the interested resale renter or buyer to the consumer timeshare reseller; c. have sold or rented a specific number of timeshare interests without providing a ratio or percentage of sales as required by Section 721.205(2)(c), Florida Statutes (2015); and d. state that the consumers timeshare interest has a specific resale value. 31. With regard to the written contract, Defendants have charged consumer timeshare resellers amounts greater than $75.00 in an one-year period, before obtaining a written contract executed by the consumer which comports with Section 721.205(2)(f). Specifically, Defendants knew, or should have known, their conduct was unfair, deceptive, or prohibited by Florida Statutes (2015). 9
32. Pursuant to Section 721.205(7), Florida Statutes (2015), any person, in connection with resale advertising services, who violates any part of this section, commits a deceptive and unfair trade practice and is subject to all penalties and remedies available under FDUTPA. 33. Therefore, Defendants have violated FDUTPA. These abovedescribed acts and practices of the Defendants have injured and likely will continue to injury and prejudice the public. COUNT II VIOLATION OF THE FLORIDA DECEPTIVE AND UNFAIR TRADE PRACTICES ACT, CHAPTER 501, PART II, FLORIDA STATUTES (2015) 34. Plaintiff incorporates and re-alleges paragraphs 1 through 33 above as if fully set forth hereinafter. 35. At all material times, Defendants were engaged in trade or commerce as defined in Section 501.203(8), Florida Statutes (2015). 36. Section 501.204(1), Florida Statutes (2015) provides that [u]nfair methods of competition, unconscionable acts or practices, and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful. The provisions of FDUTPA shall be construed liberally to promote and protect the consuming public and legitimate business enterprises from those who engage in unfair methods of competition, or unconscionable, deceptive, or 10
unfair acts or practices in the conduct of any trade or commerce. 501.202, Fla. Stat. (2015). 37. Defendants representations and omissions of material facts as set forth in paragraphs 13 through 24 are likely to mislead consumers acting reasonably under the circumstances. They are designed to induce consumers to pay an up-front fee. 38. The representations and omissions constitute deceptive acts and practices under FDUTPA. 39. Defendants knew or should have known that their telemarketing and timeshare scheme is deceptive or prohibited by Florida Statutes. 40. Defendants have violated FDUTPA by using these deceptive acts and practices to induce consumers to pay their up-front fee. 41. Defendants violations of FDUTPA have injured and likely will continue to injury and prejudice the public. 42. Plaintiff is entitled to permanent injunctive relief without having to show irreparable injury to the public. JURY DEMAND 43. Plaintiff requests a trial by jury for all counts herein. 11
PRAYER FOR RELIEF WHEREFORE, the Plaintiff respectfully requests that this Court: A. Temporarily and permanently enjoin Defendants and their officers, agents, servants, employees, attorneys and those persons in concert or participation with them who receive actual notice of the Court s injunction enjoining them from engaging in any deceptive or unfair acts or practices in the telemarketing and timeshare resale activities in violation of the Act. Specifically, Defendants shall not falsely represent to consumers that: i. Defendants have ready renters or buyers for the consumers timeshare property; ii. that these renters or buyers are willing to pay consumers specific prices for their timeshare property; iii. Defendants guarantee the rental or sale of the consumers timeshare property; and iv. Defendants guarantee that such rental or sale will occur within specific time periods. A. Assess civil penalties against Defendants pursuant to Section 501.2075, Section 501.2077 and Section 501.059(8)(a) in an amount not to exceed $10,000 per violation, and $15,000.00 per violation for consumers who are military service members, disabled or senior citizens; 12
B. Declare each contract made between Defendants and any consumer invalid and unenforceable; C. Require disgorgement of profits and award restitution and refunds to consumers for each violation; D. Award Plaintiff reasonable attorneys fees and costs pursuant to the provisions of the Act, and as otherwise allowable by applicable statutes; E. Enter final judgment against Defendants, jointly and severally, for damages, restitution, disgorgement of profits, civil penalties, restitution, costs and reasonable attorneys fees; and F. Award such other relief as the interests of justice shall require and that this Honorable Court may deem just and proper. Dated this 29 th day of February, 2016. 13 Respectfully submitted, PAMELA JO BONDI Attorney General /s/ Kristen K. Johnson Kristen K. Johnson Assistant Attorney General Florida Bar No.: 89096 Donna C. Valin Assistant Attorney General Florida Bar No.: 96687 Office of the Attorney General Consumer Protection Division
14 135 W Central Blvd, Suite 670 Orlando, Florida 32801 Office: (407) 316-4840 Donna.valin@myfloridalegal.com Kristen.johnson@myfloridalegal.com