Manhattan Club Lawsuit

Thank you Jeff for the info. Great news!

Would be great to know if the whole settlement is going to the "owners" or if some if a fine to NYS and if so what the breakdown is, or even better simply how much restitution each owner is getting. Looking forward to the notice from the AG and more info here!

EDIT: I see it says the 6.5 M will go to the "owners". Excellent!

(Kevin - so he wasn't provided the info one day and then got it and posted about it when he did - good lord who cares??? If you don't appreciate the info here, after all Redweek has done to keep us informed, just don't come here!).

NYAG says that a claims administrator will handle restitution issues, eligibility and clarify all issues for owners. When they give us more information on that, we'll post it here. They have not provided it today despite several requests. The settlement is not being portrayed as a fine, but as a restitution fund. Stay tuned.

Happy this matter is moving forward.

jeff_reports Hello again to all TMC owners.

Want to update you all, once again, that there is NO class action lawsuit pending against the club. All talk and posts on this forum about a class action lawsuit are wish fulfillment, not based on any facts that RedWeek is aware of.[/Q

Thank you

Kevin, please call. would like to understand your issues. Jeff

Can anybody please give me the contact information of the attorneys currently involved in this? I don't know if anybody else has this problem, but the mortgage on our interest has not been released, even though we paid it in full within 60 days of our idiotic purchase. I demand a release several times, but the Manhattan club told me that they were barred from doing anything. They were barred from selling, they were barred from clearing title, in my opinion. I just don't want the AG to think that our interest is 100+ percent encumbered. Thank you

By ginan44 18,000 owners only 6.5 million nets $321 per owner. Plus doesn't state whether we can get out of contract. Not much of a victory unless new owners decrease maintenance fee significantly. Just got bill for maintenance this week 8 months before it was due. When I called they admitted I'm not due to pay till next April. Maintenance up to over $2,900 for 1 bedroom for next year. Can get 1 bedroom on Jetsetter right now for $221 per night. That's almost 13 nights verses my seven I get with my maintenance fee. I have flex week and can only get nights they say are available verses renting any night any time.

Yes getting out of the contract is absolutely crucial, or else it's a farce. I am hopeful based on the settlement summary. Would be ridiculous after reading that that there wouldn't be an out / buy-back option.

ginan44 wrote:

By ginan44 18,000 owners only 6.5 million nets $321 per owner. Plus doesn't state whether we can get out of contract. Not much of a victory unless new owners decrease maintenance fee significantly. Just got bill for maintenance this week 8 months before it was due. When I called they admitted I'm not due to pay till next April. Maintenance up to over $2,900 for 1 bedroom for next year. Can get 1 bedroom on Jetsetter right now for $221 per night. That's almost 13 nights verses my seven I get with my maintenance fee. I have flex week and can only get nights they say are available verses renting any night any time.

Please talk Kevin off the cliff. Kevin: Opinions & thoughts are good keep it up. - rants & argumentative trolling over trivia are different.

Hi Jeff, I wish to thank you for your useful posts. You have always kept us informed. It is not always easy to get information from the AG's office. Sometimes, conflicting informations are given dependent on whom you talked to. Thank you for your good work.

AG today has not provided copy of settlement nor provided any verbal clarifications about the many questions owners have about the case. Here are some numbers from the court records that may put the settlement into perspective. Eichner's management company charged a $6.4 million fee, per year, to manage the club. That number is nearly identical to the $6.5 million the AG says will now be made available as restitution to owners. TMC owners, on average, have paid $30 million per year in maintenance fees while renters contributed another $4 million and Bluegreen/TMC owners paid $2 million annually. Those are numbers from two years ago. Current numbers could be higher.

According to the 2017 MC Annual Budget timeshare charges come up to $ 35,989,594, management fees $ 6,482,049, and rentals approximately $ 7 million. Total income =$ 47,009,535 According to 2018 MC Annual Budget timeshare charges increased to $ 37,123,133, management fees $ 6,482,049, and rentals approximately $ 7,7 million.Total income = $ 49,069,387

Total income raised in amount of $2,059,852 in ONE year. Would they care about $6,5 million?

jeff_reports wrote:

AG today has not provided copy of settlement nor provided any verbal clarifications about the many questions owners have about the case. Here are some numbers from the court records that may put the settlement into perspective. Eichner's management company charged a $6.4 million fee, per year, to manage the club. That number is nearly identical to the $6.5 million the AG says will now be made available as restitution to owners. TMC owners, on average, have paid $30 million per year in maintenance fees while renters contributed another $4 million and Bluegreen/TMC owners paid $2 million annually. Those are numbers from two years ago. Current numbers could be higher.

Do you think there's any chance of them buying back our units? I really just want out. 6.5 million sounds like a lot but if it's distributed evenly, that only works out to a few hundred dollars each. I don't mean to be a downer...I'm glad they got what they deserved, I just wish we had a choice.

Owners should note that the $6.5 million restitution fund is equal to the amount that the Eichner groups have paid themselves, each year, for managing the club's operations.

RedWeek frequently consults with Manhattan attorney Doug Wasser for his analysis of the proceedings. As some of you may know, Doug has 33 clients who are Manhattan Club owners who asked him to serve as a liaison with the Attorney General's office. From our perspective, Doug knows as much about the case as any lawyer who is NOT directly participating in the AG vs. Eichner case.

We asked Doug to give his initial perspective on the $6.5 million settlement agreement. Here are his comments:

“TMC has 15,000+ unit owners, all with different agendas, and seeking different things. The statute of limitations to reverse a sale may have expired for longer term owners. So, hopes for a monetary settlement for longer term owners may actually have been limited. I expect that that the $6.5 million restitution fund may go mostly to recent purchasers, whose rights may not yet have lapsed from the passage of time.

"The project is at serious financial risk as we speak, and one way to address its collapse and hopefully restore some confidence and unit market value, is to kick out the sponsor and put in a new regime in its place.

"For sure, I would have hoped that the AG would have extracted a huge settlement from the sponsor to distribute to the whole community, but I have some doubts as to whether that was ever legally in the cards, or whether there would still be a project worth saving by the time a larger monetary settlement was obtained. There still may be grounds for a class action at this point. Who knows? But that’s not my bailiwick. I’ve heard rumors of some class action attorneys in the wings. We’ll see what happens.

"Now that the sponsor will be divested of control, the project may hopefully be able to reclaim some market confidence and come back to firmer footing. And that could be the tide which lifts all boats.

"Time will tell whether this disposition is workable." ----Douglas Wasser

Redweek & Doug: Maybe you'll can comment on these questions... not legal advice, just thoughts.

I am ecstatic that our TMC saga has moved to a new phase. But that's what it is, a new phase with lots of issues that lawyers, the claims administrator, and new owners will need to hash out. Here are some issues that I see:

-- which of the 14K-18K original purchasers are still considered 'owners', both for purposes of the restitution, and potential follow-on ownership under the new owners ? (presuming that all timeshare ownerships are not severed/bought out by the new owners).

-- as some have asked, what happens for those who are being billed during the interim between AG/Court ruling and the eventual sale to new owners?

-- which contracts will transfer from current TMC-old to TMC-new? (there are 88+ versions of rules/contracts), or will new contracts be offered to those who want to continue with TMC-new

-- if TMC-old has not properly registered deeds, mortgage payoffs, paid taxes to NYC Dept of Finance, and hasn't kept a valid set of books... who's going to straighten it out, how long will it take (part of negotiations on transfer sale?)

-- potential investors will be very cautious in getting involved with highly encumbered property, so will be seeking some way to indemnify themselves from prior Eichner-related problems & wrongdoing.

-- Then there are all of the issues with class action or other suits against Eichner (instead of against TMC-new owner)... unless the AG's settlement somehow relieves Eichner & others from such actions.

Thanks Doug and Good Luck to all of us... but we'll need lots of patience, even after all these years.

NB: edited and crossposted on Yahoo TMC group

The AG has provided no guidance on any of these questions, unfortunately.

How great that this MC settlement is finally settled BUT thankyou to group of you who have worked SO hard for all of us-!!!Nancy/RobertHarmon

deborahn127 wrote:

Can anybody please give me the contact information of the attorneys currently involved in this? I don't know if anybody else has this problem, but the mortgage on our interest has not been released, even though we paid it in full within 60 days of our idiotic purchase. I demand a release several times, but the Manhattan club told me that they were barred from doing anything. They were barred from selling, they were barred from clearing title, in my opinion. I just don't want the AG to think that our interest is 100+ percent encumbered. Thank you

My MC interest was paid off within a month since the purchase. It took me seven (7) years to release the mortgage that was issued by O.Park Central LLC, after sending numerous letters and emails to the MC Board, Finance Department, Eichner, etc. That is a Mortgage scam. To my understanding, in accordance to the NYAG 2014 Order, mortgage closure was not barred. Below is the copy of the 2014 AG order in regards to the mortgage issues:

"Respondents are preliminary restrained from commencing any new foreclosure proceedings against Manhattan Club owners for delinquent common charges or for failure to comply with their obligations pursuant to any purchase money mortgage, note, assignment or allonge arranged or offered by a Respondent when the Manhattan Club owners finances their purchases of ownership interests in the Manhattan Club".

Three days ago NYAG made an announcement which is not a finalized Court document so far, and does not cover many other quires that were raised by the MC owners. I think we have to continue asking for more details, possibly, mortgage scam might be turn into another case or investigation.

I am going to send a letter in regards to the mortgage scam to Louis M. Solomon, Chief of Enforcement in the Real Estate Finance Bureau, who handled the MC investigation, and suggest other owners will do the same. His contacts:

Louis M. Solomon, Chief of Enforcement Office of the Attorney General Real Estate Finance Bureau 120 Broadway, 23rd Floor New York, NY 10271

Phone: (212) 416-8122 Fax: (212) 416-8179

Link for the 2014 NYAG Order: https://ag.ny.gov/pdfs/Order%20signed%207-24-2014.pdf

What does this mean for the owners?