Friday, June 19, 2020

reconsidering, court rules that FDUTPA covers more than Lanham Act "advertising," reinstates only state claims

Westgate Resorts, Ltd. v. Reed Hein & Assoc., LLC, 2020 WL 3265972, No. 6:18-cv-1088-Orl-31DCI (M.D. Fla. Apr. 27, 2020) 

Previously, the court dismissed Lanham Act false advertising and coordinate state law claims against timeshare exit purveyors. Here, the court reverses part of its earlier holding, with respect to non-advertising-based state law claims. Although courts often say that federal Lanham Act and state law claims are subject to the same analysis, that is an overstatement; in some circumstances, state laws are broader.

FDUTPA covers deceptive acts and practices that go beyond advertising. Westgate alleged that, once in contact with Westgate timeshare owners, defendants committed “unfair and deceptive acts and practices” by “instruct[ing] owners of Westgate timeshare interests to stop making payments of validly assessed maintenance and taxes, and of legitimately owed note and mortgage payments, to Westgate in Florida, which damages Westgate.” Owners who started out current on their payments were allegedly deceived into thinking they could safely exit without foreclosure and stopped payments at defendant TET’s instruction, when in fact they defaulted and entered into foreclosure. These allegations were supported by testimony from customers of TET. This plausibly proximately caused Westgate’s damages and might entitle Westgate to injunctive relief, even if the conduct was no longer ongoing. “[A] jury could find that TET engaged in deceptive practices by guaranteeing owners that it could legitimately exit them from their timeshare interests and instructing those same owners to stop making payments to Westgate, knowing that it would not actually negotiate with Westgate, that Westgate would likely foreclose, and that TET would simply claim that it had successfully ‘terminated’ the owners’ timeshare interests without disclosing the foreclosure.”


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