A high-pressure timeshare business has been slapped with a lawsuit by the Colorado Attorney General, accused of luring customers with phony discounts and travel deals packed with hidden fees.
Highlands Resorts at Christie Lodge, which marketed timeshare properties at Christie Lodge in downtown Avon, lured 2,500 customers over the course of two and a half years to attend sales pitches in Denver or at affiliated resorts, the state claims in a deceptive trade practices case filed in Denver County Court.
Lisa Siegert, Christie Lodge general manager, said the 280-unit complex hired Highlands Resorts to market timeshares in 2013. Highlands Resorts sold around 1,300 timeshares for Christie Lodge over the next two years, Siegert said, each at least one week long.
Highlands Resorts closed its Colorado operations last December, according to the complaint filed Dec. 1.
The state says Highlands Resorts and its owner, Telluride resident Todd Herrick, “intentionally deceived, misled, and financially injured consumers” and unfairly undercut competitors that play by the rules. The state is also suing salesperson Greg Penrod and vendors.
According to the lawsuit, Highlands Resorts hired third parties to conduct telemarketing and postcard campaigns, telling would-be buyers they could redeem free travel packages by attending sales seminars.
But after enduring a 90-minute pitch, the state alleges, customers received certificates for their “free” airline tickets and cruises – which included deposits as high as $200 and only applied to trips at predetermined times and in predetermined places.
Highlands Resorts told customers the travel packages were worth $1,900, but each certificate only cost the timeshare business $40 to buy, the complaint claims.
Highlands Resorts salespeople also offered attendees a discounted deal if they bought a timeshare that day, according to the complaint, but the “discount” was really a ploy to pressure consumers. According to the complaint, Highlands Resorts told customers that the price for a timeshare package would go up to $25,000 – which would cover one week in the summer at Christie Lodge, 32,800 points at a timeshare exchange brokerage, RCI, as well as other fees – unless customers jumped on a same-day discount offered at the end of the presentation.
But the state says the same-day “discount” never expired and customers on average paid $7,000 for the package supposedly valued at $25,000.
The complaint claims that “Highlands Resorts feared that if a consumer left the sales presentation without making a purchase, they would never return.”
The state also says Highlands Resorts was not a registered telemarketer in Colorado for most of the time that it marketed Christie Lodge properties. The company later registered itself after it was notified by the state Attorney General, but its vendors did not.
Highlands Resorts and its vendors also contacted Colorado residents on the state’s no-call list, the complaint says.
Todd Herrick, the owner of Highlands Resorts, is a full-time resident of Telluride who also owns local heli-skiing operator Helitrax and Gunnison fly fishing and whitewater rafting outfitter Black Canyon Anglers, according to the Telluride Venture Accelerator, where Herrick is listed as a mentor to startups. Herrick did not return a message seeking comment.
Highlands Resorts is one of a larger group of timeshare companies controlled by a resort called Sedona Pines in Arizona, according to the lawsuit. On its website, Highlands Resorts says it operates one resort in Durango and two resorts in Arizona. Sedona Pines is also affiliated with RCI.
Greg Penrod, a Highlands Resorts sales manager who also works at Sedona Pines, did not return messages seeking comment.
Highlands Resorts at Christie Lodge, Sedona Pines, Greg Penrod and Todd Herrick are being represented by John A. Chanin of Lindquist & Vennum in Denver. Chanin did not respond to a message seeking comment.
The state, which is represented by the office of Colorado Attorney General Cynthia Coffman, is seeking payments of $325,000 from those four defendants and a permanent injunction that would stop them from, among other things, advertising timeshares without displaying fees and conditions. A spokesperson did not respond to a message seeking comment.