Diamond Resorts International® (“Diamond”) and its affiliated entities, on August 7, 2017, filed a federal lawsuit in the United States District Court for the Middle District of Tennessee, against the Castle Law Group, PC, a Tennessee professional corporation, and its principal Judson Phillips, Esq., as well as various affiliated and inter-related individuals and entities including, among others, William Michael Keever, Sean Austin, Castle Marketing Group, LLC, and Castle Venture Group, LLC.
The lawsuit is part of an ongoing effort by Diamond to arrest the behavior of timeshare “third-party exit companies” (“TPE”) that plague the industry by preying on unsuspecting timeshare owners. The TPEs target and manipulate timeshare owners by soliciting services in exchange for excessive fees. TPE representatives falsely promise to provide timeshare interest “transfers” and/or “exit” services to timeshare consumers with regard to the resale of timeshare interests. Diamond is seeking damages, injunctive relief, and the appointment of a receiver in connection with the Defendants’ open and intentional interference with Diamond’s contractual and business relationships, and also alleges a structured civil conspiracy amongst Defendants, violations of the Federal Lanham Act, as well as the Tennessee Consumer Protection Act.
The complaint avers that Castle, along with its related and inter-related individuals and entities, make false and defamatory statements against Diamond, and/or Diamond members’ timeshare interests, using underhanded tactics to dispense misleading information to Diamond owners and otherwise instruct Diamond timeshare owners to breach their contracts with Diamond. The complaint sets forth the alleged unlawful scheme, which was initiated by the formation of the Castle Law Firm. Austin and Keever are the original architects of the blueprint for the deceptive strategy that involved the formation of Castle Marketing, Castle Venture Group and most notably Castle Law, which was concocted by Austin and Keever to give unwitting timeshare consumers the appearance of legitimate legal activities, but, in reality, is merely a front for the nefarious acts put in action by TPEs.
Diamond maintains that the Castle TPE scheme was initially disclosed to Phillips and was solely designed as an opportunity to make fast money using unsuspecting timeshare owners as their marks and the vehicle by which to damage and directly attack Diamond. Phillips was the only licensed attorney at the inception of Castle Law. Keever served as Castle’s CEO and Manager while Austin, the mastermind of the operation, was the COO who closely directed and micro-managed all the affairs of Castle Law and its subsidiary enterprises.
The complaint further alleges that Keever, along with Phillips and Austin, utilized Keever’s business background and legal knowledge of corporate structures to intentionally create several shell entities, referred to as Castle Affiliates, to funnel monies to these entities, or otherwise move the ill begotten gains “offshore,” to avoid potential creditors, like Diamond, and otherwise avoid ultimate liability for their unscrupulous acts. The lawsuit makes note of Keever, who, in the presence of others, bragged about his self-proclaimed business acumen which he maintained would safeguard them all against any potential claims from litigants “seeking to pierce the corporate veil and access hidden funds”.
The complaint also alleges that Austin openly proclaimed that if Castle Law was “attacked” or “sanctioned” they would merely close shop and it would be inconsequential as most of the money was essentially hidden and already “offshore” in any event. According to the lawsuit filed by Diamond, the Defendants’ plan was overt. It was set up to victimize unsuspecting timeshare owners by providing illusory timeshare cancellation services and, in turn, deceptively and significantly in calculated fashion damaging Diamond’s business by virtue of its tortious interference of Diamond’s contracts with its timeshare owners to the point of the ultimate destruction of the relationship.
Bud Bennington, Esq. and Glennys Rubin, Esq. of the Florida-based Shutts & Bowen LLP law firm are serving as national coordinating counsel for Diamond in addressing the Third Party Exit Company issue. The Complaint was filed in Nashville, Tennessee, with attorney Eddie Wayland, Esq., of the King & Ballow law firm, serving as co-lead and local counsel on behalf of Diamond.
Diamond Resorts International® (Diamond Resorts) is a worldwide leader in the hospitality and vacation ownership industries with a network of more than 370 vacation destinations located in 35 countries throughout the continental United States, Hawaii, Canada, Mexico, the Caribbean, South America, Central America, Europe, Asia, Australasia and Africa.
Diamond Resorts International® manages vacation ownership resorts and sells vacation ownership points that provide members and owners with Vacations for Life® at over 370 managed and affiliated properties and cruise itineraries.