There is currently a class action lawsuit with the purchasers of hotel and condominium units at San Diego's Hard Rock Hotel and sellers of units because of failure to disclose material information and buyers financial losses.
The plaintiff, in this case, agreed to purchase certain units two years before the hotel is actually built. The seller of the units violated Interstate Land Sales Full Disclosure Act by not providing the plaintiff certain congressional mandated protections in the purchase and sale contract.
The buyers were entitled to a right to rescind the contract for any reason within two years of signing it. The sellers were required to disclose of this rescission right to purchasers of the hotel units but failed to do so. This lawsuit alleges that the sellers misleadingly told the buyers they had an obligation to close on the units or lose their deposits at the original contract price, even though the market price for the units had been drastically reduced.
The buyers did close on their units but suffered financial losses because of the misleading information. These two parties settled the case in early 2017 but in May, a judge preliminarily "approved the party settlement holding the class would be certified for settlement purposes and directing a settlement administrator to notify class members". This final approval hearing is not until September with a judge will decide whether the settlement shall be fully approved in the case dismissed. [Source]
So, what does the settlement provide?
It will require defendants pay $51,150,000 into a common fund, which will be distributed to all members after accounting for attorneys fees and administrative costs and expenses. The disbursement will be based on the current value of the unit if they still own it, the resale price, or the amount of their loan that was discharged through foreclosure.
If you currently own a unit at the Hard Rock Hotel in San Diego or would like more information on this litigation to contact our office today.
Image by Graham Hills