By: Rob Harris
By now, many of you have heard that Trump National Golf Club Jupiter has been found liable in a class action lawsuit and ordered to pay more than $5,700,000 in damages and interest. The court’s opinion makes for interesting reading and is attached here.
Before Trump purchased the club from the Ritz-Carlton, the plaintiffs were on a waiting list to resign their memberships and obtain return of their initiative fees. The operative rules permitted resignations to occur based on new members entering. While waiting, those on the list were considered members, required to pay dues, and permitted access to the golf course.
Following its acquisition, the Trump organization unilaterally changed things. As the court explained,
“After closing on its purchase of the Club, Defendant held a town-hallstyle meeting on December 14, 2012, to discuss amendments to Club Documents and changes to aspects of operation of the Club. At all times material to this lawsuit, Donald J. Trump5 held the top position of authority at Defendant’s company. After the December 14, 2012 meeting, under Mr. Trump’s authority, Defendant disseminated a letter to all Club members including those on the resignation waiting list. The letter was dated December 17, 2012, and bore the signature of Donald J. Trump, as owner of the Club.
“The letter communicated to Plaintiffs and the Class Members three options that they must choose by December 31, 2012: opt-in; opt-out; or remain on the resignation waiting list, but pay no Club dues and have no Club access.
“Those members who opted in were afforded a reduction in Club dues for three years and reciprocity with the other Trump-owned clubs, in exchange for forfeiting their rights to refunds. Those members who opted out kept their rights to refunds and Club access, but could not be on the resignation waiting list and would incur an increase in Club dues with no cap on the amount of Club dues. Plaintiffs and the Class Members fell into the third category communicated by the December 17, 2012 letter. Because they chose to remain on the resignation waiting list, Plaintiffs and the Class Members were denied permission to use the Club in exchange for a release of the obligation to pay dues. In the letter, Mr. Trump, on behalf of Defendant, stated to Plaintiffs and the Class Members “as the owner of the club, I do not want them to utilize the club nor do I want their dues. In other words…if you choose to remain on the resignation list, you’re out.” Defendant’s general manager testified that it was clear from the letter that members remaining on the resignation waiting list were out of the Club after December 31, 2012. Defendant’s director of memberships likewise testified that the message expressed to Plaintiffs and the Class Members in Defendant’s letter was clear: that if they remained on the resignation waiting list, as of December 31, 2012, they would no longer be Club members and would no longer have access to the Club.”
The court concluded that Trump’s actions constituted a recall of the plaintiffs’ memberships, entitling them to prompt return of their initiation fees. Having been deprived of the opportunity to use the golf course while waiting for their resignations to take effect, they were entitled to return of their money.