Lawsuit claims Fort Collins luxury real estate investment firm broke fiduciary rules
FORT COLLINS — A group of investors is suing a Fort Collins-based timeshare investment company, alleging that it breached fiduciary duties while maintaining a timeshare in Hawaii.
In a complaint filed Wednesday in the U.S. District Court of Colorado, Oklahoma-based investment vehicle W2 Kauai and investors Steve Bardwell and Fred Rickman claim that they control about 20% of the shares in Lifestyle Asset Management LLC, an investment vehicle that manages the Hawaii timeshare and disburses a cut of profits from rentals of the property to non-investors. The plaintiffs say they spent more than $1 million to buy the shares.
The plaintiffs allege Lifestyle and its management committed several breaches of its duty to its shareholders, including co-mingling funds in different accounts and not making its financial statements available to members. Lifestyle is also accused of not paying $36,000 in property taxes and $77,000 to the Hawaii timeshare’s property owner.
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The complaint argues that the bills were unpaid because Lifestyle has not collected dues from the owners of 55% of the company’s equity, including from two members of the company’s board. When the plaintiffs tried to buy out the positions of the members who were late on payment, the company’s management allegedly said it made an oral agreement with the late members that it would pay for the missing expenses despite that being a violation of the shareholder’s bylaws.
The plaintiffs are asking a court to require Lifestyle to turn over its books, remove company leaders and split the equity of the non-paying members and give it to the paying members.
Kevin Schutte, an attorney for Karla Jones, a co-founder and senior partner at Lifestyle, told BizWest she denies all the claims made in this lawsuit and in a separate lawsuit in Texas specifically accusing her of violating that state’s securities act.
“Ms. Jones is confident that the case will be dismissed, and she will be seeking all available remedies for defending herself against such frivolous claims,” Schutte said.
© 2020 BizWest Media LLC
FORT COLLINS — A group of investors is suing a Fort Collins-based timeshare investment company, alleging that it breached fiduciary duties while maintaining a timeshare in Hawaii.
In a complaint filed Wednesday in the U.S. District Court of Colorado, Oklahoma-based investment vehicle W2 Kauai and investors Steve Bardwell and Fred Rickman claim that they control about 20% of the shares in Lifestyle Asset Management LLC, an investment vehicle that manages the Hawaii timeshare and disburses a cut of profits from rentals of the property to non-investors. The plaintiffs say they spent more than $1 million to buy…
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