A “senior” couple say they were “scammed” by JetSmarter for $30,000 weeks before the company started cutting back on its scheduled flights with the free seats they were expecting

 

With each lawsuit – this is at least the seventh Private Jet Card Comparisons has tracked – the stories about JetSmarter’s sales tactics get more troubling. Even as management was pivoting its model of paid annual memberships in return for the ability to book free seats on scheduled private jet shuttles, its sales team was continuing “high-pressure” tactics trying to push even more expensive memberships while telling the media that it was focusing on more accessible pricing.

 

On March 26, 2018, in an interview with Private Jet Card Comparisons CEO Sergey Petrossov was trumpeting new lower membership costs while promising members in its old program would continue to enjoy the benefits they had paid for.

 

He told us, “We are lowering the fee of entry for new members to democratize the access point even more. Annual membership is now $4,950 plus a $3,000 initiation fee. These new members will pay more per seat than (existing) SMART members do now. The plan is to open up access to more people that fly even a few times per year versus more frequent fliers that are joining today with SMART membership for $15,000. Existing SMART members are not affected by this and keep their old membership with better pricing and perks.”

 

We then turned to ask, “Does SOPHISTICATED stay at 45k?”

 

Petrossov told us, “Sophisticated is $50,000 and has been that way for a while. We are making it more private and won’t be advertising as much to make it more exclusive. We are continuously expanding the service and features.”

 

According to a lawsuit filed last week in the United States District Court Southern District of Florida by Sheri Laine and Gary Seidler on March 29, 2018, they received an email from JetSmarter that this would be their “Last chance to become a founding JetSmarter member.” The company was founded in 2012. The each bought in for the SMART membership paying a combined $30,000.

 

They were told by joining they would still be able to get free seats for flights under three hours even as the private jet-sharing service, what until then had been a core benefit. From that point, they were hit with multiple approaches to upgrade to the SOPHISTICATED membership with offers to pay $97,500 for three years through mid-June, although they declined.

 

They were able to take one flight on their SMART memberships and then as others found out the number of scheduled flights with free seats SMART had dwindled to apparently nil. According to the lawsuit, “ However, in the mid-summer of 2018, Defendants reported to Plaintiff that the benefits they had just purchased would no longer be available to Plaintiffs and that all future flights would require payment by Plaintiffs – thus undermining the very essence of the“membership.” Plaintiff did avail themselves of Defendants’ services once thereafter but was required to pay for that flight.”

 

In early October, the plaintiffs, unable to get a refund, again wrote to JetSmarter, this time stating, “We are an older couple who gave you and your company a significant amount of funding for a promise of travel that you have not fulfilled after your assurance that you would. We are both incredibly disappointed and hope that you can make this better for us.” A further email from Laine on October 19, 2018, stated, “Unfortunately it feels like we have been scammed by you and your company. Please don’t be that person. Hope to hear from you.”

 

The lawsuit states that the plaintiffs would need to spend nearly $100,000 per month to replicate the benefits they were promised and were not delivered. They are seeking at least $2.2 million in damages.

 

JetSmarter has recently moved to a model that seems to be based on entirely on crowdsourcing flights, many costing between $1,000 and $5,000 per seat with no free seats available, a far cry from the conditions it was selling membership earlier this year.

 

In its latest twist, after hawking memberships for $4,950 with a $3,000 initiation fee for its all paid model, JetSmarter now appears to be only selling $2,500 memberships per its website (below).

 

JetSmarter membership pricing is now $2,500

An attorney not connected with the legal actions said she recommends that in addition to pursuing civil claims unhappy JetSmarter members who believe there was fraud in the way they were sold or renewed memberships should report the company to both the Attorney General in their state as well as the FBI. “From a consumer perspective, it’s very important to ensure that an investigation is also started that would look into criminal activity,” she said.

 

The most recent JetSmarter lawsuit is below in its entirety:

 

Case 0:18-cv-62969-BB Document 1-3 Entered on FLSD Docket 12/05/2018 Page 1 of 1

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 1 of 14

 

 

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

 

 

 

 

SHERI LAINE AND GARY SEIDLER

 

Plaintiff,                                             Civil Action No.

 

against

 

JETSMARTER, INC., DAVID M. SHERIDAN

and JOHN DOES 1 – 4

 

COMPLAINT and

Defendants                                               JURY DEMAND

 

————————————x

 

Plaintiffs Sheri Laine (“Plaintiff” or “Laine”) and Gary Seidler (“Seidler”)

 

(“collectively “Plaintiff”), by way of complaint against Defendants Jetsmarter, Inc., David

 

  1. Sheridan and John Does 1-5, states as follows:

 

 

 

JURISDICTION AND VENUE

 

  1. This Court has original jurisdiction over this action under 28 U.S.C. §1332 as

 

this action seeks monetary damages resulting from the Defendants’ actions in an amount

 

exceeding $75,000.00, and there is complete diversity of citizenship between Plaintiff and

 

all Defendants.

 

  1. Venue is proper in the Southern District of Florida pursuant to 28 U.S.C. §

 

1391(b)(2), as Defendants’ principal place of business is in Fort Lauderdale, Florida and a

 

substantial part of the events or omissions giving rise to the claim were initiated and

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 2 of 14

 

 

 

occurred here, including the marketing, advertising and trade practices at issue.

 

 

 

PARTIES

 

3     Plaintiffs Laine and Seidler are individuals residing in Del Mar and Santa

 

Monica, respectively. At all times relevant to these proceedings, Plaintiffs jointly retained

 

an apartment in London, England. Plaintiffs are each senior citizens as defined by Section

 

501.2077, Fla. Stat., and Plaintiff Laine requires certain additional accommodations when

 

traveling.

 

  1. Defendant Jetsmarter, Inc. (“Jetsmarter”) is a foreign corporation, organized

 

under the laws of the State of Delaware and is registered to do business in the State of

 

Florida. Jetsmarter’s world headquarters is located at 500 East Broward Blvd., Fort

 

Lauderdale, Florida.     Jetsmarter markets itself as a company that provides air

 

transportation as an alternative to commercial carriers and private jet ownership.

 

  1. Defendant David Sheridan (“Sheridan”) is a sales agent of Defendant

 

Jetsmarter who was assigned the title of Senior Membership Executive.

 

  1. John Does 1 – 4 are persons who are the officers or managers of Jetsmarter,

 

who developed and approved the marketing and sales materials and may have otherwise

 

been involve in the fraudulent sales practices made to Plaintiffs.

 

FACTUAL BACKGROUND

 

  1. On or about April, 2018, having a family member who was a Jetsmarter

 

member and also having seen the advertising material placed into the marketplace by

2

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 3 of 14

 

 

 

Defendant Jetsmarter about the benefits offered by Jetsmarter, Plaintiffs were contacted by

 

Jetsmarter’s representative Sheridan. In communications, Defendant Sheridan discussed

 

various membership options inclusive of the “Smart” and “Sophisticated” membership.

 

As part of the sale, Plaintiffs were told that the Smart level was being discontinued on April

 

2, 2018 and that they needed to join prior to that date. In an email of March 29, 2018 to

 

Plaintiff Laine entitled “Last chance to become a founding JetSmarter member,” she was

 

again specifically informed by Defendant Sheridan that she needed to join “this week to

 

take advantage of complimentary seats on select flights under three hours.”[emphasis

 

supplied].

 

  1. In their discussions, Defendant Sheridan explained that the Smart

 

“membership” was a prepaid program which would permit the “member” the right to fly to

 

locations within three hours of the departing city without cost to the member. The

 

Sophisticated level, again prepaid, provided enhanced privileges such as advanced

 

notification of flights, extended free flights and other discounts and benefits.

 

  1. Plaintiffs informed Sheridan that the Smart level was more than sufficient for

 

their needs and on March 31, 2018, they charged $30,000.00 to their credit card. However,

 

despite already informing Plaintiffs that they had until April 2, 2018 to join at the Smart

 

level, on April 1, 2018 Defendant Sheridan wrote to Plaintiffs and said that he had obtained

 

“permission for both of you to still execute today as discussed. Today would be the final

 

day, after that my hands are tied. No pressure just wanted to send a final message.”

 

  1. Despite the analysis conducted with Defendant Sheridan and reaching the

3

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 4 of 14

 

 

 

collective conclusion that the Smart level was more than sufficient for Plaintiffs, within

 

weeks after joining Defendant Sheridan sent an April 25, 2018 email to Plaintiff Laine..

 

In what indicates to be the start of high pressure attempts to “ratchet-up” the program level,

 

the email, entitled “Upgrade offer: This week only” provided for an undetailed upgrade for

 

$85,445.21 (utilizing a credit for the moneys Plaintiff had just paid) for three years or

 

$35,945.21 for a single year. Plaintiffs rejected this offer making clear to Defendant

 

Sheridan that they only wanted to stay within their present level.

 

  1. One month to the day later (as if needing to meet quota), on May 25, 2018,

 

Defendant Sheridan sent another email to Plaintiff providing her an “exclusive offer” to

 

upgrade to the Sophisticated level. Again, Plaintiff rejected this “exclusive offer.” As if

 

this was not enough pressure placed upon this elderly couple, on March 31, 2018,

 

Defendant Sheridan sent yet another email creating urgency.

 

  1. On June 14, 2018, less than a month later Defendant Sheridan sent to

 

Plaintiff an email entitled “Just reviewed your account.” Without explanation of his

 

reasoning Defendant Sheridan again took efforts to re-sell to Plaintiff the Sophisticated

 

level for an upfront cost $97,500.00 and stating that in converting the membership Plaintiff

 

would be a “value that exceeds [her] current spend.” No details were provided as to how

 

he had reached that conclusion. To put further usual additional pressure on Plaintiffs, the

 

email closed that she should contact him “before month’s end.” Once more Plaintiff let

 

Sheridan know that they wished to stay at the level they had just purchased.

 

  1. Plaintiffs were able to utilize the free flight services on but a single occasion.

4

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 5 of 14

 

 

 

However, in the mid-summer of 2018, Defendants reported to Plaintiff that the benefits

 

they had just purchased would no longer be available to Plaintiffs and that all future flights

 

would require payment by Plaintiffs – thus undermining the very essence of the

 

“membership.” Plaintiff did avail themselves of Defendants’ services once thereafter but

 

was required to pay for that flight.

 

  1. Plaintiff has attempted to obtain a return of her purchase price for the

 

services rendered by Defendants, but Defendants have failed and refused to provide the

 

same.

 

  1. Although Defendants attempted to push Plaintiffs into a relatively worthless

 

“Family Membership” which continued to require Plaintiffs to pay for flights, no

 

arrangement could be reached which provided the promises which were made to induce the

 

Plaintiffs to buy into the Jetsmarter “membership.” After not having use of the program,

 

on October 10, 2018, Plaintiff Laine wrote to Defendant Sheridan:

 

Hello David,

I was so disappointed not to receive a call from you this

morning after making an appt. to speak with you and calling

your office several times during the day. Please reach out to us

as Gary and I are concerned about our account, we are running

out of time and unable to get on flights due to not having a

membership we can use as our 3 hour and under flights were

taken from us after paying you $30,000 to join. Shane offered

us a deal that is not satisfactory or fair. We look forward to

having you help us work this out. We are an older couple who

gave you and your company a significant amount of funding

for a promise of travel that you have not fulfilled after your

assurance that you would. We are both incredibly disappointed

and hope that you can make this better for us.

Thank you,

5

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 6 of 14

 

 

 

Sheri Laine

 

  1. After a brief conversation with Defendant Sheridan in which he said he

 

would look into the issues, a sizeable period of time elapsed without hearing from

 

Defendant Sheridan, prompting Defendant Laine to send an email dated October 19, 2018:

 

Hello David,

Gary and I had hoped to hear back from you after our

conversation just last week and your promise to get back to us

within 2 days- regarding your help in assisting us with

Jetsmarter charters under 3 hours.

As Seniors we really believed in your pitch to get free flights

under 3 hours, which is the only reason we joined.

You have promised us 3 times now to get back to us to rectify

the membership.

Please help us to sort this mess out,

Gary is beyond disappointed in your company and your

promises to assist us.

Every salesperson has said the final decision rests with you, yet

you say your team has to get back to you.

Unfortunately it feels like we have been scammed by you and

your company.

Please don’t be that person.

Hope to hear from you.

Sheri Laine

 

  1.    In response, Defendant Sheridan sent this last communication:

 

Sheri,

Thank you. I am not avoiding you but waiting on our team to

update me on resolutions. I will not forget about you both.

Thank you again.

 

  1. As a result of Defendants actions, Plaintiffs have suffered damages.

 

 

 

 

6

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 7 of 14

 

 

 

COUNT I

Breach of Contract

 

  1. Plaintiff incorporates the foregoing allegations as if fully set forth herein.

 

  1. Plaintiffs and Defendant entered into an on-line agreement through which in

 

exchange for the payment of $30,000.00, Defendant Jetsmarter, through its agent

 

Defendant Sheridan, agreed to provide certain travel benefits to Plaintiff.

 

  1. The agreement entered into by the parties was in a format which was later

 

changed by Defendants and Defendants failed to provide to Plaintiff a copy of the contract

 

after its execution and entry.

 

  1. After Plaintiffs were able to use Defendant’s free services as contacted for on

 

one single occasion, Plaintiff came to learn that Defendant Jetsmarter had unilaterally

 

changed the program and that the program offered to Plaintiffs – and for which they had

 

purchased – was no longer being offered. Plaintiffs were now required to pay for their

 

flights.

 

  1. As a result of these changes, Plaintiffs has been unable to continue to utilize

 

the services for which they contracted and purchased.

 

  1. Based upon Defendants’ own assessment of the cost which would be

 

incurred by Plaintiff in order to retain duplicate services, the “benefit of the bargain,” each

 

Plaintiff would have to pay approximately $98,550.00 per month.

 

  1. As a result of their actions and conduct, Defendants have breach the contract

 

with Plaintiff and caused Plaintiff damages.

 

7

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 8 of 14

 

 

 

WHEREFORE, Plaintiffs Sheri Laine and Gary Seidler demand judgment against

 

defendants, jointly and severally, as follows:

 

(1)   Awarding judgment and damages of no less than $2,200,00.00 sustained by

 

Plaintiffs, together with pre-judgment interest;

 

(2)   Awarding Plaintiffs Sheri Laine and Gary Seidler her costs and

 

disbursements and reasonable allowances for the fees of plaintiff’s counsel and

 

experts, and reimbursement of expenses;

 

(3)   Awarding pre and post judgment interest as permitted by law.

 

(4)   Awarding such other and further relief the Court deems just and equitable.

 

 

COUNT II

Violation of Good Faith and Fair Dealing

 

  1. Plaintiff incorporates the foregoing allegations as if fully set forth herein.

 

  1. Implied in every contract is the duty for each party to utilize good faith in its

 

performance. Common law calls for substantial compliance with the spirit, not just the

 

letter, of a contract in its performance.

 

  1. In entering into the agreement at issue there exists an implied covenant that

 

the parties will act in good faith and deal fairly, and that neither party shall do anything that

 

will have the effect of destroying or injuring the right of the other party to receive the fruits

 

of the contract. Defendant Jetsmarter did not act consistent with this principal when it

 

unilaterally changed the very basis of the agreement entered into with Plaintiffs.

 

  1. As a direct and proximate result of Defendant JetSmarter’s conduct, Plaintffs

8

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 9 of 14

 

 

 

have suffered damages.

 

WHEREFORE, Plaintiffs Sheri Laine and Gary Seidler demand judgment against

 

defendants, jointly and severally, as follows:

 

(1)   Awarding judgment and damages of no less than $2,200,00.00 sustained by

 

Plaintiffs, together with pre-judgment interest;

 

(2)   Awarding Plaintiffs Sheri Laine and Gary Seidler her costs and

 

disbursements and reasonable allowances for the fees of plaintiff’s counsel and

 

experts, and reimbursement of expenses;

 

(3)   Awarding pre and post-judgment interest as permitted by law.

 

(4)   Awarding such other and further relief the Court deems just and equitable.

 

 

 

COUNT III

Violation of the Deceptive and Unfair Trade Practices Act

 

  1. Plaintiff incorporates paragraph 1-17, and 19-22 as if fully set forth herein.

 

  1. In attempting to advertise, market and sell the flight services, Defendants

 

Jetsmarter and Sheridan made an express representation that Plaintiffs’ sole obligation was

 

to make their payments, in full and in advance, and in exchange therefor they would

 

receive all of the benefits described to them both verbally and in writing. Defendants

 

specifically advertised that for flights under three hours in duration a customer would be

 

able to obtain two seats on its planes with no additional charge. This statement was false.

 

  1. The marketing platform was developed by John Doe 1 and 2, fictional

 

9

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 10 of 14

 

 

 

persons who will be named after discovery is conducted, and such marketing was approved

 

by Jetsmarter’s supervisors/officers John Does 3 and 4, also fictional persons who will be

 

named after discovery is conducted.

 

  1. Within a couple of months after purchasing the enrolling “membership” with

 

Defendants, Plaintiffs came to learn that the programs as sold to them were no longer

 

available and that they would be required to purchase flights in the future. This, along with

 

other components of the purchase which vanished, was contrary to the express

 

representation made by Defendants in their marketing and advertising.

 

  1. Plaintiffs are “Consumers” as defined in Section 501.203(7) Florida’s

 

Deceptive and Unfair Trade Practices Act. As they are each over the age of 60, Plaintiffs

 

are also defined as “senior citizens” pursuant to Section 501.2077. Fla. Stat.

 

  1. The advertising and selling of the “memberships” fall within the definition of

 

“trade or commerce” as well as “things of value” as defined in Florida Statute 501.203(8)

 

and (9) respectively.

 

  1. Through the use of the communications and in connection with the sales and

 

advertisement of its services to Plaintiffs, Defendants made misrepresentations and false

 

promises. Moreover, Defendants’ methods of unilaterally changing the membership

 

program and thereafter refusing to return the purchase price – and other similar and related

 

activities – constitute unconscionable practices.

 

  1. As a result, Plaintiff has suffered damages.

 

WHEREFORE, Plaintiffs Sheri Laine and Gary Seidler demand judgment against

10

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 11 of 14

 

 

 

defendants, jointly and severally, as follows:

 

(1)   Awarding judgment and damages of no less than $2,200,00.00 sustained by

 

Plaintiffs, together with pre-judgment interest;

 

(2)   Awarding statutory damages;

 

(3)   Awarding Plaintiffs Sheri Laine and Gary Seidler her costs and

 

disbursements and reasonable allowances for the fees of plaintiff’s counsel and

 

experts, and reimbursement of expenses;

 

(4)   Awarding pre and post-judgment interest as permitted by law.

 

(5)   Awarding such other and further relief the Court deems just and equitable.

 

 

COUNT IV

Respondeat Superior

 

  1. Plaintiff incorporates the prior Counts as if fully set forth herein.

 

  1. Jetsmarter and its agents, John Does 1 – 4 instructed or at least permitted

 

Defendant Sheridan to utilize its name in the carrying out of marketing and sales of flight

 

services.

 

  1. When marketing, advertising and selling the services which is the subject

 

matter hereof, Defendant Sheridan was acting within the scope of his agency or

 

employment.

 

  1. Jetsmarter and its agents, John Does 1 -4 had a duty to properly train and

 

supervise Sheridan which Jetsmarter and John Does 1-4 failed to carry out.

 

  1. The actions taken by Defendant Sheridan in the marketing and sale of the

11

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 12 of 14

 

 

 

property to Plaintiffs caused Plaintiffs damages.

 

WHEREFORE, Plaintiffs Sheri Laine and Gary Seidler demand judgment against

 

defendants, jointly and severally, as follows:

 

(1)   Awarding judgment and damages of no less than $2,200,00.00 sustained by

 

Plaintiffs, together with pre-judgment interest;

 

(2)   Awarding Plaintiffs Sheri Laine and Gary Seidler her costs and

 

disbursements and reasonable allowances for the fees of plaintiff’s counsel and

 

experts, and reimbursement of expenses;

 

(3)   Awarding pre and post-judgment interest as permitted by law.

 

(4)   Awarding such other and further relief the Court deems just and equitable.

 

 

 

COUNT V

Fraud

 

  1. Plaintiff incorporates the prior Counts as if fully set forth herein.

 

  1. In the March communications from Jetsmarter and Sheridan to Plaintiffs,

 

Defendants made material representations about the program which Plaintiffs were

 

purchasing and that upon prepayment, Plaintiffs would be able to fly on the Jetsmarter

 

charters within three hours of their departure city without further charge.

 

  1. These representations were false. In fact, other than one flight there were

 

significant costs imposed upon them in order to utilize the Jetsmarter services.

 

  1. Defendants knew or should have known that these representations to

 

12

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 13 of 14

 

 

 

Plaintiffs were false and misleading and that Plaintiffs would rely upon the same.

 

  1. Plaintiffs reasonably relied upon Defendants’ statements and enrolled with

 

Jetsmarter paying the amounts quoted to them.

 

  1. As a result, Plaintiffs have suffered damages.

 

WHEREFORE, Plaintiffs Sheri Laine and Gary Seidler demand judgment against

 

defendants, jointly and severally, as follows:

 

(1)   Awarding judgment and damages of no less than $2,200,000.00 sustained by

 

Plaintiffs, together with pre-judgment interest;

 

(2)   Awarding punitive damages;

 

(3)   Awarding Plaintiffs Sheri Laine and Gary Seidler her costs and

 

disbursements and reasonable allowances for the fees of plaintiff’s counsel and

 

experts, and reimbursement of expenses;

 

(4)   Awarding pre and post-judgment interest as permitted by law.

 

(5)   Awarding such other and further relief the Court deems just and equitable.

 

 

 

 

13

 

Case 0:18-cv-62969-BB Document 1 Entered on FLSD Docket 12/05/2018 Page 14 of 14

 

 

 

JURY TRIAL DEMAND

 

Plaintiffs request a jury trial for any and all Counts for which a trial by jury is

 

permitted by law.

 

Respectfully submitted this 4 day of December, 2018.

 

 

 

THE LAW OFFICES OF BRUCE E. BALDINGER, LLC

Attorney for Plaintiffs Sheri Laine and Gary Seidler

365 South Street

Morristown, NJ 07960

Tel: (908) 218-0060

 

By: /s/ Bruce E. Baldinger

Bruce E. Baldinger

Fla. Bar No. 776696

bruce@baldingerlaw.com

 

 

KATZMAN WASSERMAN BENNARDINI

& RUBINSTEIN, P.A.

Attorney for Plaintiff Sheri Laine and Gary Seidler

7900 Glades Road, Suite 140

Boca Raton, FL 33434

Tel: (561) 477-7774

Fax: (561) 477-4774

 

By:     /s/ Steven M. Katzman

Steven M. Katzman

Fla. Bar No. 375861

smk@kwblaw.com

mrm@kwblaw.com

 

 

 

About the Author Doug Gollan

I am Founder and Editor of Private Jet Card Comparisons, the only independent buyer's guide to jet card membership programs, and DG Amazing Experiences, a weekly luxury travel e-newsletter for private jet owners. I am also a contributor to Forbes.com