McLeod County Board Member Daryl Luthens has been named as a defendant in a lawsuit alleging vote tampering in relation to a timeshare board.
The civil complaint filed on behalf of the Breezy Center Timeshare Owners Association in Crow Wing County late last month mainly focuses on Neal Narveson and his company, Narveson Management, and requests relief for both common law fraud and consumer fraud. Narveson Management had management contracts with various timeshare associations. The complaint says Narveson handpicked board members of the BCTOA and other timeshare associations.
"At various times, (Breezy Point Resort) proposed management contracts to Narveson-managed association boards, including that of the BCTOA, to provide management services at a much cheaper cost than the associations paid to Narveson," the complaint states. "The Resort's proposals were routinely rejected without consideration."
The complaint claims Luthens serves on approximately six boards of Narveson-managed associations.
The complaint also states, "Over the years, (Breezy Point Resort) affiliates and employees have run for positions on the board of directors for some Narveson-managed associations, posing a threat to Narveson's stranglehold."
In 2016, two board members on the BCTOA were challenged for their seats. An existing board law required proxy votes for the election be mailed and postmarked 10 days before the annual meeting to be valid for the election. The complaint argues this board law violates Chapter 317 of Minnesota Statutes, which allows proxies to be present at the time of the annual meeting.
A sworn statement from a former BCTOA board member alleges that prior to the annual meeting in January 2016, Narveson met with "loyal board members" from other associations he managed and directed them to forge signatures on proxy votes in favor of existing board members. Luthens and others are alleged to have provided forgeries as directed.
Luthens declined to comment on the lawsuit Monday morning.
“Narveson further advised those forging proxies to alter the signatures as much as possible so that it wasn’t obvious the same person had filled out and signed the documents," the complaint states.
With aid from counsel, the plaintiff attempted to verify signatures on proxies with their owners. As of the time the complaint was filed, 12 signatures on proxies cast in favor of existing board members are purported to be forgeries, including one from a man who died in 2010.
Narveson is also alleged to have illegally provided all-expense paid trips, meals and beverages to board members.
The complaint claims the fraud resulted in the BCTOA paying more than $100,000 in litigation expenses defending the results of the election and continuing Narveson's management contracts. It also states attorney and investigation expenses are in excess of $50,000.
BCTOA requests judgement against the defendants in an amount exceeding $50,000 for common law fraud, and exceeding $50,000 from Narveson Management and Neal Narveson for consumer fraud. This civil action is still in its early stages, with a scheduling conference in early July.