The Federal Trade Commission has sued the operators of LA Fitness and other gyms.
The agency says that the gyms make memberships nearly impossible to cancel. Those who want to cancel their membership must either go to the gym itself or mail a cancellation notice.
Customers must log in to the website to print the form. If they forget their login credentials, then LA Fitness requires consumers to use the “key tag” number assigned at start up, and the first five digits of their credit card or bank account number to reset their login credentials.
The agency seeks a court order prohibiting the allegedly unfair conduct and refunds for harmed consumers.
LAFitness Complaint by scott.mcclallen
“The FTC’s complaint describes a scenario that too many Americans have experienced – a gym membership that seems impossible to cancel,” said Christopher Mufarrige, Director of the Bureau of Consumer Protection. “Tens of thousands of LA Fitness customers reported difficulties – cancellation was often restricted to specific times or required speaking to specific managers who were often not present or available. The FTC will not hesitate to act on behalf of consumers when it believes companies are stifling consumers’ ability to choose which recurring charges they want to keep.”
California-based Fitness International, LLC and Fitness & Sports Clubs, LLC operate LA Fitness and other gym chains, including Esporta Fitness, City Sports Club, and Club Studio, that have more than 600 locations and over 3.7 million members nationwide.
The two companies offer gym memberships that cost can cost between $30 and $299 a month, depending on the gym, along with optional add-on services such as towel service. When signing up for a membership, the consumer initially pays the first and last month’s dues, followed by monthly recurring dues and annual fees. LA Fitness clubs also offer personal training memberships, which have fixed initial terms followed by a recurring monthly membership.
Even after completing this task, consumers who tried to cancel in person still faced obstacles, according to the complaint. Consumers could only cancel with one specific employee, even though LA Fitness authorized several employees to sign consumers up for memberships. This restricted cancellation hours to times when consumers are typically at work, despite most locations operating up to 19 hours per day, seven days per week.
Consumers who tried to cancel by mail also faced challenges, according to the complaint. While consumers were told to use the LA Fitness website to download and print the cancellation form, the company did not clearly inform consumers that they also have the option to just submit a written notice of their cancellation and did not tell them what information to include in such a request. Further, consumers were told that the mailed cancellation forms or requests should be sent certified or registered mail, causing the consumers to incur additional costs.
The complaint alleged that LA Fitness has failed to clearly inform consumers that they can cancel add-on amenities and services individually, without affecting their gym membership, according to the complaint. For example, it failed to disclose that such services could be cancelled by virtually any gym employee.
Finally, instead of simplifying the cancellation process in response to consumer complaints, LA Fitness has trained staff to reject escalated requests and to deny cancellations requested by phone or email, reiterating that all cancellations must be done in person with one specific employee or by mail.
Consumers who try to cancel their memberships by stopping charges to their bank or credit card find they are rebilled, often under new account numbers. The FTC alleges such practices violate the FTC Act and the Restore Online Shoppers’ Confidence Act.
The Commission vote authorizing the staff to file the complaint was 3-0. The complaint was filed in the U.S. District Court for the Central District of California.
The FTC staff attorneys are Serena Mosley-Day, Reid Tepfer, and Edward Hynes of the agency’s Southwest Region.
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