The state of North Carolina’s litigation against former Peak Fitness owner Jeff Stec is still ongoing.

The state of North Carolina’s litigation against former Peak Fitness owner Jeff Stec is still ongoing.

That information came in a press release from the office of North Carolina Attorney General Roy Cooper, who recently announced that his state has stepped up its efforts to ensure that health clubs are prepared to refund members whose clubs have closed.

Cooper’s office stated that multiple locations of ZX Fitness, which took the place of the former Peak Fitness clubs after Peak Fitness went into bankruptcy, are still under investigation, along with two Curves for Women clubs in North Carolina. Two other Curves for Women clubs have entered into settlements with the Attorney General’s office requiring their compliance with the law. Three more Curves for Women clubs have complied with the law after receiving a warning letter from the office’s consumer protection division.

In all, the division has recently contacted 28 North Carolina clubs and related businesses, such as dance and martial arts studios, about their compliance with state law. Over the past few years, the division has recovered more than $500,000 for members whose clubs have closed.

“My office hears every week from people whose gym shut down, leaving them in the lurch,” Cooper said in a statement. “Fortunately, North Carolina law requires health clubs to set aside money for refunds, and we want to make sure that businesses are following the law so consumers are protected.”

Under North Carolina law, health clubs, dance studios, martial arts studios and dating services are required to have a bond or letter of credit to cover certain prepaid contracts in case they go out of business and need money to repay consumers. Businesses are required to file sworn statements with the Attorney General’s office about their bonds twice a year.

The state of North Carolina’s litigation against former Peak Fitness owner Jeff Stec is still ongoing.

The state of North Carolina’s litigation against former Peak Fitness owner Jeff Stec is still ongoing.

That information came in a press release from the office of North Carolina Attorney General Roy Cooper, who recently announced that his state has stepped up its efforts to ensure that health clubs are prepared to refund members whose clubs have closed.

Cooper’s office stated that multiple locations of ZX Fitness, which took the place of the former Peak Fitness clubs after Peak Fitness went into bankruptcy, are still under investigation, along with two Curves for Women clubs in North Carolina. Two other Curves for Women clubs have entered into settlements with the Attorney General’s office requiring their compliance with the law. Three more Curves for Women clubs have complied with the law after receiving a warning letter from the office’s consumer protection division.

In all, the division has recently contacted 28 North Carolina clubs and related businesses, such as dance and martial arts studios, about their compliance with state law. Over the past few years, the division has recovered more than $500,000 for members whose clubs have closed.

“My office hears every week from people whose gym shut down, leaving them in the lurch,” Cooper said in a statement. “Fortunately, North Carolina law requires health clubs to set aside money for refunds, and we want to make sure that businesses are following the law so consumers are protected.”

Under North Carolina law, health clubs, dance studios, martial arts studios and dating services are required to have a bond or letter of credit to cover certain prepaid contracts in case they go out of business and need money to repay consumers. Businesses are required to file sworn statements with the Attorney General’s office about their bonds twice a year.

Urban Active Faces Lawsuit, Responds to BBB Rating! Looking Really Bad For Urban Active

Urban Active says it cannot comment on a recent lawsuit, but it is attempting to resolve complaints filed with the Better Business Bureau (BBB) of Central Ohio, which last week issued the Lexington, KY-based company an “F” rating.

An amended version of the lawsuit was filed Tuesday in Franklin County (OH) Common Pleas Court. The complaint was originally filed last Wednesday on behalf of Ohio resident Amber Gascho. The amended version includes Ohio residents Ashley Buckenmeyer and Michael Hogan on behalf of themselves and all other similarly situated plaintiffs.
Gascho, Buckenmeyer and Hogan claim Global Fitness Holdings LLC, Lexington, KY, which does business as Urban Active, violated the Ohio Consumer Sales Practices Act and the Ohio deceptive trade practices act and breached a contract. The plaintiffs, represented by the law firm of Vorys, Sater, Seymour and Pease LLP, Columbus, OH, are seeking an award of damages of more than $25,000. The lawsuit is seeking class-action status for all Ohio Urban Active members who purchased membership contracts from Nov. 1, 2007, to the present.

Specifically, Gascho, Buckenmeyer and Hogan allege that Urban Active:

Misrepresented the terms and duration of its membership contracts, personal training contracts and other contracts for services. Misrepresented customers’ cancellation rights. Failed to notify customers of their cancellation rights as required by law. Failed to provide customers with copies of contracts at the time of signing as
required by law. Failed to honor notices of cancellation. Continued to charge customers after cancellation. Failed to inform customers of hidden $15 “maintenance fees,”which increase the cost of its membership contracts. Failed to provide customers with personal training sessions as contracted for in their agreements.

Gascho claims that Urban Active told her that she could cancel her personal training contract for a $10 fee, but when she tried to cancel the contract, she was told the
charge would be $250, according to the complaint. Buckenmeyer claims that an Urban Active personal trainer pressured her into signing a contract, but after she tried to cancel the contract four hours later, Urban Active refused to cancel the contract and continues to charge her bank card, according to the complaint.

Like Gascho and Buckenmeyer, Hogan claims he was not advised of his cancellation rights, nor was he provided with duplicate copies of a notice of cancellation form.
Hogan claims that he tried to cancel his Urban Active contract in October 2010, yet his bank card was still being charged through last February, according to the
complaint. Hogan was charged more than $100 in additional fees after he resent a notice of cancellation, fees that Hogan claims Urban Active has refused to refund.

John Gragg, general counsel for Urban Active, says the company does not comment on litigation, but he did tell Club Industry that the company “will vigorously defend
our good name.”

The lawsuit comes on the heels of a release from the BBB of Central Ohio, which says it has received more than 200 complaints from Ohio Urban Active members within the last year. Of those complaints, 78 of them were either unanswered or unresolved, as Urban Active did not respond to written requests for explanation, the BBB said.

“We’re aware of the complaints that have been filed, and we’re aware that people are frustrated and that it’s taken a while to respond to concerns,” Gragg tells Club
Industry. “Our goal is to provide the best fitness experience, and we take any complaints very seriously.”

Most of the complaints deal with billing issues. Specifically, members have complained that Urban Active continued to charge their bank accounts or credit cards after
the members believed that their contracts had expired or had been canceled.

“The trends we’re seeing in complaints against Urban Active tell us consumers need to read the fine print on the contract before they sign and keep a close eye on their
bank statements to insure they’re not getting billed more than they should,” Kip Morse, president and CEO of the BBB Central Ohio, said in a statement.

The Lexington Herald-Leader reported last week that the BBB of Central and Eastern Kentucky also has given Urban Active an “F” rating. That chapter has processed 93
complaints against Urban Active over the past three years, with 62 of them resolved, the newspaper reported.

Gragg told media outlets last week that the complaints represent less than half of 1 percent of the company’s overall membership base.

“We apologize to our customers who have experienced problems,” Gragg says. “We’re working diligently to resolve these issues by promoting more personnel to provide
better customer service. We’re also working with all of the Better Business Bureaus to resolve these issues as well.”

Gragg adds that Urban Active had taken steps to resolve these issues before the BBB Central Ohio released its report.

“Every one of those cities that we have BBB issues, year in and year out, we’re unanimously voted the top health chain of that market,” Royce Pulliam, CEO of Urban
Active, tells Club Industry. “We know we’ve got a few customer service issues that we’ve got to get under control, and we’re going to put forth all our best efforts to
make sure that we do so. We do have a few things to be better at, and we’re going to be better at it.”

Urban Active has 34 clubs in operation, primarily in Ohio, Kentucky and Tennessee. The company also has expanded into Pittsburgh, Omaha, NE, and Charlotte, NC. Last
year, Urban Active closed two of its clubs in Cincinnati and a club in Brentwood, TN.

Gragg confirmed that Urban Active will open two new clubs in July, one in the Buckhead section of Atlanta and the other in Dublin, OH. He adds that Urban Active also is considering seven to 10 other locations for development.

Urban Active Faces Lawsuit, Responds to BBB Rating! Looking Really Bad For Urban Active

Urban Active says it cannot comment on a recent lawsuit, but it is attempting to resolve complaints filed with the Better Business Bureau (BBB) of Central Ohio, which last week issued the Lexington, KY-based company an “F” rating.

An amended version of the lawsuit was filed Tuesday in Franklin County (OH) Common Pleas Court. The complaint was originally filed last Wednesday on behalf of Ohio resident Amber Gascho. The amended version includes Ohio residents Ashley Buckenmeyer and Michael Hogan on behalf of themselves and all other similarly situated plaintiffs.
Gascho, Buckenmeyer and Hogan claim Global Fitness Holdings LLC, Lexington, KY, which does business as Urban Active, violated the Ohio Consumer Sales Practices Act and the Ohio deceptive trade practices act and breached a contract. The plaintiffs, represented by the law firm of Vorys, Sater, Seymour and Pease LLP, Columbus, OH, are seeking an award of damages of more than $25,000. The lawsuit is seeking class-action status for all Ohio Urban Active members who purchased membership contracts from Nov. 1, 2007, to the present.

Specifically, Gascho, Buckenmeyer and Hogan allege that Urban Active:

Misrepresented the terms and duration of its membership contracts, personal training contracts and other contracts for services. Misrepresented customers’ cancellation rights. Failed to notify customers of their cancellation rights as required by law. Failed to provide customers with copies of contracts at the time of signing as
required by law. Failed to honor notices of cancellation. Continued to charge customers after cancellation. Failed to inform customers of hidden $15 “maintenance fees,”which increase the cost of its membership contracts. Failed to provide customers with personal training sessions as contracted for in their agreements.

Gascho claims that Urban Active told her that she could cancel her personal training contract for a $10 fee, but when she tried to cancel the contract, she was told the
charge would be $250, according to the complaint. Buckenmeyer claims that an Urban Active personal trainer pressured her into signing a contract, but after she tried to cancel the contract four hours later, Urban Active refused to cancel the contract and continues to charge her bank card, according to the complaint.

Like Gascho and Buckenmeyer, Hogan claims he was not advised of his cancellation rights, nor was he provided with duplicate copies of a notice of cancellation form.
Hogan claims that he tried to cancel his Urban Active contract in October 2010, yet his bank card was still being charged through last February, according to the
complaint. Hogan was charged more than $100 in additional fees after he resent a notice of cancellation, fees that Hogan claims Urban Active has refused to refund.

John Gragg, general counsel for Urban Active, says the company does not comment on litigation, but he did tell Club Industry that the company “will vigorously defend
our good name.”

The lawsuit comes on the heels of a release from the BBB of Central Ohio, which says it has received more than 200 complaints from Ohio Urban Active members within the last year. Of those complaints, 78 of them were either unanswered or unresolved, as Urban Active did not respond to written requests for explanation, the BBB said.

“We’re aware of the complaints that have been filed, and we’re aware that people are frustrated and that it’s taken a while to respond to concerns,” Gragg tells Club
Industry. “Our goal is to provide the best fitness experience, and we take any complaints very seriously.”

Most of the complaints deal with billing issues. Specifically, members have complained that Urban Active continued to charge their bank accounts or credit cards after
the members believed that their contracts had expired or had been canceled.

“The trends we’re seeing in complaints against Urban Active tell us consumers need to read the fine print on the contract before they sign and keep a close eye on their
bank statements to insure they’re not getting billed more than they should,” Kip Morse, president and CEO of the BBB Central Ohio, said in a statement.

The Lexington Herald-Leader reported last week that the BBB of Central and Eastern Kentucky also has given Urban Active an “F” rating. That chapter has processed 93
complaints against Urban Active over the past three years, with 62 of them resolved, the newspaper reported.

Gragg told media outlets last week that the complaints represent less than half of 1 percent of the company’s overall membership base.

“We apologize to our customers who have experienced problems,” Gragg says. “We’re working diligently to resolve these issues by promoting more personnel to provide
better customer service. We’re also working with all of the Better Business Bureaus to resolve these issues as well.”

Gragg adds that Urban Active had taken steps to resolve these issues before the BBB Central Ohio released its report.

“Every one of those cities that we have BBB issues, year in and year out, we’re unanimously voted the top health chain of that market,” Royce Pulliam, CEO of Urban
Active, tells Club Industry. “We know we’ve got a few customer service issues that we’ve got to get under control, and we’re going to put forth all our best efforts to
make sure that we do so. We do have a few things to be better at, and we’re going to be better at it.”

Urban Active has 34 clubs in operation, primarily in Ohio, Kentucky and Tennessee. The company also has expanded into Pittsburgh, Omaha, NE, and Charlotte, NC. Last
year, Urban Active closed two of its clubs in Cincinnati and a club in Brentwood, TN.

Gragg confirmed that Urban Active will open two new clubs in July, one in the Buckhead section of Atlanta and the other in Dublin, OH. He adds that Urban Active also is considering seven to 10 other locations for development.