LA Fitness and other gym franchises make it difficult for consumers to cancel their gym memberships and other services that continue indefinitely unless canceled, the Federal Trade Commission, or FTC, alleged in a lawsuit Wednesday.
“The FTC’s complaint describes a scenario that too many Americans have experienced – a gym membership that seems impossible to cancel,” Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, said in a statement. “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 lawsuit, filed in a California district court, charges California-based Fitness International, and subsidiary Fitness & Sports Clubs – which operate gym franchises including LA Fitness, Esporta Fitness, City Sports Club, and Club Studio – of unfair practices.
The gyms 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 pays the first and last month’s dues, followed by monthly dues and annual fees. LA Fitness clubs also offer personal training memberships, which have fixed initial terms followed by a monthly membership.
LA Fitness uses opaque and complicated methods to make it difficult for consumers to cancel their memberships, the FTC lawsuit charges.
LA Fitness has required consumers who want to cancel to either go to the gym or send a cancellation notice by mail. To start the process, LA Fitness has instructed consumers to log on to its website and print a cancellation form.
But even logging in can be cumbersome as consumers often don’t recall their login credentials, and LA Fitness requires consumers to use the email address used to establish membership, 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.
Even after completing this task, consumers who tried to cancel in person still faced obstacles, according to the lawsuit. 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 a day, seven days a week.
Consumers who tried to cancel by mail also faced challenges, according to the lawsuit. While consumers were told to use the LA Fitness website to download and print the cancellation form, the company didn’t clearly inform consumers that they also have the option to submit a written notice of their cancellation and didn’t tell them what information to include in the request. Consumers also were told that the mailed cancellation forms or requests should be sent certified or registered mail, causing the consumers to incur additional costs.
In addition, LA Fitness has failed to clearly inform consumers that they can cancel add-on options and services individually, without affecting their gym membership, according to the lawsuit. For example, it failed to disclose that these services could be canceled by almost 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, telling consumers again 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’re rebilled, often under new account numbers.
The FTC is seeking a court order prohibiting the allegedly unfair conduct and money back for consumers harmed by the difficulty in canceling memberships.
The agency alleges the practices outlined in the lawsuit violate the FTC Act and the Restore Online Shoppers’ Confidence Act.
