In-Shape Health Clubs, which is based out of Stockton, California, has agreed to pay $3 million in fines and $23 million in restitution in order to settle a civil case that originated in 2014.
The complaint alleged that in a three-year period, consumers complained about several actions the health clubs took, including unauthorized billings, membership promotions and cancellation practices. The complaint also alleges that in order to bring the number of health clubs from 40 to 73, In-Shape violated California’s False Advertising Law, Health Studio Act and other laws regarding consumer protection when it touted its “free” services, sold promotional memberships, refused to honor requests to cancel memberships, practices unauthorized billing and tried to collect on debts that were invalid.
The district attorneys’ offices in the counties of Santa Cruz, Monterey and Kern Counties all worked together on the case, but the settlement will apply to all of the In-Shape clubs located in California. The settlement requires In-Shape to provide various forms of restitution to thousands of past and present members.
In-Shape’s chief executive officer issued a statement, in which he denied any wrongdoing and stated that the claims made by the district attorneys are not made on current practices. He also said that that In-Shape agreed to the settlement and cooperated with the district attorneys in order to avoid the distractions and costs of litigation.
When it is alleged that a business has been using unfair business practices and other types of conduct that violates consumer protection laws, then clients and customers may be eligible for restitution in some cases. An experienced lawyer can help you learn more about how much — if any — restitution you may be due when businesess violate the law.
Source: Club Industry, “In-Shape to Pay Millions in Restitution, Fines as Settlement in Unfair Business Practice Case,” Sarah Protzman Howlett, Aug. 22, 2016