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Hudson Valley Health Clubs Settle With State
Attorney General Spitzer today announced that an investigation of health clubs throughout the Hudson Valley has revealed numerous violations of a state law designed to safeguard consumers.
As a result of the investigation, 21 health clubs have entered into agreements with Spitzer's office and agreed to reform their business practices. The clubs collectively will pay over $50,000 in costs and penalties.
"This is the time of year when many people make a New Year's resolution to join a health club," Spitzer said. "However, consumers who pay hefty advance fees are put at risk if the club they join closes suddenly. Aggressive enforcement of consumer protection laws is essential to protect the public and level the playing field for law-abiding clubs."
The Attorney General's investigation began after several Hudson Valley health clubs closed in recent years, often leaving consumers with worthless prepaid memberships and requiring legal action to recover the monies.
In an effort to avoid future problems, Spitzer's Westchester Regional Office began a review of over 500 area health clubs to assess compliance with New York's Health Club Services Law. The law requires most health clubs to post a bond, letter of credit or certificate of deposit so that refunds are available for consumers who paid advance fees in the event the club goes out of business. The law also provides consumers with statutory cancellation rights, imposes contract restrictions and prohibits unfair and deceptive trade practices.
The investigation revealed that 16 health clubs were in violation of the statutory bonding requirement. An additional five clubs were in violation of other provisions of the Health Club Services Law, including the requirement that health club contracts advise consumers of the statutory right to cancel their membership within three days of joining. These clubs were required to revise their membership contracts and otherwise comply with the requirements of the Health Club Services Law.
The Attorney General also brought a lawsuit against U.S. Tae Kwon Do Academy of Bedford Hills after the martial arts facility shut down suddenly, leaving consumers with unexpired prepaid memberships in excess of $25,000. A judgment entered in Supreme Court, Westchester County requires the owner of the now defunct club to make restitution to consumers and to pay $4,500 in penalties and costs to the state.
Individuals who wish to file a complaint against a health club are encouraged to contact the Attorney General's consumer help line at (800) 771-7755 or visit his web site at www.ag.ny.gov.
These cases were handled by Assistant Attorney General Doris Morin of the Westchester Regional Office under the supervision of Assistant Attorney General In Charge Gary Brown.
In addition to enforcement efforts, Spitzer's office has issued tips for consumers who are considering whether to join a health club.
As a result of the investigation, 21 health clubs have entered into agreements with Spitzer's office and agreed to reform their business practices. The clubs collectively will pay over $50,000 in costs and penalties.
"This is the time of year when many people make a New Year's resolution to join a health club," Spitzer said. "However, consumers who pay hefty advance fees are put at risk if the club they join closes suddenly. Aggressive enforcement of consumer protection laws is essential to protect the public and level the playing field for law-abiding clubs."
The Attorney General's investigation began after several Hudson Valley health clubs closed in recent years, often leaving consumers with worthless prepaid memberships and requiring legal action to recover the monies.
In an effort to avoid future problems, Spitzer's Westchester Regional Office began a review of over 500 area health clubs to assess compliance with New York's Health Club Services Law. The law requires most health clubs to post a bond, letter of credit or certificate of deposit so that refunds are available for consumers who paid advance fees in the event the club goes out of business. The law also provides consumers with statutory cancellation rights, imposes contract restrictions and prohibits unfair and deceptive trade practices.
The investigation revealed that 16 health clubs were in violation of the statutory bonding requirement. An additional five clubs were in violation of other provisions of the Health Club Services Law, including the requirement that health club contracts advise consumers of the statutory right to cancel their membership within three days of joining. These clubs were required to revise their membership contracts and otherwise comply with the requirements of the Health Club Services Law.
The Attorney General also brought a lawsuit against U.S. Tae Kwon Do Academy of Bedford Hills after the martial arts facility shut down suddenly, leaving consumers with unexpired prepaid memberships in excess of $25,000. A judgment entered in Supreme Court, Westchester County requires the owner of the now defunct club to make restitution to consumers and to pay $4,500 in penalties and costs to the state.
Individuals who wish to file a complaint against a health club are encouraged to contact the Attorney General's consumer help line at (800) 771-7755 or visit his web site at www.ag.ny.gov.
These cases were handled by Assistant Attorney General Doris Morin of the Westchester Regional Office under the supervision of Assistant Attorney General In Charge Gary Brown.
In addition to enforcement efforts, Spitzer's office has issued tips for consumers who are considering whether to join a health club.
- Before signing a health club contract, become an educated consumer and visit or call at least two other health clubs to learn about dues and when they must be paid, hours of operation, variety and frequency of classes and ability to use multiple locations, if available.
- Do not give in to high pressure sales tactics or feel obligated to sign a contract immediately. Tell the health club representative you need time to think about joining the club and ask for free passes to determine if the club is right for you. Talk to other members.
- All health club contracts are cancelable within three days of signing the contract, and are cancelable at any time for any of the following reasons: if the health club ceases to offer the services stated in the contract; if the consumer moves 25 miles from any health club operated by the seller; and if, upon a doctor's order, the consumer cannot use the club because of significant physical disability for more than six months.
- Clubs must file a bond or other type of financial security with the Secretary of State to protect consumers who have pre-paid for their memberships in the event the club closes. Clubs must put a notice of this bond in all their contracts and must post this notice in the club. Clubs are exempted from this requirement if they do not offer pre-paid memberships or if they offer a monthly payment option of less than $150, and the contract does not exceed one year or contain an automatic renewal provision.
| HEALTH CLUB | LOCATION | VIOLATION |
| Alsanor Enterprises Inc. d/b/a Rye Racquet Club | Harrison, NY | bonding requirement |
| Aikido Of Westchester, Inc. | White Plains, NY | statutory contractual requirements |
| Atrium Fitness Center Corp. d/b/a World Gym Pawling | Pawling, NY | bonding requirement |
| B.M. Kim Tae Kwon Do, Inc. | White Plains, NY | bonding requirement |
| College Racquet Club, Inc. | Bronxville, NY | bonding requirement |
| Direct Fitness | Middletown, NY | statutory contractual requirements |
| Dolce/AEW Properties, LLP d/b/a Tarrytown House | Tarrytown, NY | bonding requirement |
| Doral Conference Center Associates d/b/a Doral Arrowwood Sports Center | RyeBrook, NY | bonding requirement |
| East Fishkill Fitness, LLC d/b/a Club Concepts Health & Fitness | Wappingers Falls, NY | bonding requirement |
| Fishkill Allsport Fitness and Racquetball Club, Inc. | Fishkill, NY | statutory contractual requirements |
| Hudson Valley Fitness Center, Ltd. d/b/a Hudson Valley Gym | Peekskill, NY | bonding requirement |
| IXL Health and Fitness Corp. | Rhinebeck, NY | bonding requirement |
| LifePlex LLC d/b/a LifePlex at Sportorama | Monsey, NY | bonding requirement |
| Monroe Woodbury Health and Fitness Center, Inc. | Harriman, NY | bonding requirement |
| Nevele Hotel, LLC d/b/a Fallsview/Nevele Grande | Ellenville, NY | bonding requirement |
| New Windsor Karate and Family Fitness, Inc. d/b/a Frampton's Soo Bahk do | New Windsor, NY | bonding requirement |
| Pro-Fitness/Healthsouth, Inc. d/b/a Center at Purchase | Purchase, NY | bonding requirement |
| Raphah, Inc. d/b/a Fitness Advantage | Saugerties, NY | bonding requirement |
| Tri-State Fitness, Inc. Port | Jervis, NY | bonding requirement |
| Toshindo Karate and Fitness Center | White Plains, NY | statutory contractual requirements |
| US Goshin Ryu Karate Inc. | Middletown, NY | statutory contractual requirements |
New York City Press Office: (212) 416-8060
Albany Press Office: (518) 473-5525
nyag.pressoffice@ag.ny.gov
Twitter: @AGSchneiderman
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