Boston Sports Clubs gyms showed “total disregard” for members during the Covid-19 pandemic by continuing to charge fees to customers who tried to cancel, Attorney General Maura Healey alleged last week as she unveiled a lawsuit against the company.
On Tuesday, Healey sued BSC’s parent company, Town Sports International (TSI), for violating sections of state law governing health clubs and consumer protection, arguing that it failed to honor scores of member cancellations and violated terms of an earlier agreement with her office.
Members of health clubs had the right under state law to cancel their contracts without penalty due to substantial changes in operations amid the pandemic that upended public life, but BSC continued to charge monthly fees while gyms were closed and improperly sought cancellation fees, Healey alleged.
“From the start of this pandemic, Boston Sports Clubs has shown a total disregard for its members, for good business practices, and for the law,” she said in a statement. “This company claimed it wanted to do the right thing, but it reneged on its promises. We are taking action today to secure relief for the thousands of people who have been cheated by BSC.”
BSC closed its gyms on March 16 to comply with mandatory shutdown orders, but it charged members a full monthly membership fee in April even while closed, Healey alleged. Those who had tried to cancel memberships in March or April were “rebuffed,” she said, and told they could only do so if they paid a cancellation fee, gave between 30 and 45 days of notice, and submitted the request in-person or via certified letter.
In April, Healey sent a letter formally demanding that BSC locations stop billing members while health clubs were closed, freeze all accounts at no cost, and allow cancellations with no fee.
She was not alone: attorneys general in New York, Pennsylvania and Washington, D.C. also sent a joint letter to BSC’s parent company in April warning that it was violating similar laws in their jurisdictions by ignoring cancellation requests and charging excessive fees.
The company agreed to the changes sought, but in July, when clubs reopened in a limited capacity, it unilaterally unfroze accounts and automatically charged membership fees to those whose accounts had been frozen without notification, according to Healey. BSC refused at that time to process any new cancellation requests without a $10 fee and threatened to refer any members who did not pay for previously canceled memberships to debt collectors.
“Over 2,000 Massachusetts consumers submitted complaints to the Attorney General’s Office about TSI’s practices,” Healey’s office wrote in its legal complaint. “This number of consumer complaints in a timeframe of only several months represents one of the most significant influx of complaints the Attorney General’s Office has received in recent years.”
Towns Sports International filed for Chapter 11 bankruptcy in September.
Healey’s office said it reached another agreement with BSC in October requiring the company to provide refunds to members and allow cancellations without penalties, but alleged the company “has since refused to make any effort to live up to the terms of the agreement.”