Three 24 Hour Fitness members alleging fraudulent sales practices relating to lifetime memberships have filed a federal lawsuit against the company seeking class certification and a jury trial.
The complaint in the case, O'Shea et al. v. 24 Hour Fitness USA Inc., was filed April 1 in the Northern District of California in the San Francisco Division. The three plaintiffs named in the complaint allegedly purchased lifetime memberships at various points within the last 10 years, and all three saw their annual renewal fees allegedly increase in January. (Read the complaint at the bottom of this page.)
The common theme, according to the complaint, is that 24 Hour Fitness allegedly lured customers into purchasing lifetime memberships with sales tactics that misrepresented lifetime fee guarantees in the lifetime memberships.
The complaint seeks to establish the class of all individuals in the United States who purchased a prepaid membership from 24 Hour with contracts drafted in or after April 2006, and who maintained their 24 Hour membership in or after April 2015. It also seeks to create subclasses for California, Oregon and Texas residents, which is the home for the three plaintiffs listed in the complaint.
Kevin O'Shea, a California resident, purchased his lifetime membership for $700 in 2008 and allegedly saw his annual renewal fee increase from $49 to $124 in January. Mark Victov, an Oregon resident, purchased his lifetime membership for $545 in 2007 and allegedly saw his annual renewal fee increase from $69 to $119 in January. Rod Morris, a Texas resident, purchased his lifetime membership for $700 in 2006 and allegedly saw his annual renewal fee of $49 increase to $161.29 in January.
Todd Logan, the plaintiffs' attorney, described 24 Hour's alleged conduct as "a textbook example of a widespread bait and switch scheme…by deceiving thousands of hapless customers," according to the complaint. The complaint alleges 24 Hour Fitness trains its membership counselors to use "deception and high-pressure sales tactics to sell" the lifetime memberships.
After April 2006, 24 Hour's standard membership agreement form allegedly did not guarantee lifelong memberships, according to the complaint. Instead, the second page allegedly contained fine print containing language that 24 Hour could increase all subsequent annual renewal amounts on prepaid memberships, according to the complaint.
The 11-count complaint seeks relief through certification of the class; a declaration stating the plaintiffs are entitled to reformation of their written contracts to reflect a lifetime membership with the fee guarantees; and a declaration stating that 24 Hour's conduct violates the California Legal Remedies Act, the California Unfair Competition Law, the California Health Studio Services Contract Law, the Oregon Unlawful Trade Practices Act, the Texas Deceptive Trade Practices Act, and the Texas Health Spa Act.
The plaintiffs also are seeking awards for damages, litigation and attorney expenses, pre- and post-judgment interest, other injunctive and declaratory relief, and other relief the court deems reasonable and just.
A Club Industry request to 24 Hour Fitness seeking comment for this story was not immediately returned Friday.