A franchisee of World Gym closed three of his locations in Arkansas earlier this week after a lawsuit related to alleged unpaid rent of $476,423 was filed against him, according to the Northwest Arkansas Business Journal.
The clubs, which are in Bentonville and Lowell, AR, closed a month after the landlord for the locations filed a lawsuit in February in Benton County Circuit Court against Rhett Garner, the franchisee. Two other locations owned by Garner, one in Fayetteville, AR, and one in Springdale, AR, remain open.
According to the lawsuit, as of Jan. 19, 2015, Garner owed $323,336 on the Lowell gym to WGL LLC, $128,739 on the Southwest Regional Airport Boulevard facility to Brightwood Business Park LLC, and $24,347 on the Southeast J Street facility to GG LLC. WGL, Brightwood and GG are all managed by Michael Charlton of Charlton Development.
In addition to the unpaid rent, Garner defaulted on a $200,000 promissory note loan from Charlton to buy equipment for the gyms, the lawsuit states. As of Feb. 16, Garner owes $54,644 on the note.
Charlton and his attorney have asked the court to appoint a receiver to handle the business operations and manage the assets of the three locations.