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Gym Defends Handling of Memberships During Sale

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Telegram & Gazette (Massachusetts)

 

WEBSTER - A former gym owner defended herself against allegations she duped customers by selling long-term memberships while the sale of the business she owned for 15 years was in the works.

Nikki Holland sold Pure Fitness in leased space on Sutton Road to Everybody's Fitness Center on Oct. 4. Everybody's Fitness Center is owned by Jason Cook.

Some of Ms. Holland's former customers are irate that the business sold 12-month memberships up until the sale. She said about 10 people have asked for and received credit card refunds.

Ms. Holland explained that she continued to sell memberships up until the sale was consummated because she was obligated to continue to run her business. It was possible the sale would not go through, she said.

In an interview outside of her home last week, Ms. Holland acknowledged that the new owner "could do anything he wanted with those memberships."

But she said she was led to believe during several meetings with Mr. Cook that he would honor her advance-payment customers.

"We were under that assumption," she said, expressing regret that she didn't get it in writing as part of the purchase-and-sale agreement.

"That is the honest truth," she added.

Reached Friday, Mr. Cook said Ms. Holland's characterization was "100 percent inaccurate."

Mr. Cook's business partner, his father, Bob Cook, elaborated.

Bob Cook said the discussion centered on whether each party would absorb half of the advance payment memberships. "They said, 'Absolutely no way,' " Bob Cook said.

Ms. Holland called that version "a complete lie." She said the new owners knew what they were getting into.

Although Everbody's Fitness Club didn't see "a dime" from the advance payments sold by Ms. Holland, the new owners have taken steps to accommodate those pre-existing members.

"All the people that are in that situation, we sent them an email basically saying we'll honor their contract that they had with the Hollands, with Pure Fitness, through Dec. 31," he said.

"If they want to sign a new contract for a year, for the year of 2019, we would give them a full credit for the balance they had on that contract."

In other words, if a member has six months remaining on a 15-month membership with Pure Fitness, Everbody's Fitness Club will credit the six months toward a new membership.

Also, Everbody's Fitness Club is giving a discount on new memberships by having pre-existing customers continue to pay the Pure Fitness rate of $29 per month. Everbody's Fitness Club charges $39 a month. Brand-new customers will pay $39.

"I thought that was pretty fair," Bob Cook said.

The terms appear to be well-received by members, he said. "They're happy that we're doing something for them. I don't know what more we could do," he said.

Everbody's Fitness Club inherited more than 200 members who had paid Ms. Holland in advance, according to the Cooks, who are also allowing Webster members to use other Everbody's Fitness Club locations, in Auburn and Sturbridge.

"I don't wish any bad luck to the Hollands," Bob Cook said. "They did whatever they did for whatever reasons. It's got nothing to do with us. We're just starting from Oct. 4 and moving along as Everybody's Fitness Center."

Bob Cook said the business encourages members to pay monthly rather than in advance.

Ms. Holland said it's not a crime to sell advance memberships, and she noted she paid back five customers who paid her just before the sale.

Ms. Holland said it's been exaggerated the extent to which advance customers carried her business. She said she had 1,800 members, and most of them paid monthly. She said she signed up about 170 advance payment customers during the past year.

Ms. Holland said she began offering memberships for $24.99 a month, and paid-in-full memberships for $249 a year, because of stiff competition from Planet Fitness. She said she lost many customers to Planet Fitness.

Ms. Holland added that she had been torn about whether to sell until August, when she decided the business had grown too big to handle, and that she preferred to focus more of her attention on her family. She has a husband and four children.

"It was just time to move on after 15 years," she said.

A member who reached out to the T&G via email, Michelle Macomber, described herself as "one of the members that was scammed out of $250."

She said she was contacted at the end of July to renew her membership early. It was to expire Sept. 8.

As for the debate between the Hollands and Cooks, Ms. Macomber said she's unsure whom to believe. The customer said she's awaiting a response to a complaint she made with the attorney general's office.

"Everybody's Fitness has come up with what they think is a great resolution to the problem," she said. "But I along with so many other people are still not too happy. I'd rather just be refunded my money from the contract, which I had only used a month of."

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October 22, 2018
 
 
 

 

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