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Monday
Feb222016

ILC: Time to Change Club Contract Laws

There are a number of state laws that impose requirements on health clubs that do nothing to protect consumers, but create a hindrance to day-to-day operations as well as significant liability risks for clubs. The importance of the issue has grown in recent years due to the emergence of changes in the marketplace and of predatory attorneys that aggressively seek to exploit outdated laws. The predatory attorneys turn what was a pain into something that carries significant cost and implications. If you are doing just one thing legally “wrong” in your contract, even if it is a benefit to your members, every one of your contracts is potentially voidable.

For example, you may allow your members to conveniently cancel via email, but your state law may require the cancellation to be by registered mail.

Or the law may require that you give every consumer a copy of their contract in writing -- in some cases with the signature next to the cancellation clause -- but what if they sign an electronic contract and they can print a contract. Is that covered by the law?

We’ve been talking to many of you and believe it’s time to act.

Here’s what we’ve been doing to prepare.

  • First, IHRSA conducted a review of all 50 state statutes and recent legal cases to identify the parts of the state laws causing the most problems for clubs.
  • Then, we asked each of IHRSA's state lobbyists to evaluate the feasibility of enacting changes that align with current industry practices and mitigate legal exposure for clubs. While the feasibility of enacting industry friendly legislation varies by state, updating antiquated rules for business - some written 40+ years ago for a completely different marketplace - has a fair amount of appeal for legislators across the country.
  • Next, we tasked our lobbyists with identifying legislators who would be receptive to our cause, preferably those who hold leadership positions or sit on committees likely to receive our legislation, to serve as effective champions for this pro-business, pro-consumer, common sense issue. These efforts are ongoing.

The results: We’ve begun background research to feed advocacy strategy in each state. In some states, we are setting the stage for action in 2017. In others states, we see the opportunity to act this year. For example, we are already in the process of introducing a “placeholder” bill in California, having secured a sponsor.

Now, we need to identify the bill language we wish to introduce. We are relying on you to inform us of the specific statutes that either impede your clubs’ operations or increase your liability risks (e.g. the laws that are being exploited by predatory trial attorneys). If you want to review the consumer protection law for you state, you can access them all at ihrsa.org/state

We will be holding a meeting to discuss this campaign on Tuesday, March 22, 3:30 - 4:30 PM at the IHRSA Convention. (The ILC Meeting and Lunch will be held on the same day at 11:45.) In the meantime, if you have thoughts about the consumer protection laws that impact your club, please send me an email. If you can’t attend the meeting in Orlando, then we will share the notes of the meeting with you and schedule a conference call for the spring.

Sincerely,

Helen

Helen A. Durkin
EVP Public Policy
IHRSA

P.S. Please check out the ihrsa.org/industry-leadership for additional ILC special events during IHRSA 2016.

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