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Entries in consumer protection (1)

Wednesday
Jul062016

New Jersey Trial Judge Denies Class Action Suit Targeting Health Clubs

This spring, a New Jersey judge, in a ruling favorable to the health club industry, denied certifying a class action filed on behalf of 18,000 health club members claiming that a group of fitness centers was not following state law.

In Mellet v. Aquasid, Judge Anthony Pugliese, from the bench of a state Superior Court based in Camden, blocked a consumer class action lawsuit from advancing, representing a victory for the health club industry. The ruling made two significant distinctions between gym membership and other types of consumer goods and services.

Club Contracts Different from Other Consumer Agreements

First, Judge Pugliese rejected that the fitness center’s use of liability waivers is illegal under New Jersey’s Truth in Consumer Contract and Warranty Notice Act, meant to address unconscionable contract terms. He affirmed the permissibility of liability waivers for clubs, remarking that club contracts are different from other consumer agreements on the basis that “when you engage in rigorous physical activity—like is encouraged in a health club [and] is the entire purpose of a health club—there are chances that you may injure any range of muscles, tendons, bones, nerves, what-have-you.”

He cited a 2010 case, Stelluti v. Casapenn Enterprises, in which a health club’s waiver of liability was upheld and a patron’s negligence suit was dismissed. That case concerned an injury sustained on an indoor cycling bike.

Late Fees Don't Violate NJ Retail Installment Sales Act

Second, Judge Pugliese rejected that the fitness center’s use of late fees and similar charges violated the New Jersey Retail Installment Sales Act (RISA), which limits fees assessed to consumers. He stated that RISA is meant to apply to installment loans involving the sale of goods, such as a television.

The decision in Mellet v. Aquasid demonstrates that health club membership is distinct from other types of consumer goods and services, and so is not always subject to broad state consumer protection laws that apply to most industries. 

The case is now under appeal. If you have comments or questions, please send them to IHRSA’s public policy team at gr@ihrsa.org