Court Allows Class Action Against 24 Hour Fitness

LOS ANGELES (CN) - A California appeals court cleared the way for a limited class action accusing 24 Hour Fitness of pulling a bait-and-switch on new members after enticing them to join the gym by guaranteeing renewal rate that it didn't honor.

Justice Perluss overturned a class decertification order on the grounds that the lower court had based its decision on the "erroneous legal assumption" that a class action was not necessary, because the relief granted would "extend beyond the party names."

Perluss called this conclusion "legally incorrect," particularly in light of Proposition 64, a 2004 measure limiting the relief in unfair competition claims to named parties.

The case stems from a proposed class action against 24 Hour Fitness, filed by two members who challenged the length of renewal contracts promised people who joined from 1996 to 2000. They claimed they signed a three-year contract, believing they could renew it for another three years at a fixed price. The gym insisted the guaranteed renewal rate applied to annual renewals only.

The trial court limited the class action to a select group of members who joined 24 Hour Fitness under guaranteed renewal rates and had prepaid their fees. It also restricted their allegations to unfair competition claims, denying certification for claims that the contracts were unconscionable.

Superior Court Judge Robert Hess later decertified the class after questioning the benefit of class treatment and citing the delays spent trying to define the class. The parties made seven unsuccessful attempts to change the class definition, three by the defendant and four by the plaintiffs.

The appellate court acknowledged the delays, but said they should have no bearing on certification.

"The parties' various efforts to refine, expand or contract the class definition - all of which were rejected by the trial court - in no way destroy the commonality that exists in the class as defined," Perluss concluded.

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