Facts

Sophia Martina entered a gym membership with LA Fitness on Feb. 28, 2008. She signed a monthly dues membership agreement with LA Fitness, the terms of which entitled her to use various LA Fitness facilities indefinitely in exchange for a monthly fee that would be automatically billed to her credit card or bank. Martina was charged on a monthly basis, near the end of each month.

Martina also entered into a Fitness Services Agreement with LA Fitness to obtain personal training services. Martina claimed the club could not provide her with a certified personal trainer during the window of time she required and instead provided her with an uncertified student trainer.

Martina later decided to cancel her membership, and sent written notice via certified mail to LA Fitness's California offices for a cancellation. Her contract required she provide LA Fitness with 30 days written notice before her next billing date, if she wished to cancel her membership. Plaintiff claimed LA Fitness continued to charge her for various services.

Martina filed a consumer class action against LA Fitness International LLC, claiming that LA Fitness charged unlawful fees and violated contract laws.

PLAINTIFF'S CONTENTIONS:
Martina contended that LA Fitness's form contracts violated the New Jersey Health Club Services Act by obligating members to renew their contracts on a month-to-month basis. Plaintiff claimed the agreement did not specify a termination date for the arrangement, nor did it specify a specific term of length. Martina's obligation to pay dues would continue indefinitely unless she cancelled her membership. The only way to cancel a subscription was to mail written notice of cancellation to LA Fitness, which had to be received by LA Fitness's California offices 30 days prior to the next billing date.

Martina also alleged that this billing scheme was unconscionable because it imposed unreasonable conditions just to impede and discourage cancelling a subscription.

DEFENDANT'S CONTENTIONS:
Defendants contended that the written cancellation notice, which was required to be sent before the next billing date, was in order to give LA Fitness sufficient time to stop the automated billing. LA Fitness received Martina's cancellation notice on June 26, 2008, two days before her next automated billing date on June 28, 2008. Consequently, pursuant to the form of her Membership Agreement that existed in 2008, Martina was billed for one additional month on June 28, 2008 before her cancellation went into effect.

Result

The parties entered into a class action settlement. Members who entered into a Monthly Dues Membership and who were automatically billed an additional month of dues after LA Fitness received a written notice of cancellation could submit a claim for a 45-Day access pass to certain LA Fitness facilities and a refund of 1/3 of one month's dues. Members who entered into a Fitness Services Agreement during the class period (February 28, 2006 to March 31, 2012) could submit a claim for two free training sessions, or a credit of $100 off of a new Monthly Dues Membership. LA Fitness also agreed to pay $200,000 for class counsel's attorney fees and costs, $11,065 to Martina and a $3,000 incentive award.