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Sale of Brooklyn's Kosher Gym Ignites Feud

The Kosher Gym, the Brooklyn-based fitness center that offers separate facilities for men and women, is embroiled in controversy with its members over its impending change in ownership and over alleged unauthorized billing of its members. The gym vehemently denies all charges of wrongdoing.

 

In addition to its separate facilities, the gym, which is closed on Shabbos and Jewish holidays, is unique for its absence of blaring, non-Jewish music; and its modest posters and advertisements.

 

Some members became angry after receiving a letter announcing the sale of the gym to a non-Jewish "national fitness group that focuses on gender specific clubs." The letter said that the gym will continue its separate facilities and classes, but will expand its business hours to include Saturdays and Jewish holidays. It also warned that some of the changes to the background music as well as promotional mailings, billboards, and posters might not be considered "kosher" by some members.

 

In an interview with The Jewish Press, one of the current principal owners, who wished to remain anonymous due to privacy concerns, confirmed the authenticity of the letter, but added some updated information. The company acquiring the gym is one that broadcasts either no music at all or low, instrumental background music, he said. Also, individual televisions will be controlled by each member, and the large plasma televisions in the women's facility will remain as they currently are. While staff may dress immodestly, he noted, they would probably remain predominantly in the office, and the main entrance is currently manned only by turnstiles.

 

All existing membership contracts will remain in effect. "Changing the management or shareholders of the club does not release you from your obligations of your contract and likewise protects your investment you have already paid and further guarantees the performance of the agreement you signed for the future," according to Kosher Gym's blog, kgfit.blogspot.com.

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Many members have reacted to the ownership change with disgust to sadness. One member, who wasn't aware of the change in ownership until asked for a reaction, said, "Very surprising - that's shocking. That was a unique aspect of the gym - its frum, Jewish identity."

 

The deal with the new company was finalized July 7 for approximately $2 million, though for the next two weeks the Kosher Gym is open to a competing Jewish bid, according to the current owner, who signed a non-disclosure agreement not to reveal the new owners.

 

In the past week or so, other allegations have been surfacing. One is that the Kosher Gym, according to some members, has been charging some members' credit cards for taking classes in the gym they thought were included in the original membership cost. The second allegation is that the gym has been illegally extorting money from some members by charging them unauthorized sums of money and summoning them to a Jewish court of law.

 

According to the principal owner, the gym has always charged for classes beyond the contract - hundreds of people have paid for classes and "everybody knows classes are an expense."  He said the contract has undergone a number of changes. The Jewish Press has obtained four membership agreements: an older, paper contract from 2003-2006; two others, computerized, from the start of 2007; and the latest, computerized, beginning May of this year. The oldest one had a specific line-item for "Annual Classes." From then on until this May, however, the contract neglected such a line item unless the member signed up for a class at the initial membership registration.

 

Nevertheless, said the owner, all members were informed verbally upon initial registration that classes incurred an additional expense. Also, said the owner, all members signed a synopsis "fine print" page which states, "Membership, Classes, Personal Training and other Gym Services are non-refundable" - implying that classes are independent from membership. Moreover, certain members who had paid for classes early on in their memberships had been caught later in their memberships attending classes for which they had not paid.

 

Aware that many members were attending classes without paying for them, the Kosher Gym installed a turnstile and fingerprint reader at the entrance to the building and classes at the end of May 2008, and in mid-June a sign that threatens a $500 fine and membership termination for those who illegally bypass the turnstiles. Nevertheless, said the owner, 12 people were caught on camera either crawling under or jumping over the turnstiles.

 

Those caught in a class were presented with affidavits to sign to the effect that this was the first class they had attended, said the owner - with a warning that video records would be searched to ensure the veracity of such a statement, and if found to be false the member would be charged for the costs of the investigation (which could be between $4,500 and $10,000, stated the affidavit). Those who signed it were left alone, said the owner. Those who refused had their credit cards charged, retroactively, as if they had attended that class since the start of their memberships.

 

One woman, who requested that she remain anonymous for fear of retaliation, joined the Kosher Gym quite a few years ago, and attended a certain aerobics class for a number of years. According to her, from around February to July of this year she noticed unusual charges from the Kosher Gym on her credit card bills, following which she called the gym three separate times and left messages inquiring as to the reason. No response forthcoming, she called and left a fourth message, to the effect that she was aware that credit card chargebacks are not allowed as per her contract, but she had no other recourse to protect herself. She then proceeded to request a chargeback from her credit card company. Several days later she received a packet from the gym explaining that the charge was for the classes she attended and detailing the charges, which came out to over $2000.

 

According to this woman, she and the other members of her class were completely oblivious to any requirement to pay for classes. "There was no real proper transition made," she said, regarding the new system. Moreover, the member acknowledged that class attendance had once recently been taken, but the attendance taker told the class that someone would get back to them regarding the possibility of their having to pay to attend - a call that she never received.

 

Another member said, "I was like, what do you mean, classes? I spoke to so many members, and they had no idea that you had to pay for classes."

 

Another dispute has erupted over members who fail to actively cancel their membership. The monthly payment agreement (the agreement signed by most members) states,  "After the expiration date [of] my membership plan, my membership will continue to renew indefinitely until I cancel it by giving 30 days written notice by certified, registered mail or by personally coming to the Gym and completing a cancellation form only."

 

Going forward, the Kosher Gym is attempting to convene a Rabbinical Audit and Oversight Board, which will have full access to gym records. It "will come to a ruling as to how each type of case and claim is to be handled and the procedure. Most importantly to everyone they will decide if Kosher Gym's policies were within the keeping of the Halacha or not," according to a letter posted on the Kosher Gym's blog.

 

Perturbed members, meanwhile, have been contemplating a mass protest and a class-action lawsuit.

 

"I have explained this matter to you and others within the gym and it only goes onto deaf ears because the gym is not interested in pleasing their members. They are only interested in taking their clients credit card numbers for billing purposes only," one man wrote to the Kosher Gym, as per a letter obtained from the Kosher Gym. "I dare say I've dealt with a lot of people in my time," one woman said, "and this takes the cake." Responded the majority owner of Kosher Gym to these allegations: "People don't like the strong-handed tactics that we use - but we're right to use them. A lot of these cases, they know they're wrong."

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The UnKosher Business Tactics of the Kosher Gym
Date 08:07, 07-24, 08

I just read your article regarding the Kosher Gym. I have been a member since 2004 and boy let me tell you-times have definitely changed. They have unfair and unscrupulous business tactics and everyone lies from the managers to the Owner himself. I enrolled at the gym and every year when it was time for me to renew my membership I made sure with the manager that classes were included in my membership. After all the sole purpose of me joining the gym was for the classes (I find machines incredibly boring and if you check the video recordings installed by the gym you will see I was there maybe a handful of times-and that was because classes were canceled for one reason or another). Back in June 2008 when I received my credit card statement I had a charge of 343 added by the Kosher gym along with a $15 charge on top of my $26.00 a month dues. When I called the gym to inquire-of course I get a voicemail-there is no customre service there anymore-they told me that I was being charged retroactively since Sept 2006 for classes that I hadnt paid for. Needless to say I am currently fighting these charges: I didnt pay 360 to the Kosher Gym just to use the equipment-I could've gone to Lucille Roberts for half that amount. I was in my right mind when I renewed my membership and the manager who knew me quite well assured me that classes were included in my contract. Additionally, how does the Kosher Gym have the gall to place an unauthorized charge on my credit card? They never once approached me to discuss about classes or have me sign an affidavit. The Owners are just lying. A friend of mine got charged $500 and had her membership revoked because she returned into the class but had trouble with the turnstiles so she jumped the turnstile (mind you she paid for classes and left the class to use the ladies room). Their unfair tactics have caused many members, myself included to leave the gym and join other gyms. It is wholly unjust what the Kosher Gym is doing to try to extract every penny from honest individuals such as myself.

I was duped by the Kosher Gym
Date 10:07, 07-26, 08

I was promised that a pool and steam room would be available at the Mcdonald Ave location within 2 months after I would sign the contract. My billing would be delayed until they were available. Needless to say, they are not available and my wife and I have never used the facility because of this. Throughout this period I have been billed om my credit card as if I have used the facility. They even told my wife that she has been using the facility. Neither of us were ever fingerprinted for cards. I have been to the office to complain and was told that "Josh" would call me back. He never has. My credit card was changed last year and now that they can't bill me, I have been receiving default letters from a collection company. Every bill that I have received has a written statement from me returned to them asking for a representative to call me back. I'm still waiting.
Please include my name in the class action suit. It might also eb good to notify the DA's office for fraud and misrepresentation.

Stephen Smirlock
Important legal info
Date 08:07, 07-27, 08

I am a partner at large firm, and I want to save you a lot of time, and make a suggestion that may help you all.

My niece got one of these threatening packages from the gym for "committing a chargeback" their claim over $2,000 and asked me my opinion.

I am going to use a normative non-legalize language to explain this.

My initial reaction was outrage (it still is) and I asked her to send me over the claim and all the paperwork she had. I read through the claim and their contract. While the claim may appear to way out out-of-line to a layman, the claim is legal and enforceable.

While possibly a small claims judge (or in NY an arbitrator) may reduce a lot of these claims as excessive etc, and possibly give a judgment in the gym's favor of only a few hundred dollars, the court is not legally allowed to hear the case.

Binding arbitration is common in many contracts, as it usually benefits the maker, however it is legal and enforceable. In this case, the court would enforce the case to be heard at Beis Din Mechon Lhorah.

How Beis Din Mechon Lhorah will rule in this case, I have no idea. However, clearly the case will need to heard by them.

Once someone has been issued a court summons (or arbitration summons in this case) the Attorney general, Consumer affairs, Better Business Bureau, Councilmen, etc, will not get involved because they will leave it to the legal process to resolve. Their job is to investigate possible fraud - which can lead to court case as a resolution. Obviously if their case is going to court already, the court will determine the outcome, there is no legitimate reason for government agencies to get involved.

Those who are proposing a class action suit, obviously have no idea what a class action suit entails. For starters, you cant start a class action because a company is bringing people to court, the legal system does not look at that as being wrong. Keep in mind the gym is summonsing customers to court, not vice versa.

Most importantly in a class action, you need a company with very "deep pockets. While the company acquiring the gym may be a large entity, it is not going to be liable, so you have to look at the assets of Healthstar/KG Fitness Systems, Inc, and Kosher Gym of NY, Inc. the two parties in this possible class action. Although the current shareholders may be wealthy, that has no relevance, as they will not be personally liable, as this is a corporation.

A class action suit costs many millions with the bulk of it going to the attorneys. Two observations: (a) good luck finding an attorney to take the case - that the gym is in breach of its' contract by selling to a corporate entity (b) In all likelihood it will never get off the ground because of the binding arbitration clause. (c) even if it does proceed the probability of collecting is negligible.

My suggestion would be to immediately appoint a community leader to mobilize a group of people who have claims against the gym and go to Beis Din as a group (a type of class action) and ask the beis din for an immediate injunction to stop the sale, (as I understand it is currently been put on hold by the gym for two weeks) until a clear ruling can me made by the beis din with regard to your claims.

Once they finalize the sale it will become a lot harder, and also enable the buyer to play all kinds of legal maneuvers that will leave you in a very difficult position.

Good luck- and next time you are presented a contact - anywhere - READ IT!!

Henri Misek
First thing I would suggest
Date 05:07, 07-29, 08

. . . is write to the credit card company and ask them to cancel the charges, and tell them specifically why: I.e., tell them you never authorized or signed for specific charges for any classes.

The gather all your friends from the gym and write to the credit card companies together. The card companies should have no interest in charging for the gym when presented with this imbroglio, and might even cancel the gym's charging privilieges altogether. Otherwise they risk becoming the "deep pockets", or can be left on the hook when they send cash to the gym for charges that are later reversed.

This is all just my best guess though . . .
Get A Toen (Beis din Lawyer)
Date 12:07, 07-30, 08

Many of these cases could be won by the defendants in bais din. You could possibly be believed to an oral extra contractual agreement with a migui that you could have denied ever attending a class or claimed to have paid all or part in cash. Don't even speak to them certainly don't sign any papers without a Toen Henri Misek's suggestion of a class action in beis din sounds like a great idea. We could all appoint one Toen. Forget the sale, the money gimmicks must be stopped.
new clientele
Date 03:07, 07-31, 08

Today a woman appeared in full hijab, etc in the formerly kosher gym. and HOSTILE!!! This will be the next place Jews get pushed out of--we're moving out of Kensington for the same reason.
"frum" only on the outside
Date 03:08, 08-13, 08

I've spoken to people who have dealt with the proprietors of the "kosher gym" in the past. Although they look very "frum" from outside appearances, people who have dealt with them, including their own employees, know that their only concern now and always has been to make as much money as possible. These people give the "frum" community a bad name and this is one of the primary reasons for historical antisemitism. They should be ashamed of themselves and should be put in cherem (ostracized) by their own community.
Kosher Gym / Energyz Fitness Out of Business
Date 07:11, 11-15, 09

Well they finally got shut down at the 2004 McDonald Ave location. That is the second or third location where they cheated the building owners and skipped out on the utility bills. Landlords beware if they show up at your door, you won't know what hit you until it's too late!
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