California Fitness and its sister health clubs are suspending operations at all their centers from Tuesday due to financial and legal troubles.
JV Fitness Ltd., which operates California Fitness, mYoga and Leap fitness centers in Hong Kong, has announced that operations at all its 12 centers will be suspended until further notice.
The move will affect nine California Fitness outlets and three branches of sister clubs mYoga and Leap fitness center, the Hong Kong Economic Journal reported.
According to a notice pasted at the Mong Kok branch of California Fitness, JV Fitness decided to shutter the outlets temporarily as the company is short of operating funds.
Financial troubles arose as the High Court has ordered a freeze on the company’s accounts after a shareholder filed a petition for liquidation of the firm.
A hearing on the matter is scheduled for Aug. 31, according to the notice.
The suspension of the operations hasn’t come as a total surprise for observers, given the recent troubles at the gym chain which has struggled to pay salaries and rents.
In fact, there have been rumors about a full shutdown of the embattled firm, which operates in Hong Kong and mainland China, after California Fitness shut down a Whampoa branch on July 4.
There have been reports that several California Fitness clubs had turned off air-conditioning to save on electricity costs.
Apart from business shutdown, California Fitness chain is also confronted with other problems.
On Monday, officials from the Customs and Excise Department raided the fitness center’s office in Kowloon Bay, taking away a secretary and a manager before releasing them on bail later.
They were charged with violating the Trade Description Ordinance by failing to provide members with services they paid for.
The operation came after the department had received a total of 185 complaints as of last Friday against service suspension at the fitness center’s Hung Hom branch.
Meanwhile, the Consumer Council also received 128 complaints against JV Fitness.
In April the consumer watchdog reprimanded California Fitness after its marketing staff was accused of intimidating and misleading customers to sign up for membership and high-priced private lessons.
[Chinese version 中文版]
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