Charlotte, NC — Peak Fitness has faced a lot of adversity in recent years. The North Carolina-based club company was sued by North Carolina Attorney General Roy Cooper two years ago after the office received 350 complaints relating to the Beyond Fitness clubs the company acquired in 2006. The attorney general also accused Peak Fitness of publishing misleading newspaper advertisements.
The result was a January settlement in which Peak Fitness agreed to make changes in its customer service, including changes in its billing and refund policies. But the trouble did not stop there for Peak Fitness.
Peak Capital Holdings LLC, parent company of Peak Fitness clubs, filed for Chapter 11 bankruptcy last month. Court records show that Peak Capital Holdings owes as many as 200 creditors between $500,000 and $1 million, and that its assets are less than $50,000.
Laura Haid, the vice president of operations for Peak Fitness, said in a statement that Peak Capital Holdings was working with creditors to reorganize, and that the company was affected by a challenging economy.
“During these tough economic times, we have to make sacrifices and difficult decisions to sustain our operations,” Haid said in the statement.
The Peak Fitness Web site listed 25 clubs in the Carolinas this month, down from 33 last month. Four clubs in the Triangle region of North Carolina (anchored by Raleigh, Durham and Chapel Hill) were part of the bankruptcy reorganization, and other clubs in the Carolinas were expected to follow, a company attorney said. The number of clubs in the Triangle region was reduced from 12 to eight. Since the bankruptcy filing, a club in Winston-Salem, NC, and a club in Rock Hill, SC, closed.
The rest of the Peak Fitness clubs, including 11 in the Charlotte area, are owned by private holding companies. These clubs remain profitable and were not affected by the bankruptcy filing, Haid said. However, Peak's attorney said after the filing that the company was evaluating each of its clubs.
Lawsuits show that a handful of Peak clubs owe the IRS more than $110,000 in taxes. Other claims involve contract disputes and money owed to electric companies, developers, a pool service company and more, the Raleigh News & Observer reports.