A settlement has been reached between the owners of Planet Fitness, Newington, NH, and its franchisee partners in PFNY LLC.
According to a statement obtained by Club Industry, the lawsuit between Planet Fitness Holdings LLC, the franchisor of Planet Fitness, and the partners in PFNY LLC has been resolved by mutual agreement. A stipulation of dismissal was filed Wednesday in U.S. District Court in New Hampshire.
As part of the settlement, according to the statement, PFNY LLC, the Yonkers, NY-based franchisee owned by Jeff Innocenti, James Innocenti and Gino LaVerghetta, has agreed to develop an estimated additional 100 clubs for the company in addition to the multiple clubs they currently own and operate throughout New York.
Planet Fitness owners Mike Grondahl, Marc Grondahl and Chris Rondeau—former partners in PFNY LLC, according to the statement—will continue to own several Planet Fitness facilities in Long Island, NY, and New Jersey and will actively develop these areas.
“Collectively, Planet Fitness, PFNY LLC and the individuals involved are pleased that the litigation is behind them and look forward to continued successes in the New York metro market,” the parties said in a joint statement.
The Grondahls and Rondeau filed a lawsuit last December against the Innocentis and LaVerghetta, claiming the franchisees conducted business with real-estate companies and a contractor without their knowledge. The Innocentis and LaVerghetta denied the allegations and filed a countersuit in January.
A joint motion was filed May 31 that revealed the two parties engaged in mediation on May 24 and May 25 before a retired judge and reached an agreement to resolve their issues.
Court documents revealed that Planet Fitness had had discussions with the Innocentis and LaVerghetta about taking the company public with an initial public offering (IPO). Planet Fitness later confirmed that an IPO was discussed, but it tabled those plans until it resolved its issues with its PFNY partners.
A source close to Planet Fitness says an IPO is now unlikely for the company.
Last week, Club Industry reported that a potential deal Planet Fitness had been negotiating to sell the company had fallen through. A source said the unidentified company involved in the negotiations to buy Planet Fitness was from outside the fitness industry.