BOSTON — The owner of Boston Sports Clubs filed for Chapter 11 bankruptcy protection Monday due to challenges from the COVID-19 pandemic, according to Reuters.
Town Sports International Inc., which owns and operates about 185 gyms, including roughly 28 Boston Sports Clubs in Massachusetts, said in a statement on the BSC website that the goal of the voluntary restructuring “is to emerge from Chapter 11 as an even stronger company, better positioned to serve members into the future.”
The company said in its statement that it is not going out of business and its clubs will operate normally.
Gyms across the country are struggling after closing for months due to the coronavirus.
Bloomberg reports the company reported estimated liabilities and assets of $500 million to $1 billion in its Chapter 11 filing in Delaware. Chapter 11 bankruptcy would allow the company to continue operating while it pays creditors and restructures the business.
Hundreds of Boston Sports Club members filed complaints with Attorney General Maura Healey in April after the company continued to charge membership fees even though the fitness centers were closed on March 16 by an emergency order at the beginning of the pandemic.
The company agreed to stop all billing until it reopened, provide additional membership access equal to the number of days paid while the clubs were closed, allow members to cancel by sending a request through their club’s website, and waive all cancellation fees through April 30, 2020.
Four BSC members filed a class-action lawsuit in April alleging the company continued collecting membership dues despite the gyms being closed due to the COVID-19 pandemic.
This is a developing story. Check back for updates as more information becomes available.
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