Gascho v. Global Fitness Holdings, LLC
| Decision Date | 28 March 2012 |
| Docket Number | Case No. 2:11–CV–00436. |
| Citation | 863 F.Supp.2d 677 |
| Parties | Amber GASCHO, et al., on behalf of themselves and all others similarly situated, Plaintiffs, v. GLOBAL FITNESS HOLDINGS, LLC, Defendant. |
| Court | U.S. District Court — Southern District of Ohio |
OPINION TEXT STARTS HERE
Gregory M. Travalio, Mark David Landes, Christopher J. Wagner, Joanne S. Peters, Mark H. Troutman, Isaac, Brant, Ledman & Teetor, L.L.P., Thomas N. McCormick, Kenneth J. Rubin, Vorys Sater Seymour & Pease, John M. Kuhl, Columbus, OH, for Plaintiffs.
Dan L. Cvetanovich, Sabrina Christine Haurin, Bailey Cavalieri LLC, Columbus, OH, for Defendant.
This matter is before the Court on Plaintiffs' Objection to the Magistrate Judge's Report and Recommendation Recommending Denial of Plaintiffs' Motion to Remand (Doc. 48), and Defendant's first Motion for Partial Judgment on the Pleadings (Doc. 36).1 These matters are fully briefed and ripe for disposition. For the reasons that follow, the Court OVERRULES Plaintiffs' objection and therefore DENIES Plaintiffs' Motion to Remand (Doc. 11), and the Court GRANTS in part and DENIES in part Defendant's first Motion for Partial Judgment on the Pleadings.
On April 13, 2011, Plaintiffs initiated this class action against Defendant Global Fitness Holdings, LLC, d/b/a Urban Active (“Global Fitness”), in the Court of Common Pleas for Franklin County, Ohio. Defendant was served with the Complaint on April 18, 2011. Global Fitness is a Kentucky limited liability corporation that operates fitness facilities in Ohio. Plaintiffs are residents of Ohio who entered into membership and/or personal training, child care, and/or tanning contracts at Global Fitness's Ohio Urban Active gym facilities. Plaintiffs allege that they were financially wronged as members of Urban Active fitness clubs in Ohio.
The Complaint asserted claims on behalf of Plaintiff Amber Gascho and a class of plaintiffs identified as “[a]ll persons to whom Urban Active sold personal training contracts or services to [sic] within the State of Ohio from November 1, 2007 until present.” (Compl. at ¶ 7). On December 12, 2009, Plaintiff Gascho, a resident of Ohio, signed a gym membership contract with Defendant's facility located in Powell, Ohio. Id. at ¶¶ 23–24. According to Plaintiff Gascho, Defendant did not, at the time she signed the membership contract, fully advise her of the membership costs, including a semiannual maintenance fee, or of the right to cancel her membership. Id. at ¶ 25.
In July 2010, Plaintiff Gascho signed a personal training contract, based on Defendant's representation that she could cancel this contract any time for $10. At the time of signing, Defendant did not give to Plaintiff Gascho a copy of the personal training contract or of the “notice of cancellation” form. Id. at ¶ 29. Several weeks later, when Plaintiff Gascho tendered her notice of cancellation and $10 termination fee, she was shown for the first time a copy of her contract. Id. at ¶ 30. She was also advised that the early cancellation fee was $250.00, not $10.00. Id. When Plaintiff Gascho refused to pay the $250.00 fee, Defendant continued to charge her credit card for the personal training contract. Id. at ¶ 31.
The Complaint specifically alleged that Plaintiff Gascho's claims “are typical of the claims of the other members of the Class[.]” Id. at ¶ 12. The Complaint did not allege how many members the class contained. The Complaint asserted claims under Ohio's Consumer Sales Practices Act (“CSPA”), Ohio Rev.Code § 1345.01 et seq., Ohio's Prepaid Entertainment Contract Act, Ohio Rev.Code § 1345.41 et seq., and a claim of common law fraud. Id. at ¶¶ 27–49. The Complaint sought declaratory, injunctive and monetary relief in excess of $25,000, as well as costs and attorneys' fees under the CSPA. Id. at p. 9.3
On April 19, 2011, and while the case remained pending in state court, a First Amended Complaint was filed by Amber Gascho and two additional named plaintiffs. The First Amended Complaint, which was served on April 19, 2011, purports to assert claims on behalf of the following classes:
(A) All persons in Ohio to whom Urban Active sold membership contracts from November 1, 2007 until the present.
(B) All persons in Ohio to whom Urban Active sold personal training contracts or contracts for other services from November 1, 2007 until the present.
(C) All persons in Ohio who cancelled Urban Active membership contracts, personal training contracts and other contracts for services and for whom Urban Active continued to charge their credit, bank or debit accounts from November 1, 2007 until the present.
Id. ¶ 9. According to the First Amended Complaint, the claims of the three named plaintiffs “are typical of the claims of the other members of the Class [es.]” Id. at ¶ 12.
The First Amended Complaint asserted four causes of action, including claims under the Ohio Consumer Sales Practices Act, the Ohio Prepaid Entertainment ContractAct, the Ohio Deceptive Trade Practices Act, Ohio Rev.Code § 4165.01, et seq., and breach of contract. Id. at ¶¶ 51–75. Plaintiffs requested declaratory, injunctive and monetary relief in excess of $25,000, as well as costs and attorneys' fees under the Consumer Sales Practices Act and the Deceptive Trade Practices Act and “[s]uch other relief as this Court deems just and appropriate.” Id. at pp. 13–14.
Defendant removed this action to this Court on May 19, 2011, pursuant to the Class Action Fairness Act (“CAFA”), as codified at 28 U.S.C. §§ 1332(d) and 1453. In June 2011, Plaintiffs moved to remand this matter to state court, arguing that Defendant failed to file its notice of removal within the 30–day time frame required by 28 U.S.C. § 1446(b) (Doc. 11).
On August 5, 2011, Plaintiffs filed a Second Amended Complaint (Doc. 31) against Defendant. This complaint added additional named plaintiffs and expanded the putative class. In this complaint, Plaintiffs allege, inter alia, that Defendant engages in common practices of misrepresenting the terms and conditions of contracts at the time of sale, making unauthorized deductions from Plaintiffs' bank accounts, failing to provide consumers with copies of contracts at the time of signing, failing to orally inform consumers at the time of signing of their right to cancel, failing to provide copies of “notice of cancellation” documents in the form required under Ohio law, and failing to honor contract cancellations. As a result of this alleged activity, Plaintiffs assert the following claims: violation of the Ohio Consumer Sales Practices Act (Counts I and II); violation of the Ohio Prepaid Entertainment Contract Act (Count III); violation of the Ohio Deceptive Trade Practices Act (Count IV); unjust enrichment (Count V); conversion (Count VI); and breach of contract (VII).
On August 19, 2011, Defendant filed its Answer to Plaintiffs' Second Amended Complaint (Doc. 35), and its first Motion for Partial Judgment on the Pleadings pursuant to Federal Rule of Civil Procedure 12(c) (Doc. 36). Defendant moves for judgment in its favor on Counts I through VI of Plaintiff's Second Amended Complaint. Defendant does not seek judgment on the pleadings as to Plaintiff's breach of contract claim (Count VII). Defendant's Motion for Partial Judgment on the Pleadings has been fully briefed and is ripe for disposition.
In November 2011, the Magistrate Judge filed a Report and Recommendation recommending that Plaintiffs' Motion to Remand be denied (Doc. 47). Citing Holston v. Carolina Freight Carriers Corp., 936 F.2d 573 (unreported table decision), 1991 WL 112809 (6th Cir.1991), among other cases, the Magistrate Judge concluded that the notice of removal was timely filed because Defendant acted within a reasonable time in reviewing documents relevant to the amount in controversy and removed the action within 30 days of the review. In December 2011, Plaintiffs filed their Objection to the Magistrate Judge's Report and Recommendation. Plaintiffs argue that the Magistrate Judge erroneously concluded that this matter should not be remanded to state court because Defendant did not comply with the requirements of 28 U.S.C. § 1446(b). Defendant responded and Plaintiffs filed a reply in further support of their position.
On January 26, 2012, Defendant filed a Motion for Leave to Submit Supplemental Authority in Support of Defendant's Motion for Partial Judgment on the Pleadings (Doc. 55). By this motion, Defendant cites the recent decision of Robins v. Global Fitness Holdings, LLC, 838 F.Supp.2d 631 (N.D.Ohio 2012), as supplemental authority. Plaintiffs responded to this motion, arguing that Robins is irrelevant to the case at bar, and that, even if it is relevant, it does not support Defendant's arguments in this case.
On February 14, 2012, Defendant filed a second Motion for Partial Judgment on the Pleadings, whereby it moved for partial judgment on the pleadings as to certain named Plaintiffs' claims of breach of contract, and claims under the Consumer Sales Practices Act and the Prepaid Entertainment Contract Act (Doc. 61). Four days later, Plaintiffs moved to strike this Motion for Partial Judgment on the Pleadings (Doc. 62). On March 6, 2012, the Magistrate Judge denied the Motion to Strike, and granted the Motion for leave to Supplement (Doc. 66). Considering the recency of the filing of Defendant's second Motion for Partial Judgment on the Pleadings, it will be addressed in a subsequent decision.
Because it involves the preliminary issue of whether this matter must be remanded to state court, the Court will first address Plaintiffs' Objection to the Magistrate Judge's Report and Recommendation which recommends that this Court deny Plaintiffs' Motion to Remand. The Court then will address Defendant's first Motion for Partial Judgment on the Pleadings.
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