On August 22, 2025, the Federal Trade Commission (FTC) filed a high-profile lawsuit against Fitness International, LLC—the parent company of LA Fitness—accusing the popular gym chain of making it unnecessarily difficult for members to cancel their memberships. The FTC’s move, which quickly caught the attention of consumers and industry insiders alike, comes amid a broader regulatory push to crack down on what the agency calls “tricks and traps” in subscription-based business models across the United States.
The FTC’s complaint, filed in the U.S. District Court for Central California, describes a scenario that many gym-goers might find all too familiar: a membership that seems nearly impossible to escape. According to the agency, LA Fitness required members to either show up in person or mail in a cancellation form—a process riddled with hurdles. Members had to log in online to print a cancellation form, but this wasn’t always simple. The login process itself was often complicated, involving original sign-up data, key tag numbers, and partial bank or credit card numbers. Even after conquering those obstacles, members attempting to cancel in person could do so only with a designated manager, who was available only during limited hours. If the manager wasn’t present, members were forced to return at another time.
Mailing a cancellation form wasn’t much easier. The FTC alleges that members were required to send their forms via certified or registered mail, adding extra costs and confusion. Add-on services—like towel service or personal training—were also difficult to cancel individually, with unclear disclosures compounding customer frustration. The agency argues that these practices violate both the FTC Act and the Restore Online Shoppers’ Confidence Act (ROSCA), laws designed to protect consumers from unfair and deceptive business practices.
Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection, didn’t mince words when discussing the case. “The FTC’s complaint describes a scenario that too many Americans have experienced – a gym membership that seems impossible to cancel,” he said. Mufarrige highlighted that tens of thousands of LA Fitness customers had reported difficulties, often finding the cancellation process restricted to specific times or requiring conversations with specific managers who were frequently unavailable. “The FTC will not hesitate to act on behalf of consumers when it believes companies are stifling consumers’ ability to choose which recurring charges they want to keep,” he added, according to multiple news outlets including CMSWire and ABC7.
The scale of consumer harm alleged in the complaint is significant. The FTC estimates that consumers paid hundreds of millions of dollars in unwanted fees due to these practices, despite thousands of complaints filed with consumer groups and regulators. The complaint further notes that LA Fitness sometimes continued billing even after customers followed the company’s strict cancellation procedures. In some cases, the gym reportedly charged new account numbers after customers tried to block charges through their banks.
LA Fitness, for its part, has strongly rejected the FTC’s allegations. In a statement issued on August 22, Jill Hill, President of Club Operations, called the claims “without merit” and criticized the FTC’s reliance on ROSCA. “The allegations are without merit, and the statute the FTC relies upon – the Restore Online Shoppers’ Confidence Act (ROSCA), enacted almost 15 years ago – was designed to address only online retail transactions, does not require any specific method of cancellation, and has never before been applied to the health club industry. We remain confident that we will prevail in court,” Fitness International, LLC said in its official response, as reported by ABC7.
Hill emphasized that most LA Fitness memberships, and all personal training memberships, are purchased in person at club locations. Nevertheless, she pointed out that 18 months before the FTC’s new “Click-to-Cancel” rule was scheduled to take effect, LA Fitness proactively launched an online cancellation option for all members, regardless of how they originally signed up. “With just a few clicks, members may cancel online – a step we voluntarily implemented well ahead of regulatory deadlines,” Hill stated. She also noted that, despite a federal court of appeals recently invalidating the FTC’s Click-to-Cancel rule, LA Fitness has kept its online cancellation program in place to provide members with yet another simple way to cancel. “Members also have always had the option to cancel in person at any club, or by mail, and those who wish to do so can and do cancel in such fashion,” she added.
The broader context for this legal showdown is the FTC’s now-vacated Click-to-Cancel rule. Finalized in October 2024, the rule aimed to require businesses to make canceling a subscription as easy as signing up—eliminating multi-step, phone-based, or otherwise complex processes that have long frustrated consumers. “Too often, businesses make people jump through endless hoops just to cancel a subscription,” FTC Chair Lina Khan said when the rule was first announced. “Nobody should be stuck paying for a service they no longer want.” However, just before the rule was set to take effect, a U.S. Appeals Court vacated it in July 2025, leaving companies and consumers in a state of regulatory limbo.
Even though the Click-to-Cancel rule is not currently enforceable, its impact on customer experience (CX) strategy has been profound. According to CMSWire, the rule has elevated smooth cancellation experiences from optional courtesy to an expected standard. It would have required companies to allow customers to cancel online in real time, without phone calls or navigating multiple screens. The rule also prohibited unwanted retention pitches during cancellation unless customers explicitly consented to hear them. This marked a significant shift from traditional retention strategies that often relied on friction and complexity to discourage cancellations.
For customer experience leaders, the LA Fitness case serves as a cautionary tale. The FTC’s scrutiny signals that friction-filled offboarding is no longer a viable business strategy. In an era when customer experience is measured not just by onboarding and engagement but also by how gracefully customers can leave, businesses must rethink their subscription and membership models. CX experts have noted that making cancellation easy isn’t just about compliance—it builds trust and increases the likelihood that customers will return in the future.
Ultimately, the FTC’s lawsuit against LA Fitness is about more than one company’s policies. It’s a signal to the entire subscription-based economy that transparency and consumer autonomy are becoming non-negotiable. Whether or not the courts side with the FTC, the message is clear: customer trust is built not only on the value of services, but also on the ease with which consumers can opt out. For businesses, that means prioritizing transparent, streamlined cancellation journeys as much as acquisition and retention efforts.
As the legal battle unfolds, both regulators and industry leaders will be watching closely. The outcome could set a new standard for how companies across sectors treat their customers—not just at sign-up, but at goodbye.
