For the first time, a bonded health spa has apparently gone out of business in Maryland, leaving hundreds of customers scrambling to find out whether they will get refunds for unused services, state and Prince George's County consumer officials said yesterday.
The $50,000 bond posted by Mother's Gym, 3475 Fort Meade Rd., Laurel, may not be enough to cover all the refunds that are owed, the officials indicated.
"We have had estimates of membership ranging from 500 to 1,500 people, and reports of membership fees ranging from $100 to $350," said Jennifer Dean, a spokeswoman for the Prince George's County Office of Consumer Affairs. And those numbers, she said, suggest that the bond may provide only part repayment for the members.
Dean, who said she had visited the gym site, said the business was closed and the equipment was gone.
The Maryland attorney general's office, which is reponsible for administering the bonding law, is trying to establish the facts of the closing before proceeding, according to Steven J. Cole, chief of the consumer protection division.
Cole said that if Mother's Gym "has gone out of business, we will work to get refunds for the members. But we don't know how long it will take to do this, because we have never had to cash in a bond before."
To apply for a refund, gym members are advised to write the Maryland attorney general, Consumer Protection Division, 7 North Calvert St., Baltimore, Md. 21202. The telephone number is 301-528-8662.
"They should give us their name and address, how much money they spent on their membership and how much time is outstanding on their contract," Cole said. "We will take steps to keep them posted on what they should do."
He said that if the claims exceed the $50,000 bond, the attorney general's office would cash the bond and distribute the proceeds proportionately among members.
The first sign that Mother's Gym was in trouble came on Sept. 4, when the operator, Personal Safety Development Corp., filed a petition in the federal bankruptcy court in Rockville for reorganization under Chapter 11 of the bankruptcy law.
A company has 180 days from the date of a bankruptcy filing to come up with a plan for reorganization. Meanwhile, it can continue to operate. Neither Ken Moore, the owner of the gym, nor his attorney could be reached for comment yesterday.
The gym apparently continued to operate normally and solicit memberships after the Sept. 4 filing. Steve Hand, a Laurel computer specialist, said he bought a membership on Oct. 17.
"They came to the rescue squad in Laurel, where I am a volunteer, and said they were offering discounts to firemen and rescue workers," Hand said yesterday.
He said he wrote a check on Oct. 17 for $100 to cover his one year membership.
Since then, he has worked out several times at the facility. The last time was Wednesday night.
"When I went back Thursday, everything was gone but the sign," Hand said. He also said the facility appeared to have been emptied of all the fancy equipment.
During the past two years, thousands of Washington area consumers have lost more than $1 million in the collapse of dozens of health and fitness centers.
The protection offered by local laws include:
* Maryland since July 1, 1983, has required most health clubs to post a bond of up to $50,000 to provide refunds for members in case the club folded.
* Virginia since July 1, 1984, has required bonds of up to $50,000 for health clubs, but there is no penalty for failing to post a bond.
* District of Columbia has had a limited bonding requirement since 1976 that says that health clubs post a bond when they sell memberships prior to opening and for three months after opening.