Tag Archives: attorney general

LA Weight Loss to Refund Members $200,000


The Oregon Attorney General has issued the following press release:

The Defunct Diet Center Chain and Oregon Franchise Agree to Pay $200,000.

Attorney General John Kroger announced a settlement that will provide up to $200,000 for Oregon consumers who bought services and products from a now-defunct diet center chain.

“Misleading Oregon consumers is not acceptable,” said Attorney General Kroger.

Consumers who believe they are due refunds from LA Weight Loss should contact the Attorney General’s hot line: 877-877-9392 or fill out a refund form on the Oregon Department of Justice’s website: http://www.doj.state.or.us/releases/pdf/lawl.pdf

A 2007 lawsuit by The Oregon Department of Justice alleged that LA Weight Loss and its Oregon franchise owner made false and misleading claims about the program’s costs and fees. The state received 295 complaints about LA Weight Loss centers in Oregon.

The lawsuit named LA Weight Loss Franchise Company, a Pennsylvania-based company, and NWM, Inc., a Lake Oswego-based company.

NWM went out of business two months after DOJ filed suit.

By December 2008, all LA Weight Loss centers in Oregon had closed.

Today, DOJ filed in Marion County Circuit Court a $200,000 settlement with LA Weight Loss Franchise Company and LATO, LLC, a wholly owned subsidiary of LA Weight Loss Franchise Company. Under the settlement, the companies will also pay additional refunds directly to approximately 100 Oregonians for pre-paid amounts that were unused at the time their center closed in Oregon.

Earlier this year, DOJ reached a settlement with NWM.

Assistant Attorney General Eva H. Novick handled the case with assistance from Senior Assistant Attorneys General Greg Smith and Tim Nord.

Attorney General John Kroger leads the Oregon Department of Justice. The Department’s mission is to fight crime and fraud, protect the environment, improve child welfare, and defend the rights of all Oregonians.

Documents:

Stipulated Partial General Judgement

LA Weight Loss Assurance of Voluntary Compliance

LA Weight Loss to Pay Refunds to New York Members

Here’s the story posted on Fitness Business Pro:

ALBANY, NY — New York Attorney General Andrew Cuomo announced last week that LA Weight Loss Centers Inc. reached a settlement to pay $275,000 in refunds to thousands of New York state customers who paid for but never received services after LA Weight Loss closed its doors in January 2008.

Cuomo’s office has identified more than 100 customers so far who were affected by the closures.

“As more companies fall victim to the harsh economy, they still have an obligation to abide by the law and be forthright with their patrons,” Cuomo said in a statement. “Many New Yorkers who paid for and never received services from LA Weight Loss now have some vindication.”

In January 2008, LA Weight Loss Centers closed all of its 45 centers in New York state, then filed for Chapter 7 bankruptcy in Philadelphia. Cuomo’s office had received several complaints from customers who did not receive a refund from the company or did not have the charges removed from their credit cards for advanced payments.

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Pure Weight Loss to Pay $700,000 to Former Members

Here is the press release issued by the office of PA Attorney General Tom Corbett December 12, 2008:

Attorney General Corbett announces $700,000 consumer protection agreement with Pure Weight Loss Inc.
HARRISBURG – Attorney General Tom Corbett today announced a more than $700,000 consumer protection agreement with Pennsylvania-based Pure Weight Loss Inc. addressing more than 3,500 complaints involving non-delivery of weight loss products or services to consumers from Pennsylvania and several other states.

Corbett said a consent decree has been reached with Pure Weight Loss, Inc., of Horsham, PA (formerly known as L.A. Weight Loss Centers, Inc.), along with the company’s owner and president, Vahan Karian.

Corbett said the agreement requires the payment of $500,000 to the Pennsylvania Office of Attorney General, for distribution to consumers who pre-paid for products and services that were not delivered and who filed valid complaints with the Attorney General’s Health Care Section.

Additionally, the agreement sets aside $200,000 in a secure fund, which will be used to provide restitution to consumers who filed claims in the U.S. Bankruptcy Court case involving Pure Weight Loss. Corbett said this money will be turned over to the Bankruptcy Trustee for distribution to consumers who have filed proofs of claim with the bankruptcy court.

Corbett explained that the Attorney General’s Health Care Section began receiving complaints about Pure Weight Loss in December 2007, shortly after the company announced plans to close more than 400 weight loss centers across the country. The company halted operations on January 4th, 2008, and filed for bankruptcy shortly after that, leaving thousands of consumers without access to weight loss products and services that they had pre-purchased.

Corbett said that the majority of the consumers who contacted the Attorney General’s Office had purchased contracts lasting a year or more, paying as much as $2,000 for “lite bars” and other food items that were never delivered. Following the closure announcement in December 2007, consumers were instructed by Pure Weight Loss to pick up products from their stores prior to January 4, 2008, or file a claim for refunds – but many consumers failed to receive either refunds or the products and services they had purchased.

Corbett said that in addition to the $700,000 payment from Karian and Pure Weight Loss to fund consumer restitution, the Pennsylvania Office of Attorney General is also working with authorities from the states of New York and Maryland to recover additional funds for consumers from those states.

Both New York and Maryland require weight loss centers to post security bonds intended to protect consumers against losses, and all complaints involving consumers from those states will be turned over to authorities in New York and Maryland as claims against those security bonds – allowing the remaining funds to be distributed to consumers from Pennsylvania and other states.

Corbett said that efforts are underway to verify all the consumer claims that have been filed with the Attorney General’s Health Care Section. Bank and credit card records are also being obtained to determine the exact amount of credit card charge-backs, stop-payment orders or partial refunds that may already have been paid to some consumers. Corbett said the final distribution amount for each consumer will be calculated when the review of that financial information is complete.

It is anticipated that partial refund distribution will begin in early 2009 for eligible consumers who have already filed complaints with the Attorney General’s Health Care Section.

Refund distribution for consumers who filed proofs of claim with the U.S. Bankruptcy Court will take place at the conclusion of the bankruptcy case involving Pure Weight Loss.

The consent agreement was filed in Commonwealth Court, in Harrisburg, Pennsylvania, by Deputy Attorney General Timothy E. Gates of the Attorney General’s Health Care Section.