SoulCycle Class Action Filed Over Spin Class Certificate Expiration

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In a potential class action lawsuit that was recently filed, SoulCycle Inc. was accused for allegedly cheating customers out of the classes they purchased.

According to plaintiff Rachel Cody’s proposed class action lawsuit, SoulCycle requires their customers to purchase certificates to be able to sign up for classes at the popular indoor cycling exercise studio. SoulCycle customers are not allowed to purchase spin classes with credit cards or cash, Cody alleges.

Customers can buy small quantities of classes but are encouraged to buy larger packages (known as a “series”) at a discount. According to the SoulCycle class action lawsuit, a single spin class runs $30, and packages can be bought in bulk for up to $780 for a series of 30 classes, with an upgraded “Super Soul” 50 package deal offered at $3,500 and $4,000 for the “Hamptons Super Soul” package.

Additionally, Cody says the certificates expire in a very short amount of time, with certain certificates being valid for only 30 days. If a customer has unused classes at the end of the certificate expiration, the certificates are not refunded and the money is forfeited. According to the SoulCycle class action lawsuit, expiration periods of less than five years are prohibited under the Electronic Funds Transfer Act and the Credit Card Accountability and Disclosure Act.

The SoulCycle class action lawsuit also states that the larger packages of classes do not offer a “linearly related” amount of time for use with respect to the number of classes in the package, so substantially more classes in a series do not get a substantial time before expiration. This leaves customers enticed to purchase larger packages of classes, but often many remain unused because the classes are hard to find due to overbooking, Cody alleges.

Last year, SoulCycle reportedly sold a total of $93 million in certificates and, allegedly due to the company’s expiration policy, it earned over $25 million in net income during that same time. Cody argues in her class action lawsuit that the company uses this business practice purposely because they know customers will not be able to use all the sessions in time, and no additional business expenses are incurred to deliver additional exercise sessions, leading the company to experience an illegal windfall.

Cody brought forth seven counts against SoulCycle including: violations of the Credit Card Accountability Responsibility and Disclosure Act and Electronic Funds Transfer Act, violation of State Gift Card Statutes (for California, Connecticut, New Jersey, Massachusetts, Florida, Illinois and Maryland residents), violation of the California Unfair Competition Law, violation of the Consumers Legal Remedies Act, declaratory relief, unjust enrichment, breach of implied covenant of good faith and fair dealing.

In the SoulCycle class action lawsuit, Cody seeks certification as a Class, a declaration that SoulCycle violates the claims, injunctive and other equitable relief, restitution of the illegal revenue, attorneys’ fees and any other damages to be awarded from SoulCycle’s conduct. The class action lawsuit also seeks a court order to have SoulCycle stop its illegal practices including the sale of certificates with illegal or deceptive expiration dates and for SoulCycle to fund a corrective advertising campaign to remedy their conduct.

This proposed class action lawsuit was filed just a month after SoulCycle filed for its planned $100 million initial public offering.

Cody is represented by Daniel P. Hipskind of Olavi Dunne LLP.

The SoulCycle Class Action Lawsuit is Cody v. SoulCycle Inc., Case No. 2:15-cv-06457, in the U.S. District Court for the Central District of California.

UPDATE: On Mar. 21, 2016, SoulCycle customers fought back against a bid to toss the proposed nationwide class action lawsuit, arguing that the motion only reprises arguments that a California federal court already denied in the first amended complaint.

UPDATE 2: On Apr. 22, 2016, a California federal court judgehas once again deniedSoulCycle’s motion to dismiss a consumer class action lawsuit alleging the indoor cycling chain violates the law by imposing a 30-day expiration date on some of their class passes.UPDATE 3: On Oct. 21, 2016, plaintiffs in a SoulCycle class action lawsuitasked the court to compel the defendantto divulge relevant documents.UPDATE 4: On April 21, 2017, SoulCycle and Codyagreed to settle the class action.They requested the court vacate the remaining hearings in the lawsuit. Additionally, the parties said they will submit a motion for preliminary approval of the proposed settlement in early June.UPDATE 5: On June 16, 2017, SoulCycle agreed to pay up to$9.2 million to settle a class action lawsuit alleging the fitness company sells gift certificates that can only be redeemed in a short period of time and then fails to offer refunds for the expired gift certificates.UPDATE 6: On July 12, 2017, the SoulCycle gift certificate class action settlement is now open.Click here to file a claim.