Massage Envy Class Action Lawsuit Targets Prepaid Massages

Once again, Massage Envy faces a proposed class action lawsuit filed by disgruntled consumers who allege the company’s business practices are unfair and deceptive because it refuses to honor or refund prepaid, unused massages for customers.

The class action lawsuit brings claims of breach of contract, violation of the implied covenant of good faith and fair dealing, violation of California business and professions codes and declaratory relief.

Massage Envy is a membership-based franchise with over 700 clinics nationwide, of which 132 are based in California. Members sign-up to receive one fifty-minute massage per month for a monthly fee of approximately $60. All pre-paid massages a member has paid for that month and is unable to use accrue for the member to redeem later at a convenient time.

However, the lawsuit alleges that Massage Envy has inserted deceptive provisions into its contract that requires members to continue purchasing additional monthly massages as a precondition to redeeming the previously purchased unused massages. If a member cancels or ceases payment for the monthly purchases of additional massages when those charges become due, all of the unused pre-paid massages that have not been redeemed are forfeited.

Lead plaintiff Donna Zizian claims this forfeiture of prepaid massages breaches the uniform provision of Massage Envy’s Membership Agreement that provides “If you have Paid in Full for your membership services, you will be refunded the unused portion of your membership dues for any actual services you have not yet received.”

Zizian alleges that by failing to allow members to redeem the massages, or refund the cost of the massages, constitutes a breach of contract and breach of implied covenant of good faith and fair dealing, along with California’s Unfair Competition Law.

According to Zizian, she has been a member of Massage Envy since 2008 when she signed a standardized contract with Massage Envy with an initial term of 12 months, paying $59 for a monthly massage. Her contract held an automatic renewal clause that continues on a month-to-month basis until cancelled. Zizian claims she has at least 40 prepaid, unused massages and has kept her account current in the hopes she would eventually be able to redeem her unused massages.

However, Zizian alleges that by failing to provide refunds for unredeemed prepaid “paid in full” membership services Massage Envy unjustly increases revenue without having to provide massage services.

This is not the first time Massage Envy has faced legal action over its prepaid massage membership practices. In April 2014, more than 130,000 customers filed a class action complaint alleging violations of the California Unfair Competition Law. The certified Class claimed that the expiration of monthly 50-minute member massages that members did not use prior to membership cancellation, non-renewal, or termination for non-payment constituted an unlawful business practice and breached the membership agreement.

Massage Envy agreed to settle that California class action lawsuit in August 2014 by reinstating former members’ unused massages, extending the redemption period for current members, and injunctive relief.

Zizian is seeking to represent a Class of consumers who are current members of Massage Envy in California and paid a monthly membership fee.

She is seeking monetary damages, restitution, and an injunction prohibiting Massage Envy’s forfeiture of massages, and other equitable relief including reinstatement of the Class Members’ prepaid massages.

The plaintiffs are represented by Brett Weaver and Frank Johnson of Johnson & Weaver, LLP.

The Massage Envy Membership Class Action Lawsuit is Zizian v. Massage Envy Franchising LLC, Case No. 3:16-cv-0783-WQH-JLB in the U.S. District Court for the Southern District of California.

UPDATE: A class action settlement agreement has been reached! Instructions for how to file a claim can be found here.