Allstar Fitness bankruptcy: Sale/’rejected contracts’ hearing Friday; member response deadline Wednesday

March 18, 2013 at 11:31 am | In West Seattle businesses, West Seattle news, WS Health Club/ex-Athletic Club/ex-Allstar Fitness | 81 Comments

Continuing our followups on the Chapter 11 bankruptcy and impending sale of West Seattle’s Allstar Fitness: This Friday is the day a federal judge will consider approving the proposed sale of the club to health-club entrepreneur and former Seahawks player Sam Adams. As first reported here on March 9, court documents say that Adams does not want to assume “long-term contracts” from before last August’s bankruptcy filing. He denied that in a conversation with WSB the next day (here’s our March 10th report), saying he expected to honor “99 percent” of them, but so far, the court filings have not changed. This Wednesday, March 20th, is the deadline for interested parties to file responses with the court. As of this morning, the online file includes only a handful of responses to the sale motion, and one response to a separate motion that is scheduled to be heard April 5th – a request that the judge give permission for court proceedings NOT to result in further mass notices.

One WSB’er suggested that in case members missed the mail notification and/or still don’t know whether they are on the list of contracts proposed as “rejected” contracts, we upload the publicly available court documents here. Here’s the one with the “prepaid contracts to be rejected” list – 17 pages holding more than 2,000 names. If you want to file a response to be considered before this Friday morning’s hearing on the sale motion – which includes the “rejected contracts” list – this court document originally included in our March 9th report explains how to do so by the Wednesday deadline.

81 Comments

  1. Looks like the response date is March 29, not March 20?

    Comment by Chris — 12:11 pm March 18, 2013 #

  2. oh, I see – two separate response dates.

    Comment by Chris — 12:16 pm March 18, 2013 #

  3. Now I don’t know what to think of this whole thing! The court notice indicates that the buyer wants to reject all prepaid contracts prior to the start of the bankruptcy proceedings on August 27, 2013. Like many we assumed this was a typo and supposed to be 2012 HOWEVER we renewed our contract on October 7th 2012 and our names are on the list of proposed rejected contract list. So is this sloppy work on the part of the attorney filing the paperwork, the person who compiled the list (not paying attention to the renewal dates) or is there something else going on here??? We assumed we were safe as I am sure many others have but BEWARE, you may be on the list and not know it.

    Are they trying to reject everyone who signed a contract with FREE months associated with them regardless of when they were signed (they stopped offering the free months sometime after the trustee took over but it was after we signed our renewal).

    Comment by YeahRight — 12:27 pm March 18, 2013 #

  4. I wonder if a news source interview constitutes a contract of sorts; if an owner says they will honor something in the press, doesn’t that bind him/her to that statement?

    Comment by bridge to somewhere — 12:31 pm March 18, 2013 #

  5. B2S – Nope. Not in the slightest. Not to cast aspersions on Mr. Adams or anyone else I’ve interviewed in 30-plus years as a journalist, but anyone can SAY anything, but the written/adjudicated court record in a case like this is the only thing binding. Our conversation, by the way, was by phone, not via e-mail (unlike many reporters who prefer to talk, I prefer to do interviews in writing – whether I’m the questioner or the questionee – whenever possible so it’s on the written record even separate from the resulting article, but in this case, he called out of the blue on a Sunday morning after we’d spent some time trying to reach him any way we could, and I wasn’t going to pass up the chance to ask him questions). – TR

    Comment by WSB — 12:51 pm March 18, 2013 #

  6. Wow, no kidding. I thought we were in the clear too but according to this list we are not. TR, perhaps this should be an update to the text of the story that the August 27th, 2012 date that most had assumed was the cutoff is NOT in fact correct. It appears that EVERYONE with a contract with any “free” months is on this list. Presumably this is almost all the members of the club…?

    Comment by Westside — 12:52 pm March 18, 2013 #

  7. I’m with YeahRight. Renewal date 12/16/2012, and my attorney/husband contacted the attorney representing this AllStar mess and was told that the contract rejection wouldn’t apply to my membership, but there I am on the list! Sloppy work and inconsistent info all around (not you TR).

    Comment by Irukandji — 12:59 pm March 18, 2013 #

  8. TR- I can’t thank-you enough for providing due process notice of members who are slated for termination this Friday, so they may timely respond by 3/20 if they so desire. The Trustee didn’t see fit to provide adequate notice, but you did. THANK-YOU on behalf of our community.

    Comment by Eileen — 1:23 pm March 18, 2013 #

  9. Totally sloppy! My husband and I renewed in February 2012, so I have no idea of why we’re on the list. Plus, how can a legal document not have been proofread? August 27, 2013 has yet to happen! So what exactly are people supposed to do? Legal jargon can be difficult to fully understand…

    Comment by Melissa — 1:43 pm March 18, 2013 #

  10. thanks TR. I kind of feel for the prospective business owner; this is an onion with many layers, and it appears most layers don’t smell all that great. Good luck to him and all the former Allstar clients; I hope everyone gets what they are after.

    Comment by bridge to somewhere — 1:53 pm March 18, 2013 #

  11. At some point, there was mention that there are around 7,000 members. If the new owner is OK with losing nearly a third of the membership , good luck to him ! And good luck getting any new members from the rest of West Seattle. Once burned …

    Comment by DMS — 1:53 pm March 18, 2013 #

  12. didn’t make the list, hooray! worried about the state of the facility in the meantime, tho. it is in need of some serious tlc…

    Comment by brittany — 2:23 pm March 18, 2013 #

  13. Thanks for this info, Tracy. Meanwhile… My name is on the list AND I prepaid for a whole year’s membership last fall. If my contract is “rejected” can I get the balance of the money I paid for that contract refunded? How could employees blithely sell yearlong or longer contracts knowing that the company was declaring bankruptcy, and that those contracts could apparently not be honored?

    I appreciate the info and will file some kind of response with the court but I am not sure what. I suppose if the new owner feels like terminating me, that’s fine, but I definitely want the money back I prepaid. There were high pressure sales tactics for longterm commitment (all gyms do this) and I totally bit.

    Comment by AnneH — 2:29 pm March 18, 2013 #

  14. My partner and I signed up together for an 18 month contract last year. She is on the reject list, and I am not. Like we’d ever support that gym if our contracts were voided.

    Like others, thank you, TR, for bringing this to our attention!

    Comment by fering — 2:29 pm March 18, 2013 #

  15. Does anybody know which info is accurate? I renewed at the end of September 2012 and am on the rejected contract list…

    Comment by Carrie — 2:41 pm March 18, 2013 #

  16. Once again, I am posting what I wrote in response to this. Please feel free to borrow or modify this language if you do choose to write a letter. I sent mine to the judge and to the lawyers for the trustee.

    LETTER EXCERPT
    My present contract, for which I have already paid both my dues and the yearly maintenance fee, is not set to expire until March 9, 2014. I understand that when it is once again up for renewal, assuming the Club is sold, those terms may not be offered to me again. My next renewal window would be the appropriate time to end or modify the terms of my membership. Therefore, I am opposed to any sale that would terminate legal membership agreements like mine.

    Mr. Sam Adams, who has been identified as the party interested in buying the club, has been quoted in the local media as stating he intends to honor “99 percent of them” in reference to the approximately 2100 contracts that include terms like mine. He has also been quoted as saying he “thinks” membership terms of two years or more are illegal.

    The terms being requested by the Trustee in the notice I received does nothing to allay my concern that a membership agreement of more than 12 months and equal or less than 24 months will be honored. Therefore, I ask that you require the Trustee to stipulate in greater detail exactly which agreements are to be nullified before you approve this sale.
    END EXCERPT

    Comment by Jenny — 2:43 pm March 18, 2013 #

  17. I’m no lawyer, but I encourage anyone whose name is on the list, or who think they might have their pre-paid contract “rejected or terminated,” to write a letter of objection. I don’t see how it can hurt hurt and it might help is a lot of objections are filed.

    My last pre-paid membership renewal started in March 2012, so I assumed I would be on the list of “rejected” contracts (sure enough, I’m there). So I submitted an objection letter last week. I did my best to decipher the legal document we received.

    In the letter, I stated objection specifically to “Clause 2 of the Sale Motion (page 2, lines 12 – 14) which states that contracts of long-term prepaid members will be rejected and terminated upon the sale of the Club to the buyer.”

    If I read the notice correctly, a hard copy letter of objection has to be sent the Court Clerk (at the address in the notice) with a copy to the law firm in the notice. There was an email address for the law firm, so I emailed a soft copy of my letter to them.

    Comment by kathy — 2:47 pm March 18, 2013 #

  18. I am still confused about what exactly we need to do if our name is on the list. Ug. Frustrating.

    Comment by lauren — 2:48 pm March 18, 2013 #

  19. I renewed after Christmas (December 2012) and yet I’m still on the list. Makes no sense.

    Comment by Beth Bakeman — 2:49 pm March 18, 2013 #

  20. I renewed after Christmas (December 2012) and yet I’m still on the list. Makes no sense.

    Comment by Beth Bakeman — 2:49 pm March 18, 2013 #

  21. I just spoke to the court help line. They told me that to file, all you must do is write a letter and mail it to the court. You must include the case number (NO. 12-18818) and the debtor (West Seattle Fitness). You do not need to send a cover page. You must have it there by Wednesday if you are protesting the first motion. You can only file online in you are an attorney. I’m writing mine today.

    Comment by Marji — 2:49 pm March 18, 2013 #

  22. OK – maybe I’m slow but I still don’t fully understand what I need to do here. I have been a member for over 10 years and I am on the list. What exactly should be we saying in the letter to the judge/court? Help!

    Comment by Confused — 2:54 pm March 18, 2013 #

  23. I was in there the other day and they have posters up trying to get people to commit to new year long contracts with the promise of free months to come. I can’t believe they would still be doing that!

    Comment by BPP — 2:59 pm March 18, 2013 #

  24. I renewed in Oct and I am not on the list. I know it’s a complicated situation for the new owner but he is choosing to purchase the club and it’s members and to deal with a bankruptcy. I knew they weren’t doing well in Oct. (I got 6 months free!) but didn’t know it was as bad as it was. I am willing to give up those 6 months because I like the club and don’t like the Y nor LA Fitness but if my contract is voided, I just might not join any club!

    Comment by Anna Eileen — 2:59 pm March 18, 2013 #

  25. My contract auto renewed on April 2012 and I’m on the list. I paid for 12 months and got 3 free. Not happy that they would term someone for 6+ months when my partner pays month to month. If mine is termed we will change gyms.

    Comment by Doug — 3:09 pm March 18, 2013 #

  26. Most importantly, what has/will happen to Emerald City Smoothie?

    Comment by Spana — 3:11 pm March 18, 2013 #

  27. WSB: Thank you for posting. I didn’t see this list until you posted it, even though I’ve been keeping up with the bankruptcy. I appreciate the heads up and I will be filing with the court in light of this!

    Comment by Kerissa — 3:13 pm March 18, 2013 #

  28. I renewed in oct 2012 – after the Aug 2012 date so like the others here per the notice I should be OK. But they could not get the date correct in the motion (they stated Aug 2013.)So I wrote 2 letters not approving the motion and why. One will go cert to the court, the other to the attorney. Better safe then sorry as one thing is listed but another done.

    Comment by Babs — 3:22 pm March 18, 2013 #

  29. Can you provide a link to court documents? Or did you obtain them only through Pacer, which requires a credit card and involves a charge…Man, I though I left lawyering so that I wouldn’t end up going to federal court on a Tuesday morning. :)

    Comment by Kerissa — 3:32 pm March 18, 2013 #

  30. don’t blame sammy..

    Comment by toodles — 3:34 pm March 18, 2013 #

  31. Anyone able to locate an email address or fax number for the Judge to send our letter to since mail may be too late?

    Comment by Confused — 3:41 pm March 18, 2013 #

  32. Kerissa, the ones I have downloaded that are of relevance to the story are linked in the story – any “blue” text on WSB is a link. They are PDFs. I don’t know of any place to directly link anywhere else – I have a Pacer account and that’s where I got them. – TR
    .
    p.s. the links to prior stories include a few other doc links but I have not downloaded everything on the case docket and don’t intend to. we do spend a relative lot on court docs, between Pacer and King County’s ECR!

    Comment by WSB — 3:54 pm March 18, 2013 #

  33. Thank You WSB, I see my name on this list. This is troubling…My contract is dated Aug 20th….7 days before the Allstar Bankruptcy….

    Comment by M Flash — 4:29 pm March 18, 2013 #

  34. Not much anyone can do. Hope for the best. It could be worse. Kerry Killinger and WAMU come to mind. That was some big bucks lost. In my family. And Kerry is still doing quite well, thank you very much.

    I just laugh at WAMU’s last advertising slogan: “The Power of Yes.”

    You bet Mr. Killinger. You bet.

    My wife may lose a couple of hundred bucks, but big deal. She went to the gym five days a week. Religiously. At least she got her money’s worth. And if she didn’t: lesson learned.

    Comment by Fitness Freak — 5:14 pm March 18, 2013 #

  35. This certainly doesn’t seem like 1% of their contracts. There are a LOT of names on this list.

    Comment by Cait — 5:52 pm March 18, 2013 #

  36. You bet, Cait. I would bet most of the former contracts are on the list. My wife, for instance. Her name is on the list. Very sad.

    The news at the gym and the list posted on WSBlog definitely clashes.

    Comment by Fitness Freak — 6:39 pm March 18, 2013 #

  37. I would like to believe that they are not going to reject this many contracts. MY name is on that list. I have a 12 month contract with 3 months free that I signed last August. But, this is my 3rd such contract in a row, so I have been a member for over 3 years. It would be detrimental to business for them to simply tell all of us we’re S.O.L on something we paid for. Supposedly I am grandfathered into a certain rate for life should I renew, but I wouldn’t be surprised to see them not honor that considering all the improvements he wants to make. But to tell me I can no longer work there when I paid until November would be shocking.

    I know that this day in age people like nothing better than some good grandstanding and fearmongering, but I don’t see us being barred from working out. I think WAMU is an apples and oranges argument. They literally didn’t have the money to pay people pensions. Some of you are talking about them not letting us in the building anymore. I don’t see that happening. They wouldn’t have any members. I won’t be surprised if come November I have a new rate. In a way, that is not honoring the contract, but at least I’ll have a choice.

    Comment by Big G — 7:01 pm March 18, 2013 #

  38. I’m not a lawyer. And I’m lazy. Anybody want to post an anonymized version of their “letter”? Then, we (lazy folks) could simply add our personal details and easily mail it in.
    .
    Would a bunch of letters like that help our cause?
    .

    Comment by robwestseattle — 7:34 pm March 18, 2013 #

  39. Thanks WSB for the reporting. People will say anything. The important fact is what is in writing. This filing goes along with what I have been hearing. I also would not expect the gym to improve. Expect a possible status quo and/or decline. I personally have terminated my contract.
    If in six months, Mr Adams surprises me and/or manages differently from his other gyms, I will renew.

    Comment by scout 1 — 7:35 pm March 18, 2013 #

  40. As I said before, we’ve enjoyed our 10 years at Allstar Fitness but plan on changing gyms if the remainder of our contract is not honored. That is no way to treat loyal customers. And we will tell all our friends and neighbors not to visit Allstar as well.

    Comment by Paul — 10:01 pm March 18, 2013 #

  41. I apparently bought a pre-paid membership just a few days before the magic date and so my name is on The List (it sounds so ominous). The good news is, I’m finally part of the 1%! Oh well, at least I only paid through April.
    .
    If they really do scrap all those people’s contracts, let’s “celebrate” with a 2000-person group run/walk/cycle on Alki.

    Comment by Kelly — 10:11 pm March 18, 2013 #

  42. There is a partial sample letter in the WSB for the person who didn’t know what to say and needs some ideas. Go to the March 10 blog report (highligted in blue in today’s article above), to the comment section, to the comment posted 1:51 PM March 14.

    Comment by anne — 10:51 pm March 18, 2013 #

  43. Does anyone that pays monthly for membership care about All-Star bankruptcy? I care about a few of the members and trainers I met there but gyms are a dime a dozen and I only work out inside during the winter anyway. I might go back next winter if the new owner puts in a little TLC, it is a pretty nice, big gym if it’s maintained but maybe it’s time to go back to s smaller place like the Y.

    Comment by mikepiz — 11:06 pm March 18, 2013 #

  44. Does anyone know if this is the same group that bought the two Allatar locations downtown last year and changed the name to Seattle Executive Fitness?

    Comment by Whoa — 12:21 am March 19, 2013 #

  45. I asked Adams about that in our phone interview a week ago Sunday. He said that operation is owned by a former business partner with whom he split because that person wanted to operate downtown clubs while he was interested in more-suburban type operations – TR

    Comment by WSB — 12:56 am March 19, 2013 #

  46. Does that mean, if the court approves on Friday I can’t go workout next week? Do they not let me in or when is my membership going to end then?

    Comment by mela — 5:17 am March 19, 2013 #

  47. This list of contracts to be rejected does NOT match what the court documents say. My wife and I renewed in October 2012, well after the bankruptcy filing in August 2012, and our names are on the list. There’s a major error in how this list was compiled.

    Comment by Ryan Lundberg — 5:19 am March 19, 2013 #

  48. Well, get your work-out in this week. There’s a chance the Court will determine that Adams’ proposal isn’t enough to keep the business running.

    Comment by Irukandji — 7:55 am March 19, 2013 #

  49. Does anyone know who we can call to ask about
    how the list was compiled?

    Comment by deb — 8:06 am March 19, 2013 #

  50. We contacted the Attorney listed and were told that even he didn’t know when/how the list was generated. We were told to fax him a copy of our membership contract and a letter requesting to be removed from the list since our contract date was nearly six months after the August 2012 date.

    Comment by Irukandji — 8:30 am March 19, 2013 #

  51. Note for those checking back on this thread today: I just checked the court file to make sure we weren’t missing any new official documents, and we aren’t, so far (I will check again a few times before and at day’s end), but there are more filings of objections/responses by members, received yesterday. – TR

    Comment by WSB — 8:48 am March 19, 2013 #

  52. Well, looks like I get screwed. My contract and my girlfriends expire Feb. 2014. I don’t see that as that “long term”.
    member for 4 years. training sessions $75 each and has been weekly for 4 years. Locker rental at $20 a month. I have paid so much to this club that the day they screw me, I will go anywhere else.

    It seems that State Law means nothing for shafting members and cancelling memberships. No need to refund money or honor member ships when clubs close or get sold.

    Just do bankruptcy! The American way to screw your customers out of more money! Let the Judge void all contracts!

    State Law means nothing!

    Is there anyway to email them?

    I have my letter going out in today’s mail.

    Everyone at the club kept telling me I was OK. I would have hoped so – $75 training every week for 4 years. But no – so I hope LA Fitness gets started on that big hole next to West Seattle Bowl really soon.

    Comment by Patrick Lajko — 11:13 am March 19, 2013 #

  53. @robwestseattle

    Look for my comment above. I’ve posted an excerpt of the letter I sent here, and on other posts about this topic. Please do take and modify it.

    Once again, here it is with the opening paragraph which includes the needed court reference number…

    BEGIN EXCERPT
    This letter is in response to the notice of hearings I received (reference number: 12-18818) informing me that my rights may be affected based on the outcome of the proceedings related to the bankruptcy and proposed sale of Allstar Fitness (the “Club”) located at 2629 SW Andover Street, Seattle, WA 98126. I have been a member of this club since it first opened.

    My present contract, for which I have already paid both my dues and the yearly maintenance fee, is not set to expire until March 9, 2014. I understand that when it is once again up for renewal, assuming the Club is sold, those terms may not be offered to me again. My next renewal window would be the appropriate time to end or modify the terms of my membership. Therefore, I am opposed to any sale that would terminate legal membership agreements like mine.

    Mr. Sam Adams, who has been identified as the party interested in buying the club, has been quoted in the local media as stating he intends to honor “99 percent of them” in reference to the approximately 2100 contracts that include terms like mine. He has also been quoted as saying he “thinks” membership terms of two years or more are illegal.

    The terms being requested by the Trustee in the notice I received does nothing to allay my concern that a membership agreement of more than 12 months and equal or less than 24 months will be honored. Therefore, I ask that you require the Trustee to stipulate in greater detail exactly which agreements are to be nullified before you approve this sale.
    END EXCERPT

    Comment by Jenny — 11:24 am March 19, 2013 #

  54. Please do not interpret this list as a sign that all these folks are going to be dropped by the club. This list was compiled by the bankruptcy court as a step to the ownership change.
    The only people likely to be dropped are the ones who “invested” in the club and got long-term deals.
    First, it would be madness to drop 2,100 people in the middle of their contract — they would never come back, and
    Second, Sam Adams had said publicly that he will honor “99%” of all contracts currently on file. That includes almost all the folks on that list.

    Comment by Chris Fruitrich — 12:08 pm March 19, 2013 #

  55. Interesting – I left a comment a half hour ago and it was deleted. Why?

    So I shall repeat it again…..

    I am a member of 4 years. My contract and my girl friends expires Feb. 2014. I don’t see that as that much of a “long term”. We pay training at $75 per session. I have been with a trainer 4 years and at that rate, plus $20 a month locker rental, I give the club a lot of money.

    Why are they shafting us and terminating our memberships? The cost of training for a couple months is more than the annual membership.

    When our contracts are terminated we will go elsewhere. any club would be glad to get that training money every week.

    I thought State Law meant contracts had to be honored or refunded. It seems the American Way is to file bankruptcy. Run the club into the ground. Take the money. File bankruptcy and let the Judge void the contracts.

    I am mailing my letter today. I didn’t think about it because the staff always said our memberships were safe. Now we are on the list. I won’t believe anything they say.

    Was there anyway to email a response to the court?

    They will lose so much money – a few hundred a month! Not the best way to do business. Kick out your high paying customers.

    (Now, WSB, why do you delete my post?)

    Comment by adidasguy — 12:12 pm March 19, 2013 #

  56. What a way to anger the community.

    Just lost my business

    Comment by Dan — 12:13 pm March 19, 2013 #

  57. “Adidasguy,” I see a comment by you at 11:13 am. Did you post another one that’s not showing?

    Comment by WSB — 12:25 pm March 19, 2013 #

  58. WBS, have you been in contact with Sam Adams or anyone affiliated with him since the story was published? Do you know of there’s any merit, validity, etc. to Chris Fruitrich’s comment? Being on the list that we were sure we wouldn’t be on, having renewed in mid-October, 2012, I’m kind of fretting along with everyone else on the membership side of the table. There’s a lot of money at stake and I’m eager to know if there’s been any public or official comment or if we’re all going to be left flapping in the breeze trying to figure out how to fend for ourselves.

    PS; I appreciate your continue coverage on the matter, without which I would have foolishly thought we’d dodged the bullet. For what it’s worth, thank you!

    Comment by KatieL — 1:18 pm March 19, 2013 #

  59. Generally speaking, you will need to go to the courthouse to file the document with the clerk. Mailing a letter to the judge won’t become a part of the court file. You may be able to file online through ECF, but you will have to register and there is likely a fee involved: https://ecf.wawb.uscourts.gov/cgi-bin/login.pl

    Comment by Kerissa — 1:51 pm March 19, 2013 #

  60. It is our understanding that the attorney for the Bankruptcy Trustee will consider revising the “to be rejected” list if proof of a contract entered into after 8/27/12 is provided to his firm ASAP.
    .
    There is no guarantee that doing this will result in a name being taken off the list, but that’s the route we are going to take. According to a staff person at the Cairncross firm, the best way to get a contract to them would be as a pdf attachment to an email sent to him, Kevin Lau indicating you would like to be removed from the “to be rejected” list because you entered into a contract after 8/27/12.
    .
    His email is klau@cairncross.com.

    Comment by Irukandji — 2:34 pm March 19, 2013 #

  61. Katie – no, I have not. Nothing has changed since my conversation with him a week ago Sunday, so I have no further reason to talk to him until after the judge’s ruling on Friday (if it is an immediate ruling) – assuming he’ll be in court (I plan to). The gist of this story is:
    *Reminder that people interested in replying are supposed to do so by Wednesday, according to court documents
    *Reminder that the hearing is on Friday
    *Since somebody suggested we link to the document that contains the “rejected contract” list, in case people didn’t know whether they were on that list, we did.
    .
    That document is NOT new – it was already on the record before he called us that day. As I reported that day, he said he expected to honor most if not all of them and would start working on that after theoretically taking over the club next Monday, provided the sale is approved this Friday. However, this remains: What the judge is being asked to do is to approve a list of “rejected contracts.” There is nothing in writing in court files so far that would provide anything legally binding Mr. Adams to do what he told me during our interview that he would. But, that by NO MEANS means or implies that he *won’t* do what he said he would.
    .
    TR

    Comment by WSB — 2:34 pm March 19, 2013 #

  62. Thanks Kerissa. That’s what I thought. I’m generally familiar with the bankruptcy procecss, but from the financial institution side, not as a claimant, or whatever.

    Not being or having an attorney, does anyone happen to have a resource for instruction on writing a formal objection to be filed with the court, or perhaps a template for such things? Alternately, is anyone out there an attorney willing to offer some pro bono advice to the collective, like how to better navigate this cluster without losing our shirts (other than crossing our fingers and hoping Chris F is right)? For the record, I do hope he’s right, but I’m a frugal realist.

    Comment by KatieL — 2:37 pm March 19, 2013 #

  63. (Hmmm – my last comment may only apply to me because I am an attorney – apparently you can mail it, in which case I would mail it to the federal courthouse in downtown seattle with the ATTN line to the judge.

    Comment by Kerissa — 2:38 pm March 19, 2013 #

  64. Just spoke to the bankruptcy court regarding the receipt of the “objection to the sale of assets free and clear…” and the clerk told me the address to send my objection was Suite 6301 not Courtroom 7206. She said this was important so I thought I would pass it along as I didn’t see this listed anywhere on the official letter.

    Comment by Timeslid — 2:49 pm March 19, 2013 #

  65. Shoot, I don’t mind delivering my objection to the courthouse in person, so long as it gets to the right place and is given consideration. Thanks Kerissa and “Timeslid” for the info!

    Comment by KatieL — 3:01 pm March 19, 2013 #

  66. Thanks again, TR! For some reason, I just saw your comment. I feel a little better, because I felt I had a grasp on what was happening before. It wasn’t until today’s article on the topic that I began to fret because I somehow misunderstood that the list was new information. Given memberships are so spendy and the topic of money being a sensitive one, it’s something I think we’re all taking seriously.

    You folks down at the WSB do well to keep us informed. Your comment is a good reminder to slow down and re-read things before getting too excited about what might, at first, seem like new info. Thanks, again. :o)

    Comment by KatieL — 3:10 pm March 19, 2013 #

  67. I am not aware of any basis TO object. Bankruptcy courts have the authority to void unsecured pre-filing contracts, and usually do, to give the new owner a “fresh start”. It’s harsh, but it’s the way it works. If I am wrong, someone give me a valid reason to object other than “it’s not fair” or “I paid in advance”, neither of which are proper grounds. I hate to lose all that money I paid.

    Comment by JT — 4:26 pm March 19, 2013 #

  68. You know – I was contacted several times in December by the club wanting me to renew my annual contract. When I said “but aren’t you in Bankruptcy?”, the fellow said – “come in and I’ll have you speak to my General Manager, I’m sure the new owner will honor your contract.”
    In the end, I let my membership expire (12 + 6 months free) and now am month-to-month. Whew – thought it sounded too good to be true.

    Comment by VideoGal — 4:48 pm March 19, 2013 #

  69. Thanks to TR and WSB for keeping the community updated on the bankruptcy of Allstar. Though I filed an objection, it is essentially proforma as I doubt that the judge will hold up the sale. In my experience, prepaid contracts are usually voided to give the new owner a clean start.

    I think though that perhaps the list of 2100 may not have been compiled accurately, especially if Mr. Adams is considering honoring/reinstating some of the contracts.

    I doubt that Mr. Adams wants to tick off 2100 current members — currently stats indicate that for every person receiving bad service, minimally 10-15 people are contacted — often more. Allstar’s reputation is somewhat damaged due to this bankruptcy and the disrepair; the voiding of 2100 contracts would be much worse.

    Comment by Cal — 7:30 pm March 19, 2013 #

  70. B_10_Proof-of-Claim-12-2012-fillable.pdf This is the form we need to oppose the notice of hearing 1 and 2 Judge Overstreet, From the US Bankruptcy Court West District of Washington (website)

    Comment by SAD — 3:56 am March 20, 2013 #

  71. JT is exactly right. It sucks that some of us may lose money on the deal but that’s how it works. The court and the trustee’s job is to make sure whoever (Sam) buys the failed business is going to have a fighting chance at success. I can’t imagine the judge allowing a sale WITHOUT a provision to void some contract. I’m guessing Sam really has no say in this provision. However, once the sale in finalized, there is no reason he can’t make good on his words to honor many of the contracts.

    In the end, it’s going to come down to Sam on whether he honors contracts. I’m hoping he makes the right decision and honors a lot of them. But, I also understand if he does not. It’s a business that makes money by selling memberships. There is no way the business can survive if there is a large number of long term contracts sitting on the books that bring in no money to the new business. Sucks, but it’s reality. Either way, I will renew. I need heavy free weights and my options are limited.

    Members can write all the letters they want to the court but I can assure you, the Judge will probably not even consider them based on the reasons JT mentioned.

    Comment by Brewmeister — 8:19 am March 20, 2013 #

  72. Does anyone know if there is a way to fax in a response letter?

    Comment by Amy — 8:28 am March 20, 2013 #

  73. I had the same thing happen as VideoGal. I too changed to month to month. Glad I dodged that bullet. I hope Sam fixes up the club as his ex-partner is doing downtown.

    Comment by Rarejem — 8:32 am March 20, 2013 #

  74. Like everyone else, I did not respond because my renewal date is after August 27. I was just told about the list being posted on the blog today.

    Guess they were not worried about losing members that pay hundreds of dollars a month for personal trainers. Many of us are on the list and won’t be around.

    Comment by Jackie — 7:12 pm March 20, 2013 #

  75. I wrote a letter not opposing the sale but opposing the request to reject the prepaid memberships. I believe the selected date is arbitrary and favors one group of Club members over another without a clear basis. BTW, the administrative assistant for the Trustee said the August 2013 date was indeed a typo and should be 2012.

    If Sam Adams’ strategy is to honor “99 percent” of the prepaid memberships by reinstating those members after their contracts are rejected, it would seem responsible for him to indicate that now. If that’s not it and his interview with WSB was simply an attempt to reduce active opposition to the sale, shame on him. There is a tremendous amount of Good Will attached to All Star Fitness, the Club, and how Sam Adams handles this membership issue will determine how much he capitalizes on or sqaunders it. My wife and I have five months to go on our bonus period, are on the reject list and will not sign up for the new club if it turns out Sam Adams was lying in the WSB interview. If he had said he couldn’t afford to honor those bonus periods, that would have been an entirely different matter and we would have been more accepting about losing out on the bonus (we feel we earned). But that’s not what he said, so it’s become a matter of his integrity.

    Comment by JTB — 10:37 am March 21, 2013 #

  76. Some interesting docs in the court file this morning … watch for a new story before too long (I hate to promise timeframe because breaking news can throw us topsy-turvy, but it’s a priority) – TR

    Comment by WSB — 10:47 am March 21, 2013 #

  77. JTB- The Trustee’s Motion states as follows: “The Buyer does not wish to assume the obligations under the remaining long-term, pre-paid members contracts of the Debtor (the “Rejected Contracts”). The parties to these Rejected Contracts are identified on Exhibit B to the Hooper Declaration and represent over 2,100 members”. In other words, to blame the Trustee or anyone else but Mr. Adams for cutting this business deal and actively wiping out 1/3 of club “liabilities” (that is what you are, now that they have your money and owe you services), would be a big mistake.

    If the Trustee’s statement does not answer your curiousity concerning Mr. Adams “integrity”, I don’t know what will. Oh — but he did state in another public interview that his favorite book is “The Bible”, so that should make everyone happy about getting screwed with a smile.

    Comment by Eileen — 10:52 am March 21, 2013 #

  78. Eileen,
    I know what the Motion states. Left alone, that would have indicated Sam Adams made a business decision not to honor those prepaid contracts. Why he would honor some and not others isn’t clear. But he is the one who reached out to WSB and represented his intention to honor most of the contracts. I’m willing to give him the benefit of the doubt and see if he follows through on that or not. I can see why it might be legally necessary to selectively reinstate some memberships if the object is to get out from multiple year contracts. But if the WSB blog interview was only intended to dampen opposition to the sale, I believe it will prove to have been a big mistake. I look forward to the WSB update from the latest court filings.

    Comment by JTB — 11:13 am March 21, 2013 #

  79. Based on the notice of appearance and request by the attorneys representing GRE 509 Olive, LLC (an investment group), I suspect that the sale might not go through on Friday. I just read the document posted in pacer.gov.

    Comment by Cal — 12:38 pm March 21, 2013 #

  80. That’s what I’m writing about. Almost done.

    Comment by WSB — 12:53 pm March 21, 2013 #

  81. While on the treadmill today, I saw that Connie Thompson, Komo Problem Solvers, did a story on the banktruptcy and the prepaid contracts. I did not actually hear what was said but this could be picked up by watching the news later tonight or checking on the Komo TV website.

    Comment by Cal — 6:09 pm March 21, 2013 #

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