LA Fitness pushes back. The company says the FTC's claims are baseless, highlighting that it voluntarily launched an online cancelation tool ahead of federal deadlines.
That's essentially what The Federal Trade Commission (FTC) is saying to LA Fitness. The US government regulator has filed a lawsuit against LA Fitness' parent company, alleging the popular gym chain used unfair and burdensome tactics that stifled members' ability to cancel recurring memberships and services. The case lands amid the FTC's broader push to crack down on so-called "tricks and traps" that plague subscription-based models across industries.
Less than a year ago, the FTC finalized its "Click-to-Cancel" Rule around this effort. However, a US Appeals Court vacated that rule before it was set to take effect last month. Still, it's a pretty decent model for good cancellation and strong customer experience.
The FTC's complaint paints a picture familiar to many consumers: a membership that feels impossible to cancel. According to the filing, LA Fitness required members to either appear in person or mail in a cancellation form, with multiple obstacles in the process. Members had to log in online to print a cancellation form -- a step many found difficult given login complexities tied to original sign-up data, key tag numbers and partial bank or credit card numbers.
Even when in-person cancellation was attempted, members often could only complete it with one designated manager, available during limited hours. Mailing cancelations also required certified or registered mail, creating additional cost and confusion.
Cancel in the mail. For real, that's criminal customer experience in 2025. Ok, enough of the subjectivity for now.
Meanwhile, add-on services like towel service or personal training were difficult to cancel individually, with disclosure gaps leading to more frustration.
FTC officials argue these practices violate the FTC Act and the Restore Online Shoppers' Confidence Act (ROSCA). "The FTC's complaint describes a scenario that too many Americans have experienced - a gym membership that seems impossible to cancel," said Christopher Mufarrige, Director of the Bureau of Consumer Protection.
LA Fitness, operated by California-based Fitness International, LLC, pushed back strongly. In a statement, Jill Hill, President of Club Operations, called the allegations "without merit" and criticized the FTC's reliance on ROSCA, which she argued was designed for online retail transactions -- not gym memberships.
Hill emphasized that LA Fitness had already launched an online cancellation tool 18 months before the Click-to-Cancel rule was set to take effect. "With just a few clicks, members may cancel online - a step we voluntarily implemented well ahead of regulatory deadlines," she said. The company also noted that it continues to offer in-person and mail options, as required by various state laws.
Despite a federal court of appeals recently invalidating the FTC's Click-to-Cancel rule, LA Fitness says it kept its online option in place. "Fitness International remains dedicated to providing accessible, high-quality fitness options while maintaining compliance with all applicable laws," Hill added.
The lawsuit also comes against the backdrop of the FTC's Click-to-Cancel rule, finalized in October 2024 but shot down in federal court in July. The rule would have required sellers to make canceling a subscription as easy as signing up, responding to thousands of consumer complaints about recurring charges and convoluted cancellation systems.
"Too often, businesses make people jump through endless hoops just to cancel a subscription," FTC Chair Lina Khan when the rule was announced. "Nobody should be stuck paying for a service they no longer want."
The Click-to-Cancel rule would have applied broadly to negative option programs -- subscriptions or memberships that continue until the consumer takes action to stop them.
Related Article: Everything You Need to Know About the FTC's Click to Cancel Rule
The Federal Trade Commission's Click-to-Cancel rule has elevated smooth cancellation experiences from optional courtesy to regulatory requirement. The rule mandates that businesses make subscription cancellations as simple as sign-ups, eliminating the complex processes that previously frustrated customers.
The new regulation would have required companies to allow customers to cancel online in real time without phone calls or navigating multiple screens. This represents a significant shift from traditional customer retention strategies that relied on friction to prevent customer departures. The rule also prohibited unwanted retention pitches during cancellation unless customers explicitly consent to hear them. This restriction forces CX teams to abandon friction-based retention tactics in favor of value-driven engagement throughout the customer journey.
Related Article: Customer Journey Mapping: A How-To Guide
We've reported at CMSWire that CX leaders should implement cancellation flows requiring minimal effort -- ideally one or two clicks rather than complex multi-step processes. Companies must also provide transparent information about fees, renewal terms and post-cancellation procedures upfront. Infrastructure upgrades and staff training may be necessary to meet these requirements.
However, the investment builds long-term loyalty based on trust rather than customer entrapment.
The regulation, although not materializing, creates opportunities for companies to differentiate through transparency and respect for customer autonomy. When customers feel empowered during cancellation processes, they demonstrate higher likelihood of returning to the service later.
CX leaders who proactively embrace these changes position themselves to avoid regulatory issues while establishing new standards for customer trust. Making departure easy often proves the most effective strategy for encouraging future returns.
For customer experience (CX) leaders, the LA Fitness case offers a cautionary tale. The FTC's scrutiny makes clear that friction-filled offboarding is no longer a viable strategy. In an era when CX is measured not just by onboarding and engagement, but also by how gracefully customers can leave, businesses must rethink subscription and membership models.
The FTC's Click-to-Cancel push and its lawsuit against LA Fitness serve as reminders: customer trust is built not only on the value of services, but also on the ease with which consumers can opt out. For CX leaders, that means prioritizing transparent, streamlined cancelation journeys as much as acquisition and retention efforts.