The former chief executive of Boston Sports Clubs has been ordered to pay more than $6 million after a Massachusetts judge found he approved a plan to bill members during the COVID-19 shutdown and obstructed their attempts to cancel contracts.
$6 Million Judgment Handed Down
Patrick Walsh, who once led parent company Town Sports International LLC and its affiliates, was ruled personally liable for $3.8 million in restitution plus $2.2 million in interest, according to a judgment filed Monday in Suffolk County Superior Court by Justice Hélène Kazanjian.
The decision followed a December bench trial in which Walsh argued he believed he had reached a deal with then-Attorney General Maura Healey—now governor—that would shield him from litigation if the company let members cancel online. The judge dismissed his testimony as “not credible.”
Pandemic, Debt, and Desperation
At the pandemic’s onset, Town Sports was already on the brink, staring down a $177.8 million debt payment due in late 2020 with just $19 million cash in hand. Walsh and other executives laid off most of the company’s 9,000 workers in March 2020 but still charged members for April, despite having no clear path to reopening.
The chain—once operating 30 locations in Massachusetts and dozens more in New York, D.C., and Pennsylvania—admitted in filings it could not predict when gyms might reopen. Yet customers were blocked from canceling in person, by phone, or online.
Complaints poured in, prompting the attorney general to intervene in April 2020. Members were eventually offered credits instead of refunds, but even those credits were inconsistently applied. Roughly half of 103,000 members received some form of relief.
