Some people have voiced frustration that the owner didn't notify them in advance of the bankruptcy filing. I'm not sure they're seeing the issue clearly.

Even when a business is struggling and bankruptcy is a distinct possibility, the owner can't simply go around telling people this information. If the information got out that the business *might* not last through the year, then the business *certainly* wouldn't last through the year.

The idea that this is a "take the money and run" situation also doesn't make sense to me. I don't know anything about Giani, but just look at the debts of the business relative to the assets. This was not exactly a cash cow type of business.

You should call up your credit card company and try!!!

I had an issue with my gym one time, whose membership I pre-paid a year in advance. A year later (since the credit card charge date), I had issues with the gym not honoring the remaining months of my membership after a long freeze (due to traveling and sickness, etc). I had their agreement in email communication. I called up my credit card company, explained to them what happened. The credit card company asked me to send in the details in a letter, and I was able to get my prorated money back!!! I remember while on the call with my credit card company, once I told them it was a pre-paid one year membership, they immediately changed their reaction (they were in the middle of giving me their 90-day return / refund policy).

So I'd say - if you have the time to spare, it's worth a try with your credit card company.

Good luck!

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The fact is that Mr Giani solicited payment right before the new semester began and then filed for bankruptcy right after the first week of classes. $400 per kids for 200+ kids add up to well over 50 ~ 60 grands (assuming half of the parents paid in advance to get 10% discount back in September). Whether he keeps this money for himself or he paid salary for the staff doesn't make a difference to me. The fact is that he screwed his customers with a smile.

In my case I paid $675 one year in advance, which I cannot get it back because it's well past 90 days and the credit card company won't create a dispute case. Yes the loss (200 - 300) has minimal effect on me but Mr Giani lost the trust from the neighborhood forever.

Nevertheless my baby and I do miss the place...

The franchise agreement likely provides that the franchise agreement can or will be revoked in the event the franchisee files for bankruptcy. That doesn't make filing for bankruptcy illegal or shady.

I don't know about the specifics of what happened and don't care to speculate. The one thing I think we have to remember is that, when a business is failing, someone will get stiffed. In this case its the customers who last paid deposits. It could be the employees. It could be the landlord. It could be the vendors. It could be everyone. That's what bankruptcy means, you can't pay your debts.

Just remember that, no matter when he announced filing bankruptcy, someone would be the creditor that got stiffed. Bankruptcy law is also tricky in that it prevents debtors from preferring one set of creditors over another. So basically you have to operate business in the ordinary course or the debtor, and the creditors who received preference, could face additional liability.

Please ! Corporate will tell you anything to leave them alone.
They are not responsible for thier stores. They are individually owned and operated. Maybe they did not get thier 6,8,or 10 % on the gross. But, that is all they are worried about. If one of thier franchisees are in financial difficulties they would not lift a finger to bail them out in any way. They will however try to see what your doing wrong, like maybe ,the rent is insane, of course after the fact. When your buying in, they just want to sell, even if they know you can\'t make it at a particular site.
The other MUST, is to have insurance to cover them , in case of a claim against the individual store owner goes wrong, and they are included.

The whole thing is very shady. Our child attended The Little Gym and sure enough, Mr. Joseph were soliciting renewal fees just the week before. Trust me... if you're filing bankruptcy, you know about it in advance. The fact that corporate is saying that he violated their agreement tells you how shady this all is.

Jersey City kids' gym files for bankruptcy, closes unexpectedly after parents pay for next semester

February 13, 2012, 6:41 PM
By Summer Dawn Hortillosa / The Jersey Journal

When Jersey City resident Helen Kalarakis brought her 3-year-old son Yianni to The Little Gym at 420 Grand St. for his regular gymnastics class last Tuesday, they were shocked to see that the gym was closed.

"The gate was down, it was closed and there was a sign on the entrance saying they were filing Chapter 7 bankruptcy," said Kalarakis. "My son was crying because he wanted to go in but didn't understand."

Kalarakis was especially upset because she saw the gym as a great place for her son to get exercise and play with other kids and for her to meet with other parents. "We're mad they didn't let us know. (My son) couldn't even say goodbye to the instructors. We didn't get to say goodbye to anyone."

The gym, which opened in 2006, was one of 300 The Little Gym franchises and offered kids' classes like sports, gymnastics, ballet and more.

The Little Gym's corporate headquarters were also surprised to learn on Monday that JoJo Productions, the company that owns the Jersey City franchise, filed for bankruptcy. Senior Vice President Ruk Adams said that the Jersey City gym's owners, Joseph Giani and Peg Pisani, told corporate officials of their plans to close the gym.

"We knew the gym was having financial difficulties and we were in discussion with another company to acquire a license and take over operations," said Adams. "Unbeknownst to us, they made the decision to file bankruptcy ... we have a franchise agreement with them that gives them licensce to operate in that location -- this puts them in violation of that agreement."

Adams added that his company and the Jersey City gym's landlord are both owed money. He would not comment on whether The Little Gym would take legal action against JoJo Productions, noting that it must wait for the bankruptcy court ruling before knowing what options they have.

"We're most concerned about parents ... who paid for those services," said Adams.

Parent Amy Scott, whose daughter Lexie, 3, took advanced gymnastics classes, said she discovered the gym was closed when she went to the gym on Feb. 7 to register her daughter for another class. Scott had paid in advance for the entire year.

"I was trying to reach the owner (Joseph Giani). I emailed and called him and he's not returned my email or calls," said Scott. "I paid a year in advance. It's kind of upsetting. In my mind, they owe me $300 to $400."

Parents, discussing the gym's shutdown on various websites, have said that the gym's employees reached out to parents the first week of February asking them to pay for the next semester if they had not yet done so.

Several parents said they were also not able to reach Giani aired their grievances on the franchise's Facebook page, which was quickly taken down.

Adams said he hopes someone can take over operations in Jersey City and reopen, honoring already paid tuition. Until then, he said that the closest franchises in Upper West Side Manhattan, Englewood and Hasbrouck Heights have offered "at no cost to absorb those (225 to 275) kids into classes on space available basis."

Scott said that option isn't good enough.

"I'm not interested," she said, noting that the nearest locations are still too far. "It's unreasonable and I want my money back."

She was more upset, however, for her daughter's loss.

"The teachers were so good and so warm to my daughter. At first, she was extremely shy and wouldn't go into the class," said Scott. "By the third class she would be the first one in and brought the teachers presents. They were bringing her out of her shell. It was a lovely environment. I'm so sad they closed."

Joseph Giani did not return multiple calls for comment.

Sounds Ponzian. Or Madoffian, if you prefer.

Got this email today from Joseph Giani:

We are extremely sad to inform you that, as of 2/7/12, The Little Gym of Jersey City filed for bankruptcy protection and is closed. The Little Gym used its best efforts to avoid filing for bankruptcy protection.

The Little Gym is deeply sorry for any inconvenience.

For information on other The Little Gym locations that may honor your enrollment, you may contact The Little Gym International at 1-888-228-2878.

We are unable to comment on refunds at this time. The attorney representing us in this matter is Boris Peyzner, Esq., McLaughlin & Nardi, LLC located at 37 Vreeland Avenue, Totowa, New Jersey 07512.

Actually, you can say that about any affordable franchise.
The Hasbrouck Heights Gym does very well. But, I wouldn't wait for the home office to make good on any refunds. These stores are owned and operated by the buyer. The Little GYM will tell you that very politely. Just like any other franchise.

For what it's worth, you might try calling The Little Gym's corporate office in Arizona, at 480-948-2878.

They are the franchisor and whether or not they can issue refunds I don't know, but it can't hurt to ask. If they can't issue refunds, maybe vouchers to use at other Little Gym locations is possible. I see there are locations in Hasbrouck Heights, Montclair and Englewood. They may not be convenient locations for you, but something is better than nothing.

As a side note, who in their right mind would invest in a Little Gym franchise? It looks like one of the most sure-fire ways to lose money. That, and owning a drive-in movie theater.

Home, Kids, and have to find employment. Would you want to be in that position? For those who never owned a business, or ran one, have no idea how hard it is to let go. There were probably some options to keep going, and maybe at the end it was not worth the continued risk. I feel bad when I see a business close up, because I know the investment and time
it takes. That Franchise probably cost him 250.000, and not including the rent , and other monthly expenses. Be happy it wasn't a substantial amount.

Also, Phil must be doing something right at the Taqueria .
Place in NJ and NY.

No one said you shouldn't be angry and no one said you shouldn't try to get your refund back. My post was in response to the person who posted his address, telling everyone that she intended to harass the guy at his home and encouraging the others to do the same. Sorry, but I think that is completely f*cked up. What, you think having angry mobs of people beating down this guy's door is a solution?

The business hasn't even been closed for a week yet. There are other ways to try to get your money back. Personally, I'd try to be as calm as possible to try to get answers before getting angry and screaming and yelling. No one is going to help you if you act like an @sshole and pound on his door to tell him off. On the contrary, you'll probably just get arrested yourself and get a restraining order. Wow, that's a solution, don't you think?

A cheater is a cheater no matter how rich or poor he is. Don't try to make him sound like a role model. Don't try to convince me he intends to refund the money. Indeed, do you REALLY believe that? Then why do you contact your credit card company instead of waiting for this kind owner? It's legal to take others' money away without punishment, but it's illegal to ask it back in face. This is the fact and I will follow the rule, however, that doesn't stop me from thinking that is ridiculous.

So if I get robbed, if I am rich it is less of a problem, because I won't be hurting as much financially? And if I get mugged, it is my fault for carrying cash instead of traveler's checks or something? Your logic is flawed.

$400 is a lot of money any way you look at it, and a lot of people are out thousands. Many paid months ago and it is too late to dispute the cc charges.

The way this was handled was completely uncalled for. If he acted this way on the advice of attorneys, he needs new ones.

I always thought he was a nice guy, if a bit unprofessional. I think that he just did not know how to manage the financial aspects. That place was packed, the rent must have been low, there was no reason for it not to thrive.

While I don't want to get into whether ANT731 did the right / wrong thing by posting the owner's address publicly, I think everyone here is coming down too hard on her here.

While the owner's life is probably miserably now by losing his business / credit, etc, I think people here are too generous toward his behavior.

As so many of you pointed out, he is probably a good (great) guy. Nonetheless, one don't decide to go bankrupt overnight, and therefore, he was wrong to keep accepting payment from other people. Yes, some people who paid by credit card can get it back, but those people will need to spend time calling their credit card company, and go through the process in order to get money back. And even if he does plan to give the money back to everyone - why waste everyone's time by taking it in the first place, make these parents go through agony and unknown (and how many of us are not worried about our jobs and money in this economy?)?

if he does indeed plan to NOT take money that doesn't belong to him, the way he's doing it just doesn't make sense to me.

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Ita. And IMO, if you have 400 in cash to spend on "gymnastics classes" for your two year old son, you can't really be hurting for money. Yes, 400 is a lot of money but your life is not going to suck bc you lost it. Id be very upset if it went down the way she said it did, but not enough for me to post joes address and go over to his home to harass him and his family.

Also remember that this guy lost his livelihood! He has children in the community and I am sure he feels awful and embarrassed. Try calling little gym headquarters before you march over to this guys house to yell at him.

Next time, pay by credit card. You would hav avoided this whole mess if you just did that in the first place.

ant731, you are the only one still missing the point.

The point is, you have gone beyond your anger and frustration by previously posting someone's home address and proudly posting that you will be going there this weekend to give your piece of mind and in return, encouraging others to do the same.

He might have unintentionally taken your and others money by trying to keep a failing business. But the consensus seem to be he provided a nice place that a lot of parents will miss. You in return, fail to see in your frustration over loosing your money went beyond and was vindictive.

I am just glad the webmaster removed your previous post with his address.

We have paid just last week for this semester. They didnt tell anything, i will try contacting my Credit card and see if i can get refunded.

but this was a wonderful place for my son, he loved going there. he was very upset last week when saw the doors were closed. but i really feel sorry for the owner, i hope he will also recover from this soon.

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how can you be sure he doesn't intend to refund your money? give the man a moment to get his affairs in order. his business just closed. he might have a few bigger things on his mind than your tuition.

Everyone is missing the point! he clearly STOLE when he knew he would not be able to keep up with payments. Many of you may not know this, but when u plan on going bankrupt it doesnt happen overnight. Last week he should have never accepted anymore more deposits when he clearly knew he was closing next week. A GOOD person, as you all claim him
to be would have said "sorry we are not accepting anymore deposits at this time because we plan on closing".

Now please explain to me how this isn't stealing? I promise you that if he ever plans on opening ANYTHING within 3 years he will not survive on my time. credit CANNOT be extended to him and if it is that means he really never filed bankruptcy and really stole!

For what it's worth we actually agree with hparkmom. Our child actually went to little gym and Joe is a good guy. She still should practice what she preaches though.

The difference is Taqueria Owner, you went out of your way not just to insult your clients but the neighborhood. You again and again fail to recognize your part in turning customers away with horrendous service. You are nothing but a bully.

But then again, this isn't a discussion about you is it? You being who you are, cannot take any criticism from others while you rain insult and rudeness to people trying to patronize your establishment.

Being a parent hopefully changed you for a better.

Great. Phil from Taqueria is here.

Hi Phil.

Ah if only hamiltonpkmom practiced what she preached...

'ant731', I hope you can see past your anger and perhaps as a parents learn a bit of forgiveness and compassion. Posting someone's address who must obviously in more dire financial situation than you and I, is no way to find any resolution.

I cannot imagine how difficult it must be for someone to try to make it being a small business owner and a provider of a family to loose it. Your loosing $400 in no way will effect your lively hood. But to vent what is obviously very unfortunate situation by being so vile to post someone's address and to boast about it is just a real shame.

I don't presume to know the owner in any way, but may be he was trying to make the business turn around until the very last minute? I hate to kick someone when they are down. I hope none of us are ever in his shoes. As a member of JC Mom Meet Up group, I am sorry for anyone who has lost the money but I am also sorry for the business owner, it must be a terrible lost to him.

CORRECTION: please email your contact info to the jersey journal do not call they will contact you

I can understand being upset but honestly, why would you ever pay cash for something like this? Always use your credit card, you have no protection if you pay in cash.

By the way, if you harass this guy at his home, he has every right to call the police on you. Is that a better behavior to do in front of your 2 year old son?

Jersey Journal is running a story and needs parents to call for a quick interview by phone regarding your experience

email: summer.jjournal@gmail.com, or call at 917-239-8865

are u people serious? kids leader? he clearly stole...do you think he didn't know he was going under last week? what kind of person does that?? Take our money in person in front of my 2 year old son when he knew he was going under!! And you have the nerve to say you would go to his other establishment? His credit is DONE, he'll never be extended credit again.

FYI, his address is public information. It's his own fault, or little gym for releasing his phone #.