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Mar 21, 2008 9:30 pm US/Pacific
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Call Kurtis: Hilltop Gym Bankruptcy
SACRAMENTO (CBS13) ―
Hilltop Gym closed its Elk Grove and Sacramento gyms last month. Now workout equipment sits idle in the dark, a note on the floor saying the gym owner has filed for bankruptcy.
Former employees say they weren't paid. Gym members who paid up front for memberships are out money too.
So are dozens of customers dating back two years who say the gym fraudulently withdrew funds from their bank accounts. They say gym owner Will Cering refused to acknowledge their complaints.
"They won't give us his number. They say they can't give it out, he's never there," says one angry patron.
A number of former gym members sued in small claims court and won.
After out investigation the Sacramento district attorney's office launched its own investigation into the gym's owner Will Cering.
A prosecutor worked with Cering to set up a restitution account to re-pay customers. Few got their money. And now in the chapter seven filings, Cering lists all his debts including the deal with the D.A's office to pay restitution and refund customers which he say he can no longer do.
McGeorge Law professor and bankruptcy attorney Steve Felderstein says in a chapter seven filing, the company is out of business, and there's no chance to reorganize or stay open.
Essentially all of Hilltop Gym's assets will be sold. Then the court will decide who gets paid. This upcoming Tuesday, a hearing will be held at the federal courthouse in downtown Sacramento where people owed money can ask Will Cering questions and he must answer truthfully under oath.
It'll be the first time many will get the opportunity to come face to face with Will Cering. Some former gym members are still looking at the D.A.'s office to force Cering to appear a criminal court.
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