YouFit Membership Issues Trip Up Gym’s Planned $85 Million Sale

YouFit Health Clubs LLC’s proposed $85 million sale to a lender group was delayed after a bankruptcy court upheld the company founder’s objections and questioned the deal’s impact on 350,000 gym members.

Judge Mary F. Walrath of the U.S. Bankruptcy Court for the District of Delaware asked whether the buyer—a group of pre-bankruptcy lenders that includes Birch Grove Capital LP and Goldman Sachs Bank USA—planned on assuming gym members’ contracts and whether members had been notified of the proposed sale.

Her questions came after an objection was raised by gym members who sued in Florida state court over dues YouFit ...