Company That's Been Around for 40 Years Confirms It Is Closing Doors for Good
The Jenny Craig chain of weight loss centers closed its doors last week, sparking a lawsuit from workers who say they were not given legally required notice.
“It is with a heavy heart, we’re announcing the close of our business. The last 40 years would not have been possible without you,” the company abruptly announced Thursday on Facebook.
The post said that all auto-delivery subscriptions have been canceled.
Coaching sessions, food orders and all other activities either in the centers or online also ended, the notice said.
The company operated nearly 500 weight-loss centers in the U.S. and Canada, according to WXMI, but faced stiff competition from weight-loss drugs such as Ozempic, Wegovy and Mounjaro.
Craig founded the business in 1983.
A lawsuit filed last week in U.S. District Court in New Jersey said the company violated the Worker Adjustment and Retraining Notification Act by closing its doors without giving employees the required notice, according to NBC.
The WARN Act requires that employees, state and local governments be advised when a company with more than 100 workers is planning a closure or layoff.
NBC said employees in New Jersey were given a notice that said employees could lose their jobs in 60 days, or perhaps sooner.
“Legally, per the Warn Act, employees reporting to the Corporate Office and NJ centers are entitled to pay for the full Warn Act notice period. However, as the financial status of the company is still in flux, it is not clear whether the separation date may be before 6/24 for Corporate and 7/24 for NJ centers and could be as early as next Friday 5/5. If it is before the full Warn Act notice date, we may not be in a position to continue payments to the employees for the full warn notice period.”
Although employees were told they would receive pay for accrued time off, Jack Raisner, an attorney for the employees, said they are entitled to full pay for 60 days from the date of the notice and called the notice a “head fake.”
“It’s important to people. It throws people into an enormous upheaval and free fall actually,” he said of losing work suddenly.
NBC said Jenny Craig is now owned by HIG Capital.
According to Bloomberg, the company had $250 million in debt and had been seeking a buyer to avoid liquidation.
Newsflash! –> “Our Economy Rocks!” said Joe Biden
1) Tuesday Morning –> Files for Bankruptcy
2) Jenny Craig –> Files for Bankruptcy
3) Bed Bath and Beyond –> Files for Bankruptcy
4) First Republic Bank –> Insolvent Acquired by JP Morgan by a FEDERALLY GUARANTEE.Great Job!… pic.twitter.com/7ZKQ5Nbol3
— Capitol Jester (@CapitolJester) May 2, 2023
The demise of Jenny Craig comes at a time of vast upheaval in America. The chain Tuesday Morning recently announced that after almost 50 years in business, all of its stores are closing.
Late last month, Bed Bath & Beyond filed for reorganization under Chapter 11 of the federal bankruptcy laws.
CNN noted that retail sector bankruptcies are rising. The outlet cited relatively recent filings by Party City, mattress manufacturer Serta Simmons and Independent Pet Partners, a pet store retailer. David’s Bridal, a national wedding gown store, filed for Chapter 11 reorganization recently, as well.
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