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toolsThe Sona MedSpa Tragedy Continues
It is difficult to reconcile facts with statements made by the former owners of Sona MedSpa. According to the May 29, 2007 Sona MedSpa Franchisor Press Release "Sona MedSpa Plans for Growth After a Favorable Arbitration Ruling" Heather Rose, CEO of Sona MedSpa stated, “This case was one of a string of cases brought against us. The coordinated attack on our business has utterly failed. We are pleased with the result of this arbitration, and even more pleased that our franchise partners are enjoying prosperity in their Sona MedSpa businesses.” The question remains which Sona franchise partners were or are enjoying prosperity?
The facts are that over the last month Sona MedSpa, Sacremento, CA went bankrupt. This was one of the first existing Sona MedSpa franchisees and as such was used as a reference site to sell other franchise prospects. And two of the three Sona MedSpas in Chicago, IL were sold to the NuU MedSpa chain after the original Sona MedSpa owner went through substantial moneys. This means that out of the 45 Sona MedSpas which existed during the Jim Amos and Heather Rose tenure now 30 or two thirds (66.6%) of them have gone bankrupt, closed their doors, or sold to others and generally at "fire sale prices."
This is a true American Tragedy. I knew both of these franchisee families and they are good honest people. Why are franchise leaders like Jim Amos and Heather Rose allowed to "spin away" the truth with no consequences?
Sona Med Spa, The UPS Store, the Coffee Beanery
I believe that the status quo of regulation of franchising permits franchisors like Amos and his daughter to spin and sell unproven concepts with immunity and impunity under current laws. Apparently, if a concept only works 50% of the time, or less, if franchisors can keep on selling the concept, and ignore the failures, they are home free! ----as long as they remain compliant with the State UFOC's and the Rule.
Unfortunately, when franchisors know that their contracts protect them almost 100% from repercussions, they are emboldened and free to spin and sell and the truth is lost in the spin. The franchise agreements disclaim all of the representations made outside of the contract, and the contracts are upheld by the courts. The Press Release in which Sona indicated that they were the winners is not surprising and proof of how safe and comfortable these people are in the status quo.
The status quo of the regulaltion of franchising emboldens franchisors who know that the deck is stacked in their favor and that most franchisees who are failing will fade away in failure and not contest the matter with the franchisor if the franchisor's UFOC is compliant with state law.
How can it be explained as good fiscal policy that Sona Med Spa, The UPS Store, CS Creamery, The Coffee Beanery, Quznos and many others are eligible for SBA guranteed loans from the SBA? Why isn't the government interested in the high failure rate of these franchises.
If free market principles were applied to franchising, the failure rate of fist-generation frasnchisees would have to be disclosed under law. The viable franchises with high success rates would then survive and the less viable franchises with high failure rates would fade away because buyers would understand the risk and not buy these franchises.
The overseeding, churning, and encroachment that is possible in franchising is encouraged by ineffective government regulation of franchising. Unviable franchises survive because there is no competition among same concept or similar concepts becasuse franchisors are not required to disclose past and present performance statistics of the individual units to new buyers.
If franchises that are hyped as investment vehicles were regulated as well as securities are regulated, all material information concerning known performance, past and present, would be available to new buyers in the due diligence process.
When you realize that the FTC has permitted the franchisors to evade their obligation under law to reveal all material information through the artifice of Item 20 and the optional Item 19, you understand that franchising has been regulated solely in the interests of the franchisors.
You are to be congratulated, Mr. Coady, for taking Sona Med Spa on and for your win. They throught they would intimidate you by millions of dollars of counter charges which is the usual response of franchisors, but you won your point with them and were awarded $400,000 and all of their counter charges were found not to have merrit! But, you are the exception and you did have the resources to go into arbitration and win.
So many of those who lost everything in Sona are silent, or are they in the courts?
Look for comments on this Article, above, in Political Activism
Apparently, anything that has to do with government and the article, above, must be posted on Political Activism. New rule of Mr. Blue Mau Mau.
Customers of Sacramento Sona want their money back
My blog has recieved a number of complaints from customers (8 and counting) that prepaid the Scaramento Sona Med Spa prior to bankruptcy.
There also are comments from the current President of Sona, Byron Ashbridge.
See the comment thread.
Jim Coen
877-469-3002
Blog: Lets Talk Franchising
Heather Rose and Jim Amos
Simple, they are not leaders.
Amos & consequences
Don't sell yourself short. While you and I may have differing perspectives on the Sona debacle, I think we can agree that Jim Amos gives the franchise industry a bad name.
In exposing bad actors on BMM (and other sites), you are doing your part to make it more difficult for abuse to recur.
Sona Nu U
What does anyone know about the new med spa chain NuU Med Spa
Question
I just found this blog, very interesting.
I read through many comments regarding Sona Med Spa- personal, professional, legal etc... How is their guarantee of results any different than the one that the American Laser Centers make? (permanent hair removal)
NuU Medspa
I was a Sona client but wasn't too happy with my results or the bedside manner of the employees. Since, NuU has taken over, my results are finally dramatic and I feel very comfortable with the staff.
Coady is more right than he knows
I sympathize with Mr. Coady and the other franchisees who put up a lot of money and lost it.
My question to Mr. Coady is whether he sympathizes with the public customers who gave those franchisees money for services which the franchisees did not provide. More to the point, does Mr. Coady believe his fellow franchisees behaved unethically in taking money for prepaid treatments and spending the customers' money but not providing the service?
AMEN TO THAT
Give 'em hell at every opportunity!--
Richard Solomon, FranchiseRemedies.com, has 44 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
Heather Rose
I wonder if Heather Rose ever held a position in operations other than what her father gave her. I have even heard her say that the franchisees are not important but the next five are. Dennis Jones, Jim Amos and Heather Rose were able to walk away with cash in hand. They comtinue to recieve benefits while others went broke. I happen to have been involved in the Sona concept and I can tell you they bought it hook, line and sinker. They cut promised support and kept cronies on the books, in one case a Franchise sales person when they were not selling franchises. (she was allowed to work out of her home several hindred miles away). Executives always stayed at the very best of hotels, Sona paid for Heather's involement in the IFA. She also allowed an employee who stole 40,000 dollars to be put on a 500 dollar a month payment plan and did not inform the board. She also most always flew first class to meetings. The rich get richer.
Heather Rose
anything that does not involve Heather Rose or Jim Amos would be better than Sona.
Unsecured Creditors
Paul, isn't the risk all unsecured creditors take when dealing with a business? Is there something different about this situation, in your opinion?
Michael Webster PhD LLB
Franchise News
Response to Your Question
Dear Mr. Steinberg:
We were told the SonaConcept was superior and we would get a 97% laser hair removal result. I even believe today that some of the remaining Sona franchises use the SonaConcept. If you read the Arbitration result then you recognize that there is no medical proof for some sort of Sonaconcept treatment timing using hair growth pattern or the 97% result in five treatments.
What did we do at the new ViVa Skin Care Center (formerly Sona MedSpa). We continued to treat patients and through October 2007 have done 1,724 "free" treatments. This was our solution to meeting the client's expectations.
Not a Gossip Column
Guest(s),
Please see our posting guidelines. This site is not a gossip column. Its contents are meant to help better understand the investment worthiness of a franchise. Some might reasonably argue that understanding an investment includes the quality and character of its leadership. In such cases, the guest should explain why such personal information is important to assessing the company's leadership and back up any allegation with credible evidence.
I would also remind guests that there is a quirk in some state laws, although loosening, in regards to women:
Customer monies
It does appear from the response that Mr. Coady did the right thing and provided the services for which he was paid.
As to the medical efficacy of the Sona "treatment" I had a rough enough time in high school biology that I am loathe to opine... ah, I'll do it anyway and say that there is evidence which came out (as a result of franchisee efforts during litigation) which indicates that Sona was full of crap when it told franchisees that these "treatments" were legit. I am really wary of franchised medicine, and Sona MedSpa is exhibit #1 as to why.
On the matter of "unsecured creditors" I think it is important to remember that these were consumers who prepaid. When I go in to the bakery and order a birthday cake and give them a $20 deposit, I assume that they are not going to spend my $20 on whatever and then go out of business. The Sona franchisees took money for services to be rendered in the future; as such they had a responsibility not to recognize the revenues until earned, and damn certainly the franchisees had no right to spend thousands of dollars of customer monies when they could see that they were heading for bankruptcy.
I understand the realities of running a business, and what bothers me more than the f'zees spending the prepaid monies is that the f'zees refuse to acknowledge that what they did was wrong and caused pecuniary harm to consumers who trusted them. Just because Jim Amos may be pond scum doesn't mean that the franchisees should emulate Amos-- they should admit they screwed their customers, and at least apologize.
for some of us, it is living history...
Mr. BlueMauMau writes:
Historically, allegations that a woman was unchaste could form the basis of a defamation claim.
My reply:
Where I am from it can result in an encounter of the most painful kind from her brothers, father, or any male in gratitude to the family.
FuwaFuwaUsagi
Pond Scum...
Should not be insulted...Pond Scum is a much much much higher life form than AMOS & his little shrub Heather...SOMETIMES THE TRUTH DOES REALLY HURT..BUT TRUTH IS TRUTH
Cant be sued for the truth
you cant be sued for the truth
Heather Rose
A leader of a company is held to a higher standard. You can predict a future behavior based on a past behavior. I believe that anyone that invest needs to know as much information as possible. Character and ethics are the driver for most companies and we have the right to know. If not she should be more reserved when in the public eye. You seem to be protecting the Amos clan when they have never done anything but swindle the franchisee. We all deserve a clear snapshot of what is going on, maybe it seems that she is not for the franchising business or her dad has set her up to quick. Oh poor Heather!
Deposits, Trust and Unsecured Creditors
Paul, I think that you are right if the money was clearly a deposit.
But many fitness franchisees treat the payment of yearly fees as earned upon payment. This is the consumer risk in dealing with such establishments.
If the company goes bankrupt or is insolvent, aren't the prepayments just unsecured debt?
Michael Webster PhD LLB
Franchise News
Where I come from
if you vouch for a young lady's chastity, she will never get a date. Ruining he social prospects might just get you shot. Just east of here - East Texas - is the home of the famous woman athlete - runner - Babe Didricksen Zaharias. It is said that she learnt to run fast trying to escape her brothers' amourous intentions. --
Richard Solomon, FranchiseRemedies.com, has over 45 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School
You can be sued for stating the truth...
It is helpful to have told the truth when it comes time to defend one's self.
The Truth Shall Set You Free!
TIF
Sued for truth
Actually, there are instances (such as public disclosure of private facts) which can give rise to a cause of action. Also, some states do have statutes regarding impugning the chastity of a woman. Moreover, there are jurisdictions where truth is not an absolute defense.
And even if you get something non-suited it can still be cost-prohibitive, we discussed this last year regarding the tactics of John Dozier.
But the larger issue is Mr. MauMau's point that this is supposed to be for the exchange of franchise-related ideas. It is not relevant who Ms. Rose is amourous with, nor what headgear Ms. Kezios wears, nor who at Taco Del Mar had a dissolute college lifestyle. Ad hominem attacks are a sign of a lack of substantive conversational ability and as such, counterproductive if you are actually trying to engage in serious discourse.
Now I'm really mad: you've made me defend 2 franchisors in a single sentence.
In the Eye of the Consumer
Were you one of the franchise owners who ripped off their customers by selling expensive permanent hair removal products that you knew weren't permanent?
Heather?!? Your problem is way beyond just Heather. Where you see Heather is where your customers see you. Your problems started way before Ms. Rose even took a step into her new office.
Discrete transactions
I would view this a bit differently. To say that I pay $500 for 365 days of a health club is one thing, but to say that I pay $500 for 5 specific treatments costing $100 each is something else.
Moreover, there is a lot more money at stake in the Sona payments--a lot more than most health club dues.
You are an idiot
No I was never a franchisee. I worked in the corp office. I know fisrt hand of what I am speaking. I would like to know how you infer taht I am or would ever be a franchisee. You need to do more home work. I never approved of any product. I was there from the first sales presentation from Dennis Jones though. The first step she ever took is when jim Amos secured funding for the project. Sounds like you are a customer? You are just mis-informed as to what is history.
We're About Business, Not Private Lives
It is a blue moon out again in which I am removing a post. I do so with great reluctance, and do so in this same comment area under a Sona Medspa article.
Our site focuses on the exchange of franchise-related ideas for investing, and not the private lives of CEOs and franchise leaders. Divorces are particularly messy. We do not have the tools here to sift through this stuff. We are not the morality patrol. In discussing a company's senior officers, we are interested in the leadership skills while they are at the helm because that affects the investment worthiness of a franchise concept. We aren't interested in their private lives.
I realize that there are millions of other social network sites and forums that these sort of postings can be made, and probably will be made. But not here.
If you continue with such postings, you will be banned from this site.
Mr. Blue MauMau
Moderator
I view it differently too
If you had paid $ 500 for two cases of rather good red wine, you would be so happy that you really wouldn't care about your body hair.--
Richard Solomon, FranchiseRemedies.com, has 44 years experience with franchise litigation and crisis management. He is a graduate of The Citadel and The University of Michigan Law School