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Wednesday, May 29, 2024 | Back issues
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APA to Pay $9M to Settle Lobbying Fee Class Action

WASHINGTON (CN) - The American Psychological Association must pay $9 million to settle claims it duped members into paying more than $70 million to the APA's lobbying arm as part of their membership dues, a federal judge ruled.

The decision by U.S. District Judge John Bates marks the conclusion of three class actions filed against the association by four of its members. The first of the suits was filed in October 2010.

Each of the lawsuits accused the association of disguising "optional" donations to the APA Practice Organization -- a separate, Washington, D.C.-based lobbying group -- as practice assessment costs in its mandatory membership fees.

The plaintiffs claimed these assessments donations cost members an additional $110 to $140 annually, affecting more than 75,000 members between the years of 2001 and 2015.

Judge Bates preliminarily approved the proposed settlement of the lawsuits on February, 12, 2015, and held a fairness hearing on the matter on August 13.

Under the terms of the final settlement Bates approved on October 14, eligible members of the class will receive an average payout of $303 each -- "hardly a damning figure," Bates wrote.

About 30 percent of the approved total settlement amount will cover attorney fees and court costs, while an extra $5,000 will be set aside for each of the lead plaintiffs in the respective cases.

Lastly, Bates said, any remaining funds donated to Mental Health America, a nonprofit mental health advocacy group selected by the litigant parties.

According to the terms of the settlement, the association has agreed to rename its practice assessments "APAPO Membership Dues" with an additional disclaimer that clearly states the fee is not required for membership.

The association will also pay an additional $200,000 to cover costs such as class action claim notices sent via email and postcard mailers, as well as a settlement website and hotline, according to the ruling.

"Joining APAPO has never been required for membership in the APA, and that will remain the case moving forward," the association said in a written statement. "Other changes will be made to the APA dues statement to underscore that APAPO membership is a recommended option - due to the advocacy work the APAPO does on behalf of the profession - but is not a requirement for APA membership."

"We are pleased that we have been able to reach an agreement with the named plaintiffs to settle this dispute," APA President Dr. Barry Anton said. "While we do not concede that there was any wrongdoing on our part, this agreement allows us to end the dispute and return to focusing our full attention on the goals and mission of the APA and the APAPO."

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