The American Psychological Association (APA) has settled a class-action lawsuit that accused the organization of deceptively requiring many of its members to pay a large annual fee to fund the group's lobbying arm. The fee was actually optional.
Under the settlement, the APA, which represents more than 122,000 doctoral-level psychologists around the world, has agreed to refund a total of $9.02 million to members who paid the fee between 2000 and early 2015. The assessment, which changed from year to year, was about $140 annually and was charged only to licensed clinicians, not research scientists and others. It generated about $6 million a year, according to the lawsuit.
About 60,000 APA members in the United States are eligible for refunds, according to Jonathan Paikin, one of the attorneys who represented the organization. About 20 percent of that group has submitted claims for repayment so far, said Hassan Zavareei, an attorney for the plaintiffs. Zavareei's firm, Tycko and Zavareei, has asked the judge to grant the lawyers 30 percent of the settlement.
(Full disclosure: My wife is a licensed clinical psychologist and a longtime APA member. She is eligible to share in this refund.)
The lawsuit claimed that in a variety of ways over the years, the APA "deceptively created the impression that the fee was actually required as part of annual APA dues." For example, an annual dues assessment said that members who provide health-related services “must pay" the fee that supports the lobbying arm, a separate group known as the APA Practice Organization (APAPO). It was established separately because tax laws restrict nonprofits like the APA from political work and other forms of advocacy.
In 2002, the APA’s Web site stated that members "must pay the Special Assessment," and in 2004, the APA announced that starting in 2005 “all APA members who are licensed psychologists will be billed the assessment," the lawsuit claimed.
The APA did not concede that its communications were misleading and acknowledged no wrongdoing in the settlement. In a news release sent out in January, when the settlement was announced, the organization said that "APA/APAPO and the plaintiffs disagreed about whether the APA dues statement could mislead practice members concerning the annual practice assessment." Beginning in 2016, the fee will be called the "APAPO membership dues" to clarify it, the statement said.
Zavareei's interpretation was that "the APA has been taking this position that [the fee] is in fact mandatory, meaning that it's morally mandatory. But you can still not pay it [and] you won't get kicked out of the APA."
The lawsuit was dismissed by a federal court judge in Washington in 2012, but his decision was overturned by an appellate court last year. The two sides then began to discuss settling and ultimately arrived at the $9.02 million figure.
"I do think this is a great result for the class, and the APA has been, I think, very reasonable in trying to resolve this after we won" at the appellate court, Zavareei said.
Eligible members must submit refund claims by Oct. 12. If no one objects to the terms of the settlement or delays it, repayment checks should go out early next year, Zavareei said.