The legal battle over annual dues assessments charged practicing psychologists to support the American Psychological Association Practice Organization (APAPO) has been reignited in a suit filed March 27 in the U.S. District Court for Southern California.
The law firm of Tycko and Zavareei LLP of Washington, D.C., filed a class action suit against the American Psychological Association and APAPO on behalf of California psychologists who paid the assessment during the 10 years prior to 2011.
The suit is filed in the name of Ira Grossman, Ph.D., who operates Grossman Psychological Associates in San Diego, Calif., “and all others similarly situated.” It mirrors a suit the law firm filed in 2010 in the U.S. District Court for the District of Columbia where the APA and the APAPO are headquartered.
That suit, which was filed on behalf of all psychologists in the nation who were charged the assessments, was dismissed on May 30, 2012 after almost two years of motions and counter motions in part because the District of Columbia exempts nonprofit corporations from consumer protection laws except in special circumstances that were deemed not applicable in the case.
Rhea Farberman, APA’s executive director of communications, told The National Psychologist the new suit appears based on the same grounds found invalid in dismissal of the national suit.
“The dismissal of the national class action reflected a detailed and substantive rejection by the court of the basis for the plaintiffs’ claims,” Farberman said. “We don’t know what steps the plaintiffs’ attorneys will take next but it is clear to us that the California filing is essentially the same as the putative national class action that was dismissed with prejudice by the D.C. federal court.”
She added, “The move to California is an apparent effort to find a friendlier court.”
The extra charge for practicing psychologists began in 1985 as a $50 “special assessment” to support greater advocacy on behalf of practitioners. The annual assessment was renamed “the practice assessment” when the APAPO was established in 2001 as a legally separate body with increased latitude for lobbying and has increased substantially since. The lawsuit notes that by 2011, the end of the period in question, the assessment was $140.
The crux of the lawsuit is that APA members were misled to believe for 10 years that paying the assessment was mandatory for practitioners to maintain membership in APA until a joint statement was released by the APA and APAPO boards in 2011 that said while the assessment is necessary for the APAPO to continue its work on behalf of practicing psychologists, no psychologist was ever denied APA membership or terminated from membership for not paying the added costs.
Before that many if not most practitioners believed they had to pay the assessment because it was billed with regular APA dues each year with no disclaimer that paying the assessment was optional.
“The APA misrepresented to its members that as a part of annual membership renewal there was a ‘mandatory’ assessment, which it then allocated to the APAPO,” the suit says.
The suit alleges that the system “skirted” federal law that limits lobbying a 501(c)(3) non-profit organization, such as the APA, can engage in by funneling those funds to the APAPO, which was organized as a 501(c)(6) with broader lobbying abilities.
An amount “exceeding $5 million” was so allocated over the 10-year period, according to the suit.
In defending against the earlier suit the APA and APAPO contended members were never misled about the nature of the assessment, which has supported increased advocacy on issues such as parity, protecting the doctoral standard and reimbursement rates and supporting legal actions against abusive managed care practices.
Although the two organizations are legally separate, board members of the APA also make up the board of the APAPO. Beginning in 2011 dues notices carried a statement noting that the assessment is not tied to eligibility for APA membership.
The APAPO’s coffers have shrunk as a result of the brouhaha, which began in listserv exchanges in the spring of 2010 when an appeal for more members to pay the assessment revealed for the first time to many practitioner members that the assessment was not mandatory.
General membership in APA also has been plummeting in recent years in part because of the assessment controversy and in part from protests that the APA Council of Representatives did not pass a total ban on psychologists working at terrorist detention facilities after torture tactics were revealed until forced by a membership petition.