GateHouse agrees to settle class-action suit over charges for ‘premium’ publications

Notice posted on GateHouse websites.

GateHouse Media, which owns more than 100 daily and weekly community newspapers in Eastern Massachusetts, has agreed to settle a class-action lawsuit brought over the company’s practice of charging for “premium” publications that subscribers hadn’t asked for. The legal documents in the case are posted here.

The money was extracted by shortening the length of customers’ subscriptions. Most prominent among those premium publications was Lens, an advertising vehicle published several times a year that was delivered along with GateHouse papers. Lens carried a cover price of $3.95, though subscribers to the papers were assessed $2. A year ago I wrote about the Lens ploy here and here.

GateHouse, according to the proposed settlement, “denies any wrongdoing on its part” but agreed to the settlement based on “the risks and potential cost of the litigation” and “the benefits of the proposed Settlement.” Kirk Davis, GateHouse’s chief executive officer, declined to comment.

Under the agreement, subscribers may receive a refund or have their subscriptions extended if the proposed settlement is approved in Superior Court. According to court documents, the settlement is scheduled to be finalized on Aug. 1. The lawsuit, brought on behalf of two GateHouse newspaper subscribers by Kurtzman Carson Consultants, claimed that GateHouse violated Massachusetts law by failing to disclose its subscription policies adequately.

Although GateHouse, based in Pittsford, New York, has agreed to stop labeling Lens as a premium publication for which subscribers must pay extra, it would continue that practice with other publications, which would cost about $2 in the form of shortened subscriptions. GateHouse would also continue to charge a $4.95 “activation fee” for new subscribers. Disclosure would be clearer and more prominent than it had been previously.

If you visit many GateHouse papers online right now,* you’ll see a “Legal Notice” linking to the settlement documents, which include instructions on how to file a claim. The not-very-helpful text of the notice: “To learn more about the proposed class action settlement in the Steven Keenholtz, M.D., et al. v. GateHouse Media, LLC, et al. action, pleaes click here.” Keenholtz, of Marblehead, and Dorothy Guillicksen, of Hanover, are the plaintiffs named in the class-action suit.

Let’s be clear: This is a very, very small matter. From the time I learned about it, I was astounded that GateHouse would go to the trouble of hitting subscribers with an “activation” fee and charging them for publications they hadn’t asked for and didn’t want. Why not just raise the subscription price?

Meanwhile, David Harris recently reported in the Boston Business Journal that GateHouse was laying off 49 people at its Framingham facility as it consolidated print operations. And Ian Donnis of Rhode Island Public Radio writes that GateHouse continues to hack away at The Providence Journal, and that layoffs may be coming.

*Update: I have learned that the proposed settlement pertains to most but not all GateHouse Media papers in Eastern Massachusetts. The settlement is restricted to papers that carried Lens, and are concentrated in Greater Boston.

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