U.S. Justice Department settles discrimination case with former Montco swim club

The U.S. Justice Department announced Thursday that it had reached a settlement with a former Montgomery County swim club that was accused of discriminating against African American and Hispanic children.

The settlement, which is pending approval by a Bankruptcy Court judge, also resolves a private lawsuit filed on behalf of members of Creative Steps Inc., a Philadelphia day camp, against the Valley Club in Huntingdon Valley.

As much as $1.1 million will be shared with 73 discrimination claimants, said lawyers Brian R. Mildenberg and Gabriel Levin, who represented the camp members.

"We believe the settlement sends a strong message that racial discrimination against children will not be tolerated," the lawyers said in a statement.

Sixty-five campers visited the suburban swim club in June 2009, and some reported hearing club members asking what black children were doing there.

Subsequently, the Valley Club refunded the camp's $1,950 membership fee with no explanation, and the children were not allowed back.

Struggling with bad publicity and mounting legal bills, the club filed for bankruptcy that November. The club property was sold for $1.46 million.

The bankruptcy case is pending, but once it is closed, the remaining assets will be paid to Creative Steps, the children, and their counselors, the Justice Department said.

The discrimination case was investigated by the Justice Department and the Pennsylvania Human Relations Commission.

"Our hope is that this case serves as prevention for years to come and a reminder that discrimination is illegal, and has no place in Pennsylvania," said JoAnn Edwards, the commission's executive director.

As part of the settlement, $65,000 will be set aside from the bankruptcy assets to fund a diversity leadership council that will involve former Valley Club members and Creative Steps interacting in recreational and educational activities.