A state jury in New Jersey has ruled that a conversion therapy offered by a Jewish organisation claiming to change clients from gay to straight was fraudulent.

The jury ordered the Jews Offering New Alternatives for Healing (JONAH), its founder and a counsellor to pay $72,400 to compensate five plaintiffs for fees they paid to the organisation and for mental health counselling one of the plaintiffs needed afterward.

The lawsuit was filed by the Southern Poverty Law Center (SPLC) in 2012 under the New Jersey Consumer Fraud Act, the first case of its kind in the US.

"Conversion therapists, including the defendants in this case, sell fake cures that don't work but can seriously harm the unsuspecting people who fall into this trap," said David Dinielli, SPLC deputy legal director.

According to the jury, JONAH, founder Arthur Goldberg and counsellor Alan Downing violated New Jersey's consumer fraud law by claiming their counselling services could cure clients of being gay.

The complainants were three young men and two parents who paid $100 per week to JONAH for their sons' individual therapy and another $60 for group therapy sessions.

In the trial, the men who participated in the program said they ended up disappointed, frustrated and depressed as JONAH's treatment strained family relations.

"I wouldn't wish it on my enemy," plaintiff Benjamin Unger testified. "It was very harmful. It made me very depressed, and people have a right to know about it."

He was told one of the reasons he was gay was because he was too close to his mother. But JONAH's treatment program made him resentful towards his mother, resulting in him not talking to her for three months and moving out of the house.

Unger quit the program but depression and anxiety left him bedridden for three months. He later received treatment for trauma from a clinical psychologist.

In a pre-trial ruling last Feb. 5, Judge Peter Bariso said "the theory that homosexuality is a disorder is not novel but—like the notion that the earth is flat and the sun revolves around it. It is outdated and refuted."

One plaintiff was encouraged to undress and stand naked in a circle during a therapy session.

"This is not legitimate therapy," testified psychologist Lee Beckstead, a member of an American Psychological Association who has expertise on sexual orientation change efforts. "It's outdated ... it's confusing, it's misleading. It's even reckless. And it's harmful. It's worse than snake oil."

The jury also ordered the defendants to pay attorney's fees. Bariso will consider whether to cancel JONAH's business license.

The lawsuit helped spark legislation in Congress to protect consumers from conversion therapy nationwide.

New Jersey, California, Oregon and the District of Columbia have enacted laws to protect minors from conversion therapy practiced by licensed therapists.

In a statement, Goldberg and co-director Elaine Silodor Berk said, "At this time, Arthur and I are still in shock but wanted to let you know of the unjust and unconscionable ruling that has come down in the Southern Poverty's Law Center's suit against JONAH."

They are asking for funds to pursue their decision to appeal the case.

"With today's decision, we have lost only a battle but can still win the war," they said.

Chuck LiMandri, president of the Freedom of Conscience Defense Fund and JONAH's lead counsel said, "This is a sad day, not just for my clients, but for America: Our freedom to choose to live according to Biblical values is being restricted by powerful forces, which in this case included the refusal to allow highly qualified expert witnesses to testify that change is possible for many people."