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Cassidy v. Merin

Decided: November 27, 1990.

HAROLD J. CASSIDY, ESQ., ROGER J. FOSS, ESQ., AND PHILLIP E. SAN FILIPPO, ESQ., INDIVIDUALLY AND D/B/A CASSIDY, FOSS & SAN FILIPPO, ESQS., PLAINTIFFS-RESPONDENTS,
v.
KENNETH D. MERIN, NEW JERSEY COMMISSIONER OF INSURANCE, DEFENDANT-APPELLANT



On Appeal from the Superior Court of New Jersey, Law Division, Monmouth County.

Petrella, Muir, Jr. and Brochin. The opinion of the court was delivered by Brochin, J.A.D.

Brochin

One of the 1988 legislative amendments to our no-fault automobile insurance law required automobile liability insurers to offer their insureds two alternative coverage options. One option barred an insured from recovery for "non-economic loss" that resulted from an automobile accident unless the insured had "sustained a personal injury which results in death; dismemberment; significant disfigurement; a fracture; loss of a fetus; permanent loss of use of a body organ, member, function or system; permanent consequential limitation of use of a body organ or member; significant limitation of use of a body function or system; or a medically determined injury or impairment of a non-permanent nature which prevents the injured person from performing substantially all of the material acts which constitute that person's usual and customary daily activities. . . ." N.J.S.A. 39:6A-8(a). The other option imposed no limitation on the insured's right to recover for non-economic loss. N.J.S.A. 39:6A-8(b).

When the legislation which prescribed these options was enacted, defendant, Kenneth D. Merin, was the State Commissioner of Insurance. He publicly urged consumers to select the coverage option which would curtail their right to sue for

non-economic losses. Various other groups and individuals also publicly expressed their views, urging selection of one or the other of the options.

Plaintiffs are New Jersey attorneys who were among those attempting to influence public opinion on the choice of coverage. With that objective, they circulated letters to their clients and others urging selection of the insurance coverage option which would not limit suit for "non-economic loss." In the letters which plaintiffs circulated, they wrote:

Because of recent changes in the law passed in August, 1988, we no longer believe our clients can rely upon the agent through whom they buy insurance to obtain a meaningful explanation of the purchase of certain options.

Under the new law, insurance agents have been granted immunity from their own negligence in providing you with services. The significance of this immunity, we feel, will encourage some agents to be less diligent than they used to be in explaining your rights to you. Under the new law, if a purchaser of insurance does not specifically request the insurance option which does not extend immunity to negligent drivers who injure them, the purchaser will be given coverage which extends significant immunity to drunk drivers and other negligent drivers who injure members of your household. . . . Though we are sure that some agents may be conscientious in explaining your rights, many may not. . . .

Several insurance agents sent copies of these letters to Commissioner Merin. He sent a copy to David Johnson, Esq., Director of the Office of Attorney Ethics, and asked Mr. Johnson to determine "if such letters violate any Supreme Court rules or provisions pertaining to the practice of law." Mr. Johnson referred the inquiry to the Committee On Attorney Advertising which, pursuant to R. 1:19A-2, has "the exclusive authority to consider requests for advisory opinions and ethics grievances concerning the compliance of advertisements and other related communications with the Supreme Court's Rules Of Professional Conduct," RPC 7.1, 7.2, 7.3(a) and (b), 7.4 and 7.5. Thereafter, Commissioner Merin again wrote to Mr. Johnson to urge him to review the material circulated by the defendants and other attorneys for "other issues beyond advertising." Commissioner Merin also explained, "[t]he letters that I forwarded to you were in support of a general request that

the appropriateness of such mailing be determined. I did not, and have not, asked that the actions of the individual firms be reviewed."

Ultimately, the Supreme Court Committee On Attorney Advertising determined that the letters sent by plaintiffs and other attorneys to "current and prospective clients concerning the recent changes in the automobile insurance laws. . . . did not constitute a violation of the Rules Of Professional Conduct governing attorney advertising [and did not] otherwise comprise unethical behavior."

Before the Supreme Court Committee on Attorney Advertising had issued its decision, a newspaper reporter asked Commissioner Merin if he had taken any action with regard to the letters. Commissioner Merin told the reporter that he had asked either the courts or the Committee On Attorney Ethics whether the conduct of the attorneys was proper. Following the Commissioner's disclosure of this information, an article appeared in the reporter's newspaper. It stated that the Commissioner had "asked the State Supreme Court's committee on advertising to check the 'ethics' of law firms urging their clients not to accept a new car insurance option that would reduce premiums but limit an accident victim's right to sue for pain and suffering." The article stated that the Commissioner "questions whether such letters constitute an ethics violation," and it quoted the Commissioner as saying, "[i]t could be more than just bending the advertising rules for lawyers." Thereafter, Commissioner Merin spoke to at least two other reporters, one for another newspaper and the other for a television broadcaster, and similar stories appeared in a number of other newspapers and on television. In some of these, plaintiffs and their law firm were identified as among those that had circulated the letters.

The plaintiffs filed suit against Commissioner Merin. In seven counts, their complaint alleges that he defamed them to the press by charging them with violations of professional

ethics, that his complaint to the Office of Attorney Ethics was false and malicious, that he tortiously interfered with their relationships with their clients, and that he deprived them of their civil rights while acting under color of state law.

The complaint does not particularize defendant's allegedly defamatory statements to the press. The only competent evidence about those statements is contained in Commissioner Merin's deposition testimony. There he paraphrased what he had told the reporters as follows:

I had inquired of the courts as to whether or not . . . [plaintiffs' letter writing campaign] was proper.

[I]t's just the general issue of what is the proper role for attorneys in dealing with the matter that's been legislated on as heavily as this one has.

[The plaintiffs' conduct] presented a larger ethical issue about the propriety of lawyers giving general ...


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