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Macedo v. Russo

February 02, 2004

JOSEPH MACEDO, ROSEMARY LESKY, AND ALL OTHERS SIMILARLY SITUATED, PLAINTIFFS-RESPONDENTS,
v.
JOSEPH DELLO RUSSO, M.D., JOSEPH DELLO RUSSO, M.D., P.A. T/A NEW JERSEY EYE CENTER, MEDICAL CARE, P.L.L.C. D/B/A DELLO RUSSO LASER VISION, WILLIAM T. KELLOGG, M.D., DEFENDANTS-APPELLANTS, AND JOHN DOES 1-10 AND ABC CORPORATIONS 1-10, DEFENDANTS.



On appeal from the Superior Court, Appellate Division, whose opinion is reported at 359 N.J. Super. 78 (2003).

SYLLABUS BY THE COURT

This appeal deals with the applicability of the Consumer Fraud Act (CFA) to the conduct of defendant Joseph Dello Russo and others, while acting in their professional capacity as physicians.

Plaintiffs Joseph Macedo and Rose Mary Lesky sued Dr. Joseph Dello Russo (defendant), the corporate entities he created to perform laser surgery, and Dr. William T. Kellogg, alleging that defendants violated the CFA when they allowed Kellogg, who was not fully licensed, to treat plaintiffs. Plaintiffs did not allege that their treatment fell below the appropriate medical standard of care or that they suffered any physical injuries as a result of the treatment. Rather, they alleged that the defendants represented, through their own words and conduct, that plaintiffs would be treated by fully licensed physicians. Consequently, plaintiffs claimed that they suffered "mental anguish" and other economic damages for which they sought compensatory and punitive damages, and attorney's fees and costs.

The trial court granted defendants' motion to dismiss the CFA count because the allegations underlying it implicated the provision of medical services, which was outside the purview of the Act. On leave to appeal, the Appellate Division reversed, citing Blatterfein v. Larken, 323 N.J. Super. 167 (App. Div 1999), which held that an

architect's activity as a real estate seller was subject to the CFA, and the Supreme Court's decision in Lemelledo v. Beneficial Management Corp., 150 N.J. 255 (1997) (finding that the existence of other regulatory schemes regarding practices of financial institutions presents no limit on applicability of CFA).

The Supreme Court granted defendants' motion for leave to appeal.

HELD: Advertisements by learned professionals in respect of the rendering of professional services are insulated from claims under the Consumer Fraud Act, and the trial court correctly dismissed the claims against the defendant physicians under that Act.

1. The precursor to the CFA, which created liability in connection with fraud in advertising, was not meant to encompass advertising by physicians because such advertising was not permitted for another two decades. Since its enactment, the CFA has not been amended to include the advertising of professionals. In fact, the only major substantive change concerning the scope of the CFA came in 1976, when the Act was amended to include the sale of real estate in the definition of "merchandise." (pp. 4-6)

2. Since Vort v. Hollander, 257 N.J. Super. 56 (App. Div.), certif. denied, Per curiam.

Argued December 1, 2003

Plaintiffs Joseph Macedo and Rosemary Lesky sued Dr. Joseph Dello Russo, the corporate entities he created to perform laser surgery, and Dr. William T. Kellogg alleging, among other things, that defendants violated the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -116, when they allowed Kellogg, who was not fully licensed, to treat plaintiffs. Plaintiffs do not allege that their treatment fell below the appropriate medical standard of care or that they suffered any physical injuries as a result thereof, but only that

through their own words and conduct, the defendants represented to each plaintiff that they would be treated by properly licensed doctors, with no limitations on their licenses, and that Kellogg was a licensed physician with no limitations upon his license, and licensed to provide the care and treatment which he provided to each plaintiff.

Consequently, plaintiffs claim that they suffered "mental anguish," loss of enjoyment of life, medical bills and economic damages for which they seek "compensatory damages, punitive damages, attorneys fees, interest, [and] costs."

The trial court granted defendants' motion to dismiss the CFA count because the allegations underlying it implicate the provision of medical services, a subject outside the purview of the Act. On leave to appeal, the Appellate Division reversed. Macedo v. Dello Russo, 359 N.J. Super. 78 (2003). In support, the court cited its decision in Blatterfein v. Larken, 323 N.J. Super. 167 (App. Div. 1999) (holding that architect's activity as real estate seller is subject to CFA) and our decision in Lemelledo v. Beneficial Management Corp., 150 N.J. 255 (1997) (finding that existence of other regulatory schemes regarding practices of financial institutions presents no limit on applicability of CFA). Id. at ...


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