Physician deceptive and unfair business practices.
Florida's Deceptive and Unfair Trade Practices Statute
The Federal Trade Commission (FTC) Act, 15 U.S.C. [sections] 45 (1995), is the model for Florida's Deceptive and Unfair Trade Practices statute. Florida's "Little FTC Act" specifically accords deference to the FTC and federal court decisions interpreting the FTC Act and provides that a deceptive or unfair trade practice claim does not displace any common law or other statutory claim.
The federal courts have defined a deceptive trade practice to be any act or practice that has the tendency or capacity to deceive consumers and an unfair trade practice to be any act or practice that offends public policy and is immoral, unethical, oppressive, unscrupulous, or substantially injurious to consumers. In contrast, the FTC defines a deceptive trade practice to be any act or practice that, in the view of the consuming public, would be material to a significant number of consumers and is likely to deceive a consumer who acts reasonably under the circumstances. Further, the FTC defines an unfair trade practice to be any act or practice in which the substantial injury to consumers is not outweighed by the benefits of the act or practice to business or the competitive market and is the type of injury that a consumer could not have reasonably avoided.
Florida case law has adopted the federal court definitions of deception and unfairness rather than the FTC definitions. Regardless, neither the federal court nor the FTC definitions of deception or unfairness requires proof of actual fraud or deception or proof of intent or negligence.
The "Learned Professions" Exemption
Historically, those practicing the "learned professions," including lawyers and doctors, were exempt from the antitrust laws until Goldfarb v. Virginia State Bar, 421 U.S. 773, reh`g denied, 423 U.S. 886 (1975). In Goldfarb, the U. S. Supreme Court ruled that if a profession involves the exchange of money for services, then the professional activity, in this case the practice of law, is not exempt from the FTC Act.
After Goldfarb, a few states addressed the application of state unfair and deceptive trade practice statutes to professionals. Most states started with lawyers and most states that did not address the issue by statute ruled that the business aspects of the practice of law were subject to the prohibitions of state unfair and deceptive trade practice statutes. Perhaps the most well-reasoned case on point is the Washington state case of Short v. Demopolis, 691 P.2d 163 (Wash. 1989). In Short, the plaintiff client of the defendant law firm claimed that the defendant committed a deceptive trade practice by switching lawyers on his case so that a lawyer other than the lawyer agreed to by the plaintiff and promised by the law firm represented the plaintiff. The Washington Supreme Court ruled that this kind of conduct, akin to bait and switch selling, is part of the entrepreneurial or business aspects of the practice of law and, thus, falls within the scope of the state unfair and deceptive trade practices act.
Not long after Short, the Washington court was again asked to apply the state unfair and deceptive trade practice act to professionals, in this case doctors. In Quimby v. Fine, 724 P.2d 403 (Wash. Ct. App. 1986), a Washington appellate court reiterated that the entrepreneurial aspects of the practice of medicine, just like law, were subject to unfair and deceptive trade practice claims. The Quimby court specifically defined the entrepreneurial aspects of the practice of medicine to include any act that increases profit and the volume of patients for a doctor. Other states have followed Washington's lead in this regard.
Application of Florida Statute to Physicians
The Washington state cases are significant for Florida because the Washington Unfair and Deceptive Trade Practices Act is identical to the Florida Deceptive and Unfair Trade Practices Act. Further, the Florida Supreme Court has already looked to Washington state case precedent to uphold the constitutionality of the Florida statute. Although there is no Florida appellate opinion explicitly ruling that physicians are subject to the state deceptive and unfair trade practices statute, the Florida statute does not expressly exempt physicians, only medical negligence claims, from being brought under the Florida statute.
The following is a list of some of the types of patient claims that could form the basis for a Florida deceptive or unfair trade practice claim against a physician. Each one of these examples concerns the entrepreneurial aspects of the practice of medicine because the doctor's conduct results in a person becoming a new patient and increases the doctor's income.
* A doctor represents to a patient that a specific medical procedure will be used during the patient's surgery. In fact, the doctor uses a different and more expensive medical procedure without advising the patient of the change.
* A doctor misrepresents to a patient that the doctor possesses a specific level of medical skill and clinical experience. The patient, influenced by the doctor's representations, hires the doctor to perform the medical treatment.
* A doctor guarantees a patient a specific result from the medical treatment the patient requests and misrepresents his or her medical qualifications to render the treatment.
* A medical facility evicts partial-fee paying patients in favor of full-fee paying patients.
* A doctor misrepresents the number and extent of satisfied patients and successful treatments.
* A doctor misrepresents or fails to fully disclose the price of the medical treatment or services to be rendered.
* A doctor misrepresents in a bill for services the actual cost for medical services and overcharges the patient for medical services rendered or for medical services not rendered to the patient.
Although the monetary remedy for a patient under the Florida Deceptive and Unfair Trade Practice statute is limited to actual economic damages and does not include damages for personal injury, there are other benefits in pursuing this type of claim against a doctor. As an alternative or companion cause of action to a medical malpractice claim, the patient and the lawyer benefit from the discretionary award of attorneys' fees and costs to a prevailing party under the Florida statute. Coupled with the modest proof requirements to make out a statutory violation, the fee shifting portion of the Florida law is more attractive.
The full panoply of tort reform measures aimed at medical malpractice claims does not apply to this statutory, nontort claim based on deceptive and unfair trade practices. This means that the shortened statute of limitations for medical negligence claims would not apply to a Florida Deceptive and Unfair Trade Practices statute claim. Likewise, the limitations on joint and several liability, the nonparty defendant liability rules, and the abrogated collateral source rule would not apply to a claim under Florida's law.
In summary, the Florida Deceptive and Unfair Trade Practice statute is underutilized when it comes to the business practices of professionals, including doctors. The days of exempting "learned professionals" from the reach of state consumer protection laws appear to be gone. Florida law provides a means to ensure that professionals, just like other business people, are not permitted to engage in business practices that victimize consumers.
 National Consumer Law Center, Unfair And Deceptive Acts And Practices, [sections] 1.1 (3d ed. and Supp., 1996).
 Fla. Stat. [sections] 501.204 (1995).
 Fla. Stat. [sections] 501.204 (1995).
 Fla. Stat. [sections] 501.213 (1995).
 FTC v. Colgate-Palmolive Co., 380 U.S. 374 (1965); Charles of the Ritz v. FTC, 143 F.2d 676 (2d Cir. 1944).
 FTC v. Sperry and Hutchinson Company, 405 U.S. 223 (1972); Spiegel, Inc. v. FTC, 540 F.2d 287 (7th Cir. 1976).
 103 F.T.C. 110 (1984). This administrative proceeding references the 1983 Federal Trade Commission Policy Statement which defines deception.
 Orkin Exterminating Co., Inc. v. FTC, 849 F.2d 1354 (11th Cir. 1988). This case references the 1980 Federal Trade Commission Policy Statement defining unfairness.
 See American Pest Corp. v. Barco Chemicals Division, Inc., 468 So. 2d 451 (Fla. 4th D.C.A. 1975) (uses the federal court definition of deception); Urling v. Helms Exterminators, Inc., 468 So. 2d 451 (Fla. 1st D.C.A. 1985) (uses the federal court definition of unfairness).
 See supra notes 5-8.
 The states of North Carolina in N.C. Gen. Stat. [sections] 75-1.1(b)(1995), Ohio in Ohio Rev. Code Ann. [sections] 1345.01 (1995), and Maryland in Md. Code Ann. Com. Law [sections] 13-104 (1995) expressly exclude the practice of law, and in the case of Ohio, the practice of medicine, from the coverage of these states' unfair and deceptive trade practices statutes. On the other hand, Connecticut in Heslin v. Conn. Law Clinic of Trantolo and Trantolo, 462 A.2d 938 (Conn. 1983), Louisiana in Reed v. Allison & Perone, 376. So. 2d 1067 (La. Ct. App. 1979), Massachusetts in Guenard v. Burke, 443 N.E.2d 892 (Mass. 1992), Montana in Matthews v. Berryman, 637 P2d 822 (Montana 1981), New York in Aponte v. Raychuk, 531 N.Y.S.2d 689 (N.Y. Sup. Ct. 1988), and Texas in Debakey v. Staggs, 612 S.W.2d 924 (Tex. 1981) have all ruled that the practice of law is subject to the prohibitions of these states' unfair and deceptive trade practice statutes. See, contra, Frahm v. Urkovich, 447 N.E.2d 1007 (Ill. 1983).
The Florida Attorney General has stated that Florida's Deceptive and Unfair Trade Practice Act does apply to prepaid legal services and, therefore, by implication to lawyers. 226 Op. Atty. Gen. (1976).
 691 P.2d 163 (Wash. 1989) and recently affirmed in Eriks v. Denver, 824 P.2d 1207 (Wash. 1992).
 Id. at 163.
 16 C.F.R. 238 (1995).
 Supra note 13 at 168.
 Quimby, 724 P.2d at 406.
 Compare the Washington State statute, Wash. Rev. Code [sections] 19.86.010 (1995) to the Florida statute, Fla. Stat. [sections] 501.204 (1995).
 Department of Legal Affairs v. Rogers, 329 So. 2d 257 (Fla. 1976).
 Fla. Stat. [sections] 501.212 (1995). See also T.W.M. and S.M. v. American Medical Systems, Inc., 886 F. Supp 842 (N.D. Fla. 1995).
 Quimby v. Fine, 724 P.2d 403 (Wash. Ct. App. 1986).
 Chapman v. Wilson, 826 S.W.2d 214 (Tex. Ct. App. 1992). The Texas Deceptive Trade Practice Statute, Tex. Bus. & Com. Code Ann. [subsections] 17.41-17.59 and TEX. Rev. Civ. Stat. Ann. Art. 4590i [sections] 12.01 (Supp. 1994), is similar to the Florida Unfair and Deceptive Trade Practice statute.
 Sorokolit v. Rhodes, 846 S.W.2d 618 (Tex. Ct. App. 1993).
 In Gatten v. Merzi, 579 A.2d 974 (Pa. Super. Ct. 1990), the court ruled that a patient could not sue her physician under the Pennsylvania Unfair Trade Practices and Consumer Protection Act for medical negligence. However, the plaintiff did not present and the Pennsylvania court did not consider any claim that the entrepreneurial aspects of the practice of medicine could form the basis of a consumer protection act claim. That is precisely what this example illustrates.
 See Fla. Stat. [sections] 501.211(2)(1995); Urling v. Helms Exterminators, Inc., 468 So. 2d 451 (Fla. 1st D.C.A. 1985); Rollins Inc. v. Heller, 454 So. 2d 580 (Fla. 3d D.C.A. 1984).
 Fla. Stat. [sections] 501.212 (1995).
 Fla. Stat. [sections] 501.2105 (1995).
 Fla. Stat. [sections] 95.11(4)(b)(1995) states that the statute of limitations for a medical malpractice claim is two years as compared to Fla. Stat. [sections] 95.11(3)(f)(995), which states that the statute of limitations for a cause of action based on a statutory liability is four years.
 Fla. Stat. [sections] 768.81 (1995).
 See Fabre v. Marin, 623 So. 2d 1182 (Fla. 1993).
 Fla. Stat. [sections] 768.76 (1995).
 The Florida Unfair and Deceptive Trade Practice Act does not apply to a "person" or "activity" regulated by the Department of Insurance. Fla. Stat. [sections] 501.212(4)(1995). The business aspects of a doctor's medical practice is not regulated by the Department of Insurance. However, the issue of whether an HMO doctor may hide behind this exemption to limit liability for violations of the Florida Unfair and Deceptive Trade Practice statute is an open question. This issue is akin to the question of whether an HMO can be vicariously liable for the medical negligence of a an HMO doctor. This question does not affect the liability of the doctor for medical negligence or, likewise, for an unfair or deceptive business practice. In fact, the trend is to recognize the vicarious liability claim for medical negligence against the HMO despite ERISA preemption. Dearmas v. AV-Med, Inc., 865 F. Supp. 816 (S.D. Fla. 1994).The question of HMO liability for an HMO physician's unfair and deceptive trade practice is an interesting question but beyond the scope of this article.
Michael Flynn is a professor of law at the Nova Southeastern University Shepard Broad Law Center in Fort Lauderdale, where he teaches consumer protection law. He received his B.A., magna cum laude, and his J.D., cum laude, from Gonzaga University.
This column is sponsored by the Consumer Protection Law Committee of The Florida Bar.
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|Publication:||Florida Bar Journal|
|Date:||Jul 1, 1997|
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