Where a medical practice terminated Plaintiff-physician under allegedly fraudulent circumstances, the claims affect the professional services rendered by a member of a learned profession.  Stamatakos v. Carolina Urology Partners, PLLC, 2024 NCBC 8 (J. Davis). As a result, the “learned profession” exception of the Unfair and Deceptive Practices Act (“UDTP”) applies and Plaintiff’s UDTP claim must be dismissed.

Plaintiff-physician joined with other physicians to create Defendant Carolina Urology Partners, LLC (“CUP”) and, in connection thereto, entered into an operating agreement. (“OA”).  Defendant Courtney Clair (“Clair”) was the CEO of CUP.  In October 2021, Plaintiff alleged that CUP and Clair improperly terminated him and, as part of the bad acts, immediately notified his patients that Plaintiff was no longer with CUP but that their care would not be affected.  Plaintiff filed suit, asserting claims for breach of contract, fraud and UDTP.  Defendants filed a motion to dismiss, contending Plaintiff’s UDTP claim was barred by the “learned profession” exception.

The Business Court agreed.  Recognizing that the UDTP Act unambiguously provides that “commerce” does not include “professional services rendered by a member of a learned profession,” the Business Court held that numerous North Carolina court cases had extended this “learned profession” exception to not just cases that involved the rendering of professional services, but also to matters “affecting the professional services” rendered by members of a learned profession. (Opinion, ¶78). Moreover, the exception was broad enough to encompass not just physicians, but those who are involved in the administration of those who render professional services (like Clair).  While Plaintiff’s claim for fraud could continue, his UDTP claim failed.

Based upon this decision, any company involved with activities that affect the administration of professional services should look to dismiss any UDTP claims that it might face.