While claims for damages in tort and contract are common sources of liability for health service providers, recent actions by the Australian Competition & Consumer Commission (ACCC) against breast imaging companies for misleading and deceptive conduct demonstrate that health providers and medical practitioners are also potentially subject to significant penalties under consumer legislation.

In ACCC v Safe Breast Imaging Pty Limited1 (Safe Breast Imaging) and ACCC v Breast Check Pty Limited2 (Breast Check) the ACCC obtained declarations, injunctions, pecuniary penalties and other orders against companies, and persons associated with them, that provided alternative breast imaging services using a device known as a Multifrequency Electrical Impedance Mammograph (MEM device). Safe Breast Imaging In this case, the Court found that the class of consumers targeted by Safe Breast Imaging (SBI) would have no special knowledge or attributes compared to a reasonable member of the wider community and that they would likely hold preconceptions about medical breast imaging, linking it with investigations into the presence of breast cancer.

The Court heard expert evidence that there was insufficient evidence to show that electrical impedance breast imaging or the MEM device could reliably identify persons at risk. On that basis, it determined that SBI’s representations that there was an adequate scientific basis for assuring a person that they did not have breast cancer, or that the MEM device was a substitute for mammography, were misleading and/or deceptive.

SBI’s business was, for some time, run out of a room rented at a medical clinic. In pamphlets and other promotional material, SBI stated that a trained doctor interpreted the images taken by the MEM device. On the evidence before the Court, none of the three authors of the Breast Health Reports issued by SBI were in fact registered medical practitioners and so this representation was also found to be misleading and/or deceptive.

Breast Check

The proceedings against Breast Check (BC) and a doctor employed by it, related not only to the use of the MEM device but also to various infrared devices for digital thermography. Again, relying on expert evidence, the Court found there were misleading representations including that there was an adequate scientific basis for assessing whether a person was at risk of breast cancer by use of an MEM device, and that the use of a thermography device, alone or in conjunction with the MEM device, was a substitute for mammography. In a finding that may have important ramifications for providers of alternative medicine, the Court said:

‘In the context of a representation of a medical nature…there is a clear “information asymmetry” between the maker of the representation and the audience. Thus, it would be entirely reasonable for a consumer to conclude that, where a service of a medical nature is being provided, there would be scientific medical evidence of a sufficient quality to support the use of the equipment used to provide such a service…”'

In a further warning to medical professionals involved in alternative health services, the Court found that a doctor employed by BC had accessorial liability under the Trade Practices Act 1975 (Cth) and the Australian Consumer Law as a person knowingly concerned in the contraventions by BC.

Penalties

In addition to declarations, injunctions, and other orders, the Court imposed pecuniary penalties on SBI and its business manager totalling $250,000 and disqualified the business manager from managing a corporation for four years. BC and the doctor employed by it received penalties totalling $100,000