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Plaintiffs suing gay-to-straight conversion therapy providers under New Jersey’s Consumer Fraud Act can recover not only the cost of the therapy but the money they spend on further therapy to undo the harm it allegedly caused, a state judge ruled on Monday.

The suit, Ferguson v. JONAH, filed in 2012, appears to the first in the U.S. to assert claims for fraud, deception and unconscionable business practices against those who claim they can cure people of homosexuality.

The defendants are JONAH (Jews Offering New Alternatives for Healing) of Jersey City, co-director Arthur Goldberg, counselor Alan Downing and his Life Coaching LLC.

JONAH’s website says that it “seeks to reunify families, to heal the wounds surrounding homosexuality, and to provide hope” through “psychological and spiritual counseling, peer support, and self-empowerment.” It also offers therapy to deal with promiscuity, pornography, pedophilia, masturbation, fetishes and other sex-related issues.

The plaintiffs are four young men who underwent gay conversion therapy and two of their parents.

They claim it is an ineffective and discredited practice based on the misguided notion that homosexuality is a mental disorder, a position rejected 40 years ago by the American Psychiatric Association. In fact, the APA has warned that attempts to alter or suppress sexual orientation can cause serious harm to young people.

New Jersey is one of two states that have outlawed the therapy for minors, a ban upheld by a federal judge last November against a First Amendment challenge. The other is California, whose law was likewise upheld by the U.S. Ninth Circuit Court of Appeals. A petition for certiorari to the U.S. Supreme Court is pending.

The plaintiffs say they were charged $60 and $100, respectively, for individual and group therapy sessions.

They described group cuddling sessions and being counseled to be naked with their fathers at bathhouses and to reenact scenes of past abuse. One claimed he was told to beat an effigy of his mother with a tennis racket, while screaming as if killing her.

One alleged group exercise involved holding oranges representing testicles and being taunted with homophobic slurs.

Further, they claim they were told that being homosexual is loathsome and made them more susceptible to loneliness, suicide and HIV/AIDS and that they were to blame if the therapy did not work.

They allegedly needed and sought “legitimate” counseling afterward to deal with such consequences as depression, suicidal thoughts and impaired ability to engage in relationships. One plaintiff was allegedly unable to work for a year.

Last July, Hudson County Assignment Judge Peter Bariso Jr. denied a motion to dismiss the case for failure to state a claim.

The defendants followed up in March with a motion for partial summary judgment, asking the court to dismiss part of the damages sought.

They contended that emotional distress damages are not an “ascertainable loss” under the Consumer Fraud Act and thus, the plaintiffs cannot recover money for therapy allegedly necessitated by JONAH’s services.

Bariso disagreed, calling a categorical denial of post-JONAH treatment costs “inappropriate.”

Assuming, for purposes of the motion that the therapy damaged the individuals it was meant to cure, “any subsequent costs of repairing plaintiff’s mental or emotional health are the direct and proximate result of JONAH’s actions and, hence, should be borne by JONAH, provided of course that plaintiffs tender evidence…to establish such damages,” Bariso said.

He distinguished cases that denied therapeutic costs, saying the merchandise offered in them was unrelated to mental or emotional counseling and the emotional distress alleged by those plaintiffs was “a step removed from the product or services rendered.”

Bariso analogized the Ferguson case to one in which kitchen renovations were poorly done and the plaintiffs were allowed to recover the cost of repair.

In addition, he found that even if the repair therapy did not qualify as ascertainable harm, it met the “damages sustained” criterion of the law because the treatment costs were quantifiable.

The plaintiffs were represented by lawyers from the Southern Poverty Law Center (SPLC) in Montgomery, Alabama, the New York office of Cleary Gottlieb Steen & Hamilton and Newark’s Lite DePalma & Greenberg.

SPLC staff attorney Sam Wolfe said, “We welcome this ruling that should serve as a caution to would-be conversion therapists everywhere: conversion therapists can be held liable to pay costs to repair damages resulting from their discredited and abusive practices.”

David Dinielli, SPLC’s deputy legal director, said the defendants “inflicted grave damage” on the plaintiffs, who believed JONAH could cure them of being gay and “were left with guilt, shame and frustration. No amount of money can fix the damage…but recognizing that JONAH can be held accountable for the cost of repairing that damage is an important step.”

Cleary Gottlieb’s Lina Bensman said the holding is important because there is little if any other recourse against “unethical counselors and life coaches,” in contrast to licensed professionals who are subject to supervisory bodies.

The lead defense attorney is Charles LiMandri of a Rancho Sante Fe, California, firm. He is president of the Freedom of Conscience Defense Fund, whose stated mission is “to defend religious freedom by providing protective legal services at the trial level to persons whose religious liberty and free-speech rights have been attacked.”

LiMandri said he will not seek an interlocutory appeal because the expense and uncertainty are not justified by the treatment costs of $10,000 to $20,000, even when trebled.

He called the plaintiffs’ efforts to recover such damages a “major blunder” because it has enabled him to obtain a “gold mine” of records, which he claims will help him because they show no connection between JONAH’s services and the problems for which the plaintiffs later sought help.

He and local counsel Michael Laffey, of the Messina Law firm in Holmdel, assert that the right to self-determination is at stake.

“We are defending our clients’ civil rights and the civil rights of people who want to attempt to change,” said Laffey.

Contact the reporter at mgallagher@alm.com.