SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-1100-18T4

LABORATORY CORPORATION

OF AMERICA d/b/a LABCORP,

Plaintiff-Respondent,

v.

FUSION DIAGNOSTICS 

LABORATORIES, LLC t/a 

FUSION DIAGNOSTIC 

LABORATORIES LIMITED

LIABILITY COMPANY, also 

t/a FUSION DIAGNOSTICS 

LAB,

Defendant-Appellant.

________________________________

Submitted January 6, 2020 – Decided

Before Judges Sabatino and Geiger.

On appeal from the Superior Court of New Jersey, Law 

Division, Morris County, Docket No. L-1952-15.

Robert A. Skoblar, attorney for appellant.

Scarinci & Hollenbeck, LLC, attorneys for respondent 

(Joel N. Kreizman, on the brief).

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the 

internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

January 30, 2020
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PER CURIAM

Defendant Fusion Diagnostic Laboratories (Fusion) appeals from: (1) an 

order granting summary judgment dismissing counts III through X of its 

counterclaims; (2) a judgment entered in favor of plaintiff Laboratory 

Corporation of America (LabCorp) for $135,226.32 (including pre-judgment 

interest) following a non-jury trial; and (3) an order denying its post-judgment 

motion for reconsideration or a new trial. We affirm. 

I.

In February 2013, Moataz Abdalla and Dr. Amir Ahmed partnered to 

acquire the indebted, year-old Fusion lab from its prior owner/members. Fusion 

analyzed blood samples, depended on physician referrals, and billed the patient's 

insurance company. The insurer then issued an explanation of benefits to 

indicate what portion of Fusion's invoice was covered. 

In 2014, Abdalla and Dr. Ahmed built an account base, updated their 

technology, and trained qualified staff. Fusion's customer-base growth, 

however, soon overtook the lab equipment's capacity to analyze samples. To 

serve clients even when it was unable to perform the work, Fusion began 

referring tests to a third-party laboratory. Fusion then provided the report from 

the outside laboratory to the referring physician. 
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Against this backdrop, LabCorp and Fusion entered into an oral agreement 

in March 2014. According to Fusion, it would send LabCorp samples for testing 

which Fusion did not have the capacity to do in-house. In exchange, LabCorp 

would charge Fusion seventy percent less than its book price. In addition, 

Fusion's phlebotomists at its referring physicians' offices would draw blood 

from those patients who utilized insurances known as New Jersey Family Care 

and Horizon New Jersey Health. According to Fusion, it agreed to this 

arrangement "because LabCorp had agreements with those private insurance 

companies that the members of those HMOs would only be covered for 

laboratory work if they used LabCorp's services." Fusion claimed it did not 

know then but found out months later was that LabCorp had "capitation 

agreements"[1] with those insurers. Fusion alleged that under this arrangement,

LabCorp would save the expense of the phlebotomist, Fusion would service the 

physician account, LabCorp would pick up the samples and furnish reports to 

Fusion within twenty-four to forty-eight hours, and LabCorp would utilize a 

1

 Under the capitation agreements, LabCorp was paid an advance lump sum by 

the health maintenance organization (HMO) irrespective of the number of tests 

LabCorp performed. The insured was required to use LabCorp for the testing to 

receive coverage. 
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third-party billing account and bill the insurance carriers directly. These 

transactions are known in the industry as "full send outs." 

Fusion alleged LabCorp breached the agreement in three ways: (1) 

LabCorp billed Fusion at its full book price without applying the seventy percent 

discount as promised for those referrals where Fusion did not have the capacity 

to perform the testing; (2) LabCorp did not utilize the already established third -

party billing account for the "full send outs" and instead billed Fusion directly 

for those patients that utilized New Jersey Family Care and Horizon New Jersey 

Health; and (3) LabCorp repeatedly provided analysis for routine reports well 

after the twenty-four to forty-eight hour industry accepted time standard, 

injuring Fusion's reputation on its physician accounts.

Fusion's contractual relationship with LabCorp spanned from March 2014 

until July 15, 2014. According to Fusion, the relationship soured and ended 

because LabCorp refused to honor its pricing agreement, continued to bill 

Fusion for the full send outs, and repeatedly failed to provide reports within 

twenty-four to twenty-eight hours. Fusion claims it immediately, and 

continuously, objected to the overcharges when it was first invoiced by 

LabCorp. Accordingly, Fusion refused to remit any payment for the perceived 

overcharges. 
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In response, LabCorp closed the account and claimed Fusion owed it a 

balance of $112,381.40. Fusion claims that amount was seventy percent greater 

than agreed upon and included $23,146.77 for the full send outs, which were 

unbillable because it could not directly bill the insurers. Fusion also alleged 

LabCorp failed to provide timely reports within twenty-four to twenty-eight

hours resulting in lost business accounts. 

As a result of Fusion's refusal to pay for services rendered, LabCorp filed 

a five-count complaint sounding in breach of contract, book account, quantum 

meruit, unjust enrichment, and an account stated. Plaintiff sought $136,736.67 

in damages. Fusion filed an answer and ten-count counterclaim that alleged 

breach of contract (counts I and II), violation of the New Jersey Consumer Fraud 

Act (CFA) (count III), common law fraud (count IV), unfair competition (count 

V), intentional interference with contractual relations (count VI), intentional 

interference with prospective economic relations (count VII), negligent 

interference with prospective economic relations (count VIII), fraudulent 

concealment (count IX), and restraint of trade (count X). Notably, in its answer 

to the first count of the complaint Fusion stated, "The total owed by the 

defendant to plaintiff, not including offsets to which the defendant is otherwise 

entitled, is $33,714.42." 
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On October 20, 2016, LabCorp moved for partial summary judgment to 

dismiss Fusion's counterclaims other than the two breach of contract counts. 

The motion was granted on May 12, 2017. 

A two-day bench trial began on April 18, 2018. That day, plaintiff 

reduced its claim by approximately $16,700. Over the course of trial, Tawanda 

Blackwell and James Henriques testified for plaintiff, including a rebuttal; 

Moataz Abdalla testified for defendant. 

Blackwell testified she was a collection supervisor at LabCorp and was 

responsible for accounts receivable. She "confirmed that the account had a 

[seventy] percent across-the-board discount for discountable testing and noted 

on the bills where the discount was reflected." Blackwell also acknowledged 

two initial, erroneous invoices showed Fusion owed LabCorp $135,736.67, 

when the outstanding amount was actually $118,942.63 after the discounts were 

applied. She explained Fusion had two accounts with LabCorp: a third-party 

billing account billed to Horizon, an HMO, and a direct client account billed to 

Fusion. The trial court determined her testimony was credible and non-evasive. 

Henriques testified he was a key hospital services representative for 

LabCorp, which required him to solve reporting issues, special pricing, 

equipment, and supplies relative to hospital and clinical facility accounts. He 
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took control of the Fusion accounts in March 2014, but was not involved in the 

initial meeting, which was handled by a former LabCorp employee named Chip 

Murphy. Henriques' main contact with Fusion was Dr. Walter Shonkwiler. The 

two reached an agreement to make Fusion a hospital key account, which allowed 

for a seventy percent discount on all discountable testing, and Henriques further 

agreed to make special requests for pricing on specific tests when Fusion 

desired. 

According to Henriques, there were no discussions regarding delayed 

reporting; the discussions with Dr. Shonkwiler were limited to pricing. He also 

testified, and objective evidence showed, Fusion received special pricing on at 

least two occasions. Henriques explained LabCorp was required to provide 

insurance and other processing information to receive payments from third 

parties. He claimed Fusion frequently failed to provide that information. He 

also testified, however, that the services were always completed even without 

the proper billing information. Ultimately, LabCorp wrote off the third-party 

billing account receivable because Dr. Shonkwiler never provided the proper 

information. 

The court found Henriques' testimony was credible and supported by the 

objective evidence presented during trial, which the court reviewed extensively. 
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The court noted Fusion failed to submit any of its own records to disprove the 

information contained in the LabCorp reports. 

The court concluded the "vast majority of the delay issues were problems 

caused by Fusion's method drawing samples or adding verbal tests that required 

written authorizations from Fusion to complete." Furthermore, the court 

accepted Henriques' testimony that he never guaranteed a turnaround time for 

testing. The evidence also showed that, "[o]ver the four-month period that 

Fusion sent samples to LabCorp for testing, LabCorp accepted over a thousand 

orders" for which Fusion did not remit payment. Plaintiff rested after Henriques' 

testimony. 

Abdalla testified Fusion could not charge for testing billed to Horizon due 

to an exclusivity agreement between Horizon and LabCorp for testing. 

Therefore, Fusion entered into an agreement with LabCorp so Fusion could 

market its services to doctors who accepted Horizon. Abdalla testified 

LabCorp's March 2014 reports indicated LabCorp did not receive samples or 

that tests were missing or ordered improperly. He described the relationship as 

Fusion existing at LabCorp's mercy. 

The court noted most of Abdalla's testimony was unsupported by objective 

evidence and the testimony that did relate to objective evidence was plagued by 
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errors. For example, Abdalla testified Fusion's profit margin was usually thirty 

percent, but that claim was belied by the tax returns Fusion provided the court. 

The court further noted Abdalla's claims of lost business and profits were 

unsupported by any evidence, objective or testimonial; to the contrary, the 

evidence indicated Fusion continually increased its gross and net income each 

year from 2014 to the date of trial. In addition, Abdalla admitted he did not 

know the exact amount sent for testing over the term of the business relationship. 

The court concluded LabCorp established, by a preponderance of the 

evidence, that Fusion entered into an agreement with LabCorp for blood testing 

and failed to remit payment for services rendered. Accordingly, the court found 

LabCorp proved its breach of contract claim against Fusion and awarded 

$118,942.63, plus interest, in damages. The court found Fusion met its burden 

of proof with regard to showing it entered an agreement with LabCorp but failed 

to prove causation as to the perceived delays in receiving test results or as to 

lost clients. Therefore, the court dismissed Fusion's counterclaim for breach of 

contract (counts I and II) with prejudice. 

Fusion moved for reconsideration or a new trial. The judge issued an 

August 31, 2018 order and six-page written statement of reasons denying the 

motion. The judge first noted that Fusion was essentially rearguing its case. 
10 A-1100-18T4

The judge then engaged in a detailed analysis of the trial testimony and exhibits. 

The court noted:

Henriques denied that any of the third-party billing was 

included in the invoices from LabCorp. Based on the 

testimony, as well as the invoicing, spreadsheets and 

reports entered into evidence at trial, the [c]ourt 

concluded that Mr. Henriques' testimony denying that 

any of the third-party billing was included in the 

invoices from LabCorp was credible. 

As to exhibit LC265, the court stated: 

Henriques testified that this form and the information 

contained therein was provided by Fusion. He further 

explained that he reviewed [all] of these forms to 

confirm that none of the third-party billing tests were 

billed to Fusion. 

As to Abdalla's testimony, the court noted Abdalla "admitted to errors in 

his testimony during trial." Although Abdalla claimed that a "$22,969.47 

invoice should have been $9,165.15, the records did not correspond with that 

assertion." As an example, the court explained mistake in Fusion's position as 

to the billing for Vitamin B12 testing. Based on the discrepancies between

Fusion's allegations and the credible evidence, the court found that Abdalla, who 

was Fusion's only witness, was not credible. The court concluded that " Fusion's 

disagreement with [the] [c]ourt's findings and credibility determinations does no 

warrant either reconsideration or a new trial."
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Fusion's also argued that LabCorp establish a prima facie case for breach 

of contract or accounts stated because it did not establish that tests were to be 

discounted or the price Fusion agreed to pay for the testing and because 

LabCorp's invoices were wrong. The court rejected these claims, concluding

the invoices and Blackwell's testimony "establish[ed] the prices, discounts and 

ultimately, the damages in the case." The court then emphasized that "it is

undisputed that Fusion never paid money for services provided to it by 

LabCorp."

This appeal followed. Fusion raises the following points: 

POINT ONE

LABCORP DID NOT MAKE OUT A PRIMA FACIE 

CASE FOR BREACH OF CONTRACT BECAUSE IT 

DID NOT ESTABLISH WHAT TESTS WERE 

AGREED TO BE DISCOUNTED OR WHAT PRICE 

FUSION AGREED TO PAY FOR THE TESTING.

POINT TWO

DESPITE THE TESTIMONY OF LABCORP'S 

WITNESSES AT THE TRIAL TO THE CONTRARY, 

FUSION WAS BILLED DIRECTLY FOR THE FULL 

SEND OUTS IN THE SUM OF $22,001.79.

POINT THREE

LABCORP DID NOT MAKE OUT A CLAIM FOR AN 

ACCOUNT STATED BECAUSE ITS INVOICES 

WERE ADMITTEDLY WRONG AND NEVER

CORRECTED TO DATE AND FUSION HAS 

CONTINUOUSLY OBJECTED TO THE FEES THAT 

WERE CHARGED.
12 A-1100-18T4

POINT FOUR

THE LOWER COURT SHOULD NOT HAVE 

DISMISSED MANY OF FUSION'S 

COUNTERCLAIMS BY SUMMARY JUDGMENT 

BECAUSE MATERIAL QUESTIONS OF FACT 

EXISTED AS TO WHETHER LABCORP WAS 

INVOLVED IN BAIT AND SWITCH REGARDING 

ITS PRICING; AND WHETHER OR NOT LABCORP 

WAS PERPETRATING A FRAUD BY BILLING 

FUSION WHERE IT HAD EXCLUSIVITY OR 

CAPITATION AGREEMENTS WITH INSURERS.

II.

We first address the grant of partial summary judgment dismissing counts 

III through X of Fusion's counterclaim. Fusion claims there were material facts 

at issue precluding summary judgment. We are unpersuaded by this argument. 

Summary judgment should be granted if the court determines "that there 

is no genuine issue as to any material fact challenged and that the moving party 

is entitled to a judgment or order as a matter of law." R. 4:46-2(c). The court 

must "consider whether the competent evidential materials presented, when 

viewed in the light most favorable to the non-moving party, are sufficient to 

permit a rational factfinder to resolve the alleged disputed issue in favor of the 

non-moving party." Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 

(1995). On appeal, the Appellate Division "review[s] the trial court's grant of 

summary judgment de novo under the same standard as the trial court." Templo 
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Fuente De Vida Corp. v. Nat'l Union Fire Ins. Co., 224 N.J. 189, 199 (2016)

(citing Mem'l Props., LLC v. Zurich Am. Ins. Co., 210 N.J. 512, 524 (2012)).

The trial court determined that Count III, the consumer fraud claim, could 

not proceed because Fusion did not qualify as a consumer under the CFA. 

Fusion, a commercial firm, agreed to pay for services that were not available 

directly to the general public. Accordingly, Fusion is not a "consumer" within 

the meaning of the CFA. See Papergraphics Int'l, Inc. v. Correa, 389 N.J. Super. 

8, 12-13 (App. Div. 2006) (interpreting "consumer" as defined in the CFA). 

Count IV, the common law fraud claim, required dismissal because Fusion 

did not allege any facts to support that claim beyond those alleged to support 

their breach of contract claim. See Bracco Diagnostics, Inc. v. Bergen 

Brunswick Drug Co., 226 F. Supp. 2d 557, 563 (D.N.J. 2002) (noting fraud and 

breach of contract claims may only coexist when the fraud relates to precontractual inducement). The economic loss doctrine prohibits a party from 

recovering in tort economic losses arising out of the breach of a contract. Dean 

v. Barrett Homes, Inc., 204 N.J. 286, 296 (2010). 

Counts V through VIII were dismissed because there was "insufficient 

evidence on the record for the [c]ourt to determine whether LabCorp" orally 

agreed "to provide timely lab reports or diagnostic testing referred by Fusion." 
14 A-1100-18T4

The trial court also concluded that any "consequential damages resulting from 

LabCorp's failure to abide by the terms of an oral agreement to provide timely 

reports and accept samples in good faith [were] more properly addressed under 

a theory for breach of contract," rather than through tortious interference, citing

Dean, 204 N.J. at 296. 

Count IX, the fraudulent concealment claim, focused on Fusion's lack of 

awareness that LabCorp had capitation agreements with certain HMOs. It was 

dismissed because there was "no evidence on the record that indicates LabCorp 

was engaged in fraudulent behavior by agreeing to set up a third[-]party account 

and insuring Fusion it would be reimbursed by patients' HMO[s]." Accordingly, 

it was immaterial to Fusion and LabCorp's agreement that LabCorp was in 

capitation agreements with certain HMOs. Therefore, LabCorp was never under 

a duty to disclose the existence of the capitation agreements. 

Count X, which alleged restraint of trade, asserted LabCorp, in concert 

with Quest Diagnostics, violated antitrust laws by cornering the market. It was 

dismissed because there was no evidence that LabCorp and non-party Quest

Diagnostics, conspired, or contracted to control the market. During oral 

argument before the trial court, Fusion "conceded that there was no expert 

testimony or any other support for the restraint of trade claim." Additionally, 
15 A-1100-18T4

Fusion did not define the market being controlled by LabCorp or Quest

Diagnostics. The trial court further noted Fusion's continuing relationship with 

another laboratory "belies Fusion's claim that the market is injured through 

LabCorp and Quest's alleged exclusive control." 

The court's determinations were supported by the motion record and 

reflected appropriate application of the relevant legal principles. We discern no 

basis to disturb the grant of partial summary judgment dismissing counts III

through X of Fusion's counterclaim. 

III.

We next address the trial decision. Our scope of review of a judgment 

following a bench trial is limited. Final determinations of a trial court "premised 

on the testimony of witnesses and written evidence at a bench trial" are 

deferentially reviewed. D'Agostino v. Maldonado, 216 N.J. 168, 182 (2013). 

"Findings by the trial judge are considered binding on appeal when supported 

by adequate, substantial and credible evidence." Rova Farms Resort, Inc. v. 

Inv'rs Ins. Co. of Am., 65 N.J. 474, 484 (1974) (citing N.J. Tpk. Auth. v. 

Sisselman, 106 N.J. Super. 358 (App. Div. 1969)). "[W]e do not disturb the 

factual findings and legal conclusions of the trial judge unless we are convinced 

that they are so manifestly unsupported by or inconsistent with the competent, 
16 A-1100-18T4

relevant and reasonably credible evidence as to offend the interests of justice[.]" 

Seidman v. Clifton Sav. Bank, S.L.A., 205 N.J. 150, 169 (2011) (second 

alteration in original) (quoting In re Tr. Created By Agreement Dated Dec. 20, 

1961 ex rel. Johnson, 194 N.J. 276, 284 (2008)). We also defer to a trial judge's 

credibility determinations. In re Return of Weapons to J.W.D., 149 N.J. 108, 

117 (1997).

"To establish a breach of contract claim, plaintiffs must prove: the parties 

entered into a contract, containing certain terms; plaintiffs performed what was 

required under the contract; defendant did not fulfill its obligation under the 

contract; and defendant's breach caused a loss to plaintiffs." Pollack v. Quick 

Quality Rests., Inc., 452 N.J. Super. 174, 188 (App. Div. 2017) (citing Globe 

Motor Co. v. Igdalev, 225 N.J. 469, 482 (2016)).

If a party commits a "breach of a material term of an agreement, the nonbreaching party is relieved of its obligations under the agreement." Roach v. 

BM Motoring, LLC, 228 N.J. 163, 174 (2017) (quoting Nolan v. Lee Ho, 120 

N.J. 465, 472 (1990)). "[A] breach is material if it 'goes to the essence of the 

contract.'" Ibid. (quoting Ross Sys. v. Linden Dari-Delite, Inc., 35 N.J. 329, 341 

(1961)). After a material breach occurs, "the non-breaching party may treat the 

contract as terminated and refuse to render continued performance." Goldman 
17 A-1100-18T4

S. Brunswick Partners v. Stern, 265 N.J. Super. 489, 494 (App. Div. 1993) 

(quoting Ross, 35 N.J. at 341).

The trial court determined Fusion breached the oral agreement and 

LabCorp did not. Fusion acknowledged it did not pay for services rendered by 

LabCorp, and the evidence adduced at trial supported that fact. Failing to pay 

for services rendered operated as a material breach of the agreement. Fusion's 

assertion that mispricing or delays, even if substantiated, would permit them to 

completely forego their obligation to pay for services rendered lacks merit. 

More fundamentally, as the trial court emphasized in its decision, Fusion 

failed to present any objective evidence in support of its claims. Rather, Fusion 

relied on inferences and testimonial evidence from one witness who was found 

not credible. As the court noted, Abdalla contradicted himself and appeared 

confused at multiple points in his testimony. 

The record amply supports the trial court's findings of fact and conclusion 

that LabCorp sustained its burden of proof while Fusion did not. The evidence 

further supports the damages awarded to LabCorp. We decline to disturb those 

findings and conclusions.

IV.
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Lastly, we consider the denial of Fusion's motion for reconsideration. 

Motions for reconsideration are governed by Rule 4:49-2. "The decision to deny 

a motion for reconsideration falls 'within the sound discretion of the [trial court], 

to be exercised in the interest of justice.'" In re Belleville Educ. Ass'n, 455 N.J. 

Super. 387, 405 (App. Div. 2018) (alteration in original) (quoting Cummings v. 

Bahr, 295 N.J. Super. 374, 384 (App. Div. 1996)). Reconsideration should be 

employed only "for those cases which fall into that narrow corridor in which 

either the [c]ourt has expressed its decision based upon a palpably incorrect or 

irrational basis, or it is obvious that the [c]ourt either did not consider, or failed 

to appreciate the significance of probative, competent evidence." Cummings, 

295 N.J. Super. at 384 (quoting D'Atria v. D'Atria, 242 N.J. Super. 392, 401 (Ch. 

Div. 1990)). "Reconsideration cannot be used to expand the record and reargue 

a motion. Reconsideration is only to point out 'the matters or controlling 

decisions which [a party] believes the court has overlooked or as to which it has 

erred.'" Capital Fin. Co. of Del. Valley, Inc. v. Asterbadi, 398 N.J. Super. 299, 

310 (App. Div. 2008) (quoting R. 4:49-2).

We review a trial court's decision to grant or deny a motion for 

reconsideration for abuse of discretion. Cummings, 295 N.J. Super. at 389. An 

abuse of discretion occurs "when a decision is 'made without a rational 
19 A-1100-18T4

explanation, inexplicably departed from established policies, or rested on an 

impermissible basis.'" U.S. Bank Nat'l Ass'n v. Guillaume, 209 N.J. 449, 467-

68 (2012) (quoting Iliadis v. Wal-Mart Stores, Inc., 191 N.J. 88, 123 (2007)).

Measured against these standards, we are convinced Fusion's arguments 

are without sufficient merit to warrant discussion in a written opinion, Rule

2:11-3(e)(1)(E), and affirm substantially for the reasons set forth in the trial 

court’s statement of reasons. We add the following comment.

As correctly determined by the motion court, Fusion failed to demonstrate 

that the court's decision rested on a palpably incorrect or irrational basis, or that 

the court failed to consider or appreciate the significance of competent evidence.

Cummings, 295 N.J. Super. at 384. Thus, reconsideration was properly denied.

To the extent we have not addressed Fusion's remaining arguments it is 

because we conclude they are without sufficient merit to warrant discussion in 

a written opinion. R. 2:11-3(e)(1)(E). 

Affirmed.