CAPE MAY COURT HOUSE - A judge once again dismissed an indictment that charged North Wildwood Dr. John Costino and his wife, Barbara Haas, with health care claims fraud.

Superior Court Judge Raymond Batten on Tuesday dismissed the latest indictment after a defense attorney said prosecutors provided incorrect information to the grand jury.

The couple was initially indicted in July 2009 in a 124-count indictment that alleged health care claims fraud and conspiracy involving 62 patients.

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Defense attorney John Tumelty, representing Barbara Haas, argued that the Prosecutor's Office never actually looked at the individual patient records to determine what treatment the 62 patients received and whether or not it was provided by a licensed health care provider.

That indictment was dismissed in December 2009 after Batten found the lack of specificity of the lengthy indictment unsettling given the severity of the second-degree charges.

In August 2010, the Cape May County Prosecutor's Office indicted the couple a second time in a three-count indictment, also for health care claims fraud, third-degree charges, involving just three patients.

At the time, the Prosecutor's Office said the charges involved more than 30 instances of fraud for physical therapy treatments that were never administered or were given by unlicensed aides.

On Tuesday, Batten dismissed that three-count indictment based on the grand jury presentation.

Defense attorney John Tumelty, who represented Haas, said Tuesday that he argued that the state misrepresented the case to the grand jury.

Tumelty said the grand jury was told that Costino and Haas presented false claims for a treatment called electrical stimulation tens therapy, but he said no such therapy exists.

"There's no such treatment modality," Tumelty said.

Tumelty said the clients did receive electrical stimulation and that there's no evidence the patients did not receive treatment.

Prosecutor Robert Taylor said Tuesday that the dismissal revolved around the incorrect usage of the "tens" term during the grand jury presentation by former Assistant Prosecutor Matthew D. Weintraub, but Taylor said the case was not over.

"We will represent the matter to the grand jury in a few weeks," Taylor said.

Tumelty said Costino and Haas feel vindicated by the judge's ruling in this case and in the prior indictment.

"The judge has thrown out both indictments based on mistakes and misinformation presented to the grand jury," Tumelty said.

Costino's sister, Kathleen Wiechnik, of Medford, Burlington County, said she was in the courtroom when Batten made his decision today.

"We're gratified that Judge Batten made the right decision, but I'm also extremely concerned that the Cape May County Prosecutor's Office and a detective can lie to a grand jury over and over again and get an indictment and my brother and sister-in-law have to fight against these lies and hope that the right decision is made."

Wiechnik said the County Prosecutor's Office and the detective in the case should be held accountable.

Tumelty said the couple feel the Prosecutor's Office has targeted them.

"It's like a persecution," Tumelty said.

Costino's license to practice medicine in New Jersey was revoked in December 2009.

Meanwhile, Costino still faces charges stemming from his September 2007 arrest for insurance fraud and the illegal distribution of prescription drugs.

He was indicted in that case in February 2008 for illegally distributing oxycodone and filing false health insurance claims.

Costino, who at the time of his arrest in 2007 had practiced medicine for 36 years, operated his practice in North Wildwood and specialized in pain management, geriatric medicine and treating heroin addiction with Suboxone.

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