Justia Antitrust & Trade Regulation Opinion SummariesArticles Posted in Health Law
Reliance Health Care, Inc. v. Mitchell
The Supreme Court dismissed this interlocutory appeal of a vacated class certification order and directed the circuit court to remand the case to address motions to compel arbitration, holding that this appeal was moot.Plaintiffs, who represented the estates of former residents of fourteen different nursing homes, alleged breach of contract and unjust enrichment claims against the nursing homes, in violation of the Arkansas Civil Rights act and the Arkansas Deceptive Trade Practices Act. The nursing homes moved to compel arbitration for all but two of the named plaintiffs, after which the plaintiffs moved for class certification. The circuit court granted Plaintiffs' motion for class certification without ruling on the motions to compel arbitration. The nursing homes brought an interlocutory appeal of the class-certification order and petitioned for writ of prohibition, mandamus, and certiorari. The Supreme Court granted the writ petition, vacating the order granting class certification, and ordered the circuit court to rule on the motions to compel before ruling on class certification, holding that the interlocutory appeal of the vacated class-certification order was moot. View "Reliance Health Care, Inc. v. Mitchell" on Justia Law
Anastasia Wullschleger v. Royal Canin U.S.A., Inc.
Plaintiff’s dog, Clinton, suffered from health problems. The solution, at least according to a veterinarian, was to feed him specialized dog food available only by prescription. It has different ingredients than regular dog food but includes no special medication. Prescription dog food is expensive. The crux of Plaintiff’s complaint is that the “prescription” requirement is misleading because the Food and Drug Administration never actually evaluates the product. And the damages came from its higher sales price. The original complaint, which included only state-law claims, reflected these theories. Brought on behalf of all similarly situated Missouri consumers, it alleged a violation of Missouri’s antitrust laws, claims under Missouri’s Merchandising Practices Act, and unjust enrichment. Plaintiff initially filed her complaint in state court, but Royal Canin and Nestle Purina quickly removed it to federal court. The district court then remanded it. The Eighth Circuit vacated the district court’s judgment and send this case back to the district court with directions to remanded it to Missouri state court. The court explained that just on the face of the amended complaint, the answer is clear. Only the carryover claims and their civil-conspiracy counterpart remain, and neither one presents a federal question. It is no longer possible to say that “dependence on federal law permeates the allegations” of Plaintiff’s complaint. Further, the court wrote that the manufacturers hope to keep the case in federal court through supplemental jurisdiction. It is too late, however, to turn back the clock. View "Anastasia Wullschleger v. Royal Canin U.S.A., Inc." on Justia Law
Vasquez v. Indiana University Health, Inc
Bloomington, Indiana (population 90,000) is in a metropolitan statistical area with a population near 200,000. From Bloomington, one can drive an hour and ten minutes to Indianapolis (population 865,000); two hours to Evansville (population 120,000); two hours to Louisville (population 620,000); or two and a half hours to Cincinnati, (population 300,000). Dr. Vasquez arrived in Bloomington in 2006, opened an independent vascular‐surgery practice, and obtained admitting privileges at Bloomington Hospital, Monroe Hospital, and the Indiana Specialty Surgery Center. He performed more than 95% of his inpatient procedures at Bloomington Hospital. In 2010, IU Health acquired Bloomington Hospital. In 2017, IU Health acquired Premier Healthcare, an independent physician group based in Bloomington. Vasquez alleges that, because of the acquisition, IU Health employs 97% of primary care providers (PCPs) in Bloomington and over 80% of PCPs in the region. Vasquez’s alleged that IU Health launched “a systematic and targeted scheme” to ruin his reputation and practice because of Vasquez’s commitment to independent practice. IU Health's employees cast aspersions on his reputation. IU Health revoked Vasquez’s Bloomington admitting privileges.Vasquez brought claims under Sherman Act, 15 U.S.C. 2, and Clayton Act, section 18. The Seventh Circuit reversed the dismissal of his suit. Vasquez’s accounts of how a hypothetical monopolist could dominate Bloomington’s vascular‐ surgery market suffice for the pleading stage; the complaint presents a plausible account under which his suit is timely. View "Vasquez v. Indiana University Health, Inc" on Justia Law
Siva v. American Board of Radiology
The Board, a private, nonprofit provider of medical certifications to radiologists, is dominant in the market for radiology certifications. All states permit physicians who are not Board-certified to practice medicine, provided they possess a valid state medical license. Siva, a Board-certified radiologist, says that most insurers will not grant in-network status to physicians who are not Board-certified; uncertified physicians are often shut out from meaningful employment opportunities. When the Board began selling certifications in 1934, radiologists who passed the examination would remain certified for life. The Board later shifted to “initial certification” and “maintenance of certification” (MOC). Radiologists who wish to remain Board-certified must participate in and pay for the MOC program annually, which requires continuing education credits from third parties, completing “practice improvement” activities, and passing Board-administered examinations.The Seventh Circuit affirmed the dismissal of Siva’s antitrust suit. Siva argued that MOC should be thought of not as part of the Board’s certification product but as a unique product in its own right and that the Board’s decision to revoke the certification of radiologists who refuse to participate in the MOC program reflects not a benign product redesign but rather an illegal tying arrangement that violates the Sherman Act, 15 U.S.C. 1. Siva cannot identify a distinct product market in which it is efficient to offer MOC separately from certification. View "Siva v. American Board of Radiology" on Justia Law
California v. Johnson & Johnson
Johnson & Johnson, Ethicon, Inc., and Ethicon US, LLC (collectively, Ethicon) appealed after a trial court levied nearly $344 million in civil penalties against Ethicon for willfully circulating misleading medical device instructions and marketing communications that misstated, minimized, and/or omitted the health risks of Ethicon’s surgically-implantable transvaginal pelvic mesh products. The court found Ethicon committed 153,351 violations of the Unfair Competition Law (UCL), and 121,844 violations of the False Advertising Law (FAL). The court imposed a $1,250 civil penalty for each violation. The Court of Appeal concluded the trial court erred in just one respect: in addition to penalizing Ethicon for its medical device instructions and printed marketing communications, the court penalized Ethicon for its oral marketing communications, specifically, for deceptive statements Ethicon purportedly made during one-on-one conversations with doctors, at Ethicon-sponsored lunch events, and at health fair events. However, there was no evidence of what Ethicon’s employees and agents actually said in any of these oral marketing communications. Therefore, the Court of Appeal concluded substantial evidence did not support the trial court’s factual finding that Ethicon’s oral marketing communications were likely to deceive doctors. Judgment was amended to strike the nearly $42 million in civil penalties that were imposed for these communications. View "California v. Johnson & Johnson" on Justia Law
Federal Trade Commission v. Hackensack Meridian Health Inc
Englewood, a non-profit corporation with a single community hospital in Bergen County, New Jersey, provides primary, secondary, and some non-complex tertiary services to patients. It lacks the expertise, regulatory approvals, and facilities to provide more complex tertiary and quaternary services. Hackensack, New Jersey's largest hospital system, has multiple academic medical centers, community hospitals, specialty hospitals, a medical school, and a research institution, including two hospitals in Bergen County.The Federal Trade Commission opposes a merger between Englewood and Hackensack and filed an administrative complaint citing the Clayton Act, 15 U.S.C. 18. To prevent the parties from merging before the administrative adjudication, the FTC filed suit under Section 13(b) of the Federal Trade Commission Act. The Third Circuit affirmed the entry of a preliminary injunction. The FTC established that there is a reasonable probability that the merger will substantially impair competition. The court upheld the district court’s acceptance of the FTC’s proposed relevant geographic market defined by all hospitals used by commercially insured patients residing in Bergen County; price discrimination is not a prerequisite for a patient-based market. The district court did not err in finding that there would be a significant price impact and any benefits that would result from the merger did not offset anticompetitive concerns. View "Federal Trade Commission v. Hackensack Meridian Health Inc" on Justia Law
Marion Diagnostic Center, LLC v. Becton Dickinson & Co.
A putative class of medical providers sued, alleging a conspiracy to drive up the prices of syringes and safety IV catheters (Products). Their first complaint, alleging a hub‐and‐spokes conspiracy ( Sherman Act, 15 U.S.C. 1) between manufacturer, BD, group purchasing organizations, and four distributors, was dismissed because the Providers failed to allege that the distributors coordinated with each other in furtherance of the conspiracy. In an amended complaint, the Providers abandoned their horizontal conspiracy allegations and alleged two vertical conspiracies, one between BD and McKesson and another between BD and Cardinal Health.The district court dismissed, noting that because the named plaintiffs do not purchase the Products directly from Cardinal, they lack “antitrust standing” to sue Cardinal. The Seventh Circuit affirmed. . The Providers cannot sue Cardinal under Article III because their injury is not fairly traceable to Cardinal’s conduct; precedent precludes the suit because they do not purchase the Products from either member of the BD‐Cardinal conspiracy. The Providers did not plausibly establish that vertical conspiracies involving just two distributors and BD could influence the prices that the Providers pay, regardless of which distributor they purchase from, and regardless of the fact that there are at least four major distributors. View "Marion Diagnostic Center, LLC v. Becton Dickinson & Co." on Justia Law
Association of American Physicians & Surgeons, Inc. v. American Board of Medical Specialties
The Association of American Physicians & Surgeons (AAPS), is a nonprofit organization of physicians and surgeons. The American Board of Medical Specialties, a nonprofit provider of medical certification services, is an umbrella organization for 24 member boards, each dedicated to a particular medical practice area. The Board deems physicians who meet its requirements to be “Board-certified.” To remain certified, physicians must comply with the Board’s Maintenance of Certification (MOC) program and continuing education requirements. All states permit physicians who are not Board-certified to practice medicine.According to AAPS, the Board conspired with its member boards, hospitals, and health insurers to condition the granting of staff privileges and in-network status on physicians’ continued participation in the MOC program so that physicians find themselves forced to participate in the program to practice medicine, at least if they wish to do so in hospitals or to accept certain forms of insurance. The Seventh Circuit affirmed the dismissal of its suit under section 1 of the Sherman Act and claiming negligent misrepresentation on the Board’s website to “create the false impression that [the MOC program] is indicative of the medical skills of physicians.” The complaint does not plausibly allege an agreement between the Board, hospitals, and insurers. Mere legal conclusions are “not entitled to be assumed true.” View "Association of American Physicians & Surgeons, Inc. v. American Board of Medical Specialties" on Justia Law
St. Luke’s Hospital v. ProMedica Health System, Inc.
The Sixth Circuit previously affirmed the Federal Trade Commission’s decision to block a merger of ProMedica and St. Luke’s Hospital in Lucas County, Ohio. As part of the unwinding of the merger, ProMedica and St. Luke’s signed an agreement in which ProMedica’s insurance subsidiary, Paramount, agreed to maintain St. Luke’s as a within-network provider; Paramount could drop St. Luke’s if ownership of the hospital changed. A large healthcare company based in Michigan, McLaren, subsequently merged with St. Luke’s. Paramount ended its relationship with St. Luke’s, removing the hospital from its provider network. St. Luke’s then alleged that ProMedica’s refusal to do business with it violated the antitrust laws. The district court preliminarily enjoined ProMedica from ending the agreement. The Sixth Circuit vacated. Because ProMedica had a legitimate business explanation for ending the relationship, St. Luke’s is unlikely to show that ProMedica unlawfully refused to continue doing business with it. St. Luke’s has little likelihood of establishing an irreparable injury given the option of money damages. View "St. Luke's Hospital v. ProMedica Health System, Inc." on Justia Law
Shah v. VHS San Antonio Partners, LLC
Shah, a board-certified pediatric anesthesiology specialist, joined STAR, which became the exclusive provider of anesthesia services at several San Antonio-area acute-care hospitals, including NCB. BHS guaranteed STAR $500,000 in collections for pediatric anesthesia services provided at NCB. In 2012, STAR became the exclusive provider of anesthesia services at four BHS hospitals. Shah was not a party to the 2012 agreement, nor was he named in the pediatric income guarantee but he continued to practice as a STAR pediatric anesthesiologist, becoming the primary beneficiary of STAR’s guaranteed collections. In 2016, STAR and BHS amended the 2012 agreement, eliminating the pediatric income guarantee. The exclusivity provision remained. STAR terminated its relationship with Shah. Shah could no longer provide pediatric anesthesia services at NCB or any other BHS facility included in the exclusivity agreement. Shah requested authorization to provide pediatric anesthesia care at NCB; BHS responded that Shah’s reappointment to the Medical Staff of BHS and his privileges were approved but the exclusivity provision precluded Shah from providing pediatric anesthesia services at six BHS facilities (including NCB). After unsuccessfully suing STAR in Texas state court, Shah sued under the Sherman Act.The Fifth Circuit affirmed summary judgment in favor of the BHS parties. Shah’s definition of the relevant market is insufficient as a matter of law; it does not encompass all interchangeable substitute products because it does not include the two non-BHS facilities that the BHS parties contend serve as viable alternatives to BHS facilities. View "Shah v. VHS San Antonio Partners, LLC" on Justia Law