Hospital Seeks Second Opinion on Certifying Class with Uninjured Members

Ten years into litigation, a hospital has moved to decertify a class of plaintiffs who claim the hospital’s merger caused them to overpay for medical services. Arguing there is insufficient proof that class members were harmed, the hospital’s motion invites the court to jump into the fray about whether classes may be certified when they include members who were not actually injured.

Defendant NorthShore University HealthSystem and Highland Park Hospital, both located near Chicago, merged in 2000. After the Federal Trade Commission pursued a post-merger challenge in 2004 for alleged violations of Section 7 of the Clayton Act, a putative class of hospital patients filed suit in 2008 claiming the merger caused them to pay inflated prices for inpatient and outpatient hospital services. The District Court initially denied a motion to certify a class of patients who had paid for NorthShore’s services, but the Seventh Circuit vacated that denial in 2012 – see Messner v. NorthShore Univ. HealthSystem, 669 F.3d 802 (7th Cir. 2012) – and on remand the District Court then certified the class in 2013. Continue Reading

Trump’s Pick for Department of Justice Antitrust Division Chief

Last month we discussed Supreme Court Justice Neil Gorsuch’s confirmation hearings. Specifically, we noted the Senate Judiciary Committee’s failure to nail Gorsuch down on key antitrust issues, including issues he handled as an experienced antitrust lawyer and decided as a judge on the U.S. Court of Appeals for the Tenth Circuit, which we also wrote about. At one point, Gorsuch invoked the so-called “Ginsberg Rule” and simply declined to answer Sen. Amy Klobuchar’s question regarding, not a pending or prior case, but the Department of Justice’s 2008 report on monopolization, responding, “Oh, senator, I—there’s no way you’re [going to] get me to.” Klobuchar quickly changed the subject. Despite the senators’ reluctance to fulfill their “advise and consent” obligations under the Constitution by pressing Gorsuch on contemporary antitrust issues, the Judiciary Committee voted to send Gorsuch to the full Senate on April 3. Less than a week later, on April 7, the Senate confirmed him by a 54-45 vote, cementing Gorsuch’s place in history as the 113th justice of the Supreme Court.

A key player in shepherding Gorsuch through the confirmation process was Makan Delrahim, whom President Donald J. Trump nominated on March 27 to head the Department of Justice’s Antitrust Division. Since January, Delrahim has served the administration as deputy assistant and deputy counsel to the president, advising the Trump administration on the selection of a replacement for former Supreme Court Justice Antonin Scalia. Delrahim had reportedly taken on the role of “quarterback,” handling the administration’s Supreme Court strategy and acting as a liaison between the White House and the Senate. Delrahim attended the Senate Judiciary Committee hearings with Gorsuch. Continue Reading

The Senate’s Uneventful Gorsuch Confirmation Hearing

Recently, we discussed in prior articles the antitrust legacy of Neil Gorsuch, currently a judge on the U.S. Court of Appeals for the Tenth Circuit and nominee for the Supreme Court of the United States. Gorsuch has significant antitrust experience, both in private practice and on the bench. While at Kellogg, Huber, Hansen, Todd, Evans & Figel, Gorsuch defended “Baby Bell” SBC Communications, a company formed after the Federal Trade Commission’s breakup of AT&T, and prosecuted (to a jury verdict) what is widely considered to be one of the largest private antitrust awards in Conwood v. United States Tobacco. As a judge on the Tenth Circuit, Gorsuch has written several high-profile antitrust opinions, among them Novell v. Microsoft, a case in which the Tenth Circuit concluded Microsoft had no duty under the Sherman Antitrust Act to share its intellectual property with rival software-developer Novell. Indeed, during Gorsuch’s four-day Senate confirmation hearing last week, Democratic Sen. Amy Klobuchar called Gorsuch as an antitrust expert. Continue Reading

Case Closed! FTC Announces New Processes for Potentially Ending Investigations

Earlier this week, the Federal Trade Commission’s Acting Chair, Maureen K. Ohlhausen, announced new and potentially meaningful processes to be implemented by the agency for reviewing and ending some investigations.

Responding to President Trump’s directives aimed at eliminating wasteful and unnecessary regulations, Ohlhausen stated that the FTC would be “focusing our resources where they will do the most good for the public, and eliminating wasteful, legacy regulations and processes that have outlived their usefulness.” As part of this effort, Ohlhausen announced that the FTC’s Bureau of Competition would be implementing initiatives that include: Continue Reading

Antitrust Legacy of High Court Nominee Gorsuch in Private Practice

Last month, we discussed the antitrust jurisprudence  of Neil Gorsuch, currently of the U.S. Court of Appeals for the Tenth Circuit judge and nominee to the Supreme Court of the United States. Our discussion focused on three of Gorsuch’s opinions during his decade-long tenure with the court of appeals. Even before Gorsuch was nominated to the Tenth Circuit, however, he had already made a name for himself in the antitrust world as a trial lawyer for both plaintiffs and defendants.

In Gorsuch’s early years in private practice at Kellogg Huber Hansen Todd Evans & Figel, he defended Bell Atlantic in an antitrust case named GTE New Media Services v. Ameritech.

The case arose out of allegations that the five  regional Bell operating companies “illegally combined and conspired to restrain trade and to monopolize  the internet Yellow Pages by controlling internet access points through which competing internet Yellow Pages providers offer their services.” Later, Gorsuch represented so-called “Baby Bell” SBC Communications, a company formed after the breakup of the AT&T Corp. in 1982 pursuant to AT&T’s consent decree with the Department of Justice. In that case, ZTel Communications v. SBC Communications, telecommunications carrier SBC Communications was charged with violating the Sherman Act by refusing to provide Z-Tel Communications with access to its telecommunications facilities and equipment as required by the Telecommunications Act of 1996. Both cases were resolved before trial. Continue Reading

The Antitrust Points of View of Supreme Court Nominee Neil Gorsuch

Last March, we wrote a series of articles discussing Supreme Court Justice Antonin Scalia’s antitrust legacy on the Supreme Court. We noted Scalia’s admitted discomfort with the Sherman Act, specifically with holding corporate defendants, even monopolists, liable absent strong evidence of anti-competitive conduct. His likely successor appears to possibly hold similar views of the antitrust laws, ostensibly applying the Sherman Act to avoid replacing procompetitive, free-market behavior with judicially imposed, anti-competitive fiat, based on the record presented.

On Jan. 31, President Donald J. Trump nominated Neil M. Gorsuch, a judge on the U.S. Court of Appeals for the Tenth Circuit since 2006, to fill Scalia’s seat on the Supreme Court. Gorsuch has a long and storied background in antitrust work. Indeed, perhaps as much as former Justice John Paul Stevens. After graduating from Harvard Law School and eventually clerking for Supreme Court Justices Byron White and Anthony Kennedy (the most senior justice now on the Supreme Court), Gorsuch entered private practice where he brought and defended several major antitrust actions. Thereafter, upon his appointment to the Tenth Circuit, Gorsuch issued three high-profile antitrust opinions that shed light on his substantial expertise in the area. This article will focus on Gorsuch’s antitrust opinions. Future articles will focus on his antitrust experiences in the private sector and at the Department of Justice, where he briefly served. Continue Reading

What to Expect From FTC during Trump Administration: New Leader Illuminates

On Jan. 25, President Trump named Maureen Ohlhausen as the Federal Trade Commission’s acting chairwoman. A recent speech by Ohlhausen, who has served as a commissioner for the FTC since 2012, shed some light on the role the FTC may have under her leadership during the new administration.

Ohlhausen briefly summarized a “few areas in which the Commission succeeded” under the Obama administration, including “clamping down on pay-for-delay agreements” and challenging potentially anticompetitive hospital mergers. See FTC v. Penn State Hershey Med. Ctr., 838 F.3d 327 (3d Cir. 2016); FTC v. Advocate Health Care Network, 841 F.3d 460 (7th Cir. 2016). Continue Reading

Carl Hittinger Examines American Monopolists through the Lens of History, Politics

Partner Carl Hittinger has authored a series of articles for The Legal Intelligencer that explores the history of select American monopolists by posing two fundamental questions: Why have some monopolists succeeded in gaining, maintaining and increasing monopoly power where others have failed? Why does history keep repeating itself and the basic lessons taught have not been learned by subsequent monopolists?” Further, Hittinger writes about the legal, social, political, marketing and public relations factors that are part and parcel of the monopoly conundrum.

Read more.

Abrams, Commins, Foix Author Article on Antitrust Suit Counterclaims

Partners Robert Abrams, Gregory Commins and Danyll Foix authored an article published in “The Antitrust Review of the Americas 2017,” published by Global Competition Review. Their article, “United States: Private Antitrust Litigation,” reviews counterclaims in antitrust litigation in the United States and discusses the strategies behind their use in intellectual property, franchise, distribution and other types of antitrust cases for which counterclaims should be considered by both plaintiffs and defendants.

Read the article.

FTC Still Ramping Up Antitrust Review of Health Care Mergers

Last month, we reported on the Federal Trade Commission’s (FTC) steady filing of injunctions to block what are effectively local mergers of small health care providers. In 2007, the FTC filed suit in Saint Alphonsus Medical Center v. St. Luke’s Health System, its first successful challenge to a hospital merger in recent history. Since then, the Obama administration-appointed FTC has appeared bolder in its approach to health care mergers, which have been on the uptick since the passage of the still-existing Affordable Care Act has encouraged providers to coordinate health care services and provide better service at a lower cost.

The Saint Adolphus case was followed by two notable FTC filings to enjoin health care mergers in the Chicago, Illinois and Harrisburg, Pennsylvania areas. In both cases, the district courts denied the FTC’s request for preliminary injunction, which the U.S. Court of Appeals for the Third Circuit in Federal Trade Commission v. Penn State Hershey Medical Center, 838 F.3d 327 (3d Cir. 2016), and the U.S. Court of Appeals for the Seventh Circuit in Federal Trade Commission v. Advocate Health Care Network, 841 F.3d 460 (7th Cir. 2016), reversed. Since those decisions were handed down, Advocate Health Care and NorthShore University Health System—the entities involved in the proposed Seventh Circuit merger—are ­continuing to pursue the merger on remand to the district court. In contrast, Penn State Hershey Medical Center and Pinnacle Health System—the entities involved in the proposed Third Circuit merger—have apparently decided not to pursue the merger any further, citing the time and cost required to continue litigating the matter. Continue Reading