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From Antitrust Law Daily, May 10, 2013

FTC Efforts to Block Integration of Georgia Hospitals Stalled Pending Remand

By Jeffrey May, J.D.

The federal district court in Albany, Georgia, has ruled that it lacks jurisdiction to act on FTC motions to enjoin further integration of the now consummated merger of Albany's Palmyra Park and Phoebe Putney Memorial hospitals. The FTC is pursuing its challenge to the transaction, following a recent, unanimous decision of the U.S. Supreme Court, holding that the acquisition was not immune from attack under the state action doctrine. However, until the Eleventh Circuit enters an order remanding the case to the district court, the lower court cannot take up the FTC’s Motion for a Temporary Restraining Order and Motion for Preliminary Injunction pending the outcome of the Commission’s administrative proceeding (FTC v. Phoebe Putney Health System, Inc., May 8, 2013, Sands, W.).

In February, the Supreme Court reversed a federal appellate court decision (663 F.3d 1369, 2011-2 Trade Cases ¶77,722) holding that the effective merger of the only two competing hospitals in the Albany area was immune under the state action doctrine from an FTC challenge. The Supreme Court remanded the case to the Eleventh Circuit. The FTC subsequently requested that the appellate court expedite its remand to the district court in order for that court to begin its consideration of the FTC’s motions. Although the appellate court initially granted the FTC's request to expedite, it immediately recalled its order. In light of the recall order, jurisdiction to proceed on the merits had not been restored to the district court.

The defendants had moved for more time to respond to the FTC’s motions or for a clarification of whether the deadline for responding would begin to run upon issuance of a new mandate from the Eleventh Circuit. The FTC argued that the district court's jurisdiction was restored by the Eleventh Circuit’s initial mandate, issued in 2012, affirming the district court’s dismissal of the FTC’s complaint. The district court rejected this argument. The FTC's argument that the court had jurisdiction since 2012 was "seriously belied" by the FTC's motion for an expedited remand order, the court noted.

Meanwhile, the FTC administrative proceedings continue. In March, the Commission lifted the stay of those proceedings, concluding that it issued the stay of the administrative proceedings in its own discretion, and it could restart its own administrative proceeding.

Attorneys: Amanda Lewis for FTC. Emmet J. Bondurant, II (Bondurant, Mixson & Elmore, LLP) for Phoebe Putney Health System, Inc.

Companies: Phoebe Putney Health System, Inc.

MainStory: TopStory Antitrust FederalTradeCommissionNews GeorgiaNews

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