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From Antitrust Law Daily, January 5, 2018

Physician excluded from specialized market lacks standing to sue rivals

By E. Darius Sturmer, J.D.

A physician whose aspirations to start a specialty private practice in infectious disease medicine in Gainesville, Florida, were allegedly thwarted by her prospective rivals’ refusals to help her regain hospital staff privileges lacked standing to pursue a federal antitrust claim against the rival physicians stemming from the alleged conduct. Though the physician pleaded sufficient facts to state a claim for relief under Sec. 1 of the Sherman Act, she was not an "efficient enforcer" of the antitrust violation alleged. Therefore, the defendants’ motion to dismiss was granted without prejudice (Garlington v. Kima, January 3, 2018, Walker, M.).

The complaining physician, who specialized in infectious diseases, alleged that the defendants’ refusals to sign off as alternate providers at North Florida Regional Medical Center (NFRMC) during her application process effectively blocked her from obtaining not just the privileges, but the essential pipeline of patient referrals that would come through that affiliation. The defendants were a small group of doctors who were, along with one other now-retired physician originally named as a defendant but since dropped from the case, the only infectious disease physicians in Gainesville with privileges at NFRMC. The plaintiff formerly worked at one of their practices and held NFRMC staff privileges then, but she relinquished them upon departing the practice.

Upon her prospective return to the area, the plaintiff asserted, the defendants met and entered into a pact that none of them would give up any on-call days or agree to be her alternate provider of infectious disease services, an NFRMC staff privileges requisite. They did so "in order to exclude [her] from the market of NFRMC [infectious disease] referrals and thereby reserve the associated profits for themselves." Thus, the purported conspiracy essentially and deliberately caused her exclusion from competing in Gainesville’s market for private infectious disease services, she claimed.

Subject matter jurisdiction. The federal district court in Gainesville, Florida, decided that it lacked subject matter jurisdiction over the claim because the plaintiff was not the appropriate party to be pursuing antitrust claims based on the competitor’s anticompetitive conduct. Even assuming the plaintiff suffered some antitrust injury from the defendants’ conduct, she still had to "be an ‘efficient enforcer’ to have antitrust standing in this case," and a review of the facts revealed that consumers were more directly injured and therefore better suited to pursue the claim.

The defendants’ alleged conspiracy to exclude the complaining physician from the market of infectious disease specialists in Gainesville harmed competition in the market for services by decreasing consumer choice, the court observed. Thus, those potential patients seeking more choices in Gainesville for quality disease care at competitive prices were the ones most fitting to pursue the interests on antitrust law, which was, after all, "to increase consumer choice, lower prices and assist competition, not competitors."

Moreover, the plaintiff’s damages were speculative, the court remarked. She would not have been entitled to or guaranteed patient referrals even if she held the staff privileges she sought, The plaintiff’s own testimony acknowledged that she had "no idea whether [she’d] make more or less" practicing in Gainesville with the NFRMC infectious disease privileges she sought than she currently made practicing the same specialty in Ocala, Florida, instead.

Sufficiency of allegations. The defendants’ alternative grounds for dismissal—failure to plead interstate commerce or concerted action—were, however, rejected by the court. The plaintiff’s allegations that the defendants provided care to out-of-state patients, accepted Medicare and Medicaid payments as well as credit card payments from out-of-state financial institutions, and bought out-of-state supplies for their offices demonstrated a substantial effect on interstate commerce generated by their business activities, the court said. Furthermore, the complaining physician’s factual allegations "plausibly suggest[ed] an illegal, anticompetitive agreement among [the] defendants to exclude her from entering Gainesville’s market for private infectious disease physicians."

The case is No. 1:17cv131-MW/GRJ.

Attorneys: Paul Andrew Donnelly (Donnelly & Gross, P.A.) for Wendy M. Garlington. Jennifer Cates Lester (Salter Feiber Murphy Hutson & Menet PA) for Marie Kima.

MainStory: TopStory Antitrust FloridaNews

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