Antitrust Challenges by Allied Health Care Professionals Involving Hospital Staff Privileges
Peter M. Sfikas, Senior partner, Peterson & Ross, Chicago, Illinois. B.S., 1959, Indiana University; J.D.,
1962, Northwestern University School of Law.
Author's Note: The author wishes to thank Tamra S. Kempf for her valuable assistance in connection
with this Article.
INTRODUCTION
In recent years, the denial, termination, or restriction of hospital staff privileges has given rise to a
number of antitrust lawsuits. In addition to physicians, various allied health care professionals, such as
chiropractors, dentists, nurse anesthetists, nurse midwives, and podiatrists, have challenged hospitals'
decisions regarding staff privileges under the antitrust laws. [n1]
Under most state laws, a hospital's refusal to appoint a health care professional to its medical staff is
not subject to judicial review because of the understandable reluctance of judges to substitute their
judgment for that of decision makers in private organizations. [n2] Accordingly, the outlook for a health
care provider to successfully challenge a decision relating to hospital staff privileges is not very optimistic
unless some other type of violation of law, such as an antitrust violation, can be alleged. [n3] Even so, a
significant number of staff privileges cases including antitrust claims have not survived dispositive
motions.
The existence of new sources of outpatient care undoubtedly has had the effect of minimizing the
antitrust injury associated with the denial or restriction of staff privileges. Likewise, the continuing
reliance of federal courts on economic theory in antitrust cases has had a profound impact, because the
economic approach demands proof that output is restricted in order to show the required foreclosure of
competition and, thus, establish an antitrust violation. [n4]
Antitrust plaintiffs have sued hospitals alleging conspiracies involving the hospital medical staffs.
Allied health care professionals have also made claims of monopolization, attempted monopolization,
boycott, and unlawful tying arrangements. This Article will examine these various antitrust claims as well
as the jurisdictional requirements that must be satisfied in order to maintain an antitrust action.
JURISDICTIONAL PREREQUISITES
In order to survive a motion to dismiss, an allied health care professional challenging a staff privileges
decision on antitrust grounds must allege a relationship between the challenged action and interstate
commerce. [n5] Section 1 of the Sherman Act prohibits every contract, combination, or conspiracy "in
restraint of trade or commerce among the several States. . . ." [n6] Similarly, section 2 of the Sherman Act
prohibits establishment of monopolies, attempts to monopolize, and conspiracies to monopolize in
interstate commerce. [n7] The Supreme Court in McLain v. Real Estate Board, [n8] a case frequently relied
upon in challenges to staff privileges decisions, recognized the requirement that a plaintiff allege the
"defendants' activity is itself in interstate commerce or, if it is local in nature, that it have an effect on some
other appreciable activity demonstrably in interstate commerce." [n9]
Because a challenge to the denial, revocation, or restriction of staff privileges will involve very
localized conduct, an allied health care professional will have to allege an effect on interstate commerce. In
Pao v. Holy Redeemer Hospital, [n10] a staff privileges case involving an ophthalmologist, the court
interpreted McLain and concluded a plaintiff need not make "a 'particularized showing' that as a matter of
fact the defendant's alleged restraint had a substantial impact upon interstate commerce." [n11] Rather, the
Pao court applied a test "framed in terms of probable effects on interstate commerce based on the logic of
practical economics. . . ." [n12] To satisfy the jurisdictional requirement, the plaintiff in Pao asserted he
rendered services to out-of-state patients, received revenue from out-of-state patients, received revenue
from out-of-state sources such as insurance companies and Medicare, and purchased medical supplies and
equipment from out-of-state suppliers. [n13]
In Summit Health, Ltd. v. Pinhas, [n14] the plaintiff, an optometrist and ophthalmological surgeon,
filed a complaint alleging the revocation of his hospital staff privileges was the result of a conspiracy in
violation of section 1 of the Sherman Act. The district court dismissed the plaintiff's Sherman Act count
after concluding the defendants were protected from antitrust liability pursuant to the state action doctrine.
The court also held the plaintiff had failed to allege a sufficient nexus with interstate commerce.
In considering whether the plaintiff's complaint established jurisdiction under the Sherman Act, the
Ninth Circuit reversed the district court's determination that the plaintiff had failed to allege a sufficient
nexus between the challenged activity and interstate commerce. [n15] The court stated the plaintiff need
not "make the more particularized showing of the effect on interstate commerce caused by the alleged
conspiracy to keep him from working" but, rather, indicated the plaintiff "need only prove that peer-review
proceedings have an effect on interstate commerce, a fact that can hardly be disputed." [n16]
In affirming the Ninth Circuit's decision, the Supreme Court held the jurisdictional analysis should
focus "upon the potential harm that would ensue if the conspiracy was successful"; not upon the "actual
consequences." [n17] The Court then found, as a matter of practical economics, a successful conspiracy
would reduce the quantity of ophthamological services in the Los Angeles market. [n18] The impact on
competition of a single surgeon's exclusion from the market, measured generally, was found to affect other
participants and potential participants in that market. [n19] Such restraint, the Court concluded, is covered
by the Sherman Act.
Some hospitals have very little effect on interstate commerce. Staff privileges judgments made by
these hospitals will be extremely difficult for a health care provider to challenge under the antitrust laws.
In Mitchell v. Frank R. Howard Memorial Hospital, [n20] a staff privileges case involving a radiologist, the
Ninth Circuit held the plaintiff failed to make an interstate commerce showing sufficient to establish
Sherman Act jurisdiction. In Mitchell, the record contained uncontroverted evidence indicating the hospital
had not provided medical services for even one out-of-state patient since 1983. [n21] The court concluded
the fact the hospital received some out-of-state insurance money and purchased supplies from some out-ofstate sellers did not constitute a substantial effect on interstate commerce. [n22]
Accordingly, an allied health care professional challenging a hospital's decision regarding staff
privileges should allege with specificity, and be able to prove if challenged, examples of a hospital's
significant effect on interstate activity. The proximity of the facility to other comparable facilities,
treatment of a measurable number of out-of-state patients, purchase of equipment and supplies from other
states, revenues generated from out-of-state insurance programs, and revenues obtained through payments
from out-of-state patients are certainly relevant to a determination of whether jurisdiction is appropriate
under the Sherman Act. [n23]
CONSPIRACY ALLEGATIONS
Most lawsuits challenging hospital staff privileges decisions allege conspiracy. [n24] In examining an
allied health care professional's conspiracy allegations made pursuant to section 1 of the Sherman Act, a
court must first determine whether some form of joint action exists to satisfy the contract, combination, or
conspiracy requirement. [n25] Concerted conduct by more than one person or entity must be established -mere unilateral activity is not actionable under section 1 of the Sherman Act. [n26] If concerted action is
found, a court must then determine whether the concerted activity is an unreasonable restraint of trade.
[n27]
In Kreuzer v. American Academy of Periodontology, [n28] a case involving an alleged boycott against
a dentist, the D.C. Circuit recognized one of the difficulties in determining whether a conspiracy to restrain
trade exists is that such a conspiracy is rarely evidenced by explicit agreements. A conspiracy is most often
proven by "inferences that may fairly be drawn from the behavior of the alleged conspirators." [n29] In
Matsushita Electric Industrial v. Zenith Radio, [n30] the United States Supreme Court stated respondents
had to demonstrate "the inference of conspiracy is reasonable in light of the competing inferences of
independent action or collusive action that could not have harmed respondents." [n31]
In Cooper v. Forsyth County Hospital Authority, [n32] the plaintiff podiatrists alleged the denial of
their podiatric surgical privileges resulted from an anticompetitive conspiracy. However, the plaintiffs in
Cooper had no direct evidence of a conspiracy, but rather relied upon inferences drawn from circumstantial
evidence. [n33] The court concluded the plaintiffs' circumstantial evidence was insufficient to permit an
inference of conspiracy. [n34] The court noted "federal courts consistently have recognized mere contacts
and communications, or the mere opportunity to conspire among antitrust defendants, is insufficient
evidence to infer an anticompetitive conspiracy in the context of denial of hospital surgical privileges."
[n35]
The Ninth Circuit, in Oltz v. St. Peter's Community Hospital, [n36] considered three elements in
evaluating a conspiracy claim for denial of hospital staff privileges to an anesthesiologist: (1) an agreement
or conspiracy among two or more persons or distinct business entities; (2) by which the persons or entities
intend to harm or restrain competition; and (3) an agreement or conspiracy which actually injures
competition. [n37] After these elements have been established, the court stated the factfinder must then
"balance the restraint and any justifications or procompetitive effects of the restraint in order to determine
whether the restraint is unreasonable." [n38]
Conspiracies Between a Hospital and its Medical Staff
Several types of conspiracies may be alleged in hospital staff privileges complaints. For example, a
number of antitrust plaintiffs have alleged a hospital and its medical staff wrongfully conspired to deprive
the plaintiff of his medical staff privileges. [n39] However, the federal appeals courts are split with respect
to whether a hospital is legally capable of conspiring with members of the medical staff. [n40] The split in
opinion results from different readings of the Supreme Court's holding in Copperweld Corporation v.
Independence Tube Corporation. [n41] In Copperweld the Court held "officers or employees of the same
firm do not provide the plurality of actors imperative for a section 1 conspiracy." [n42]
In Weiss v. York Hospital, [n43] the Third Circuit concluded a hospital is legally incapable of
conspiring with its medical staff under section 1 of the Sherman Act. The plaintiff in Weiss, an osteopath,
on behalf of the class of all osteopathic physicians in the York Medical Service Area, brought an antitrust
class action suit against a hospital and its medical staff based upon York Hospital's denial of the plaintiff's
staff privileges. The plaintiff alleged he was denied staff privileges solely because he was an osteopathic
physician, rather than a medical physician. Plaintiff argued the hospital's medical physicians conspired to
exclude osteopaths from York Hospital in order to restrict the ability of osteopaths to compete with medical
physicians, thereby increasing their profits. In considering this conspiracy allegation, the Third Circuit
concluded, as a matter of law, a hospital could not legally conspire with its medical staff, as an entity
because the staff "operated the same as an officer of a corporation would in relation to the corporation . . .
[and] had no interest in competition with the hospital." [n44] However, the court went on to hold there was
a combination among the individual members of the medical staff. [n45]
The Ninth and the Eleventh Circuits, however, have rejected the Copperweld corporate law analysis
and have held a hospital is legally capable of conspiring with its medical staff under section 1 of the
Sherman Act. An Eleventh Circuit case, Bolt v. Halifax Hospital Medical Center, [n46] involved a
physician whose medical staff privileges were revoked at three hospitals. The plaintiff filed a complaint
against the hospitals, members of their medical staffs and a local medical society, alleging various
violations of the antitrust laws. [n47] In particular, the plaintiff alleged the hospital and the medical staff
entered into a conspiracy in violation of section 1 of the Sherman Act. In considering the plaintiff's
conspiracy allegation, the Eleventh Circuit stated it perceived "no basis for holding that a hospital is legally
incapable of conspiring with the members of its medical staff." [n48] The court stated "[a] hospital and the
members of its medical staff, in contrast [to a corporation and its agents,] are legally separate entities, and
consequently no similar danger exists that what is in fact unilateral activity will be bootstrapped into a
'conspiracy.'" [n49]
The Ninth Circuit also rejected the Copperweld rationale in its decision Oltz v. St. Peter's Community
Hospital. [n50] The plaintiff in Oltz, an anesthesiologist, filed a complaint alleging an unlawful conspiracy
among anesthesia service providers and the local hospital. The court stated "[a]lthough the M.D.
anesthesiologists may have been the agents of St. Peter's for some purposes, their interests were not as wed
as the ties between a corporation and its officers or employees." [n51]
Conspiracies Between Two or More Hospitals
Under appropriate circumstances, it is possible in a suit for denial of staff privileges to argue there is a
conspiracy between two or more hospitals. In Nurse Midwifery Associates v. Hibbett, [n52] the plaintiff
nurse midwives alleged a conspiracy existed between two hospitals to deny the plaintiffs' privileges at these
hospitals. The court stated plaintiffs must show: (1) the alleged conspirators' business activities constituted
parallel conduct; (2) the alleged conspirators had a motivation to enter into a conspiracy; and (3) the actions
taken were contrary to the alleged conspirators' individual economic interests. [n53]
Similarly, in Bolt v. Halifax Hospital Medical Center, [n54] the plaintiff alleged the existence of three
separate conspiracies, one of which involved a conspiracy between several hospitals. The Bolt court held
the hospitals were separate entities, and a valid conspiracy claim could be made.
AN ALLIED HEALTH CARE PROFESSIONAL MUST ESTABLISH STANDING
An allied health care professional challenging a staff privileges decision must plead facts sufficient to
establish standing to allege antitrust violations. [n55] Section 4 of the Clayton Act provides that "any
person injured in his business or property by an antitrust violation shall be entitled to recover damages."
[n56] The plaintiff must plead both an "injury" and a "causal connection" between the violation alleged and
the injury.
In recent years, courts have frequently dismissed antitrust complaints for lack of standing. In
Colorado Chiropractic Council v. Porter Memorial Hospital, [n57] the district court found the plaintiffs,
chiropractors and a chiropractic council, did not have standing to pursue an antitrust challenge regarding
staff privileges because the plaintiffs failed to establish an injury that was traceable to the defendants.
In Associated General Contractors v. Carpenters, [n58] the United States Supreme Court considered
the following factors in determining whether plaintiffs had standing to sue for damages under the federal
antitrust laws: (1) whether plaintiffs were competitors or consumers in the allegedly restrained market; (2)
whether plaintiffs' alleged injury was only an indirect result of the alleged violations; (3) whether there
were more direct victims of the alleged conspiracy; (4) whether plaintiffs' claims were speculative; and (5)
whether allowance of plaintiffs' claims would create a risk of duplicative recovery. [n59]
In addressing the issue of standing, allied health care professionals must plead facts and avoid mere
conclusions of law. In Pao v. Holy Redeemer Hospital, [n60] the court dismissed with prejudice the
plaintiff ophthalmologist's Sherman Act claims because it would be an onerous imposition on the judicial
process to permit litigation to go forward on the basis of conclusory and speculative allegations. [n61]
Per Se or Rule of Reason Standard
Most antitrust challenges to hospital staff privileges decisions are made pursuant to section 1 of the
Sherman Act. [n62] Case law, however, has long interpreted this language to prohibit only "unreasonable"
restraints of trade. [n63] This approach, generally referred to as a "rule of reason," is typically used to
analyze conspiracy and boycott charges made in hospital staff privileges decisions. [n64]
Under the rule of reason, an allied health care professional challenging a staff privileges decision bears
the burden of proving a particular practice is unreasonable. A rule of reason standard requires a court or
jury to balance the procompetitive effects against the anticompetitive effects of the challenged restraint.
[n65]
Further, the district court in Kaczanowski v. Medical Center Hospital of Vermont, [n66] a staff
privileges case involving podiatrists, stated: "[I]n terms of the Rule of Reason, to demonstrate a right to
relief the plaintiff must bring forth 'an injury of the type the antitrust laws were intended to prevent and that
flows from that which makes the defendants' acts unlawful.'" [n67] The focus of this rule of reason standard
is economic impact. The court applied this standard and granted summary judgment in favor of defendants.
The court held the plaintiffs failed to demonstrate an anticompetitive effect resulting in the relevant market
from the plaintiff's exclusion from the hospital staffs. [n68] The court specifically noted the record failed to
supply the essential ingredients of economic impact. [n69] Accordingly, the fact that an allied health care
professional may have suffered an injury personally is not sufficient by itself to recover under section 1 of
the Sherman Act. [n70]
In Marrese v. American Academy of Orthopedic Surgeons, [n71] a case involving a professional
association's denial of membership to an orthopedic surgeon and a subsequent denial of hospital privileges,
the district court for the Northern District of Illinois reasoned the factfinder must consider the
circumstances of the specific case in deciding whether a restrictive practice should be prohibited as
imposing an unreasonable restraint on competition. [n72] In order to make such a determination, the
threshold issue is whether the defendant has sufficient market power to exert anticompetitive behavior.
[n73] Once it is established the defendant has market power, the question becomes whether there is a
restraint of trade and, if so, whether that restraint is unreasonable. [n74] In any rule of reason analysis, it is
essential that an anticompetitive market effect be demonstrated. [n75]
It is the exception, rather than the rule, that a court will utilize a per se analysis in a case challenging a
staff privileges decision. [n76] However, some restraints such as price fixing have been determined to be so
manifestly anticompetitive that they are considered to be per se illegal. Thus, a court in those
circumstances will not engage in a case-by-case analysis of whether the procompetitive effects of the
challenged restraint outweigh the anticompetitive effects of the restraint. [n77]
As stated by the Supreme Court in Northwest Wholesale Stationers v. Pacific Stationery and Printing,
[n78] for the per se rule to be applied by a court, a plaintiff must allege the defendants possessed "market
power or unique access to a business element necessary for effective competition." [n79] In practically all
hospital staff privileges cases, a rule of reason analysis will be applicable.
Boycott Allegations in the Context of Hospital Staff Privileges
Some allied health care professionals who have been denied hospital staff privileges have alleged an
illegal boycott, or a concerted refusal to deal. [n80] In Weiss v. York Hospital, [n81] the plaintiff, an
osteopath who was denied staff privileges at York Hospital, filed suit both individually and as
representative of the class of all osteopathic physicians in the York Hospital medical service area against
York Hospital, the York Medical and Dental Staff, and ten individual physicians who served on several
committees at York.
In Weiss, the jury found the defendants had engaged in a policy of discrimination against the plaintiff
and other osteopaths by applying unfair, unequal, and unreasonable procedures in reviewing their
applications. [n82] The court of appeals considered whether the challenged activities could be characterized
as a group boycott or a concerted refusal to deal. The court concluded the hospital's restrictive policy with
respect to hospital staff privileges was sufficiently close to a traditional boycott; and, thus, the boycott
characterization was appropriate. [n83] Based upon this similarity to the traditional boycott, and the fact
that the defendants offered no public service or ethical norm rationale for their discriminatory treatment,
the court applied the per se rule and held an injunction under section 1 could issue in favor of the class.
[n84]
Wilk v. American Medical Association [n85] is another case involving boycott allegations in the
context of hospital staff privileges. In Wilk, licensed chiropractors alleged the American Medical
Association (AMA) and several other defendants engaged in an illegal boycott against chiropractors in
violation of section 1 of the Sherman Act. The district court concluded the conspiracy ended in 1980, but
the illegal boycott's lingering effects still threatened plaintiffs with current injury. [n86] The district court,
therefore, ordered injunctive relief designed to make AMA members aware of the present AMA position -that it is ethical for medical physicians to associate professionally with chiropractors if the physician
believes such an association is in the patients' best interest. [n87] The Seventh Circuit found the district
court had correctly applied the rule of reason rather than a per se analysis. [n88]
In Konik v. Champlain Valley Physicians Hospital, [n89] the plaintiff alleged an unlawful boycott.
Konik involved an anesthesiology specialist who appealed from a judgment dismissing her complaint under
the Sherman Act. The plaintiff claimed the defendants, a hospital and an anesthesia group, had engaged in
an unlawful group boycott with respect to the provision of anesthesiology services in the hospital. The
plaintiff's claim was premised upon the construction of a contract between the hospital and the professional
corporation regarding the provision of anesthesiology services at the hospital. Although invited to become
a party to the contract, the plaintiff declined. [n90] In affirming the district court, the Second Circuit Court
of Appeals held the evidence was insufficient to support a rational inference that the contract, which was
offered to the plaintiff at parity with the professional corporation, was designed to exclude her. [n91]
ALLEGED TYING ARRANGEMENTS
Some allied health care professionals who have been denied hospital staff privileges have alleged that
such denial was based upon an illegal tying arrangement. [n92] Bhan v. NME Hospitals, [n93] involved a
nurse anesthetist who brought suit on a tying theory in violation of section 1 of the Sherman Act. The Bhan
court stated that, to recover on a tying theory, a plaintiff must demonstrate: (1) a tie-in between two distinct
products or services; (2) sufficient economic power in the tying product market to affect the tied product
market; and (3) more than a substantial amount of commerce in the tied market product is effected. [n94]
The Supreme Court in Jefferson Parish Hospital v. Hyde [n95] noted the essential characteristic of an
illegal tying arrangement lies in the "seller's exploitation of its control over the tying product to force the
buyer into the purchase of a tied product that the buyer either did not want at all, or might have preferred to
purchase elsewhere on different terms." [n96] It is, therefore, critical that an allied health care professional
attempting to challenge a hospital staff privileges decision on a tying arrangement theory allege both the
sale of two different products, namely the tied and tying products, and a restraint in a particular geographic
market.
As with other alleged antitrust violations, it is necessary to determine the issue of the appropriate
standard of analysis. In Hyde, the Supreme Court addressed the question of which analysis, rule of reason
or a per se approach, was appropriate in a case involving allegations of an illegal tying arrangement. The
plaintiff in Hyde, a board certified anesthesiologist, was denied admission to a hospital staff. The hospital
in Hyde had an exclusive services contract with a professional medical corporation of anesthesiologists
which required all anesthesiology services for the hospital's patients be provided by the corporation. [n97]
The plaintiff sought a declaratory judgment establishing the exclusive contract was unlawful, as well as an
injunction ordering the hospital to appoint him to the medical staff.
In considering plaintiff's contention that the per se condemnation was appropriate, the Supreme Court
in Hyde concluded "[p]er se condemnation -- without inquiry into actual market conditions -- is only
appropriate if the existence of forcing is probable." [n98] Because the Supreme Court concluded it was not
probable the defendants in Hyde had market power in the market for the tying product, the court applied a
rule of reason analysis. Similarly in Bhan, [n99] the court declined to apply the per se rule because the
hospital did not have sufficient economic power in the relevant market. [n100]
An illegal tying arrangement was also alleged in Collins v. Associated Pathologists. [n101] The
plaintiff, a pathologist, alleged the contractual arrangement between the hospital and a group providing
pathology services to the hospital functioned as an unlawful tying arrangement. [n102] The Seventh Circuit
held no tying arrangement could exist unless there was a demand for the purchase of pathology services by
hospital patients separate from the demand for the hospital facilities and services. [n103] Unlike the record
in Jefferson Parish Hospital, the record in Collins indicated no separate demand existed to create a separate
market for pathological services. [n104] Based on the lack of two products necessary to make a tying
arrangement plausible, the Seventh Circuit affirmed the district court's grant of summary judgment for the
defendants.
MONOPOLIZATION AND ATTEMPTED MONOPOLIZATION CLAIMS
Monopolization and attempted monopolization claims have also been made by allied health care
professionals who have been denied hospital staff privileges or who have had their staff privileges
terminated or restricted. [n105] Section 2 of the Sherman Act provides "[e]very person who shall
monopolize or attempt to monopolize, or combine or conspire with any other person or persons, to
monopolize any part of the trade or commerce among the several States . . . shall be deemed guilty of a
felony." [n106] Monopoly power is "the power to control market prices or exclude competition." [n107] In
order for an allied health care professional to prove monopolization, or an attempt to monopolize in the
context of hospital staff privileges, the individual first must define the relevant geographic and product
market.
In Konik v. Champlain Valley Physicians Hospital, [n108] the plaintiff, an anesthesiologist, alleged
one of defendants, an anesthesiology group, monopolized and attempted to monopolize the market for
anesthesiology services in the geographic market in which it operated. In analyzing the plaintiff's
monopolization claim, the court held that in order for monopolization to violate section 2 of the Sherman
Act, the defendant must not only possess monopoly power in the relevant market, but that power must have
been acquired or maintained willfully, rather than having been acquired or maintained from growth or
development as a consequence of a superior product, business acumen, or historic accident. [n109] Because
the trial testimony in Konik demonstrated no other anesthesiologists wanted to practice in the geographic
market, the Second Circuit concluded the district court properly dismissed the plaintiff's monopolization
claim under section 2. [n110]
Similarly, in Collins v. Associated Pathologists, [n111] the Seventh Circuit held the district court
properly granted the defendants' motions for summary judgment regarding the monopolization claims. The
court held the plaintiff, a pathologist, could not bring a claim of monopolization or attempted
monopolization against the defendants without showing some type of effort at illegal monopolization on
the part of the hospital where the anesthesiologist operated. [n112] Likewise in Bhan v. NME Hospitals,
[n113] the court granted the defendant's motion for summary judgment on the plaintiff nurse anesthetist's
monopolization and attempt to monopolize claims. In Bhan, the plaintiff failed to provide any evidence of
the relevant market for anesthesia services and thus, could not demonstrate market power in that market.
Alleged Violations of the Essential Facilities Doctrine Under Section 2 of the Sherman Act
Some health care professionals who have been denied hospital staff privileges have also alleged a
violation of the essential facilities doctrine under section 2 of the Sherman Act. [n114] This doctrine
provides that where facilities cannot be practically duplicated by would-be competitors, those in possession
of such essential facilities must allow them to be shared on fair terms, and it is an illegal restraint of trade to
foreclose the scarce facility. [n115] Some plaintiffs have alleged that the denial of staff privileges
constitutes a violation of the essential facilities doctrine. [n116]
In McKenzie v. Mercy Hospital, [n117] the plaintiff physician alleged the defendant hospital violated
the essential facilities doctrine by denying him hospital staff privileges. The plaintiff admitted that even
after losing his staff privileges he still had a substantial obstetrical care practice and was continuing to
compete with the defendant hospital's emergency room. [n118] Hence, on the basis of the plaintiff's own
admission, the court concluded the plaintiff had failed to demonstrate the hospital controlled facilities
essential to the plaintiff's medical practice of obstetrical and emergency care practice. [n119]
In Konik v. Champlain Valley Physicians Hospital Medical Center, [n120] the court considered the
plaintiff anesthesiologist's claim based upon the essential facilities doctrine, and concluded the claim must
fail because the plaintiff was unable to demonstrate any economic handicap resulting from the alleged
exclusion from the defendant hospital. [n121]
STATE ACTION DEFENSE
Defendants in a number of recent antitrust cases involving challenges to hospital staff privileges
decisions have asserted the state action defense. [n122] Under certain circumstances, the state action
doctrine recognized by the United States Supreme Court in Parker v. Brown, [n123] can immunize conduct
from application of the antitrust laws if certain conditions are met. The Supreme Court in Parker, and its
progeny, enunciated the circumstances in which a state may immunize activities which are a product of
state regulation. To shield activities from the antitrust laws, the following two-prong test must be satisfied:
(1) the challenged restraint must be clearly articulated and affirmatively expressed as state policy; and (2)
the conduct in question must be actively supervised by the state itself. [n124] This test was articulated in
California Retail Liquor Dealers Association v. Midcal Aluminum [n125] and has become known as the
Midcal test.
Various staff privileges cases have applied the Midcal two-prong test in analyzing assertions of the
state action defense. In Patrick v. Burget, [n126] the United States Supreme Court reversed the Ninth
Circuit's decision which had found the conduct related to the staff privileges decision under review to be
immune from antitrust liability under the state action doctrine. In Patrick, the plaintiff was a general and
vascular surgeon who operated an independent practice in competition with the surgical practice of the
defendant clinic. Pursuant to a peer-review process, the clinic voted to terminate the plaintiff's hospital
staff privileges. The plaintiff filed a complaint alleging members of the clinic initiated and participated in
the hospital peer-review proceedings to reduce competition by the plaintiff rather than to improve patient
care.
In reversing the Ninth Circuit's decision, the Supreme Court in Patrick concluded the second prong of
the Parker test was not satisfied. [n127] In analyzing the active supervision prong of the Midcal test, the
court stated the following:
The active supervision prong of the Midcal test requires that state officials have and exercise power to
review particular anticompetitive acts of private parties and disapprove those that fail to accord with state
policy. Absent such a program of supervision, there is no realistic assurance that a private party's
anticompetitive conduct promotes state policy, rather than merely the party's individual interests. [n128]
The Supreme Court therefore examined Oregon's supervision of the peer-review process. The Court
held the state action doctrine did not protect the peer-review activities under scrutiny from application of
the antitrust laws because no state actor in plaintiff's state actively supervised hospital peer-review
decisions. [n129] The Court was not forced to decide the broad question of whether judicial review of
private conduct could ever constitute active supervision because the state's judicial review of privilegestermination decisions, if it existed at all, fell far short of satisfying the active state supervision requirement.
Similarly, in Summit Health, Ltd. v. Pinhas, [n130] the Ninth Circuit rejected the defendant's
contentions that the State Department of Health Services, the California Board of Medical Quality
Assurance, and the state judiciary all actively supervised California's peer-review system. The court noted
California's judicial review was of a very limited nature, and thus did not constitute active supervision of
the peer-review process. [n131]
CONCLUSION
Physicians and allied health care providers have had little success in recent challenges to hospitals'
staff privileges decisions. The courts frequently dismiss these cases on dispositive motions long before any
evidentiary hearings.
As a casual observer of recent antitrust law may be aware, courts in antitrust actions increasingly focus
on the question whether certain conduct reduces the output of products or services. The typical denial of a
hospital staff privileges case neither reduces competition, nor reduces the output of health care services.
Nevertheless, given the correct set of facts, it is possible for courts to find an antitrust violation in the
context of denial, termination, or restriction of hospital staff privileges. Such facts must include the
requisite jurisdictional basis, the existence of a conspiracy or other combination or proof of monopolizing
conduct, the existence of the plaintiff's standing, and the absence of such defenses that would give
immunity to the defendant's actions.
REFERENCE: [n1.] In staff privileges cases, complaints often include allegations regarding breach of
contract, violations of state antitrust law, violations of procedural due process and/or tortious interference
with contractual relations. A full discussion of these issues is beyond the scope of this Article.
[n2.] See, e.g., Shahawy v. Harrison, 875 F.2d 1529 (11th Cir. 1989) (physician); Adkins v. Sarah
Bush Lincoln Health Center, 544 N.E.2d 733 (Ill. 1989) (physician); Barrows v. Northwestern Memorial
Hosp., 525 N.E.2d 50 (Ill. 1988) (physician); Lapidot v. Memorial Medical Center, 494 N.E.2d 838 (Ill.
App. 1986) (physician); Rao v. St. Elizabeth's Hosp., 488 N.E.2d 685 (Ill. App. 1986) (physician).
[n3.] Treble damages, costs of the suit, and reasonable attorney fees are available under section 4 of the
Clayton Act. 15 U.S.C. § 15 (1988).
[n4.] The case of Marrese v. American Academy of Orthopaedic Surgeons, 1991-1 Trade Cas. (CCH)
P69,398 (N.D. Ill. 1991), is illustrative of the economic analysis reflected in many courts' examination of
hospital staff privileges challenges. In Marrese, the plaintiff orthopedic surgeon sued the American
Academy of Orthopaedic Surgeons (Academy) alleging the Academy rejected his application for
membership because of a continuing conspiracy among the Academy members. The Marrese court stated
the following with respect to the requisite economic effect:
The first inquiry in a rule of reason analysis is whether the defendant possesses market power, as a
preliminary step to establishing whether there was an unreasonable restraint of trade. . . ." Market Power" is
the ability to raise prices above the competitive level by restricting output. (citation omitted). Id. at
P65,605.
In considering the plaintiff's allegations with respect to market power, the Marrese court concluded the
plaintiff failed to show the denial of membership left the plaintiff at a competitive disadvantage or deprived
him of the "opportunity to compete effectively on equal terms." (citation omitted). Id. at 65,606. The court
noted the plaintiff did little more than state the Academy had market power and put the plaintiff at a
competitive disadvantage. Id.
The reader should be careful not to confuse this case with its predecessor of the same name. As the
Marrese court noted, "[t]his case has had a career of Byzantine complexity in both the state and federal
courts since the events that gave rise to the complaint occurred over fifteen years ago." Id. at 65,599.
[n5.] The following cases discuss the interstate commerce requirement in the context of staff privileges
for both physicians and allied health care professionals. See, e.g., Anesthesia Advantage, Inc. v. Metz
Group, 912 F.2d 397 (10th Cir. 1990) (held a genuine issue of material fact existed as to whether plaintiff
nurse anesthetists satisfied interstate commerce requirement; case remanded); Doe v. St. Joseph's Hosp.,
788 F.2d 411 (7th Cir. 1986) (plaintiff physician failed to meet interstate commerce requirement); Stone v.
William Beaumont Hosp., 782 F.2d 609 (6th Cir. 1986) (physician failed to meet interstate commerce
requirement); Hayden v. Bracy, 744 F.2d 1338 (8th Cir. 1984) (physician failed to meet interstate
commerce requirement); Marrese v. Interqual, 748 F.2d 373 (7th Cir. 1984), (orthopedic surgeon produced
sufficient evidence to satisfy interstate commerce requirement); cert. denied, 472 U.S. 1027 (1985); CardioMedical Ass'n v. Crozer-Chester Medical Center, 721 F.2d 68 (3rd Cir. 1983) (physician; held - sufficient
evidence to meet interstate commerce requirement); Bhan v. NME Hosp., 669 F.Supp. 998 (E.D. Cal.
1987), aff'd, 929 F.2d 1404 (9th Cir. 1991) petition for cert. filed, Sept. 30, 1991 (produced sufficient
evidence to satisfy interstate commerce requirement); Sweeney v. Athens Regional Medical Ctr., 709
F.Supp. 1563 (M.D. Ga. 1989) (nurse midwife produced sufficient evidence to satisfy interstate commerce
requirement); Tempkin v. Lewis-Gale Hosp., 1989-2 Trade Cas. (CCH) P68,865 (W.D. Va. 1989), aff'd,
1991-1 Trade Cas. (CCH) P69,401 (4th Cir. 1991) (physician and nurse practitioner produced insufficient
evidence to satisfy interstate commerce requirement); Pao v. Holy Redeemer Hosp., 547 F. Supp. 484 (E.D.
Pa. 1982) (ophthalmologist produced sufficient evidence to satisfy interstate commerce requirement). Cf.
Nara v. American Dental Ass'n, 526 F. Supp. 452 (W.D. Mich. 1981) (dentist produced insufficient
evidence to satisfy interstate commerce requirement).
[n6.] 15 U.S.C. § 1 (1988).
[n7.] Id. § 2.
[n8.] 444 U.S. 232 (1980).
[n9.] Id. at 242.
[n10.] 547 F. Supp. 484 (E.D. Pa. 1982).
[n11.] Id. at 489.
[n12.] Id.
[n13.] Id. In reviewing the alleged interstate activities, the court found both plaintiff's affidavit and
pleadings "satisfie[d], albeit only marginally, the jurisdictional standard discussed earlier." Id.
[n14.] 894 F.2d 1024 (9th Cir. 1990), aff'd, 111 S. Ct. 1842 (1991).
[n15.] Id., 894 F.2d 1024.
[n16.] Id. at 1032.
[n17.] Id.
[n18.] Id. at 1848.
[n19.] Id.
[n20.] 853 F.2d 762, 765 (9th Cir. 1988), cert. denied, 489 U.S. 1013 (1989).
[n21.] Id. at 764-65.
[n22.] Id. at 765.
[n23.] See supra note 5 and cases cited therein.
[n24.] In the following cases, involving challenges to hospital staff privileges decisions, conspiracy
allegations were made. See, e.g., Sweeney v. Athens Regional Medical Center, 709 F. Supp. 1563 (M.D.
Ea. 1989) (nurse midwife; defendant's summary judgment motion denied on conspiracy issue); Nurse
Midwifery Ass'ns v. Hibbett, 918 F.2d 605 (6th Cir. 1990), modified, 927 F.2d 904 (6th Cir. 1991) (nurse
midwives; remanded; several competing obstetricians, alleged to have joined together to cause the hospital
to deny privileges to a competitor and thus, were not agents of the hospital for purposes of the
intracorporate conspiracy doctrine), petition for cert. filed, No. 90-1883 (June 10, 1991); Kaczanowski v.
Medical Center Hosp., 612 F. Supp. 688 (D. Vt. 1985) (podiatrist; defendant's summary judgment motion
granted on conspiracy issue); Feldman v. Jackson Memorial Hosp., 571 F. Supp. 1000 (S.D. Fla. 1983)
(podiatrist; conspiracy claim failed), aff'd., 752 F.2d 647 (11th Cir. 1985), cert. denied, 472 U.S. 1029
(1985). The Federal Trade Commission has also pursued a number of cases involving hospital staff
privileges. See, e.g., Medical Staff of Memorial Medical Ctr., 110 F.T.C. 541 (1988) (consent order)
(complaint alleged the medical center acted as a combination or in conspiracy with some of its physician
members in denying a nurse-midwife hospital staff privileges); Health Care Management Corp., 107 F.T.C.
285 (1986) (consent order) (complaint alleged the hospital and its medical staff conspired to restrain
podiatrists from performing surgery at the hospital); North Carolina Orthopedic Ass'n, 108 F.T.C. 116
(1986) (consent order) (complaint alleged the association conspired to take action to exclude or
unreasonably discriminate against podiatrists who sought surgical privileges or access to or use of hospital
facilities).
[n25.] See Summit Health, Ltd. v. Pinhas, 111 S. Ct. 1842 (1991) (ophthalmological surgeon).
[n26.] See Oltz v. St. Peter's Community Hosp., 861 F.2d 1440, 1449 (9th Cir. 1988), modified on
reh'g, 927 F.2d 904, petition for cert. filed, June 10, 1991 (nurse anesthetist).
[n27.] Id.
[n28.] 735 F.2d 1479, 1486 (D.C. Cir. 1984).
[n29.] Id. In Kreuzer, the court held the plaintiff did not establish the existence of a conspiracy
between the two professional associations. Id. at 1490. The specific contacts between the alleged
coconspirators were of too abstract a nature for the court to infer a conspiracy to violate the Sherman Act.
Id. at 1489.
[n30.] 475 U.S. 574 (1986).
[n31.] Id. at 588.
[n32.] 789 F.2d 278 (4th Cir. 1986), cert. denied, 479 U.S. 972 (1986).
[n33.] Id. at 281.
[n34.] Id.
[n35.] Id. See also Monsanto v. Spray-Rite Serv. Corp., 465 U.S. 752 (1984); Steuer v. Nat'l Medical
Enterprises, 672 F. Supp. 1489 (D.S.C. 1984), aff'd, 846 F.2d 70 (4th Cir. 1988). In Steuer the court applied
the summary judgment standard enunciated by the United States Supreme Court in Matsushita, 475 U.S.
574 (1986), and concluded the record unequivocally supported the defendants' claim they acted unilaterally
in entering into an exclusive contract for pathology services at Cherokee Memorial Hospital. Accordingly,
the court granted the defendants' motion for summary judgment with respect to the plaintiffs' conspiracy
count. Steuer, 672 F. Supp. at 1516-19.
For many years courts were hesitant to grant summary judgment. In "complex litigation where motive
and intent play leading roles, the proof is largely in the hands of the alleged conspirators, and hostile
witnesses thicken the plot." Poller v. Columbia Broadcasting Sys., 368 U.S. 464, 473 (1962).
However, in recent years, courts have been more inclined to use summary adjudication in antitrust
cases. Cases such as Matsushita, 475 U.S. 574; Celotex Corp. v. Catrett, 477 U.S. 317 (1986); Andersen v.
Liberty Lobby, Inc., 477 U.S. 242 (1986); Car Carriers, Inc. v. Ford Motor Co., 745 F.2d 1101 (7th Cir.
1984), indicate "contrary to emphasis of some prior precedent, the use of summary judgment is not only
permitted but encouraged in certain circumstances, including antitrust cases." Collins v. Associated
Pathologists, Ltd., 844 F.2d 473, 475 (7th Cir. 1988), cert. denied, 488 U.S. 852 (1988). Accordingly,
courts have used summary adjudication in a number of cases involving antitrust challenges to staff
privileges decisions.
[n36.] 861 F.2d 1440 (9th Cir. 1988).
[n37.] Id. at 1445. Most courts hold pursuant to section 1 of the Sherman Act, a plaintiff need not
prove intent on the part of the coconspirators to restrain trade or to build a monopoly. See Bolt v. Halifax
Hosp. Medical Center, 891 F.2d 810, 819-20 (11th Cir. 1990), cert. denied, 110 S. Ct. 1960 (1990). It is
therefore generally sufficient to prove the conspiracy had an anticompetitive effect. See National Collegiate
Athletic Ass'n v. Board of Regents, 468 U.S. 85, 101 n.23 (1984).
[n38.] Bolt, 891 F.2d 810; NCAA, 468 U.S. 85. In Oltz, the Ninth Circuit affirmed a jury verdict in
favor of plaintiff anesthesiologist. The court held the evidence was sufficient to demonstrate a conspiracy
to terminate the plaintiff's hospital staff privileges but remanded the case for a new trial on damages. Oltz,
861 F.2d at 1452-53.
[n39.] See Weiss v. York Hosp., 745 F.2d 786 (3d Cir. 1984), cert. denied, 470 U.S. 1060 (1985).
[n40.] Compare Weiss v. York Hosp., 745 F.2d 786 (3rd Cir. 1984), with Bolt v. Halifax Hosp.
Medical Ctr., 891 F.2d 840 (11th Cir. 1990).
[n41.] 467 U.S. 752 (1984).
[n42.] Id. at 769.
[n43.] 745 F.2d 786, 814-15 (3rd Cir. 1984), cert. denied, 470 U.S. 1060 (1985).
[n44.] Id. at 817. In Weiss, the Third Circuit ultimately concluded the hospital medical staff's policy of
discriminating against osteopathic physicians constituted a per se illegal boycott. Id. at 820-24. A number
of staff privileges challenges have also alleged boycotts in restraint of trade. See, e.g., Nanavati v. Burdette
Tomlin Memorial Hosp., 857 F.2d 96 (3rd Cir. 1988), cert. denied, 489 U.S. 1078 (1989) (physician);
Collins v. Associated Pathologists, Ltd., 844 F.2d 473 (7th Cir.) (pathologist), cert. denied, 488 U.S. 852
(1988); Konik v. Champlain Valley Physicians Hosp., 561 F. Supp. 700 (N.D.N.Y. 1983), aff'd, 733 F.2d
1007 (2nd Cir.) (anesthesiologist), cert. denied, 469 U.S. 884 (1984).
Courts have held that a medical staff could not conspire with the hospital because legally there is only
one entity. See, e.g., Nurse Midwifery Ass'ns v. Hibbett, 918 F.2d 605 (6th Cir. 1990), modified, 927 F.2d
904 (6th Cir. 1991), petition for cert filed, No. 90-1883 (June 10, 1991); Nanavati v. Burdette Tomlin
Memorial Hosp., 857 F.2d 96 (physician); Potters Medical Ctr. v. City Hosp. Ass'n, 800 F.2d 568, 573 (6th
Cir. 1986) (general acute care hospital).
[n45.] Weiss, 745 F.2d at 816.
[n46.] 891 F.2d 810, 819-20 (11th Cir.), cert. denied, 110 S. Ct. 1960 (1990).
[n47.] Id. at 813.
[n48.] Id. at 819.
[n49.] Id. In Bolt, the appellate court concluded the district court erred in prohibiting the plaintiff from
introducing evidence that the peer review proceedings were a sham and the hospital's reasons for revoking
his staff privileges were pretexts. Id. at 822. Thus, the court held the district court erred in granting directed
verdicts in favor of defendants. Id.
[n50.] 861 F.2d 1440 (9th Cir. 1988).
[n51.] Id. at 1450. The Ninth Circuit in Oltz concluded the evidence was sufficient to demonstrate a
conspiracy and to support the jury verdicts. The court held ample evidence supported the plaintiff's claim
that M.D. anesthesiologists and St. Peter's conspired to terminate his billing contract as well as to enter into
the exclusive contract. Id. at 1452-53.
[n52.] 689 F. Supp. 799 (M.D. Tenn. 1988), modified, 918 F.2d 605 (6th Cir. 1990), petition for cert.
filed, No. 90-1883 (June 10, 1991).
[n53.] Id. at 808. Because there were genuine issues of material fact, the court denied the defendants'
summary judgment motion on the alleged conspiracy between two hospitals. Id. at 809. The court of
appeals affirmed based on the plaintiffs' claim the two hospitals had conspired together. 918 F.2d 605, 617
(6th Cir. 1990), modified, 927 F.2d 904 (6th Cir. 1991), petition for cert. filed, No. 90-1883 (June 10,
1991).
[n54.] 891 F.2d 810, 816 (11th Cir. 1990), cert. denied, 110 S. Ct. 1960 (1990).
[n55.] The following staff privileges cases also discuss standing to sue under the antitrust laws. See,
e.g., Summit Health, Ltd. v. Pinhas, 111 S. Ct. 1842 (1991) (ophthalmological surgeon; standing upheld);
Anesthesia Advantage, Inc. v. Metz Group, 759 F. Supp. 638, 645-46 (D. Colo. 1991) (nurse anesthetists;
no standing); Chiropractic Cooperative Ass'n v. American Medical Ass'n, 867 F.2d 270 (6th Cir. 1989)
(chiropractic association; reversed grant of summary judgment to defendant based upon lack of standing);
Tempkin v. Lewis-Gale Hosp., 930 F.2d 913 (4th Cir. 1991) (physician; no standing); Bhan v. NME
Hosps., 669 F. Supp. 998 (E.D. Cal. 1987), aff'd, 929 F.2d 1404 (9th Cir. 1991) (nurse anesthetist; standing
upheld); Todorov v. DCH Healthcare Auth., 921 F.2d 1438 (11th Cir. 1991) (neurologist; no standing).
[n56.] 15 U.S.C. § 4 (1988).
[n57.] 650 F. Supp. 231, 236 (Colo. 1986).
[n58.] 459 U.S. 519 (1983).
[n59.] Id. at 538.
[n60.] 547 F. Supp. 484 (E.D. Pa. 1982).
[n61.] Id. at 491.
[n62.] The following staff privileges cases discuss the rule of reason (ROR) analysis and/or the per se
rule. See, e.g., Oltz v. St. Peter's Community Hosp., 861 F.2d 1440 (9th Cir. 1988), modified on reh'g, 927
F.2d 904, (nurse anesthetist; ROR applied); petition for cert. filed, June 10, 1991; Dos Santos v. ColumbusCuneo-Cabrini Medical Ctr., 684 F.2d 1346 (7th Cir. 1982) (anesthesiologist; ROR applied); Drs. Steuer &
Latham v. National Medical Enterprises, 672 F. Supp. 1489 (D.S.C. 1984), aff'd, 846 F.2d 70 (4th Cir.
1988); Marrese v. American Academy of Orthopedic Surgeons, 1991-1 Trade Cas. (CCH) P69,398 (Jan.
15, 1991) (orthopedic surgeon; ROR applied); Vincent v. Reynolds Memorial Hosp., 1991-1 Trade Cas.
(CCH) P69,402 (4th Cir. 1991) (physicians; ROR applied); Morgan, Strand, Wheeler, & Biggs v.
Radiology, Ltd., 924 F.2d 1484 (9th Cir. 1991) (radiologist, ROR applied); Cf. Boddicker v. Arizona State
Dental Ass'n, 1980-2 Trade Cas. (CCH) P63,540 (D. Ariz. 1980), aff'd, 680 F.2d 66 (9th Cir. 1982)
(dentist; ROR applied), cert. denied, 459 U.S. 837 (1982); Bellam v. Clayton County Hosp. Auth., 1990-2
Trade Cas. (CCH) P69,255 (N.D. Ga. 1990) (anesthesiologists; ROR applied).
[n63.] See, e.g., Chicago Board of Trade v. United States, 246 U.S. 231 (1918); Standard Oil Co. v.
United States, 221 U.S. 1 (1911).
[n64.] See National Soc'y of Professional Eng'rs v. United States, 435 U.S. 679 (1978).
[n65.] Id.
[n66.] 612 F.Supp. 688 (D. Vt. 1985).
[n67.] Id. at 696.
[n68.] Id.
[n69.] Id.
[n70.] See Bellam v. Clayton County Hosp. Auth., 758 F. Supp. 1488 (N.D. Ga. 1990)
(anesthesiologists; no antitrust injury).
[n71.] 1991-1 Trade Cas. (CCH) P69,398 (Jan. 15, 1991).
[n72.] Id. at 65,605.
[n73.] Id.
[n74.] Id. at 65,606.
[n75.] Id.
[n76.] See supra note 62.
[n77.] See F.T.C. v. Indiana Fed'n of Dentists, 476 U.S. 447, 457-58 (1986); NCAA v. Board of
Regents of the Univ. of Okla., 468 U.S. 85, 100 (1984); National Soc'y of Professional Eng'rs v. United
States, 435 U.S. 679, 692 (1978); Wilk v. American Medical Ass'n, 895 F.2d 352, 358 (7th Cir. 1990), cert.
denied, 467 U.S. 1210 (1990).
[n78.] 472 U.S. 284 (1985).
[n79.] Id. at 298.
[n80.] The following cases contain boycott claims. See, e.g., Summit Health, Ltd. v. Pinhas, 111 S. Ct.
1842 (1991) (ophthalmologist; boycott claim successful); Nanavati v. Burdette Tomlin Memorial Hosp.,
857 F.2d 96 (3d Cir. 1988) (physician; boycott claim unsuccessful), cert. denied, 489 U.S. 1078 (1989);
Collins v. Associated Pathologists, Ltd., 844 F.2d 473 (7th Cir.) (pathologist; boycott claim unsuccessful),
cert. denied, 488 U.S. 852 (1988); Marrese v. American Academy of Orthopaedic Surgeons, 726 F.2d 1150
(7th Cir. 1984) (en banc) (surgeon; adequate allegation of boycott claim, but barred by res judicata), rev'd
on other grounds, 470 U.S. 373 (1985); Marrese v. American Academy of Orthopedic Surgeons, 1991-1
Trade Cas. (CCH) P69,398 (N.D. Ill. 1991) (surgeon; boycott claim unsuccessful).
[n81.] 745 F.2d 786, 819 (3d Cir. 1984), cert denied, 470 U.S. 1060 (1985).
[n82.] Id. at 818.
[n83.] Id. at 820.
[n84.] Id. at 820-22.
[n85.] 895 F.2d 352 (7th Cir.), cert. denied, 467 U.S. 1210 (1990).
[n86.] Id. at 357.
[n87.] Id.
[n88.] Id. at 362. In Wilk v. American Medical Ass'n, 719 F.2d at 221-22, the court held the per se
standard should not be used in the context of a learned profession because the nature and extent of the
restraint's anticompetitive effect was too uncertain to warrant per se treatment.
[n89.] 733 F.2d 1007 (2d Cir. 1984), cert. denied, 469 U.S. 884 (1984).
[n90.] Id. at 1011.
[n91.] Id. at 1018.
[n92.] The following staff privileges cases also involve allegations of tying arrangements. See, e.g.,
McKenzie v. Mercy Hosp., 854 F.2d 365 (10th Cir. 1988) (physician; tying claim failed); Konik v.
Champlain Valley Physicians Hosp., 561 F. Supp. 700 (N.D. N.Y. 1983), aff'd, 773 F.2d 1007 (2d Cir.
1984) (anesthesiologist; tying claim failed), cert. denied, 469 U.S. 884 (1984); Nurse Midwifery Ass'ns v.
Hibbett, 689 F. Supp. 799 (M.D. Tenn. 1988), modified, 918 F.2d 605 (6th Cir. 1990) (midwives; tying
claim failed), petition for cert. filed, No. 90-1883 (June 10, 1991); Tempkin v. Lewis-Gale Hosp., 1989-2
Trade Cas. (CCH) P68,865 (W.D. Va. 1989), aff'd, 1991-1 Trade Cas. (CCH) P69,401 (4th Cir. 1991)
(physician; tying claim failed); Cf. Boddicker v. Arizona State Dental Ass'n, 680 F.2d 66 (9th Cir. 1982),
cert. denied, 459 U.S. 837 (1982) (dentist; tying claim failed).
[n93.] 669 F. Supp. 998 (E.D. Cal. 1987), aff'd, 929 F.2d 1404 (9th Cir. 1991).
[n94.] Id. at 1018.
[n95.] 466 U.S. 2 (1984).
[n96.] Id. at 12.
[n97.] Exclusive staffing arrangements have also been challenged on the basis of conspiracy theories.
See, e.g., Oltz v. St. Peter's Community Hosp., 861 F.2d 1440 (9th Cir. 1988) (nurse anesthetist); Konik v.
Champlain Valley Physicians Hosp., 561 F. Supp. 700 (N.D. N.Y. 1983) (anesthesiologist), aff'd, 733 F.2d
1007 (2d Cir.), cert denied, 469 U.S. 884 (1984); Dos Santos v. Columbus-Cuneo-Cabrini Medical Ctr.,
684 F.2d 1346 (7th Cir. 1982) (anesthesiologist).
[n98.] 466 U.S. 2, 15 (1984).
[n99.] 669 F. Supp. 998 (E.D. Cal. 1987), aff'd, 929 F.2d 1404 (9th Cir. 1991). In Bhan, the court
granted summary judgment as to the plaintiff's section 1 claim because there was a complete failure of
proof as to the scope of the relevant market and the anticompetitive effect the hospital's decision had on the
relevant market. Id. at 1022.
[n100.] Id. at 1020; see also Drs. Steuer & Latham v. National Medical Enterprises, 72 F. Supp. 1489
(D.S.C. 1984), aff'd, 846 F.2d 70 (4th Cir. 1988); Tempkin v. Lewis-Gale Hosp., 1989-2 Trade Cas. (CCH)
P68,865 (W.D. Va. 1989), aff'd, 1991-1 Trade Cas. (CCH) P69,401 (4th Cir. 1991). The court in Tempkin
ultimately dismissed the plaintiffs' tying claim because the plaintiffs failed to allege the defendants sold two
different tied products. Id. at 62,551. The court refused to apply the per se rule in evaluating the plaintiffs'
illegal tying arrangement allegations. Hence, absent demonstrable evidence of market power, it is most
likely that a court will apply a rule of reason analysis to illegal tying arrangement challenges of hospital
staff privileges decisions.
[n101.] 844 F.2d 473 (7th Cir. 1988), cert. denied, 488 U.S. 852 (1988).
[n102.] Id. at 474-75.
[n103.] Id. at 477.
[n104.] Id.
[n105.] The following staff privileges cases also contain monopolization and/or attempt to monopolize
claims. See, e.g., Potters Medical Ctr. v. City Hosp. Ass'n, 800 F.2d 568 (6th Cir. 1986) (physician;
remanded for identification of relevant markets and determination of whether defendant was a monopolist);
Weiss v. York Hosp., 745 F.2d 786 (3d Cir. 1984), cert. denied, 470 U.S. 1060 (1985) (osteopath;
remanded because there was no determination that the defendant willfully maintained its monopoly
position); Kaczanowski v. Medical Ctr. Hosp., 612 F. Supp. 688 (D. Vt. 1985) (podiatrist; monopolization
claim failed); Feldman v. Jackson Memorial Hosp., 571 F. Supp. 1000 (S.D. Fla. 1983), aff'd, 752 F.2d 647
(11th Cir. 1985), cert. denied, 472 U.S. 1029 (1985) (podiatrist; monopolization claim failed); Morgan,
Strand, Wheeler & Biggs v. Radiology, Ltd., 924 F.2d 1484 (9th Cir. 1991) (radiologists, monopolization
& attempted monopolization claims failed).
[n106.] 15 U.S.C. §§ 1-11 (1988).
[n107.] United States v. E.I. DuPont de Nemours & Co., 351 U.S. 377, 391 (1956).
[n108.] 773 F.2d 1007 (2d Cir. 1984), aff'g, 561 F. Supp. 700 (N.D.N.Y. 1983), cert. denied, 469 U.S.
884 (1984).
[n109.] Id. at 1018.
[n110.] Id.
[n111.] 844 F.2d 473 (7th Cir.), cert. denied, 488 U.S. 852 (1988).
[n112.] Id. at 480.
[n113.] 669 F. Supp. 998, 1023 (E.D. Cal. 1987), aff'd, 929 F.2d 1404 (9th Cir. 1991).
[n114.] The essential facilities doctrine derives from the Supreme Court's decision in United States v.
St. Louis Terminal Railroad Ass'n, 224 U.S. 383 (1912), and was reaffirmed by the Supreme Court in Otter
Tail Power Co. v. United States, 410 U.S. 366 (1973).
[n115.] Hecht v. Pro-Football, Inc., 570 F.2d 982, 992 (D.C. Cir. 1977).
[n116.] Id.
[n117.] 854 F.2d 365 (10th Cir. 1988).
[n118.] Id.
[n119.] The Tenth Circuit in McKenzie, therefore, affirmed the district court's grant of summary
judgment for the hospital.
[n120.] 561 F. Supp. 700 (N.D.N.Y. 1983), aff'd, 733 F.2d 1007 (2d Cir. 1984), cert. denied, 469 U.S.
884 (1984).
[n121.] Id. at 724.
[n122.] See, e.g., Shahawy v. Harrison, 875 F.2d 1529 (11th Cir. 1989) (physician; no state action);
Miller v. Indiana Hosp., 930 F.2d 334 (3d Cir. 1991) (surgeon; no state action); Marrese v. Interqual, Inc.,
744 F.2d 1338 (8th Cir. 1984) (orthopedic surgeon; state action); Wicker v. Union County General Hosp.,
673 F. Supp. 177 (N.D. Miss. 1987) (nurse anesthetist; no state action); Todorov v. DCH Healthcare Auth.,
1991-1 Trade Cas. (CCH) P69,317 (11th Cir. 1991) (neurologist; state action).
[n123.] 317 U.S. 341 (1943).
[n124.] California Retail Liquor Dealers Ass'n v. Midcal Aluminum, 445 U.S. 97, 105 (1980).
[n125.] Id.
[n126.] 486 U.S. 94 (1988).
[n127.] Id. at 100-01.
[n128.] Id.
[n129.] Id.
[n130.] 894 F.2d 1024 (9th Cir. 1990).
[n131.] Id. at 1030.