FTC files brief with Court of Appeals

ALBANY, Ga. -- After vowing to continue the fight against Phoebe Putney Health System's attempt to purchase Palmyra Medical Center, the Federal Trade Commission filed an appellate brief with the U.S. 11th Circuit Court of Appeals in connection to the case.

The 52-page document, which was filed Wednesday, gives an explanation of the FTC's position and why it believes U.S. District Court Judge Louis Sands from the U.S. District Court for the Middle District of Georgia erred in his June 27 ruling, which stated that Phoebe was immune from attempts by the FTC to block the purchase of Palmyra.

"The district court's ruling, on defendants' motions to dismiss pursuant to Fed.R. Civ. P. 12(b)(6), is erroneous for a number of reasons," the brief stated. "The court misconstrued the Commission's theory of the case; it relied on factual inferences that contradict the complaint's allegations; and it misapplied well settled legal principles.

"If allowed to stand, the district court's ruling could provide a roadmap for private parties wishing to bypass any antitrust scrutiny, by structuring their hospital mergers as nominal acquisition-and-leases by the many state hospital authorities empowered to do such transactions, not only in Georgia but in other states as well."

In the brief, the FTC is requesting an opportunity to present an oral argument to aid in the Court of Appeals' resolution of the case.

"The Court should reverse the district court's decision, and issue a preliminary injunction requiring the merging parties to maintain the status quo during the pendency of the Commission's administrative proceedings," the brief concludes.

The FTC, along with the Georgia Attorney General's Office, stepped in to halt the acquisition in April on the grounds that it would create a health care monopoly in Southwest Georgia.

Following the ruling by Sands, the attorney general opted to not appeal the district court's decision.