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Phoebe files Supreme Court brief

Phoebe Putney Memorial Hospital

Phoebe Putney Memorial Hospital

ALBANY, Ga. — Phoebe Putney Health System filed a brief in the U.S. Supreme Court this week stating its position on the purchase of Palmyra Medical Center — now Phoebe North — by the Hospital Authority of Albany-Dougherty County, which continues to be challenged by the Federal Trade Commission.

The federal agency is arguing that the State Action Doctrine does not shield the transaction because it contends the state of Georgia has not articulated intent to displace competition in the market for hospital services. It also argues that relevant state law provisions do not suggest any legislative intent to displace competition in the provision of hospital services.

In its brief, Phoebe makes its case that the acquisition was an act of "a state or its officers or agents" for purposes of federal antitrust laws. It goes on to make the argument that the case in question involves no private, unsupervised, anticompetitive conduct.

Phoebe and the Hospital Authority of Albany-Dougherty County are urging that the ruling by the 11th U.S. Circuit Court of Appeals last December be affirmed.

"The FTC has changed the argument it brings before the Supreme Court now," said Thomas Chambless, chief legal counsel for the health system. "Our brief supports our position that the acquisition of Palmyra by the Hospital Authority was absolutely authorized and correct under Supreme Court and 11th Circuit precedent. The FTC has no role to play in the transaction.

"In 1943, the Supreme Court held in Parker v. Brown that in enacting the antitrust laws, Congress had no intention of seeking 'to restrain a state or its officers or agents from the activities directed by its legislature.' The FTC tried in District Court to distinguish the transaction. They now ask the court to change the standard. Our brief points out to the court that its standard is correct and should not be changed. The Legislature created hospital authorities within the counties of the state and limited them to operation within those counties, while at the same time authorizing them to purchase other hospitals.

"It is clearly foreseeable that a transaction like the Authority's acquisition of Palmyra would occur, and the FTC has no role to play."

The high court agreed to hear the case in June after the 11th Circuit upheld a ruling last year by U.S. District Judge Louis Sands that exempted the purchase from federal oversight under the State Action Doctrine. The case is set to be heard by the high court on Nov. 26, according to the Supreme Court's website.

Since the FTC filed its brief on Aug. 20, there have been amicus briefs filed by the American Antitrust Institute, a group of economics professors, a group of 20 states, the National Federation of Independent Business and Drs. Joseph Stubbs and Corleen Thompson in support of the federal agency's case.

The American Medical Association and the Medical Association of Georgia have since filed an amici brief of support for neither party. It is anticipated that additional amicus briefs will be filed in support of Phoebe and the Hospital Authority's position in the coming weeks.

The FTC declined to comment on the brief's filing.

Comments

Trustbuster 1 year, 6 months ago

The state action doctrine claimed by Phoebe's legal team is bogus in my opinion. This idea first appeared in the infamous Slaughterhouse Cases during Reconstruction. Just because a govt. authority licenses or sanctions such an economic activity that leads to a noncompetitive situation doesn't mean it is fully shielded from anti-trust litigation. The Sherman Anti-Trust Act goes after monopolies that intentionally restrain trade. Phoebe fits the case since it is a govt. sanctioned monopoly for that purpose. Natural monopolies are more better since the market forces are at work. A govt. monopoly does not operate under market force conditions. They disrespect the fundamentals of competitiveness. I agree with the commission's position. I hope the SCOTUS justices will rule in favor of the plaintiffs. State action doctrine should not be apply to Phoebe.

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Thurman 1 year, 6 months ago

"Trustbuster" certainly sounds as if he/she knows more about these type laws than the average person. Very good commenting from "Trustbuster".

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Cartman 1 year, 6 months ago

The hospital authority making the decision to buy Palmyra is a pathetic charade. It is a thin disguise for Phoebe. And to make it worse, they didn't need it. They are still trying to figure out what to do with the carcass of Palmyra. I'm holding my breathe for prices to come down. LOL.

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Sister_Ruby 1 year, 6 months ago

Pray for the Supreme Court to make a Just decision.

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