imaging devices has created a wall that has kept at least ninety nine million dollars worth of imaging devices from entering virginia's borders and virginia does so without achieving any benefits other than to protect in state service providers from competition this kind of economic protectionism violates the dormant commerce clause into independent way first it unduly burdens interstate commerce in imaging devices and therefore fails the balancing test second we don't do it it discriminates against manufacturers of these devices and therefore fails strict scrutiny now the government's brief focuses on the third argument in which there are  tremendous amount of factual disputes concerning whether the application process discriminates against at a state applicants but this court does not need to reach that issue because plaintiffs are entitled to summary judgment based on the undisputed facts showing both a burden on and discrimination against interstate commerce in imaging devices turning to the undue burden under pike virginia's requirement is particularly anti competitive as this court recognized in the appeal virginia's one of only three states that imposes the full burdens of that certificate of need program on medical imaging devices no matter how much that defy costs and yamaha on medication teaches that that unusual this against interstate manufactures and then the second is discrimination in the application process against out of state applicants essentially so under the discrimination against imaging any factors the argument is that own no that's the money that is spent on in state providers of medical imaging services and less money is being spent on the new devices manufactured out of state and a hundred percent of those are out of state but the fair shot now and then the it gets to the point now where i'm concerned of the of the of being turned into a health care policymaker and and i just don't know how much china you know with this because you know the provision of health care is a very complicated business i mean we all understood that following the litigation of to the supreme court on the to the health care cases that came before but this is really complicated stuff and i'm just wondering  example whether this is the right forum to res and there's a lot of studies to support this and i think a lot of the other states would also say this is correct on that there's a link between quality and quantity and that if you under utilized as medical facilities then the technicians whose expertise the public counsel would not hear the the experience that they need in both administrative tasks and interpreted resolves and then the point made in this is certainly the case in virginia is we have very few public hospitals there's bijan county wealth university and medical center there in richmond and then there's the university of the gen u if you will not it is relatively few public hospitals in do is to say you know recipients as a condition of the certificate of need have to provide some level of care to the indigent to supplement th and let me try to alleviate those concerns so the for those three responses on first it's important that it's not just different aspects that all thirty six states have certificate of need laws the challenge here is limited to regina's specific decision unusual that none of those states this is that submitted the unique is have the same requirement that virginia's requirement does with respect to medical imaging that's regardless the capital cost only three states have that requirement and is this court recognized in yamaha the it rejected the argument that we should look at the benefits generated by other provisions of the law rather than the specific provision being challenged so it may well be that certificate in need programs in general and other aspects for example for the hospitals does conveyed a lot of benefits but that's not the question before this court and the evidence here shows that there is a person or there's a court claire a virginia statute analysis that's hard to say that that has much to do with and it's important to note that here virginia has conceded that it has no evidence of three different things it's conceded that requirement has no evidence that requiring a certificate of need for imaging has any benefit judge wilkinson you mention the link between quality and improvement and that might be true of other aspects of virginia certificate of need program but on this record there is no evidence that ensures that the doctors utilization the machine contributes to expertise on the part of those health care professionals administer we can get into the into the w of on the issue of al discrimination in the application process but virginia's expert in fact he did not offer any expert testimony as to the benefits of the certificate program and so on that issue the benefit of right on  well i think there's a difference when there are if there's any evidence in the record of benefits to requiring a certificate of need for medical imaging then yes it becomes a factual issue and maybe that's where judge king and you are concerned but on this manufacturers virginia's goal here is to restrict the number of imaging providers to ensure as this court recognized the profitability of devices that they already own and the waiver to junior colleges this goal is by making it some of those providers may be out of state businesses so the supreme court his name clear in baucus that all you need for discrimination is some competition between add a state interest and an in state interest but here the out of state i and that is there's a factual dispute as to that issue and therefore this district court erred in granting summary judgment when there are competing experts talking about the discrimination in the application process whether the process here the facts as to whether the application process discriminates are disputed but there are no disputes about whether the factual disputes about whether the certificate of need program as applied to medical imaging discriminates against imaging manufacturers so essentially we're competing over the same healthcare dollars where more dollars are being spent on in state imaging providers and less dollars are being spent on out of state imaging manufactures the fact that there are no there's two different ways in which the statute discriminates against at a state interest one is against the imaging manufacturers the device manufacturers and one is against the out of state applicants if you will and those applicants on that issue there is a faction were doing expert testimony on the government's expert completely ignore this court's earlier ruling in determining how do you determine in state versus other state entity and only looked at state of virginia hospital that is owned by virginia and or that provides services in virginia but is incorporated in delaware and that's the only other state connection that is incorporated in delaware and that's not enough  to make that simply add a state interest it's already providing services in virginia it has a certificate of need but here there's no dispute that virginia is discriminating against the manufacturers on there is competition between the manufacturers and the in state service providers in fact that's exactly how the regulation works it's expressed purpose is to reduce the supply of devices so that in state imaging service providers can face less competition and that's clear and here i think the regulations make that clear i second point you to the regulation twelve or to new code five dash two thirty dash one ten and the corresponding regulation dash one fifty so no c t scanner is going to be improved unless a certain minimum number of scans are met but more importantly unless that new c t the introduction of the new c t would not reduce the utilization of existing services and there's the same provision for m services and it's important to note here that regina does not there's no dispute that there is competition between the two virginias only argument here on the on the discrimination angle for imaging manufacturers is to point to pharmaceutical competition your honor but there is dispute and the only argument virginia makes about discrimination is pointing to walsh the theory you had out of state drug manufacturers with the in state retail pharmacies and the cleaners there conceded there was no competition between the two here there is competition between the two and as baucus instructs that's all it's needed a competition between the added state interest here the imaging device manufacturers all of whom are honesty and the in state service providers good morning it please the court steward raphael for the commonwealth apple e's the district court correctly rejected the plaintiff storm and commerce clause challenge under both the discrimination test and the pike s on the discrimination test it was undisputed that virginia's c o p n program does not discriminate against out of state medical providers there was a huge amount of discovery both sides spent a lot of time a lot of money on this i took the expert to death of the plaintiff's experts deposition chris conover at the towards the end of the discovery period  appendix they admitted they had to do so no evidence that virginia c o p m process discriminates against out of state medical providers of goods or services that is dispositive it's their burden of proof on discrimination they have so much he says she that well that's true but the issue here is discrimination against out of state entrants all their expert said was if you have once you go p n you're more likely to get another one and we said six even if that's true which it's not even if it's true so what it doesn't prove discrimination against out of state efforts the the court probably listened to the oral argument the last time from the last time the case was here the entire discussion was is that you are i know you did i'm the entire discussion was you know we don't know if there's discrimination gets out of state entrance or not we need to send it back for discovery and that's what you did we didn't need any more evidence in light of their admissions but we hired an expert from the georgetown business school nationally renowned economist john mayo and he did  analysis of all of the applications for the past fifteen years and the key table of his findings at page one sixty six of the joint appendix he found that the c o piano approval rate is the same whether you're in state or out of state company that there is no significantly statistically significant difference in the amount of time it takes to get an application granted it's about one hundred sixty days and then the incidence of good cause petitions being filed this is their argument that you know competitors try to block you bike by doing a good cause petition that that's less than three percent concluding that the plants had no evidence of discrimination against out of state and entrance and and he did get it right it was their burden to prove discrimination where's the evidence of interstate discrimination against out of state entrants their expert admitted that he had no evidence his only if you credit one hundred percent his study and you ignore meno all he said was that incumbents are more likely to get an additional c o p i mean that's just report made a ruling on legal relevance of their experts little relevant legally relevant factor which was whether out of state concerns were discriminated against either in the quantity that was approved or in they rely on that was which is want reigns versus rule one which is the puerto rico case where they had a shield law that basically protected in state puerto rican pharmacies and they grandfather you know in state pharmacies ninety two percent of which were locally o a review of scanners without any dollar limit but that really the states that the here are the numbers of the five states that filed the brief three of them regulate scanners that's page five fifty one of the joint appendix on m r i machines it's true that only two other states like virginia have no dollar threshold but that ignores that nine other states plus d c have dollar thresholds that would cover the machines that are issued at issue in this case that's a page eight of our brief and for c t scanners which cost about seven hundred fifty thousand dollars none of the things the plans allege originally they were able to prove they couldn't prove discrimination against out of state medical providers or you know terrible delay or or blocking of competition none of that they could prove so they fall back on the argument that there are no in state you know companies was irrelevant to the discrimination test there's no discriminate doesn't help you to move to virginia to manufacture c t scanners in terms of the seal can't process you have to get one either way let me turn to the pike balancing test on that's right and i think justice we had a really nice metaphor in his concurrence in the davis case where he said you know i'm trying to apply this test is like trying to decide are three apples better than six tangerines right you're balancing the reduction in c t scanner sales into virginia against the quality of medical don't know where the oaks are right and you apply a rational basis test particularly when there's no discrimination against out of state entrance and deference is strongest when in a case like this the state has health and safety concerns there's no i think the big problem with the plaintiff's approach on pike is that there is no requirement for empirical proof they want to litigate to an economic certainty whether there are benefits or not to say oh yeah but that's not what you do in a net in a dormant congress clause case if there's a dispute over the benefits the state wins the whole point is that has to have a reasonable rational basis not that it's white but it has a rational basis and the two best examples for that are this court's decision in the brown case which upheld maryland's ban on corporate ownership of funeral homes the rational basis that marilyn gave there was that that improved familiarity between an owner and his business and protected against unfair business dealings that merely didn't have to come in with studies proving that it just sets here we have we went way beyond  quality quantity relationship our corporate designee explained that the relationship between quantity and quality was a very important thing underlying the program former health commissioner said so page one seventy four of the joint appendix the current one to so it page one ninety three joint appendix the plaintiff's own expert admitted that this relationship is well recognised in the medical industry the plaintiffs themselves when we took their depositions they admitted the more c t scans you do and read or m r i scans the better you get there is clearly a quality quantity over used or used more than a particular threshold for c t scanners it's seventy four hundred per unit that's a lot but often they use as many do as many as ten thousand the plaintiff's scanner was going to do about twenty four hundred and the administrator yes it is and the the commissioner of health and the hearing officer found that the benefits of the colon health program were totally specious and it would actually result in excess costs so to your point judge king about we saved ninety nine million dollars in unnecessary equipment that's exactly right and that's what the point of the program so that their last ninety nine million dollars sale is actually a benefit of the program exactly for the reason you said in the three years that virginia was deregulated we had more scanners in virginia than all of canada that's in the record so the whole point of this program is to make sure that there's not an over investment and investment in machines that would actually hurt other facilities by skimming the cream off where they need that to cross subsidise their money losing operations like burn units and nikki's we on the cost point of the plaintiff's own expert did a study which concluded that having a stricter  have to come in and prove the empirical data that's exactly what they argued we should have done we did but we didn't we should have had to with regard to the the point about the davis test we think that has been superseded by the by davis and by the discrimination test you don't need to hold that in order for the state to prevail i think we win under both the discrimination test or under pike you sent this case back for development of the record on the discrimination test the plaintiffs whol failed to prove the discrimination that they alleged in the complaint they're now trying to use the dormant congress clause as a requirement for laissez faire economics that harkens back to lochner versus new york and should be rejected the judges should be a exception where the state is favoring itself as a market participant in the economy over out of state entities like their kentucky issuing bonds here or genius acting like a regulator not a participant in the market criminals no your honor if the supreme court intended to overrule piper somehow undermined it i think it would have said so expressly davis was very clear that it was limited to pieces in which the state is acting as the market that's correct your honor however here it's important to note that there is no evidence on the record of any benefits to requiring a certificate in need for medical imaging the benefits that my colleague points to all pertain to hospitals or new units or anything else there is no evidence about benefits  requiring a certificate or need for medical imaging but regarding the discrimination point as this court recognized what plaintiffs expert admitted to was that there was no evidence of discrimination against out of state entities court made clear that current medical providers are by definition in state so it doesn't matter if you're incorporated outside of virginia you're providing medical services you are in state and that's a joint appendix seventy five and moreover judge king you recognize that companies that are domesticated have a leg up on others by submitting competing applications strategically submitting competing applications that could trigger this informal fact finding conference which is essentially like a full blown litigation