because of the fear of false positives namely condemning conduct which is in fact an official competition even though it looks very harsh and very very and i think it was just two weeks ago in the unanimous decision of the supreme court in wire house that admonition by the supreme court is pretty securely of concern it seems to was not illegal monopoly maintenance under section two it did find however that the conduct constituted an unlawful attempt monopolised the selfsame market under section two and i might just say parents particularly that pose as an intellectual puzzle which we have brief how can conduct contracts if you will which are not unreasonable restraints who pr employed by a party which is not found to be a monopolist nonetheless under the rule of reason be found to be conduct which is part of an attempt it makes not and i think it's your argument that that one no case i need to be clear about this because this is really quite a subsidiary argument hard no case flatly says that if the conduct is exonerated under section one it cannot be the basis of why would you do that because it makes eminent economic and i trust that why because it if a party is not a monopoly and it has available to it bundles exclusive  not unreasonable restraints of prey as a matter of logic how can that which is a reasonable restraint of trade morph into something which is part of an illegal attempt to be some amount of predatory or exclusionary conduct absolutely as i understand your argument for the we have no precedent addressing this you're saying conduct that is not an unreasonable restraint of trade shouldn't be considered predatorial or exclusionary if it's exactly the same conduct it's judged under exactly the same standard the rule of reason or a lot of times these issues are coming up on summary judgment before a jury has made a determination on to the rule of reason i think but in any event as i understand your argument it  discounts when they're not below cost by analogy to the brooklyn case can't be considered exclusionary or predatory if i'm stating an issue had it makes no sense intellectually and he says when all is said and done in may well be that the courts have to simply say an extended book group tests apply if you look very carefully a professor done on the question of how do you view bundles and the one thing that he says you surely cannot what counsel for the opposition here argues that page fifty four the would you like to see it you then i would like just say we think that greenberg justice greenberg judge greenberg had the better argument or is there something else about the pages that is observed it provides no guidance for this as it does not take into account the supreme courts and the nation about false positives it is in fact an open ended invitation to absolute given here with taken basically from the pages verbatim how should it have been i haven't sat down to try to do it they live via an instruction very similar to that in brooklyn if you find that the price of the bundle is less than the cost of producing the bundle you may find if that is an act in reached the view that in the end in order to end up with something which is just prior put it when he was in the first circuit we need a rule which isn't mr ball and the only rule which is going to be a m one wish takes into account the cost and price equation and without that you have nothing that's me and that's exactly the argument which was accepted by the supreme court in brooklyn where it was a single product not a bundle and the only question is well why is a bundle different from a single product and the answer is because you can sit down as an academic and you can hypothesize as at the judge  the price asked to be lower than some appropriate measure measure of cost then as a lot clearer as to whether the cost is marginal cost or average total cost or some other measure across you could you could  because that issue really are contrast p p o contracts for health care they are contracts which were asked for by very sophisticated buyers who cross as well as profits and they went to health and they said give us prices for your hospital services one with mackenzie as a provider and the other without i e on scusa basis and in the case of regents the offer was ninety percent of our list price is kind of and if they type of process we will offer us a seven percent discount price in ninety three if mackenzie is included in the panel ninety if they are not ten percent this off the list that by the way the could in fact though that you know hospital and receive the full benefits of their insurance without the higher co payments or which would be required if they were not in the panel so you have prices which were offered choice is given an exclusive contract entered into by one but not by providence after january one thousand and two and the question therefore of the comes how do we evaluate those what is the p p about what is this contract and this was the judge said quietly well the bundling claim you can made it must be made on the basis that the conduct has no economic purpose or sense to it save to harm competition but he feels by definition  a very easy if on the other hand one tries to do a traditional and i quest balance one would start out and ask what is the harm and whether there is that harm outweigh now hand one do that as a matter of law on appeal the answer is absolutely the court in gill barco ninth circuit the leading case in exclusive dealing with was not cited by the opposing counsel did precisely that which is let's do the harm benefit equation what's the harm here the harm is to only to contrast between the hospital and insurers have been plans in length county only to that they were desirable i'm not saying they were not desirable and they covered this teen percent and no more fifteen percent of the insured lives i'm not talking about merit care medicaid or any of the other or the obligations they pay fifteen percent has never been held by the ninth circuit to be adequate for by one of the companies which province had ten thousand lives and if you look at the read facts and add ten thousand to it you get above you get above fifteen percent in the year two thousand and two council for yes and this is crucial if you look at the agreed facts it's clear it's only fifteen percent in the last year in the last year provenance is essentially zero because it's illicit to add provenance figures to regions in the in the last year province has an open contract with the cans so if you look at the numbers correctly fifteen percent is the max at the cost to the cans in here its ability to compete by lowering its in order to you know one of the arguments was that in order for it to write the able to participate in the you look to your own costs to decide whether you are above or below cost because the theory is as just as judge bryer did it in the in the first circuit and as the supreme court did it in brook the theory is fish and producer and the reason the rule assumes it is very hard to do make a judgment about rightly fissions and i think a case can be made on this record and we had some of the evidence was before you the mckenzie was five percent lower in price lower cost provider as they claimed because in fact there were good reasons it was oh it was well or they had less of a reputation they had less efficiency in the central office etc it is it's very hard to go into your competitor's cost and say am i going to come up with a price which is below my competitors cost that's impossible in the in the real world and that's what the supreme court  please in court i have a great deal of respect for counsel and if there's one area where we have significant disagreement that they would penalize by eighteen percent a decision to do that so they would take their rate from a composite of seventy six percent to ninety percent and at the time they said that documents if they had raised their price from seventy six to seventy seven and a half they would have been faithful to their internal documents and my client would have been allowed to client in so instead what they did they said there will be an eighteen percent penalty so it's a possessed three quarters of the primary and secondary care market for us to make it revenue neutral we what their own costs are but that they don't know what their what the costs of competitor b are and that and as the system they either have to assume their competitors exclusion here was based upon the fact that we did not have her service so we couldn't match them in a quote we had no way of giving them the full line  they had ninety percent of the invasive cardiovascular surgery and they had ninety three percent you know natal surgery and there was no way that we could put a bundle together and therefore efficiency falls to the wayside we could not match that even if you assume that we were far away that she was provider in the community and the evidence does support the fact that we were the cheaper provider not merely did it cost us last but we charged less and so the irony of this case is that the less costly provider could not do business with regions because of the penalty that was going to be exacted by sacred heart like the self and this is the situation in which  you come to the market you see you know i says are competitive we discovered during the course of this case that on their ne steep so they made a deal we're only increasing your prices by forty five by forty percent they took the seventy five and they discounted off of that so they were still paying forty percent more and they continued to do that through the  in fact one of the witness who said you know we realize that we're charging too much but we're going let the market catch up with us the same set of circumstances were reflected with respect to their prices for the invasive cardio surgery they were charging well above the prices in oregon or they were reaping a monopoly profit on both of those products in that community and they were able to then turn to chance for survival in this industry is the commercially insured patients and that is forty two percent of the potential patients and if you lose any one of those your and problem for us we had an increasing sense and we had a loss of profit and we were in a spiral and at the time that we were taken over we couldn't meet  i would say that in the event that the competition cannot through some secondary source bring an additional product into the market that the answer is yes in other words the in the ortho case you had the issue of could the monopolized product be replicated and so that you had a complete line of products side by side and and here we could not replicate either of the they knew that they knew that in this case they knew that we couldn't match either price or they couldn't they knew that you couldn't make a comparable correct and that's what you know now you're not advocating  can i don't think that would work no no but i am saying that where you cannot replicate and the therefore the impact of what's happening is a multiplier and that's what happened here it was out and replicate those services and therefore we were at the mercy of the mole wire and and that's where you know when they talk about group did not involve and the court said look it's good for the consumer that these people compete down to their cost because we are going to protect equally efficient providers we're not going to protect somebody who's inefficient that can't go to that level but here are efficiency means nothing with the multiplier we were the more efficient provider of the services that we could compete on and we were analyzed to that the marketplace and analyzed what the consumer good point that efficiency and whatnot but what if you were not eat fish and if we were not in fish yeah then what you know than you because you are you  way business is function that we're asking here in a bundling case for everybody to have their economists on staff so they can try to figure out whether what they're doing is good or bad isn't it better a bright line rule that says that a monopolist may not bundle where its competitor cannot replicate the entire product line because that's what the issue is accountants i'm sure you have views about what their costs are they do they do and and i'm sure as you know accountants have argued for ever over what an appropriate measure of cost right and what you put into it and i think the supreme court not surprisingly has left it completely open by saying well it's been a some measure of cost but don't ask me what that measure may be two there's another lying assumption that to the jury found that there were exclusive agreements but that they did not substantially impact or were not and there's a clear difference between having an exclusive and having an exclusionary agreement and i think it is quite logical that this jury found that the agreement was not explosive it was exclusionary it had the effect of that had the effect of being exclusionary and and when you read the instructions about what constitutes an exclusive agreement and then you take a step back and you look at a preferred provider situation is it's it isn't exclusive it's exclusionary and i think the jury could have found that and having found that it was merely exclusionary you can draw no sustenance address the if you lose section one thing when section five but i would recommend that you take a look at the dentist fly from the third circuit the same issue is curve on that issue and the real question is was the conduct under section two exclusionary what we know is that the jury had to find it with a specific in here to monopolize we know that the jury had to find that there was a dangerous probability of success and deed the statistics seventy five percent and the was exclusionary we believe even though it was only for a short period of time that there beneath cost sale of healthy newborn services was exclusionary they did that and that happened to see our number one as a service to the community fourteen percent of our revenues were directed to the newborn area and that's the area that the sacred heart chose to sell the need in several instances it's variable cost we believe that when they told octave that they could not treat their own patients in our hospital but rather that those patients had to be transported by ambulance a terrible experience that that was exclusionary we believe that when they forced on us the cost of a hospital was in order to care for those patients which were their patients that they wouldn't care for that that drove our cost up we believe that when they were ready to build their new hospital this wonderful half a billion dollar hospital that they chose to put it in the area that was our growing area why did they do that it was intended that they would t if we could find somebody and build a new hospital somewhere else and there was one ideal other location what they do they put a restrictive covenant that no hospital could ever build there but we had then was and fin y they did control a large segment of the hospital community one third of all the doctors in ling county where there are direct employees in addition to the one third there were another ten to fifteen who are paid somewhere between twenty and two hundred thousand dollars act as chiefs of some service additionally they own subpoena will interest in the oncology not allowed to practice in our hospital so i think when you put everything together you see a pattern of exclusion a pattern of what the jury meant that there was an that we had to show coercion to buy them as two products and so there was no question that there were separate products of all the standards except the coercion and that's what we're focused we felt was that that created an issue a fact was that there was economic coercion to take the entire package and you offered an expert separations as we did who said she wasn't under coercion but we had testimony that she spoke with karen francis our c f o and and and reported that she was held hostage and so we felt that that freed a question of fact on the anecdotal evidence as well so we believe that there was both the evidence from the economist as well  oregon has a very unique statute in my reading it's the only statute in the country that is like it because it covers services and nothing there what is urged is that the book group analysis applies that the oregon court would adopt the book group follow they will consider federal precedent they're not bound by federal rights well if i were sitting today in salem and i were presented with this case will have other cases the address this that that would be persuasion well that's the only circuit court case your honor so how would the oregon court address this question i suspect that they might very well tendency to create a monopoly also a plot that was not before the u s supreme court and if this court takes a look at the decision  redmond versus from the oregon court of appeals they used a five factor past and at the end they said well the only thing that we have left to determine  if the defendant was dominant and when you read that opinion you come away with the clear impression that if the defendant in that case had then had a dominant market share happen through the damages and the other one it just disappears but when we when we send it back you know that's that i think there is some authority that allows that but but but let me let me say this  me before the oregon supreme court and that's exactly what they said in that case that in order to mock claim it depended on one of the other that's correct yeah it's your wrongful means it point in arguing the to covers ok are that thank you for clarifying i have a general question for you i have the same question for mr fox i'll let you address that before you sit down with you but this is on the subject percolating of issues percolating let's say we you know we work at an opinion i great lank you the ruling for you your clients district court say the facts don't fit and then almost in a and so what and furthermore i don't agree with the page and i don't agree with smith kline and i don't agree with you didn't help us the district court judge who said in the ninth circuit that she did not agree with  price on the p p o contracts so although the jury just took the same numbers and walked in there was no theory offered of damage caused by the discrimination alleged discrimination  to imagine what it would invent these these buyers after all they didn't know what the prices were they were given different authors and they chose between them  be a violation because they are unreasonable and harm the public interest we put before the court the letters from the federal trade commission which have firmly said that any willing provider statues in several cases proposed in the early eighty's would harm consumer interests that there were multiple interests which were in favor of having hospitals well what are they citing a huge new wonderful investor hospital near the premises of willamette most people think having hospitals near one another is in good thing not a bad but there's no was it suggest but the fact that they are smaller does not give them a right to demand other regions or peace health or earlier products that they be included in close that's just simply not the way the market works nor does it serve this rumor interest to permit the smaller hospital needs facts to demand to be included within the insurance co the assets there were worth a lot of money and it's in the record that they invested in it so one has to at least take that with if not a grain of salt with the assumption that we cannot make a judgement based on their supposed economic circumstances but we can make a judge is that there should be no per se there should be no instruction of first a type instruction such as that given here which in effect gives to the provider the opportunity to demand inclusion any willing provider by very very and that is not in the public interest