PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 19-1977

WESTERN STAR HOSPITAL AUTHORITY INC., d/b/a Metro Health EMS,

 Plaintiff – Appellant,

 v.

CITY OF RICHMOND, VIRGINIA; RICHMOND AMBULANCE AUTHORITY,

 Defendants – Appellees.

Appeal from the United States District Court for the Eastern District of Virginia, at

Richmond. John A. Gibney, Jr., District Judge. (3:18-cv-00647-JAG)

Argued: December 10, 2020 Decided: January 19, 2021

Before MOTZ, THACKER, and QUATTLEBAUM, Circuit Judges.

Affirmed by published opinion. Judge Motz wrote the opinion, in which Judge Thacker 

and Judge Quattlebaum joined.

ARGUED: Luke Andrew Hasskamp, BONA LAW PC, La Jolla, California, for 

Appellant. Craig Thomas Merritt, CHRISTIAN & BARTON, LLP, Richmond, Virginia; 

Wirt Peebles Marks, IV, RICHMOND CITY ATTORNEY’S OFFICE, Richmond, 

Virginia, for Appellees. ON BRIEF: Aaron R. Gott, Jarod M. Bona, BONA LAW PC, 

La Jolla, California, for Appellant. David P. Corrigan, Melissa Y. York, HARMAN 

CLAYTOR CORRIGAN & WELLMAN, Glen Allen, Virginia; David B. Lacy, 

CHRISTIAN & BARTON, LLP, Richmond, Virginia, for Appellees.
DIANA GRIBBON MOTZ, Circuit Judge:

For almost thirty years, the Richmond Ambulance Authority (“RAA”), a public 

body created by the Commonwealth of Virginia and governed by the City of Richmond

(“the City”), has provided nonemergency medical transportation services to the Hunter 

Holmes McGuire Veteran’s Administration Medical Center (“the VA Medical Center”). 

In 2018, however, the VA Medical Center requested quotes from other service providers. 

One quote came from Western Star Hospital Authority, Inc., doing business as Metro 

Health EMS (“Metro Health”). The VA Medical Center selected Metro Health’s bid on 

the condition that Metro Health could obtain a permit from the City to operate emergency 

medical services (“EMS”) vehicles. When the City refused to grant Metro Health a permit, 

it brought this action against the City and the RAA, alleging violations of the Sherman 

Antitrust Act and the Supremacy Clause of the United States Constitution. The district 

court dismissed the case with prejudice, concluding that the defendants enjoy immunity

from federal antitrust liability and that federal law does not preempt their actions. We 

agree and so affirm.

I.

Like many municipalities, the City operates its EMS system through a public utility 

model. Under this model, the City contracts with a single provider to manage all EMS 

vehicle operations in the City. This ensures that the City’s EMS system does not neglect 

costly, but essential emergency response services in favor of more profitable 

nonemergency services. Critically, however, the economic feasibility of the public utility 
3

model depends on the EMS provider’s exclusivity in the marketplace. This is so because

revenues generated by profitable, nonemergency transports are needed to offset the cost of 

providing emergency services to all, including those without health insurance. 

In Richmond, this model owes its existence and governance to two state laws. First, 

in 1979, the Virginia General Assembly passed a statute granting “governing bodies” of 

municipalities wide berth to regulate EMS vehicle services. Va. Code Ann. § 32.1-111.14. 

Such “governing bodies” are empowered to: prohibit the operation of EMS vehicles 

without a city-issued franchise, license, or permit; limit the number of EMS vehicles 

allowed to operate in the city; fix the charges for EMS vehicle services; and establish other 

necessary regulations relating to the operation of EMS vehicles. Id. § 32.1-111.14(A). The 

legislature stated that these powers were “necessary to assure the provision of adequate and 

continuing emergency medical services and to preserve, protect and promote the public 

health, safety and general welfare.” Id. § 32.1-111.14.

Subsequently, in 1991, the General Assembly enacted the Richmond Ambulance 

Authority Act, creating the RAA as a “public instrumentality exercising public and 

essential governmental functions.” 1991 Va. Acts 645. The legislature granted the RAA 

authority to “[p]rovide emergency ambulance service originating in the City,” as well as

“nonemergency service within the Commonwealth.” Id. This act further provided that the 

RAA be governed by eleven members: the Richmond City Manager, the Richmond 

Director of Finance, and nine persons appointed by the Richmond City Council for twoyear terms. Id. The Richmond City Council subsequently organized the RAA and granted 

it an indefinite franchise to operate EMS vehicles in the City. 
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Since its inception in 1991, the RAA has held the City’s sole EMS vehicle franchise. 

Thus, the RAA has provided all services in the City that utilize EMS vehicles, including 

nonemergency interfacility medical transport services for VA Medical Center patients. In

2018, the VA Medical Center considered contracting with other service providers and 

opened a bidding process to receive competing quotes. In its request for quotes, the VA

Medical Center conditioned any resulting contract on “conformance with . . . all applicable 

Federal, State and Local laws,” and specified that “[b]efore award of a contract, the Service 

Provider must provide an official City Franchise Permit required to operate patient 

transport services in the City of Richmond.” J.A. 249, 252. Notwithstanding its lack of 

the necessary permit, Metro Health submitted a bid.

In June 2018, the VA Medical Center conditionally selected Metro Health’s bid but

simultaneously reiterated that no contract would result unless Metro Health first obtained

a permit from the City. Metro Health pressed the City to create a process for entertaining 

permit applications from private firms. In response, the City posted a permit application 

on the Richmond Fire Department website. Metro Health perceived the application as 

unfair and deliberately engineered to prevent it from obtaining a permit. Accordingly, 

rather than submitting an application, Metro Health immediately filed this suit, seeking a 

temporary restraining order to prevent interference with its prospective contract. After a 

hearing, the district court stayed the litigation so that Metro Health could apply for a permit 

and receive a determination from the City. 

Metro Health did so and the Richmond Fire Department initially recommended that 

Metro Health be granted a permit. But the City Council disagreed; indeed, the Council
5

voted unanimously to strike a proposed ordinance that would have granted Metro Health a 

permit. 

Metro Health then filed an amended complaint against the City and the RAA,

alleging numerous violations of federal and state law. The district court granted the 

defendants’ motion to dismiss, concluding, in relevant part, that the state action immunity 

doctrine shields the City and the RAA from federal antitrust liability and that their conduct 

does not offend the Supremacy Clause. Metro Health timely noted this appeal. We review 

the district court’s dismissal of Metro Health’s complaint de novo, accepting all wellpleaded allegations as true and construing the facts in the light most favorable to Metro 

Health. In re Willis Towers Watson PLC Proxy Litig., 937 F.3d 297, 302 (4th Cir. 2019). 

II. 

Metro Health primarily contends that the City and the RAA have run afoul of the 

Sherman Act prohibition on monopolization and attempted monopolization. See 15 U.S.C. 

§ 2. If, as the defendants assert and the district court found, the state action immunity 

doctrine shields them from federal antitrust liability, Metro Health cannot succeed on these

claims.

Under the state action immunity, or Parker, doctrine, federal antitrust laws do “not 

apply to anticompetitive restraints imposed by the States ‘as an act of government.’” City 

of Columbia v. Omni Outdoor Adver., Inc., 499 U.S. 365, 370 (1991) (quoting Parker v. 

Brown, 317 U.S. 341, 352 (1943)). At bottom, the Parker doctrine embodies “the 

federalism principle that the States possess a significant measure of sovereignty under our 
6

Constitution.” Cmty. Commc’ns Co. v. City of Boulder, 455 U.S. 40, 53 (1982). Thus, 

sovereign states may “confer exclusive or shared rights to dominate a market, or otherwise 

limit competition to achieve public objectives.” N.C. State Bd. of Dental Examiners v. 

F.T.C., 574 U.S. 494, 503 (2015) [hereinafter N.C. Dental]. Were it otherwise, “federal 

antitrust law would impose an impermissible burden on the States’ power to regulate,” 

strong-arming states into “promoting competition at the expense of other values a State 

may deem fundamental.” Id.

“Because municipalities and other political subdivisions are not themselves 

sovereign,” the Parker doctrine “does not apply to them directly.” F.T.C. v. Phoebe Putney 

Health Sys., Inc., 568 U.S. 216, 225 (2013). Rather, municipalities and “substate 

governmental entities” are immune from federal antitrust claims only “when they act 

‘pursuant to state policy to displace competition with regulation or monopoly public 

service.’” Id. (quoting City of Lafayette v. La. Power & Light Co., 435 U.S. 389, 413 

(1978)). The Supreme Court has long held that such a state policy must be “clearly 

articulated and affirmatively expressed.” City of Boulder, 455 U.S. at 54.

In Town of Hallie v. City of Eau Claire, the Court explained just “how clearly a state 

policy must be articulated for a municipality to be able to establish that its anticompetitive 

activity constitutes state action.” 471 U.S. 34, 40 (1985). There, the Court clarified that

state action immunity will lie where anticompetitive activity is the “foreseeable result” of 

a state policy — that is, where it is “clear that anticompetitive effects logically would 

result” from a given policy or where a regulatory structure inherently displaces unfettered 

business freedom. Id. at 42. A legislature need not, however, “expressly state in a statute 
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or its legislative history that the legislature intends for the delegated action to have 

anticompetitive effects.” Id. at 43.

Here, the City and the RAA easily satisfy Hallie’s clear-articulation test. The 

Virginia legislature has expressly conferred broad authority on local governing bodies to 

engage in anticompetitive conduct in the EMS vehicle services market. See Va. Code Ann. 

§ 32.1-111.14(A). A local government may make it unlawful to operate EMS vehicles 

without a permit, control the issuance of permits, determine where EMS vehicles can and 

cannot operate, and fix the prices of EMS vehicle services. Id. As one court observed over 

two decades ago, these provisions “expressly authorize anticompetitive conduct.” Forest 

Ambulance Serv., Inc. v. Mercy Ambulance of Richmond, Inc., 952 F. Supp. 296, 300 (E.D. 

Va. 1997). Far from granting localities “simple permission to play in a market,” Phoebe 

Putney, 568 U.S. at 231 (internal citation omitted), the Virginia statute greenlights 

regulation and service provision that necessarily supplants unrestrained market

competition. In these circumstances, anticompetitive conduct is the “foreseeable result” of 

the state’s policy. Hallie, 471 U.S. at 42. Accordingly, the City and the RAA are entitled 

to state action immunity.

Metro Health offers several arguments in an attempt to avoid this straightforward 

conclusion. First, Metro Health argues that § 32.1-111.14 only authorizes localities to 

regulate “emergency medical services,” not “non-emergency service[s]” like prescheduled interfacility transports. Opening Br. at 25–27. Not so. In fact, multiple 

provisions of the statute make clear that localities may regulate “emergency medical 

services vehicles,” irrespective of whether the vehicles are engaged in emergency or non-
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emergency services. See, e.g., Va. Code Ann. § 32.1-111.14(A)(3) (conferring power to 

limit the number of vehicles that may be operated within the city); § 32.1-111.14(A)(8) 

(granting power to establish necessary regulations relating to the operation of such 

vehicles); see also Forest Ambulance, 952 F. Supp. at 300 (“It is the vehicle, rather than 

the use, which is being regulated.”).

Second, Metro Health contends that Phoebe Putney announced a heightened cleararticulation test that the defendants cannot meet. This argument also fails. To be sure, the

Phoebe Putney Court warned against applying “the concept of foreseeability from [the] 

clear-articulation test too loosely.” 568 U.S. at 229 (quotation marks omitted). But there, 

the Court considered a Georgia law that merely granted hospital authorities “general 

corporate powers,” not “permission to use those powers anticompetitively.” Id. at 220. 

Here, by contrast, the Virginia General Assembly not only empowered the RAA to provide 

emergency and nonemergency services, see 1991 Va. Acts 644, it also expressly authorized 

the RAA to fix prices and control entry into the EMS vehicle services market, see Va. Code 

Ann. § 32.1-111.14(A). Thus, the defendants’ invocation of the Parker doctrine fits 

comfortably within Phoebe Putney’s reiteration of Hallie’s clear-articulation test. See

Phoebe Putney, 568 U.S. at 229.

Third, Metro Health maintains that both the City and the RAA must, and cannot,

demonstrate that their conduct was “actively supervised by the State.” N.C. Dental, 574

U.S. at 504 (quoting Cal. Retail Liquor Dealers Assn. v. Midcal Aluminum, Inc., 445 U.S. 

97, 105 (1980)). But courts only demand this additional showing from “nonsovereign 

actor[s] controlled by active market participants,” like “private trade associations vested 
9

by States with regulatory authority.” Id. at 503, 511 (emphasis added). In N.C. Dental, for 

example, the Court required this heightened showing from a state board dominated by 

active private dentists who, in their role as board members, excluded nondentists from the 

teeth whitening market. Id. at 501.

Municipalities — like the City — and “substate governmental entities” — like the 

RAA — “are not subject to the ‘active state supervision requirement’ because they have 

less of an incentive to pursue their own self-interest under the guise of implementing state 

policies.” Phoebe Putney, 568 U.S. at 225–26 (quoting Hallie, 471 U.S. at 46–47). As the 

Supreme Court has long recognized, these entities — unlike private parties — are “exposed 

to public scrutiny” and “checked” by “the electoral process.” Hallie, 471 U.S. at 45 n.9. 

Moreover, as “arm[s] of the State,” they are entitled to the presumption “that [they] act[] 

in the public interest.” Id. at 45. While Metro Health insinuates that the RAA has 

improperly “pursue[d] its own interests” by adhering to the City’s public utility model, 

Opening Br. at 35, it provides no evidence that the RAA is involved in “a private pricefixing arrangement,” Midcal, 445 U.S. at 106, or that its actions are motivated by anything 

other than “governmental interests,” Hallie, 471 U.S. at 47. Thus, the concerns that 

animate the active state supervision requirement are wholly absent from this case.

Finally, in a last-ditch attempt to thwart the defendants’ invocation of the Parker

doctrine, Metro Health proposes that we adopt a novel “market participant” exception to 

state action immunity. The Supreme Court has never recognized such an exception; in

fact, it has suggested only that it might possibly exist. See Omni, 499 U.S. at 379 (“We 

reiterate that, with the possible market participant exception, any action that qualifies as 
10

state action is ipso facto [] exempt from the operation of the antitrust laws.”) (emphasis 

added); see also Phoebe Putney, 568 U.S. at 226 n.4 (explicitly declining to consider 

whether a market participant exception exists). Nor have any of the Courts of Appeals ever 

concluded that this proposed exception frustrates the invocation of state action immunity, 

though some have noted that it would, if recognized, introduce considerable tension into 

federal antitrust law. See, e.g., Automated Salvage Transp., Inc. v. Wheelabrator Envtl. 

Sys., Inc., 155 F.3d 59, 81 (2d Cir. 1998). Indeed, as Metro Health’s counsel conceded at 

oral argument, the municipality at issue in the seminal Hallie case successfully invoked the 

Parker doctrine notwithstanding its status as a “market participant.” See Oral Arg. at 5:21–

6:12. Given this unmistakable friction with longstanding Supreme Court precedent, we 

decline Metro Health’s invitation to steer federal antitrust law into uncharted waters.

Accordingly, we conclude that the City and the RAA acted pursuant to a clearly 

articulated state policy and are therefore entitled to immunity from federal antitrust 

liability.

III.

 Metro Health also contends that by “thwart[ing] the [VA Medical Center’s] 

competitive bidding process,” Opening Br. at 44, the City and the RAA have violated the 

Supremacy Clause. In Metro Health’s telling, the defendants’ conduct conflicted with the 

Competition in Contracting Act (“CICA”), 41 U.S.C. § 3301(a), which provides that “an 

executive agency in conducting a procurement for property or services shall obtain full and 
11

open competition through the use of competitive procedures.” We must reject this 

argument.

The Supremacy Clause renders federal law “the supreme Law of the Land.” U.S. 

Const. art. VI, cl. 2. Federal law may preempt state law in three ways: by “express 

preemption,” “field preemption,” and “conflict preemption.” H & R Block E. Enterprises, 

Inc. v. Raskin, 591 F.3d 718, 722 (4th Cir. 2010). For its contention that the CICA preempts 

defendants’ conduct, Metro Health invokes “conflict preemption,” which can occur when 

“‘state law stands as an obstacle to the accomplishment of the full purposes and objectives’

of federal law.” Anderson v. Sara Lee Corp., 508 F.3d 181, 191–92 (4th Cir. 2007)

(quoting Worm v. Am. Cyanamid Co., 970 F.2d 1301, 1305 (4th Cir. 1992)). But here, 

state law posed no obstacle at all. 

Rather, as the VA Medical Center repeatedly made clear — both when it initially

requested quotes and when it conditionally selected Metro Health’s bid — there would be 

no contract unless Metro Health first obtained a permit from the City. In an almost identical 

situation, the U.S. Comptroller General determined that “[e]ven under [CICA’s] full and 

open competition standard,” the VA Medical Center may require a vendor to obtain “a 

franchise or permit from the City of Richmond granting authority to provide emergency 

ambulance services.” Lifeline Ambulance Servs., Inc., B-277415, 97-2 CPD ¶ 83 (Comp. 

Gen. Sept. 22, 1997); see also Pac. Legal Found. v. Goyan, 664 F.2d 1221, 1227 (4th Cir. 

1981) (noting that “[t]he opinion of the Comptroller General is . . . entitled to weight as he 

is the auditing agent of Congress”). The Comptroller General reasoned that “the

requirement is necessary to ensure timely performance of the emergency ambulance 
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services by precluding the possibility that the services will be interrupted by the city’s 

enforcement attempts against an unlicensed contractor.” Lifeline Ambulance Servs., 97-2 

CPD ¶ 83. Where, as here, a federal agency, of its own volition, imposes a contract 

condition consistent with federal law, the Supremacy Clause is not implicated.

IV.

For these reasons, the judgment of the district court is

AFFIRMED.