1 

NOT FOR PUBLICATION [Dkt. No. 26, 27, 29, 45] 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF NEW JERSEY 

CAMDEN VICINAGE 

DEBORAH HEART AND LUNG CENTER, 

 Plaintiff, 

v. 

PENN PRESBYPYTERIAN MEDICAL 

CENTER, et al., 

 Defendants. 

Civil No. 11-1290 (RMB)(KMW) 

OPINION 

Appearances: 

Anthony Argiropoulos 

Scott B. Murray 

Thomas Kane 

Sills Cummis & Gross, P.C. 

650 College Road East 

Princeton, New Jersey 08540 

Attorneys for Plaintiff Deborah Heart and Lung Center 

Robert A. White 

Morgan, Lewis & Bockius LLP 

502 Carnegie Center 

Princeton, NJ 08540 

Jay H. Calvert, Jr. 

R. Brendan Fee 

Morgan, Lewis & Bockius LLP 

1701 Market Street 

Philadelphia, PA 19103 

Attorneys for Defendants Presbyterian Medical Center 

of the University of Pennsylvania Health System, 

University of Pennsylvania Health System, Penn Cardiac 

Care at Cherry Hill, and Clinical Health Care 

Associates of New Jersey, P.C. 

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James J. Ferrelli 

Philip H. Lebowitz 

John E. Sindoni 

Duane Morris LLP 

1940 Route 70 East, Suite 200 

Cherry Hill, New Jersey 08003 

Attorneys for Defendant Virtua Health, Inc. and Virtua 

Memorial Hospital Burlington County 

Robert V. Dell’Osa 

Cozen O’Connor P.C. 

457 Haddonfield Road, Suite 300 

Cherry Hill, New Jersey 08002 

 

 Ronald F. Wick 

Cozen O’Connor P.C. 

 The Army and Navy Building 

 1627 Street, NW, Suite 1100 

 Washington, D.C. 20006 

Attorneys for The Cardiology Group, P.A. 

BUMB, United States District Judge: 

Plaintiff Deborah Heart and Lung Center (“Plaintiff”), a 

not-for-profit charity hospital, alleges two claims against the 

Defendants - Virtua Health, Inc. and Virtua Memorial Hospital 

Burlington County (the “Virtua Defendants”), Presbyterian 

Medical Center of the University of Pennsylvania Health System, 

University of Pennsylvania Health System, Penn Cardiac Care at 

Cherry Hill, and Clinical Health Care Associates of New Jersey, 

P.C. (the “Penn Defendants”), and The Cardiology Group, P.A. 

(“Defendant CGPA”). 

First, Plaintiff claims that the Defendants conspired with 

one another, in violation of Section 1 of the Sherman Act, to 

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exclude Plaintiff from the market for certain critical, advanced 

cardiac interventional procedures, thereby restricting 

consumers’ choice of providers for these procedures, and forcing 

consumers to pay higher prices. 

Second, Plaintiff claims that these efforts were part of an 

overlapping conspiracy by the Defendants, in violation of 

Section 2 of the Sherman Act, for the Virtua Defendants to 

monopolize the market for emergent/primary angioplasties - a 

submarket of the larger market for advanced cardiac 

interventional procedures that is the subject of the first 

alleged conspiracy. Defendants have moved to dismiss on a number 

of grounds.1

 

For the reasons that follow, Defendants’ motion to dismiss 

is DENIED with respect to Plaintiff’s Section 1 claim and 

GRANTED with respect to Plaintiff’s Section 2 Claim. 

I. Background

A. The Plaintiff 

Plaintiff is a 139-bed hospital located in Burlington 

 

1 In briefing on the motions to dismiss, Plaintiff moved for leave to 

file a sur-reply in further opposition to the motions, attaching the 

sur-reply brief. Plaintiff's attachment of the brief was improper and 

Plaintiff is cautioned that, going forward, it is to obtain this 

Court's permission before filing any supplemental briefing. As such, 

this Court has not considered the improperly filed sur-reply brief. 

The Court previously exercised its discretion to deny the motion to 

file the sur-reply brief. See Docket No. 48; Fenza's Auto, Inc. v. 

Montagnaro's Inc., No. 10-3336, 2011 WL 1098993, at *4 (D.N.J. Mar. 21, 

2011)(“[T]he court has broad discretion to consider supplemental 

briefing as appropriate and fair.”). 

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County, New Jersey and is nationally renowned for the quality of 

its cardiology and pulmonary services, as well as its high 

scores for patient satisfaction.2 Uniquely, Plaintiff is one of 

only three hospitals in the United States that are legally 

exempt from collecting insurance co-pays and deductibles from 

patients. Prior to 2010, Plaintiff lacked an emergency room and 

Defendant Virtua Memorial Hospital was the primary and, at 

times, only emergency room in what Plaintiff contends is the 

relevant geographic market for emergency care. 

B. The Competitive Landscape 

Plaintiff competes with the much larger Virtua Defendants, 

who operate three hospitals in the area with nearly 900 beds. 

Since 2005, the Virtua Defendants have made Defendant CGPA the 

exclusive provider of cardiology services at Defendant Virtua 

Memorial Hospital, one of the three hospitals the Virtua 

Defendants operate. 

Until 2007, the Virtua Defendants were unable, under New 

Jersey law, which regulates what procedures hospitals may 

perform based on area need by issuing Certificates of Need, to 

provide any of the advanced cardiac interventional procedures 

that are at issue in this litigation. Those procedures fall in 

to two broad categories: (1) elective - non-emergent 

 

2 The allegations contained in Plaintiff’s Amended Complaint are accepted 

as true for purposes of the motion to dismiss. 

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angioplasty, electrophysiology, and cardiac surgery (the 

“Elective Procedures”); and (2) emergency - emergent/primary 

angioplasty (the “Emergency Procedures”). Plaintiff contends 

that the relevant geographic market for the Elective Procedures 

consists of Burlington County, New Jersey, as well as parts of 

Atlantic, Camden, Mercer, and Ocean Counties, also in New 

Jersey, and the Philadelphia area. As for the relevant 

geographic market for Emergency Procedures, Plaintiff claims 

that the market is slightly smaller and consists of Burlington 

County, as well as portions of Camden, Mercer, and Ocean 

Counties, but not Atlantic County or the Philadelphia area. 

Historically, because the Virtua Defendants were largely 

unable to perform the procedures at issue3

, Virtua transferred 

patients requiring these procedures to other area hospitals. 

These hospitals included New Jersey hospitals who had obtained a 

Certificate of Need, like Plaintiff and two other hospitals who 

also compete with Plaintiff - Cooper Hospital University Medical 

Center (“Cooper”) and Our Lady of Lourdes Medical Center 

(“Lourdes”). They also included, for Elective Procedures, 

Defendant Presbyterian Medical Center of the University of 

Pennsylvania Health System (“Penn Presbyterian”), a 

Philadelphia-based hospital, which was entitled to perform the 

 

3 In 2007, the Virtua Defendants, who previously lacked a Certificate of 

Need to perform any of the procedures at issue, were authorized to 

perform a limited number of procedures on an emergency basis. 

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procedures under Pennsylvania law. According to Plaintiff, 

patients requiring Emergency Procedures were generally not 

transferred to Penn Presbyterian because the transit time would 

have been considered unacceptable due to the need for these 

patients to receive more immediate care. Most patients, for 

both Elective and Emergency Procedures, however, were simply 

transferred to Plaintiff. 

All this changed when, according to Plaintiff, the 

Defendants conspired to exclude Plaintiff and, ultimately, drive 

it out of business and allow Defendant Virtua Memorial Hospital 

to monopolize the market for Emergency Procedures. 

C. The Alleged Conspiracies 

According to Plaintiff, Defendants entered into an anticompetitive conspiracy in 2007 premised on two interlocking 

written agreements: first, between the Virtua Defendants and 

Defendant CGPA, making CPGA the exclusive provider of cardiology 

services at Virtua; and second, between CGPA and the Penn 

Defendants, making the Penn Defendants the exclusive recommended 

referral of CGPA. These agreements, Plaintiff contends, form 

the building blocks of the larger conspiracies to exclude 

Plaintiff from receiving transfers from the Virtua Defendants, 

drive it out of the market, and allow the Virtua Defendants to 

monopolize the Emergency Procedures market. Plaintiff claims 

that, as a result of these conspiracies, the Virtua Defendants 

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transferred almost all patients requiring advanced cardiac care 

to the Penn Defendants. Plaintiff claims that, to enforce this 

larger agreement, the Virtua Defendants monitored, and reported 

to the other Defendants, instances of “leakage” - occasions when 

Virtua Defendants' patients were transferred to other hospitals 

besides those of the Penn Defendants.4 

Plaintiff alleges that, in many instances, in contravention 

of patients’ rights under the New Jersey Patients’ Bill of 

Rights, patients of the Virtua Defendants had their requests to 

transfer to Plaintiff denied, or were coerced not to transfer 

through the use of false and malicious statements. According to 

Plaintiff, the Virtua Defendants attempted to compensate for the 

greater distance to Penn Presbyterian, which previously made 

Penn an unattractive choice for patients requiring Emergency 

Procedures, by utilizing helicopter transfers. However, 

Plaintiff alleges that the helicopter transfers still regularly 

exceeded medically recommended transfer time limits. 

 

4 Plaintiff submitted an email discussing a “leakage report” in an 

exhibit attached to its opposition to the motions to dismiss. Because 

the exhibit, and Plaintiff's other attachments submitted in opposition 

to the motion to dismiss, are consistent with the facts plead in the 

Amended Complaint, this Court may exercise its discretion to consider 

them without converting the motions to dismiss into motions for summary 

judgment. Help at Home, Inc. v. Medical Capital, L.L.C., 260 F.3d 748, 

752-53 (7th Cir. 2001)(“A plaintiff need not put all of the essential 

facts in the complaint; he may add them by affidavit or brief in order 

to defeat a motion to dismiss if the facts are consistent with the 

allegations of the complaint.”(quotation and citation omitted); 

Kulwicki v. Dawson, 969 F.2d 1454, 1462 (3d Cir. 1992)(“A trial judge 

has the discretion to consider evidence outside the complaint in ruling 

on motions to dismiss.”). 

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Plaintiff claims that these actions resulted in harm to 

both Plaintiff and consumers: Plaintiff lost business to the 

Penn Defendants and consumers faced higher costs, less choice, 

and greater medical risk. In particular, according to Plaintiff, 

patients transferred to the Penn Defendants faced higher fees in 

the form of: “out of pocket expenses related to insurance copays and deductibles and balance billing” which do not occur at 

Deborah. Medicare, Medicaid, and third party insurers also 

faced increased costs from lengthier ambulance transportation to 

Penn Presbyterian and helicopter transport. Patients and 

insurers were both harmed because, according to Plaintiff, the 

conspiracy enabled the Penn Defendants to charge 

supracompetitive prices for the procedures at issue. Finally, 

Patients were deprived of their choice in hospital and, in the 

case of Emergency Procedures, subjected to unnecessary medical 

risk because of the lengthier transport time. 

II. Standard

To survive a motion to dismiss, “a complaint must contain 

sufficient factual matter, accepted as true, to state a claim to 

relief that is plausible on its face.” Sheridan v. NGK Metals 

Corp., 609 F.3d 239, 262 n.27 (3d Cir. 2010) (quoting Ashcroft 

v. Iqbal, --- U.S. ---, 129 S.Ct. 1937, 1949 (2009) (internal 

quotations omitted)). “A claim has facial plausibility when the 

plaintiff pleads factual content that allows the court to draw 

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the reasonable inference that the defendant is liable for the 

misconduct alleged.” Id. (quoting Iqbal, 129 S.Ct. at 1949). 

The Court conducts a three-part analysis when reviewing a 

claim: 

First, the court must take note of the elements a plaintiff 

must plead to state a claim. Second, the court should 

identify allegations that, because they are no more than 

conclusions are not entitled to the assumption of truth. 

Finally, where there are well-pleaded factual allegations, 

a court should assume their veracity and then determine 

whether they plausibly give rise to an entitlement for 

relief. 

Santiago v. Warminster Twp., 629 F.3d 121, 130 (3d Cir. 

2010)(quotations and citations omitted); see also Fowler v. UPMC 

Shadyside, 578 F.3d 203, 211 (3d Cir. 2009)(“ . . . [A] 

complaint must do more than allege the plaintiff’s entitlement 

to relief. A complaint has to ‘show’ such an entitlement with 

its facts.”). 

III. Analysis

Plaintiff makes two claims: (1) that Defendants have 

violated Section 1 of the Sherman Act (conspiracy to restrain 

trade); and (2) that Defendants have violated Section 2 of the 

Sherman Act (conspiracy to monopolize the Emergency Procedures 

market).5 Defendants have moved for dismissal of both claims 

 

5

 The Amended Complaint’s pleads a Section 2 claim with respect to both 

the Elective and Emergency Procedures markets. However, in Plaintiff’s 

motion to dismiss opposition briefing, Plaintiff solely addressed the 

Emergency Procedures market and, at oral argument, Plaintiff confirmed 

that its Section 2 claim was limited to the Emergency Procedures 

market. 

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based on lack of antitrust standing and failure to meet the 

elements of Section 1 and 2 claims. The Court first turns to 

the standing issue. 

A. Plaintiff Has Antitrust Standing To Maintain Its 

Claims. 

Defendants argue that Plaintiff lacks antitrust standing to 

pursue its claims. The Third Circuit applies a 5-factor test to 

assess antitrust standing. The factors are: 

(1) the causal connection between the antitrust violation 

 and the harm to the plaintiff and the intent by the 

defendant to cause that harm, with neither factor 

alone conferring standing; 

(2) whether the plaintiff's alleged injury is of the type 

for which the antitrust laws were intended to provide 

redress; 

(3) the directness of the injury, which addresses the 

concerns that liberal application of standing 

principles might produce speculative claims; 

(4) the existence of more direct victims of the alleged 

antitrust violations; and 

(5) the potential for duplicative recovery or complex 

apportionment of damages. Angelico v. Lehigh Valley 

Hosp., Inc., 184 F.3d 268, 274 (3d Cir. 1999)(citation 

omitted). 

The first two factors relate to whether Plaintiff has 

suffered an “antitrust injury.” See Daniel v. Am. Bd. of 

Emergency Med., 428 F.3d 408, 443 (2d Cir. 2005). The final 

three factors relate to whether Plaintiff would be an “efficient 

enforcer” of the antitrust laws whose interest would be “aligned 

with those of consumers generally.” Id.; Reddy v. Puma, No. 

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1:06CV1283, 2006 WL 2711535, at *5 (E.D.N.Y. Sept. 21, 2006). 

Importantly, in assessing these factors, this Court assumes the 

alleged conduct would constitute an antitrust violation. 

Steamfitters Local Unionn No. 420 Welfare Fund v. Philip Morris, 

Inc., 171 F.3d 912, 926 n.7(3d Cir. 1999)( “assum[ing] for the 

sake of assessing plaintiffs' antitrust standing that the 

conduct in which defendants allegedly engaged would constitute 

such a violation.”); Daniel, 428 F.3d at 437 (assuming that 

alleged conduct was antitrust violation in assessing antitrust 

violation to avoid blurring antitrust standing and merits); 

Glaberson v. Comcast Corp., No. 03-6604, 2006 WL 2559479, at *4-

5 (E.D.Pa. Aug. 31, 2006)(citing Antitrust Law by Phillip E. 

Areeda and Herbet Hovenkamp for the proposition that “[t]o test 

standing in a private suit . . . the court should assume the 

existence of a violation and then ask whether the [standing 

elements] are shown”). In light of this principle, the 

“antitrust injury” analysis does not depend on whether Plaintiff 

has plausibly alleged anticompetitive harm to the market. St. 

Clair v. Citizens Financial Group, No. 08-1257, 2008 WL 4911870, 

at *5 (D.N.J. Nov. 12, 2008)(holding that harm to the market “is 

not required for antitrust standing, but instead is relevant to 

show restraint of trade when proving the merits of an antitrust 

claim.”). That factor goes to the merits and whether a 

violation occurred, not a plaintiff’s standing. Id. Applying 

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these factors, Plaintiff has suffered an antitrust injury and 

would be an efficient enforcer of the antitrust laws. Plaintiff 

therefore has antitrust standing. 

First, Plaintiff has plausibly alleged that Defendants’ 

conspired to harm Plaintiff and that that conspiracy caused 

Plaintiff harm in the form of lost patient revenues. Second, 

Plaintiff’s loss of revenues from its exclusion is among the 

types of harm the antitrust laws were designed to prevent. 

Angelico, 184 F.3d at 274 (“Turning to the second element, 

whether Angelico's alleged injury is of the type the antitrust 

laws were meant to redress, we conclude that the injury he 

suffered, when shut out of competition for anticompetitive 

reasons, is indeed among those the antitrust laws were designed 

to prevent.”). Third, Plaintiff’s injuries are “clearly [a] 

direct (and substantial) . . . result of the alleged conspiracy” 

as patients that likely would have transferred to Plaintiff were 

instead sent to the Penn Defendants. Id. at 275. Fourth, there 

are no more direct victims of the alleged conspiracy. Other 

excluded hospitals are in the same position as Plaintiff. 

Insurers and individual consumers harmed by the alleged 

antitrust violations are no more direct and the latter are less 

likely to sue for this type of violation, absent a class action, 

given the small amount of damages each would have sustained on 

an individual basis. Fifth, and finally, there is no potential 

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for duplicative recovery or complex apportionment of damages 

since the other hospitals and consumers would have wholly 

separate and independent damages. Id. More generally, 

Plaintiff’s interest is aligned with consumers because both are 

interested in protecting consumer choice and access to a lower 

cost and, in the case of Emergency Procedures, medically 

superior hospital. 

Therefore, Plaintiff has antitrust standing to maintain its 

claims and this Court must turn to whether Plaintiff has 

plausibly alleged the elements of its antitrust claims. 

 B. Plaintiff Has Plausibly Alleged A Section 1 Claim. 

“To establish a violation of Section 1, a plaintiff must 

prove: (1) concerted action by the defendants; (2) that produced 

anticompetitive effects within the relevant product and 

geographic markets; (3) that the concerted actions were illegal; 

and (4) that it was injured as a proximate result of the 

concerted action.” Black Box Corp. v. Avaya, Inc., No. 07-6161, 

2008 WL 4117844, at *7 (D.N.J. Aug. 29, 2008)(quotation and 

citation omitted). Defendants have vigorously challenged 

Plaintiff’s allegations with respect to each of these elements. 

However, because Plaintiff has satisfied each of these elements, 

Defendants’ motions will be denied. 

1. Plaintiff Has Plausibly Alleged Concerted Action By 

 The Defendants. 

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“Concerted action is established where two or more distinct 

entities have agreed to take action against the plaintiff.” 

Gordon v. Lewistown Hosp., 423 F.3d 184, 204 (3d Cir. 2005). 

Entities agree where they share “a unity of purpose, a common 

design and understanding, a meeting of the minds, or a conscious 

commitment to a common scheme.” West Penn Allegheny Health 

System, Inc. v. UPMC, 627 F.3d 85, 99 (3d Cir. 2010). Agreement 

may be plead through “direct or circumstantial evidence, or a 

combination of the two.” Id. 

Plaintiff has adequately plead, through both direct and 

circumstantial evidence, that Defendants are engaging in 

concerted action to exclude Plaintiff from receiving patient 

transfer from the Virtua Defendants. Directly, Plaintiff has 

demonstrated that there are two interlocking written agreements: 

first, between the Virtua Defendants and Defendant CGPA, making 

CPGA the exclusive provider of cardiology services at Virtua; 

and second, between CGPA and the Penn Defendants, making the 

Penn Defendants the exclusive recommended referral of CGPA. 

According to Plaintiff, these interlocking agreements, in 

practice, make the Penn Defendants the exclusive advanced 

cardiac procedural referral of the Virtua Defendants. This 

direct evidence of agreement is supported by four strong pieces 

of circumstantially pled evidence: (1) the powerful shift in the 

Virtua Defendants' transfer pattern (Am. Compl. ¶¶ 75, 77); (2) 

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that the shift in patients needing Emergency Procedures was made 

despite increased medical risks and costs (Am. Compl. ¶¶ 181-

185, 208); (3) coercive conduct by the Virtua Defendants and 

CGPA to prevent patients from exercising their choice of 

hospital, in the face of a statutory obligation to allow that 

very choice (Am. Compl. ¶¶ 78-174)6; and (4) the Defendants’ 

dissemination and discussion of leakage reports. (See

Certification of Thomas Kane in Support of Plaintiff’s 

Opposition to Motions to Dismiss, Ex. D). 

The Virtua Defendants and CGPA argue that Plaintiff has 

failed to establish concerted action because Plaintiff failed to 

show that the events at issue are more plausibly the result of 

concerted action than of parallel conduct because they lacked an 

economic motive to engage in the alleged concerted action. The 

Court rejects that argument for three reasons. 

First, Defendants overstate the Plaintiff's burden on a 

motion to dismiss. To survive a motion to dismiss, a 

plaintiff's “allegations need not rule out all potential 

alternative explanations” and instead must only adduce enough 

factual material taken as true to plausibly suggest an agreement 

 

6

 The Penn Defendants contend that the alleged coercive conduct amounts 

to no more than “garden-variety business torts” that do not rise to the 

level of antitrust claims. That some of the conduct allegedly employed 

by Defendants in furtherance of the alleged antitrust conspiracy was 

also tortious is immaterial to the viability of Plaintiff’s antitrust 

claims. Tortious and anticompetitive conduct are not mutually 

exclusive. 

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was made. See In re Magneisum Oxide Antitrust Litig., No. 10-

54983, 2011 WL 5008090, at *15 (D.N.J. Oct. 20, 2011). As 

described above, Plaintiff has plainly met this burden. 

Second, Plaintiff has, in fact, plausibly and specifically 

alleged economic incentive from these Defendants. The Virtua 

Defendants and CGPA both stood to gain from the potential 

elimination of a rival. In an e-mail, CGPA's President 

contemplated the possibility of Plaintiff being driven out of 

business and hypothesized that that process could be accelerated 

by no longer transferring certain cardiac patients there. 

Plaintiff's exit from the market would result in new patients 

and an enhanced possibility of the Virtua Defendants being 

awarded a Certificate of Need to perform additional cardiac 

interventional procedures – a possibility the Virtua Defendants 

are alleged to have considered and studied. 

Third, these Defendants have failed to offer a plausible 

explanation that the events at issue were the result of 

independent conduct, rather than the result of an agreement. 

Finally, the Penn Defendants argue that a Section 1 claim 

requires, and they lacked, a unity of purpose with the other 

Defendants, since the alleged goal of their co-defendants was to 

shutdown Deborah, and their economic motivation was not 

predicated on Deborah's shutdown, but on a the “influx of new 

patients” as a result of the transfers – a legitimate business 

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interest. But the complaint need not have alleged “that the 

parties to an agreement had identical motives” or that a party's 

motive was anti-competitive - only that they “had a plausible 

reason to participate in the conspiracy.” Trans World Techs., 

Inc. v. Raytheon Co., No. 06-5012, 2007 WL 3243941, at *4 

(D.N.J. Nov. 1, 2007); Paladin Assocs., Inc. v. Montana Power 

Co., 328 F.3d 1145, 1153-54 (9th Cir. 2003)(holding that the 

plaintiff “need not prove intent to control prices or destroy 

competition to demonstrate the element of an agreement . . . 

among two or more entities.”)(quotation and citation omitted).7

 

Therefore, even if the Penn Defendants had no desire to 

eliminate Plaintiff and were merely motivated by economic selfinterest, Plaintiff has sufficiently alleged that the Penn 

Defendants participated in the alleged conspiracy and their 

reason for participation: the large influx of new patients. 

Fineman v. Armstrong World Indus., Inc., 980 F.2d 171, 212-14 

(3d Cir. 1992)(explaining that a conspirator in a scheme to 

 

7

 See also Petruzzi's IGA Supermarket, Inc. v. Darling-Delaware Co., 

Inc., 998 F.2d 1224, 1243 (3d Cir. 1993)(“However, we have made it 

clear that the defendants need not share the same motive. Rather, all 

that is required is they each have a motive to conspire.”); Acme 

Markets, Inc. v. Wharton Hardware and Supply Corp., 890 F. Supp. 1230, 

1239 (D.N.J. 1995)(holding that alleged co-conspirators may have 

“independent motivations” so long as they “acted in concert to restrain 

competition through their common objective of enforcing the restrictive 

covenant.”); In re Processed Egg Prods. Antitrust Litig., No. 08-md02002, 2011 WL 4465355, at *7 (E.D.Pa. Sept. 26, 2011(holding that even 

reluctant co-conspirators may be held liable and that “the issue is 

whether the pleading delineates to some sufficiently specific degree 

that a defendant purposefully joined and participated in the 

conspiracy.”). 

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eliminate plaintiff did not need to share a commitment to the 

elimination of the rival and could instead simply be motivated 

by its own financial incentives). 

Accordingly, Plaintiff has plausibly alleged the first 

element of a Section 1 claim. 

2. Plaintiff Has Plausibly Alleged Anticompetitive 

 Effects Within The Relevant Product And Geographic 

 Markets. 

 

 A plaintiff may demonstrate that concerted action produced 

adverse, anticompetitive effects within the relevant product and 

geographic markets in two ways: (1) through direct evidence of 

actual anticompetitive effects; or (2) through proof of the 

defendant’s market power, which acts as a proxy for 

anticompetitive effect. Deutscher Tennis Bund v. ATP Tour, 

Inc., 610 F.3d 820, 830 (3d Cir. 2010).8 

 

8

 Defendants argue that, in order to demonstrate competitive harm, 

Plaintiff was required, and failed, to demonstrate that the alleged 

exclusionary conduct resulted in a significant market foreclosure. But 

market foreclosure analysis, like market power analysis, is merely a 

surrogate for a demonstration of actual anticompetitive effect. 

Jonathan M. Jacobson, Exclusive Dealing, “Foreclosure,” And Consumer 

Harm, 70 ANTITRUST L.J. 311, 362 (2002). As Jonathan Jacobson, former 

member of the Congressional Antitrust Modernization Commission, 

persuasively writes: 

But just as foreclosure is no more a magic wand for plaintiffs, 

neither does the absence of “substantial foreclosure” provide a 

defense for firms whose exclusive dealing practices in fact 

threaten significant harm. The foreclosure concept was developed 

as a useful proxy for analyzing harm to competition. If 

“substantial foreclosure” was shown, the courts presumed that the 

competitive process had been damaged and the restraint was 

condemned accordingly. As the sophistication of antitrust 

analysis has increased, however, the foreclosure proxy has been 

found inadequate. A large amount of percentage foreclosure, 

without more, proves nothing, but the absence of percentage 

foreclosure is equally unilluminating. In all cases, the relevant 

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While, in both cases, a plaintiff must make some showing of 

a relevant market, where a plaintiff demonstrates direct 

evidence of actual anticompetitive effects, the plaintiff’s 

burden is diminished and it must only demonstrate “the rough 

contours of a relevant market.” In re Compensation of 

Managerial Professional and Technical Employees Antitrust 

Litig., No. 02-CV-2924, 2008 WL 3887619, at *7 (D.N.J. Aug. 20, 

2008)(quotation omitted). Actual anticompetitive effects can be 

shown through reduced output, increased prices, decreased 

quality, and loss of consumer choice.9

 Tunis Bros. Co., Inc. v. 

Fort Motor Co., 952 F.2d 715, 728 (3d Cir. 1991)(“An antitrust 

plaintiff must prove that challenged conduct affected the 

prices, quantity or quality of goods or services.)(quotation and 

citation omitted); Acme Markets, 890 F. Supp. at 1240 (same); 

United States v. Brown Univ. in Providence in State of Rhode 

Island, 5. F.3d 658, 675 (3d Cir. 1993)(noting that 

“[e]nhancement of consumer choice is a traditional objective of 

 question is instead whether there has been an adverse effect on 

price, output, quality, choice, or innovation in the market as a 

whole. Id.

As described below, Plaintiff has adequately alleged actual 

anticompetitive effect, obviating any need for a demonstration of 

market foreclosure. 9

 Defendants argue that Plaintiff cannot demonstrate anticompetitive 

effects because Plaintiff cannot show reduced output. However, reduced 

output is just one method of demonstrating anticompetitive harm. New 

York Medscan LLC v. New York University School of Medicine, 430 F. 

Supp. 2d 140, 146 (S.D.N.Y. 2006)(“A plaintiff asserts harm to 

competition by alleging adverse effects on the price, quality, or 

output of the relevant good or service.”)(emphasis added); Angelico, 

184 F.3d at 276 (3d Cir. 1999)(same). 

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the antitrust laws and has also been acknowledged as a 

procompetitive benefit.”); Rome Ambulatory Surgical Center LLC 

v. Rome Memorial Hosp., Inc., 349 F. Supp. 2d 389, 410 (N.D.N.Y. 

2004)(recognizing loss of consumer choice as a significant 

injury to competition). 

Because the Court concludes that Plaintiff has plausibly 

alleged direct anticompetitive effects, there is no need to, and 

the Court will not, separately assess whether Plaintiff 

adequately alleged market power. 

 a. Plaintiff Plausibly Alleged Competitive Harm 

 While Plaintiff’s allegations of supracompetitive pricing 

for the procedures at issue are too conclusory to be credited10, 

Plaintiff has sufficiently alleged competitive harm in the form 

of: (1) higher prices through co-pays and related expenses and 

increased transportation costs, particularly helicopter 

transport costs; (2) reduced quality of care in Emergency 

Procedures, where Plaintiff has plausibly alleged that the 

increased transport time may cause adverse medical outcomes11; 

 

10 See Burns v. Lavender Hill Herb Farm, Inc., No. Civ.A 01-7019, 2005 WL 

1006321, at *3 (E.D.Pa. Apr. 28, 2005)(rejecting conclusory allegations 

of higher prices); Process Controls Int’l, Inc. v. Emerson Process 

Mgmt., No: 4:10CV645, 2011 WL 403121, at *4 (E.D.Mo. Feb. 1, 

2011)(same). 

11 At oral argument, the Virtua Defendants contended that there are two 

time-based components to ensuring proper medical care for these 

procedures: the transport time to the hospital and the time, once at 

the hospital, before a patient receives the proper treatment. They 

argued that the Amended Complaint alleges only that the transport time 

is shorter for transfer to Deborah and, without allegations as to wait 

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and (3) loss of consumer choice as Plaintiff is removed as an 

option for Virtua patients, even in cases where they request to 

be transferred there but are denied. Farina v. United Parcel 

Service, MDL-1339, 2002 WL 1766554, at *10 (S.D.N.Y. July 31, 

2002)(holding that denial of ability to purchase from lowerpriced competitor was anticompetitive harm); Bearing 

Distributors, Inc. v. Rockwell Automation, Inc., No. 06-CV-831, 

2006 WL 2709779, at *7 (N.D.Oh. Sept. 20, 2006)(holding that 

removal of lower-priced, superior service product from market 

was antitrust harm). These are real competitive harms to a 

significant population. 

 They do not reflect, as Defendants alternately contend: (1) 

a de minimis, non-cognizable harm to competition; (2) a harmless 

substitution of one provider of the procedures at issue – 

Plaintiff – for another – the Penn Defendants; or (3) “increased 

competition” from the Penn Defendants. Those conclusions do not 

follow. Prior to the alleged conspiracy, the Penn Defendants 

competed freely with Plaintiff and other hospitals in the area. 

Once the conspiracy began, however, Plaintiff alleges that it 

 time at Deborah, does not plausibly establish that transfer to Penn 

subject patients to unnecessary medical risks. This is an overly 

technical reading of the Amended Complaint. Plaintiff has, 

particularly in light of the historic practice of transferring patients 

to it, plausibly alleged that there are no medical issues that prevent 

transport to it from Virtua. It is a fair inference from these 

allegations, and the allegations that Defendants’ practice subjects 

patients to unnecessary medical risk, that there is no issue with 

hospital waiting time at Deborah that would negate its transportation 

time advantage. 

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22 

was largely excluded from competition. Thus, the diversion of 

patients at issue was not the product of increased competition 

from the Penn Defendants, who were already competitors, but the 

exclusion of Plaintiff. That exclusion was harmful, not 

harmless, to consumers for the reasons detailed above and 

affected a significant harm on the market. Plaintiff has 

therefore, contrary to Defendants’ arguments otherwise, 

satisfied its burden to show anticompetitive harm that was more 

than a de minimis restraint of trade. Tunis, 952 F.2d at 728. 

 Defendants also argue that the higher prices patients 

transferred to the Penn Defendants pay, through co-pays and 

other payments that they do not need to pay at Plaintiff, cannot 

constitute a competitive harm because: (1) they are the product 

of a regulatory anomaly rather than Plaintiff’s competitive 

merits; (2) the regulatory exemption is itself anti-competitive; 

and (3) holding otherwise would mean that any transfer, other 

than to Plaintiff, could constitute a competitive harm. On the 

first issue, Defendants have cited no authority, and this Court 

can find none, suggesting that it would be improper to find 

anticompetitive harm because of Plaintiff’s admitted regulatory 

advantage.12 Defendants’ argument wrongly places the focus on 

 

12 The Court ordered supplemental briefing on this issue. Defendants’ 

 authority submitted in response is inapposite. In Schuylkill Energy 

Resources v. Pa. Power & Light Co., 113 F.3d 405 (3d Cir. 1997), the 

Court rejected an energy supplier’s contention that a utility company’s 

failure to purchase energy from it resulted in a higher rates to 

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whether Plaintiff is competing on the merits, when antitrust law 

is concerned, as evidenced by the required elements of a Section 

1 claim, with Defendants’ conduct and its effect on competition. 

Given these facts and antitrust law’s strong emphasis on 

promoting lower prices for consumers13, this Court finds that the 

higher prices patients pay can constitute an anticompetitive 

harm. On the second issue, similar logic applies: Defendants’ 

conduct and its effect on competition is at issue in this 

litigation, not the merits of the exemption. On the third 

issue, competitive harm would not arise, based on the Court’s 

interpretation, in every transfer. It is only implicated where, 

as here, it is the product of an exclusionary transfer policy. 

In any event, even if these higher prices were not credited as 

antitrust injuries, Plaintiff has plausibly alleged meaningful 

 consumers on two grounds. Id. at 414-15. First, the court found that 

the utility’s rates were determined by regulators, not the marketplace, 

and therefore any complaints were properly directed to regulatory 

authorities. Id. Defendants have not identified any corresponding 

authority here that would make antitrust review inappropriate Second, 

the plaintiff there was found to be only a supplier to the utility, not 

its competitor, so could not participate in the market for consumers. 

Id. at 415. Plaintiff here, in contrast, is in direct competition with 

Defendants. In In re Canadian Imp. Antitrust Litig., 470 F.3d 785 (8th 

Cir. 2006), the court found that prescription drug purchasers failed to 

allege anti-competitive conduct where they alleged that drug companies 

acted to prevent the importation of cheaper brand name drugs from 

Canada. Id. at 791 There, unlike here, the inability to access a 

cheaper alternative was caused, at the start, by government 

regulations, not the Defendants‘ exclusionary conduct. Id. at 791-92. 

The plaintiffs there could not allege, as Plaintiff can here, “that 

prior to the alleged anti-competitive conduct of the defendants” 

consumers had access to the cheaper alternative. Id. at 792. 

13 See Brooke Group Ltd. v. Brown & Williamson Tobacco Corp., 509 U.S. 

209, 223 (1993)(holding, in the predatory pricing context, that “[l]ow 

prices benefit consumer regardless of how those prices are 

set”)(quotation and citation omitted). 

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competitive harms to consumer choice and, with respect to 

Emergency Procedures, loss in quality. 

 Finally, Defendants argue that the alleged agreement is not 

anticompetitive, and therefore there is no anticompetitive harm, 

because there is no duty to cooperate. But the anticompetitive 

harm alleged is the exclusion of Plaintiff as a choice for 

patients, not that Defendants have an affirmative obligation to 

direct patients to Plaintiff, or give Plaintiff access to 

Defendants’ patients. 

 b. Plaintiff Has Met Its Burden To Allege Relevant 

Markets. 

 Plaintiff has also sufficiently alleged, at a minimum, the 

rough contours of the marketplace for both the Elective and 

Emergency Procedures. For the former, Plaintiff has adequately 

alleged a marketplace in Southern New Jersey and Philadelphia. 

For the latter, Plaintiff has adequately alleged a more 

restricted geographic market, which excludes Philadelphia, in 

light of the need for patients needing emergency treatment to 

receive more rapid care and the alleged greater transport time 

in transit to Philadelphia. That the Virtua Defendants are, in 

fact, transferring patients to the Penn Defendants in 

Philadelphia for Emergency Procedures does not disturb this 

analysis. Plaintiff has plausibly alleged that Philadelphia 

hospitals are not a suitable medical alternative and that 

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patients are only being transferred there as a result of the 

conspiracy. It is therefore plausible that Philadelphia is not 

part of the relevant market. In any event, regardless of 

whether Philadelphia is part of the market for Emergency 

Procedures, Plaintiff’s allegations certainly allege the “rough” 

market contours required in a direct evidence case. 

3. Plaintiff Has Plausibly Alleged That The Concerted 

 Action Was Illegal. 

 

Concerted action that unreasonably restrains trade is 

illegal. American Needle, Inc. v. Nat’l Football League, 130 

S.Ct. 2201, 2212 (2010). “At the pleading stage, a plaintiff 

may satisfy the unreasonable-restraint element by alleging that 

the conspiracy produced anticompetitive effects in the 

relevant markets.” West Penn, 627 F.3d at 100. As discussed 

above, Plaintiff has plausibly alleged competitive harm. 

Therefore, Plaintiff has plausibly alleged that Defendants’ 

concerted actions were illegal. 

4. Plaintiff Has Plausibly Alleged That It Was Injured 

 As A Proximate Result Of The Concerted Action. 

Plaintiff has alleged that it has lost revenues because 

patients who would have sought treatment at its hospital are 

instead diverted to the Penn Defendants as the result of 

Defendants’ conspiracy. Therefore, Plaintiff has plausibly 

alleged that it was injured, in the form of lost patients and 

revenues, as a proximate result of Defendant’s concerted 

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actions. 

C. Plaintiff Has Failed To Plausibly Allege A Section 2 

 Claim. 

The elements of a conspiracy to monopolize include at least 

three elements: ”(1) a combination or conspiracy; (2) an overt 

act in furtherance of the conspiracy; and (3) specific intent to 

monopolize.” Black Box, 2008 WL 4117844, at *8. Courts are 

divided on whether a fourth element – a dangerous probability of 

successful monopolization – is required to establish the claim. 

Id. This Court agrees with those courts that have concluded 

that a dangerous probability of success is not required.14 As 

the Second Circuit has held: 

Congress outlawed the conspiracy itself. Once a plaintiff 

establishes a conspiracy with a specific intent to 

monopolize, proof of success or impending success is 

irrelevant. 

Int’l Distribution Centers, Inc. v. Walsh Trucking Co., Inc., 

812 F.2d 786, 796 n. 8 (2d Cir. 1987)(citations omitted). 

 However, while a dangerous probability of success is not a 

required element, the likelihood of success may be highly 

significant to whether the defendants could plausibly have had 

the specific intent to monopolize the market at issue. Emigra 

 

14 At oral argument, Plaintiff articulated its belief that it was, in 

fact, obligated to demonstrate a dangerous probability of successful 

monopolization. While the Court does not adopt this standard because 

it believes that standard is incorrect, the differing standards are 

immaterial here. The same facts, discussed below, that demonstrate the 

implausibility of Defendants having the intent to successfully 

monopolize, would also render implausible Plaintiff’s claim that 

Defendants had a dangerous probability of success. 

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Group v. Fragomen, Del Rey, Bernsen & Loewy, 612 F. Supp. 2d 

330, 363 (S.D.N.Y. 2009)(“And while rigorous proof of a relevant 

market and the likelihood of monopolization is not required in 

this Circuit on a conspiracy to monopolize claim, the relevant 

market and the likelihood of its monopolization may have a 

significant bearing on whether the requisite specific intent to 

monopolize is present.”); Virginia Vermiculite Ltd. V. W.R. 

Grace & Co., 144 F. Supp. 2d 558, 592 (W.D.Va. 2001)(“But where 

actions are ambiguous the existence and extent of market power 

may make the inference of specific intent from conduct more or 

less plausible.”)(quotation and citation omitted). That 

specific intent to monopolize must be more than knowing and must 

be shared by all the conspirators. ID Security Systems Canada, 

Inc. v. Checkpoint Systems, Inc., 249 F. Supp. 2d 622, 660 

(E.D.Pa. 2003)(holding that the alleged co-conspirators must 

share the intent that would-be-monopolist obtain a monopoly); 

Int’l Distribution, 812 F.2d at 796 (same); In re Microsoft 

Corp. Antitrust Litig., 127 F. Supp. 2d 728, 731 (D.Md. 

2001)(“[Specific intent] signifies something more 

than willing, voluntary, and knowing participation 

in the illegal course of conduct . . . . It means participating 

in that course of conduct for the specific, shared purpose 

of [monopolization].”). 

 Plaintiff alleges that Defendants conspired with the intent 

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that the Virtua Defendants monopolize the market for Emergency 

Procedures. At the time Defendants allegedly entered into the 

conspiracy (Plaintiff alleges it began sometime in 2007), the 

Virtua Defendants had either no ability, or very limited 

ability, to perform any of the Emergency Procedures at issue. 

And any future ability to perform these procedures depended on 

Virtua obtaining a Certificate of Need from the state. Virtua 

also faced robust competition from at least Plaintiff, Cooper, 

and Lourdes. 

 Against this backdrop, Defendants argue that successful 

monopolization of the Emergency Procedures market is, and was, 

implausible and, with respect to the Penn Defendants and CGPA, 

there is no reason why they these entities would support a 

monopoly by Virtua. Therefore, Defendants argue, it is 

implausible that they would have had the intent that the Virtua 

Defendants monopolize the relevant Emergency Procedures market. 

Plaintiff counters that there are plausible economic reasons why 

Defendants could have shared such intent. Plaintiff 

misapprehends its burden. It is not sufficient that there may 

be some plausible reasons that Defendants could have shared the 

requisite intent. Plaintiff must instead advance factual 

allegations to render it plausible that Defendants did share the 

requisite intent. 

 Plaintiff has failed to meet this burden. On the 

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allegations before the Court in Plaintiff’s Amended Complaint, 

successful monopolization of the Emergency Procedures market was 

implausible given the competitive landscape and that the Virtua 

Defendants were not even approved for such Procedures, let alone 

participants in the market. In the face of these allegations, 

which are highly suggestive of a lack of specific intent, 

Plaintiff has failed to offer more than conclusory allegations 

of specific intent and argument why the Defendants rationally 

could have possessed such intent. Plaintiff has not offered 

non-conclusory allegations suggesting that Defendants did have 

such intent. Plaintiff has thus failed to plausibly allege that 

Defendants shared a specific intent for the Virtua Defendants to 

monopolize the Emergency Procedures market. Therefore, 

Plaintiff has failed to plausibly allege a Section 2 claim. 

IV. Conclusion

For all these reasons, Defendants’ motions to dismiss 

Plaintiff’s Section 1 claim is DENIED and Defendant’s motion to 

dismiss Plaintiff’s Section 2 claim is GRANTED. Plaintiff’s 

Section 2 Claim is dismissed without prejudice. 

Dated: December 30, 2011 s/Renée Marie Bumb 

RENÉE MARIE BUMB 

United States District Judge 

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