Source: https://www.justice.gov/atr/case-document/plaintiffs-reply-defendants-answering-brief-opposition-plaintiffs-motionfor-entr-0
Timestamp: 2019-04-19 06:25:44+00:00

Document:
Professional Engineers, 435 U.S. at 692); cf. to avoid a reduction in fees paid by Blue Cross--defendant could escape application of the per even remotely suggest that defendant's challenged conduct "increase[s] economic efficiency,"
investigation, 15 U.S.C. § 1312(a)."
proceeding on any of the other investigations being conducted outside Delaware. SeeUnited States v.
should justify doing so." Moreover, defendant's Answering Brief conspicuously omits discussion of Sterling Drug, Inc. v.
authority of the Antitrust Division to issue civil investigative demands in any other area.
entering a discovery schedule leading to a trial in this case commencing on or after June 1, 1999.
1 If the challenged conduct does not "increase economic efficiency and render markets more, rather than less, competitive," Broadcast Music, Inc., v. Columbia Broadcasting System, Inc., 441 U.S. 1, 20 (1979) (citations and quotation omitted), then the conduct falls under the per se rule and is "presumed unreasonable without inquiry [under the rule of reason] into the particular market context in which it is found." N.C.A.A. v. Board of Regents of University of Oklahoma, 468 U.S. 85, 100 (1984).
2 Despite this case's focus on defendant's leadership of its members' concerted refusal to deal to obtain higher fees, defendant's Answering Brief, "D.I. 24," at 10, cites cases involving alleged boycotts whose likely competitive effects were ambiguous on their face to support its argument that this case should be adjudged under the rule of reason, rather than the per se rule. E.g., Northwest Wholesale Stationers, Inc. v. Pacific Stationery and Printing Co., 472 U.S. 284 (1985) (buying association's expulsion of a member not subject to per se analysis); All Care Nursing Serv., Inc. v. High Tech Staffing Servs., Inc., 135 F.3d 740 (11th Cir. 1998) (temporary nursing agencies' challenge to arrangements under which certain nursing agencies were chosen as preferred providers of temporary nurses not per se illegal). Notably, Defendant's Answering Brief fails even to acknowledge, much less discuss, the Supreme Court's Trial Lawyers opinion, which is factually on point.
3 See, e.g., Trial Lawyers, 493 U.S. at 432-33 (ruling that Court of Appeals erred in "assuming that the antitrust laws permit, but do not require, the condemnation of price fixing and boycotts without proof of market power"); Arizona v. Maricopa County Medical Society, 457 U.S. at 348-49 (reversing Ninth Circuit's refusal to apply the per se rule to nonprofit medical foundations' agreements with their participating doctors, placing limitations upon the fees the physicians could charge some of their patients).
4 The first area warrants no discussion here because the United States' Answering Brief, "D.I. 22," at 6-7, fully refutes defendant's claim to need extensive discovery concerning "the Government's policies on the unionization of physicians and antitrust enforcement in the health care industry.... [and] the Government's promulgation, interpretation and enforcement of the [third party messenger] system." Defendant's Answering Brief, "D.I. 24," at 13.
5 In connection with its attempt to vilify Blue Cross as a purported defense to this action, defendant claims the need "[t]o vigorously probe the truth of the representations [Blue Cross] has made to providers, policy holders, and the public, and fully expects to uncover evidence of lying, and possibly, of outright fraud on the citizens of Delaware." Defendant's Answering Brief, "D.I. 24," at 12.
6 The Supreme Court's rejection in Fashion Originator's Guild of America, Inc. v. F.T.C., 312 U.S. 457 (1941), of a claim similar to defendant's claim in this case is also instructive. In Fashion Originator's, the defendants, designers and manufacturers of original women's fashions, claimed that their boycott was "reasonable and necessary to protect the manufacturer, laborer, retailer and consumer against the devastating evils growing from [competitors'] pirating of original designs." Id. at 467. In upholding the Federal Trade Commission's exclusion of the defendants' evidence proffered in support of their claim, the Supreme Court held that, "even if copying were an acknowledged tort under the law of every state, that situation would not justify [defendants] in combining together to regulate and restrain interstate commerce in violation of federal law." Id. at 468.
7 Amended Answer and Defenses (D.I. 11) at ¶ 63.
8 The term "antitrust investigation" is defined in 15 U.S.C. § 1311(c) to mean "any inquiry . . . for the purpose of ascertaining whether any person is or has been engaged in any antitrust violation . . . ."
9 This language, quoted by defendant from Oklahoma Press--the only case defendant cites purportedly in support of its argument--stands for nothing more than the principle underlying the authorization of CIDs. The Court enunciated this principle in the context of an opinion resolving a challenge to the validity of investigative subpoenas issued by the Administrator of the Wage and Hour Division of the Department of Labor under a different statutory authorization than the one at issue here. The quoted language simply begs the question of whether the issuance of CIDs in any particular antitrust investigation is "prior to the institution of a civil or criminal proceeding thereon." But the opinion itself sheds no light on the answer because the challenged subpoenas were issued during an investigation before the institution of any proceeding and were challenged on statutory and constitutional grounds that are wholly unrelated to the question at issue here. Id. at 495-97. Thus, defendant has cited no case that provides specific authority for its argument.
10 The United States first brought this opinion to defense counsel's attention in a letter dated October 5, 1998, after defense counsel raised this argument initially at the Rule 26(f) conference on October 1. Indeed, the United States believed that Sterling Drug had set the issue to rest because defendant proposed no such limitation on the Department's issuance of CIDs in these other investigations in either the Proposed Discovery Plan, "D.I. 13," or in defendant's Motion for Entry of a Scheduling Order That Incorporates Its Proposed Discovery Plan and Schedule "D.I. 18." In view of these circumstances, defendant's resurrection of this issue in its Answering Brief is odd, to say the least.
11 Unlike the petitioner in Sterling Drug, the Federation did not move, pursuant to 15 U.S.C. § 1314(b), to quash the CID issued to obtain information relevant to its activities in Tampa. Rather, the Federation is in the process of complying with the CID, likely recognizing that the opinion in Sterling Drug rendered such a petition futile. Nonetheless, defendant has attempted--in tension with the case law--to inject this issue into this case to support its argument for a protracted discovery schedule.

References: § 1312
 v.

 v.

 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 § 1311
 § 1314