Antitrust Law Daily Wrap Up, ACQUISITIONS & MERGERS NEWS: FTC seeks comments on ProMedica divestiture of St. Luke’s, (May 3, 2016)

By Greg Hammond, J.D.

The FTC is requesting public comment on ProMedica Health Systems’ application to divest St. Luke’s Hospital (In the Matter of ProMedica Health System, Inc., Dkt. 9346, File No. 101 0167).

ProMedica effectively acquired and took control of competitor St. Luke’s in August 2010. The FTC challenged the acquisition in 2011, claiming that the deal threatened to substantially lessen competition for critical health care services in Lucas County, Ohio. This diminished competition, according to the complaint, would stifle beneficial quality improvements and would result in significant increases in health care costs to local residents.

The Commission entered a final order in 2012, finding that the acquisition was anticompetitive and ordering that ProMedica divest St. Luke’s Hospital to an FTC-approved buyer within six months after the order becomes final and effective. The U.S. Court of Appeals upheld the FTC’s final order, agreeing that the merger between two of the four hospital systems in Lucas County, Ohio, would adversely affect competition in violation of Section 7 of the Clayton Act. The Supreme Court in May 2016 denied ProMedica’s petition for review of the appellate court’s decision.

The FTC will determine whether to approve the proposed divestiture after a 30-day public comment period that will end June 2, 2016. Public comments can be filed electronically or in paper form.

Attorneys: Stephen Y. Wu (McDermott Will & Emery LLP) for ProMedica Health System, Inc.

Companies: ProMedica Health System, Inc.

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