Antitrust Law Daily Wrap Up, ADVERTISING—10th Cir.: Neurologist unable to revive claims over health care system’s marketing materials, (Feb 10, 2016)

By Linda O’Brien, J.D., LL.M.

A Utah neurologist and a stroke treatment center failed to plausibly allege false advertising claims that the advertising and marketing materials of a large health care system purported to represent the nature and quality of the health care center’s stroke care services, the U.S. Court of Appeals in Denver has ruled. Thus, a district court’s dismissal of the false advertising claims was affirmed (The Intermountain Stroke Center, Inc. v. Intermountain Health Care, Inc., February 9, 2016, Holmes, J.).

Intermountain Health Care is a large network of hospitals, clinics, surgery centers, and physicians. The Intermountain Stroke Center provided same-day and next-day treatment to patients presenting with strokes and transient ischemic attacks (TIAs). In March 2013, the Stroke Center discontinued operations. Believing that Intermountain Health Care’s conduct was the impetus for the Stroke Center’s cessation of business, the Stroke Center, and neurologist Nancy Futrell, filed suit, alleging violations of the Lanham Act and Utah’s Truth in Advertising Act. The complaint asserted that Intermountain Health Care misled prospective patients regarding the nature and quality of its stroke and TIA services in its advertising and marketing materials. In March 2014, the district court granted the defendant’s motion to dismiss and the plaintiffs appealed.

False advertising. The district court properly determined that the plaintiffs failed to plausibly allege that Intermountain Health Care made any materially false or misleading representations concerning the quality of its stroke and TIA services, the appellate court found. In its marketing efforts, Intermountain Health Care made the general representations that it follows “best medical practices,” provides the “best possible care,” and has a mission of “providing excellent care of the highest quality at an affordable cost.”

According to the appellate court, the health care system’s general marketing claims were not particular enough to constitute literally false representations. The representations were merely expressions of Intermountain Health Care’s opinion, constituted sales puffery, and were not statements of fact for which Intermountain could be held liable under the Lanham Act.

The district court also correctly concluded that the three sets of specific statements were true and not misleading. The plaintiffs contended that the specific representations made on Intermountain Health Care’s website, institutional code of ethics, and “Life after a Stroke or TIA” pamphlet were literally false and misled consumers about the number of its physicians specializing in stroke or TIA treatment.

In the appellate court’s view, Intermountain’s list of its heart and vascular surgeons as stroke treatment providers on its website was not misleading, since reasonable consumers would not be deceived by the statement that a vascular physician would be available to treat them for stroke and TIA. Moreover, none of the primary specialty notations on the list expressly included a particular physician’s claim of expertise in stroke and TIA treatment. The court rejected the plaintiffs’ argument that Intermountain Health Care’s ethics code falsely claimed to carefully review financial relationships with physicians and other health care practitioners for compliance with anti-kickback and Stark laws, since the ethic claims were true and not misleading. The court noted that an announcement of its intent to behave ethically was aspirational and fell outside the scope of a Lanham Act false advertising claim.

The plaintiffs’ contention that information in Intermountain Health Care’s stroke pamphlet constituted false advertising also was rejected. The court determined that the pamphlet’s after-care chart could not be legally actionable under the Lanham Act, since it did not purport to state a position on the nature, characteristics, or qualities of its services. The pamphlet’s rudimentary information—suggesting how patients might approach post-stroke or post-TIA life—was too vague to support a Lanham Act claim, the court concluded.

The case is No. 14-4045.

Attorneys: Mark A. Larsen (Larsen Christensen & Rico) for The Intermountain Stroke Center, Inc. Alan R. Houston (Strong & Hanni) for Intermountain Health Care, Inc., IHC Health Services, Inc., and SelectHealth, Inc.

Companies: The Intermountain Stroke Center, Inc.; Intermountain Health Care, Inc.; IHC Health Services, Inc.; SelectHealth, Inc.

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