Antitrust Law Daily Wrap Up, ANTITRUST—5th Cir.: Physician fails to show antitrust injury in claims against local hospital, (Sep 11, 2015)

By Linda O’Brien, J.D., LL.M.

A neurosurgeon failed to allege sufficient facts to establish an adverse effect on competition in his action against a local hospital for allegedly engaging in anticompetitive practices, the U.S. Court of Appeals in New Orleans has ruled. Thus, the district court’s dismissal of the complaint was affirmed (Pisharodi v. Columbia Valley Healthcare System, L.P., September 10, 2015, Per Curiam).

Dr. Madhavan Pisharodi is a neurosurgeon in Brownsville, Texas, In January 2014, Dr. Pisharodi sued Columbia Valley Healthcare System, operator of Valley Regional Medical Center, alleging a violation of Section 1 of the Sherman Act. The district court granted Columbia Valley’s motion to dismiss and Pisharodi appealed.

The district court did not err in determining that the complaint insufficiently alleged antitrust injury, the appellate court found. To state a claim under Section 1 of the Sherman Act, a plaintiff must show that the defendant’s practice had an adverse effect on competition. In the appellate court’s view, the plaintiff’s allegations did not show any adverse effect on competition. He presented no facts to support his claim that Columbia Valley’s actions increased the price or decreased the supply of neurological services in Cameron County, Texas.

Additionally, the complaint’s allegations tended to show that there was no adverse effect on competition. Pisharodi alleged that he owns part of competing hospital in the area where he continues to perform neurological procedures. He claimed that his fees were lower than his competitors because he uses less expensive implants. Given only those facts, an adverse change in the local price or supply of neurological services could not be reasonably inferred, the appellate court concluded.

The case is No. 15-40206.

Attorneys: Sartaj Singh Bal (Matthews, Lawson & Johnson, P.L.L.C.) for Madhavan Pisharodi. James Robert Wetwiska (Akin Gump Strauss Hauer & Feld, L.L.P.) for Columbia Valley Healthcare System, L.P.

Companies: Columbia Valley Healthcare System, L.P.

Cases: Antitrust LouisianaNews MississippiNews TexasNews