Health Law Daily Wrap Up, ANTITRUST—D. Md.: Pharmacy residents’ antitrust claims against employers, residency accreditation body, fail on first dismissal motions, (Aug 18, 2026)

By Justin Marcus Smith, J.D.

The court reasoned that the alleged conspiracy to suppress pharmacy resident salaries had a hub but no rim to connect the spokes, and, among other circumstances pleaded, the public posting of salaries suggested procompetitive potential.

Former pharmacy residents failed to plead plausible Sherman Act claims against a group mainly composed of university hospital system employers and the accreditation body for pharmacy residencies, held the federal district court in Greenbelt, Maryland. The court found the pharmacy residents did not plausibly allege a violation of the Sherman Act because they did not allege an agreement among the employers and did not allege an unreasonable restraint of trade. More specifically, the court construed that the accreditation body’s Residency Agreement and Match Rules were not direct evidence of a horizontal conspiracy among the employers. Although the residents alleged parallel conduct, the court did not find “plus factors” circumstantial evidence of an agreement. Some allegations undercut some plus factors, case law did not support others, and the remaining plus factors were not enough to suggest an agreement. The public posting of salaries, the lack of market concentration among the employers, the non-fungible nature of residency positions, and the residents’ failure to show factors under Todd v. Exxon Corporation, 275 F.3d 191 (2d Cir. 2001), all weighed against finding an unreasonable restraint of trade. The court declined to dismiss with prejudice because this was really the first iteration of the residents’ complaint after consolidation and the first dismissal test of the claims. The court denied the motion to dismiss brought by Leesburg Regional Medical Center, Inc., a Florida nonprofit corporation and related somewhat to the University of Florida, because it did not enjoy sovereign immunity. The court also held it did not have personal jurisdiction over the Canadian contractor or a University of California executive (Albert v. American Society Of Health-System Pharmacists, No. 8:25-cv-00673-DLB (D. Md. Aug. 12, 2026)).

Background. The American Society of Health-System Pharmacists (ASHP) is the sole nationally-recognized body for accreditation of pharmacy residencies. Fewer than ten percent of pharmacy residency positions nationwide are not ASHP accredited. ASHP sets various requirements on accredited residency program, including weekly work hour caps.

As a condition of accreditation, ASHP requires residency programs to participate in the ASHP Resident Matching Program (Match). It works a bit like a mandatory online dating service for residents and residencies. ASHP farms-out the matching process to a Canadian company, NMS. Match terms are memorialized in a set of rules and agreements. Once a candidate has been matched with a program, the program must offer them employment as a resident, and the candidate must accept. NMS imposes penalties, like barring candidates from participation in future matches or stripping programs of their accreditation, for reneging on a match. For every year between 2013 and 2024, there were more residency applicants than residencies.

Four pharmacy residents claimed their long-hour and low-pay working conditions relative to counterparts in non-residency positions were the result of anticompetitive conspiracies among the healthcare providers employing them, ASHP, and NMS. Twelve healthcare providers sued included health networks with household brand recognition, hospitals, and university medical systems (collectively, employers). The residents also sued the Executive Vice President of University of California Health in his official capacity (UCal official).

The residents brought claims under Section 1 of the Sherman Act for (1) conspiracy through the Match to artificially suppress resident compensation and manipulate terms of employment by, among other things, requiring prospective residents to accept employment with programs with which they match before they can negotiate terms of employment; (2) prohibiting residents from transferring between programs; (3) limiting communication during the match process; (4) limiting the number of residency positions to ensure applicant oversupply; and (5) conspiracy to restrain competition by exchanging resident compensation information in furtherance of a price suppression agreement. The residents claimed the employers paid them less than would have otherwise been the case but-for the alleged anticompetitive conspiracies. The residents sought declaratory and injunctive relief, plus treble damages against all except the UCal official.

All respondents filed a joint Fed. R. Civ. P. 12(b)(6) motion to dismiss for failure to state a claim. Employer Leesburg Regional Medical Center, Inc. d/b/a UF Health Central Florida (Leesburg) moved to dismiss for lack of subject matter jurisdiction. The UCal official also moved to dismiss challenging subject matter and personal jurisdiction. NMS moved to dismiss for lack of personal jurisdiction.

Joint motion. The court found the residents did not plausibly allege a violation of the Sherman Act because they did not allege an agreement among the employers and did not allege an unreasonable restraint of trade.

The residents alleged overarching conspiracies to participate in the Match and abide by its rules; to limit the number of available residency positions; and to exchange compensation information. In the first count, the residents alleged an agreement to participate in the Match on terms that stifled competition and limited the number of residency positions. However, the court found they “confusingly” pleaded two agreements. One putative agreement was to run the Match. Another agreement was to limit the number of available residency positions. The residents defended the first count by focusing on the Match agreement, but they devoted very little attention to limitation of available residency positions, and they did not allege direct evidence of an agreement.

The court construed that the Residency Agreement and Match Rules were not direct evidence of a horizontal conspiracy among the employers because these documents were not agreements among the employers. They appeared to be individual agreements between each employer and ASHP. The complaint did not remove ambiguities about whether the employers acted independently or in concert.

The court rejected the residents’ argument that the Residency Agreement and Match rules were akin to bylaws that directly evinced a conspiracy. The residents did not allege that the employers controlled ASHP. ASHP appeared to be a separate accrediting body comprised of pharmacists.

The court also did not find “plus factors” circumstantial evidence of an agreement. Parallel conduct pertained, but the court found the residents’ allegations undercut some plus factors, case law did not support others, and the rest were not enough to suggest an agreement.

The court assumed that the residents plausibly alleged a common motive to conspire, but even so, this was not enough to make the conspiracy plausible. The allegations otherwise suggested only a “rimless wheel” of individual agreements between each employer and ASHP, but no agreement among themselves as spokes. Lack of a facially plausible agreement called for dismissal of Count I.

As for Count II about exchange of compensation information to suppress compensation, the residents ran into the same problems with the same circumstantial evidence that did not support an agreement for Count I. They also did not explain how such evidence was equally applicable to Count II. An argument about actions against self-interest did not help here because employer posting of salary information could be a horizontal agreement to abide by Match terms, but it was “equally consistent with a rational reaction to the fact that those rules exist.”

As for whether the residents pleaded an unreasonable restraint of trade, the court did not need to resolve whether the alleged Count I conspiracy was subject to per se, quick-look, or rule-of-reason analysis. The residents alleged a plausible relevant market.

As for Count II, again, the residents alleged a relevant market and exchange of price or salary information that could violate Section 1 of the Sherman Act but was not necessarily unlawful under the rule-of-reason and Todd factors. The complaint identified the Residency Directory as the only vehicle for such information exchange. Whether this was an unreasonable restraint presented a close question, but the court found, on the whole, that the residents did not plausibly allege that public display of resident salary information in the Residency Directory amounted to an unreasonable restraint of trade. Among other things, the residents did not plead that the employers controlled a large share of the market for resident labor and did not “connect the dots” between the display and lower salaries market-wide. The residents did not allege the employers had frequent meetings to discuss the information. More importantly, the information was public, with procompetitive potential. The residents may not have been able to maximize procompetitive effect, but they could act on it, and there was no plausible allegation that the market was susceptible to coordination or that the sharing of the information could have anticompetitive effects.

Last, the court held the residents must amend their complaint to allege a plausible anticompetitive conspiracy that reduced competition and depressed compensation in the market for pharmacy residents. The court said antitrust standing would be satisfied if they could do so. The court granted the joint motion to dismiss accordingly.

Leesburg motion. The court denied the Leesburg motion to dismiss because it analyzed that Leesburg is not an arm of the state of Florida and was not entitled to sovereign immunity. Leesburg, a non-profit subsidiary of UF Health Central Florida, in turn a subsidiary of Shands Teaching Hospital and Clinics, Inc., argued for dismissal for sovereign immunity (Eleventh Amendment immunity) insofar as it is an arm of the state of Florida. This presented a question of federal law. The court had to look at the agency’s charter. The Supreme Court recently provided guidance in arm of the state cases. See Galette v. New Jersey Transit Corporation, 607 U.S. at 523–24.

The court found that two of the four Fourth Circuit arm-of-the-state test factors, whether it is involved in state concerns and how Florida law treats Leesburg, cut in favor of Leesburg. However, the other two, including degree of autonomy and the most important factor, whether Florida would be liable for any judgment against Leesburg, did not.

Leesburg argued Florida would be functionally liable for a judgment against it by virtue of the “claims bill” process. The court said even if that were true, it would “not counsel” for sovereign immunity because state voluntary assumptions of liability do not confer sovereign immunity per Galette.

The court further analyzed that it was not so subject to state control to be deemed an arm of Florida. Crucially, despite Board arrangements with Florida, Leesburg is a corporation with traditional corporate powers. Again, Galette made it clear that a corporate form with traditional corporate powers is the “clearest evidence” that an entity is legally independent of the state.

The court continued that Parker immunity did not apply. See Parker v. Brown, 317 U.S. 341 (1943). Parker immunity is not truly immunity from suite because it does not confer a right not to be sued. An entity may not invoke Parker immunity unless the actions in question are an exercise of state sovereign power.

Leesburg, arguing for ipso facto Parker immunity, pointed to its status under Florida law, indicia of state control, and a handful of out-of-circuit holdings that state universities, their divisions, or officials have Parker immunity; however, the court said it was no persuaded. There was no binding precedent on-point, but the court analyzed that Leesburg was neither a state legislator nor a state court for ipso facto Parker immunity to attach. Without any Supreme Court or Fourth Circuit cases supporting the Leesburg position, the court, mindful that Parker immunity is disfavored, declined to extend ipso facto Parker immunity beyond its recognized bounds.

Leesburg suggested in the alternative that it was entitled to Parker immunity as a private entity because it acts pursuant to clearly articulated state policy and is subject to active state supervision. A comparison of precedents revealed that Leesburg’s participation in the Match was not enough to warrant Parker immunity. Florida law did not even mention pharmacy residencies or hiring let alone authorize Leesburg to take any particular action in connection with hiring pharmacy residents. Leesburg did not show that it qualified for ipso facto Parker immunity or that its participation in the Match is the foreseeable result of a clearly articulated state policy. The court denied the Leesburg motion to dismiss.

NMS, individual motions. The court agreed with NMS and the UCal official that the court did not have personal jurisdiction over them. The UCal official was a California resident, and the residents did not allege any activity within the ambit of the Maryland long-arm statute. Moreover, the residents did not meet their burden to establish personal jurisdiction over the UCal official because they failed to plausibly allege involvement in a conspiracy, so the court did not need to consider due process. The court granted the UCal official’s motion to dismiss for lack of personal jurisdiction without prejudice.

The residents also failed to establish personal jurisdiction over NMS on due process grounds for lack of minimum contacts with Maryland. More specifically, the residents did not show purposeful availment. The residents did not allege details like whether NMS reached into Maryland to start its relationship with ASHP. The complaint had a paragraph suggesting that NMS sends personnel into Maryland to transact business, but that did not say whether NMS personnel had interpersonal contact with a Maryland resident about its business relationship with ASHP. The “touchstone” of purposeful availment was not facially evident.

The court denied jurisdictional discovery insofar as it decided to dismiss the residents’ claims against all remaining respondents without prejudice for failure to state a claim.

The Case is No. 8:25-cv-00673-DLB.

Judge: Boardman, D.

Attorneys: Frank S. Hedin (Hedin LLP) for Alexis Albert. Martha L. Goodman (Dunn Isaacson Rhee LLP) for American Society of Health-System Pharmacists, Inc.

Companies: American Society of Health-System Pharmacists, Inc.

Cases: CaseDecisions AntitrustNews GeneralNews MarylandNews