Antitrust Law Daily Wrap Up, ANTITRUST—S.D. Ohio: Doctor’s antitrust claims for termination of hospital privileges fail, (Jun 10, 2014)

By Greg Hammond, J.D.

A medical doctor’s claim that a hospital and its peer review board terminated his surgical privileges in order to reduce competition in the surgical practice market was dismissed with prejudice. The federal district court in Cincinnati granted the hospital’s motion to dismiss, reasoning that the doctor failed to plausibly allege a violation of the Sherman Act (Semertzides v Bethesda North Hospital, June 9, 2014, Beckwith, S).

Background. John N. Semertzides, M.D. is a medical doctor who practiced surgery at Bethesda Hospitals in Ohio. In November 2009, Semertzides was allegedly questioned over the care of a particular patient. According to Semertzides, the questions turned into a full-fledged investigation of his patient admissions to the hospital and a peer review process was initiated. The peer review lasted for a period of two years and ended with the suspension and eventual termination of Semertzides’ surgical practice privileges at Bethesda. Semertzides filed suit, alleging that Bethesda Hospital, Inc., TriHealth, Inc., Queen City Surgical Consultants, LLC, and unnamed individuals conspired to violate the Sherman Act by using the peer review process to restrain trade and reduce competition in the surgical practice market. He also alleged a False Claims Act (FCA) violation and a claim for the intentional infliction of emotional distress and maintenance of a hostile work environment. Bethesda moved to dismiss Semertzides’ complaint.

Sherman Act violation. To support his Sherman Act violation claim, the court noted that Semertzides was required to demonstrate that the conduct he complained of "produces significant anticompetitive effects within the relevant product and geographic markets." However, the court determined that Semertzides failed to define the relevant market, as the complaint contradicted itself, suggesting that the relevant geographic market was Hamilton County, Ohio; the entire Country; and "Ohio, Kentucky, Indiana, and beyond." In addition, Semertzides failed to specify what the relevant product or service was, as the complaint indicated the relevant service was surgical procedures, but later stated surgical adhesion surgery. Because Semertzides failed to identify the relevant product and geographic markets, the court concluded that he failed to plausibly allege a Sherman Act violation and granted the motion to dismiss that claim.

Remaining claims. Bethesda’s motion to dismiss the remaining False Claims Act (FCA), intentional infliction of emotional distress, and/or hostile work environment claims was also granted. Because the complaint failed to allege that Semertzides complained about fraud on the government, or that he complied with the procedural requirements to gain protection under the state’s Whistleblower Protection Act (WPA), Semertzides failed to state a claim under the FCA and WPA. Because Semertzides failed to allege any extreme and outrageous conduct or any discrimination on the basis of a protected characteristic, he failed to state a claim for intentional infliction of emotional distress and/or hostile work environment. Consequently, Bethesda’s motion to dismiss those claims was granted.

The court denied Semertzides’ request for leave to amend his complaint, noting that he failed to offer a proposed amended complaint for consideration and that he was not entitled to an advisory opinion. Bethesda’s motion to dismiss Semertzides’ complaint was consequently granted with prejudice.

The case is number 1:14-CV-135.

Attorneys: David Edward Ernst (Ernst and Associates) for John N. Semertzides. Matthew C. Blickensderfer (Frost Brown Todd LLC) for Bethesda North Hospital, and Tri-Health Hospitals.

Companies: Bethesda North Hospital; Tri-Health Hospitals; Queen City Surgical Consultants, LLC

Cases: Antitrust OhioNews