A New Jersey district court recently denied a motion to dismiss Talone, et. al. v. The American Osteopathic Association, an antitrust class action. The suit alleges that the physician association violated the Sherman Act by illegally tying osteopaths’ board certification to association membership.  The defendant association moved to dismiss, arguing that plaintiffs, a group of affected doctors, had failed to allege sufficient facts to demonstrate foreclosure of competition or antitrust injury.  This alert reviews plaintiffs’ claims, the association’s arguments against them, and the court’s denial of the association’s motion to dismiss.

A federal district court denied the Texas Medical Board’s (the Board) motion to dismiss an antitrust suit filed by a telemedicine company (Teladoc), finding that the Board is not entitled to state action immunity because its actions are not actively supervised by the state.  Teladoc, Inc. v. Texas Medical Board, No. 1-15-cv-343 (W.D. Tex Dec. 14, 2015) (order denying motion to dismiss).  As we previously reported, the Board issued an emergency rule in January attempting to amend its telemedicine regulations to mandate a “face-to-face visit or in-person evaluation” prior to a physician issuing a prescription.  The Board then engaged in a formal rulemaking to adopt the amendment in April.  Teladoc won a preliminary injunction in May, temporarily blocking the implementation of the new rule. Continue Reading Antitrust Suit Continues to Stymie New Texas Telemedicine Regulation

Written by: Thomas S. Crane, Brian P. Dunphy, and Laurence J. Freedman

A federal district court recently dismissed a qui tam relator’s complaint in a declined case against the Hospital for Special Surgery (“Hospital”), its former CEO, and an outside billing company alleging that they violated the federal False Claims Act (FCA) and the New York FCA resulting from alleged violations of the Anti-Kickback Statute (AKS) and the Stark Law.  Relator, Corporate Compliance Associates (CCA), asserted nine claims apparently based in part on information obtained from the Hospital’s former Chief Compliance Officer and former Associate Vice President of Physician Services.  CCA alleged, among other things, that the Hospital sought to induce patient referrals to the hospital by purportedly paying kickbacks to its contract physicians in the form of (1) compensation arrangements that included salary payments tied to referral volumes, and (2) payments for allegedly sham administrative and teaching responsibilities.  The court’s wide-ranging and thorough decision to dismiss is notable for at least two reasons, as discussed below. Continue Reading Another Court Weighs in on Rule 9(b)’s Requirements Under the False Claims Act