654 F.3d 919
9th Cir.2011Background
- Memorial sues the Washington Dept. of Health challenging the 2008 PCI certificate-of-need regulations
- Regulations require 300 elective PCI procedures per year and a need finding only if projected demand exceeds current capacity by 300 procedures
- Markets are divided into 14 planning areas; Memorial operates Yakima’s single nonprofit hospital facing competition from Yakima Regional Medical and Cardiac Center
- Department forecasts five-year demand using base-year use rates and forecast-year population; capacity is incumbents’ current base-year PCI volumes
- If net need exceeds 300 procedures, the Dept. issues one COI per 300 excess; otherwise no new COI; Mem. argues this creates entry barriers and burdens interstate commerce
- NHPRDA once conditioned federal funding on COI regimes; repealed in 1986, creating a potential authorization gap for the 2008 regulations; district court granted judgment on the pleadings; on appeal the panel addresses antitrust preemption and dormant Commerce Clause standing
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the PCI regulation constitute an antitrust preemption issue? | Memorial contends the rules are a per se or at least unreasonable restraint. | Department argues the rules are unilateral licensing, not a private restraint, hence not preempted. | Unilateral restraint; no per se preemption |
| Does Memorial have standing to challenge the PCI regulations under the dormant Commerce Clause? | Memorial has prudential standing because it bears burdens on interstate commerce via COI. | Memorial lacks injury in fact tied to interstate commerce. | Memorial has standing |
| Has Congress unequivocally authorized the 2008 PCI regulations post-repeal of NHPRDA? | NHPRDA previously authorized COI regimes; Congress’ repeal did not preserve authorization. | NHPRDA’s authorization could survive repeal as a clear statement; savings is implied by continued state action. | No unequivocal congressional authorization for 2008 PCI regulations; remand for further proceedings |
Key Cases Cited
- California ex rel. Harris v. Safeway, Inc., 651 F.3d 1118 (9th Cir. 2011) (en banc; per se analysis reserved for manifest anticompetitive effects)
- Costco Wholesale Corp. v. Maleng, 522 F.3d 874 (9th Cir. 2008) (distinguishes unilateral vs hybrid restraints; post-and-hold vs license regimes)
- National Gerimedical Hospital & Gerontology Ctr. v. Blue Cross, 452 U.S. 378 (1981) (NHPRDA context and purpose in health planning)
- Rice v. Copperweld Corp., 467 U.S. 752 (1984) (distinction between unilateral state action and concerted private action)
- Fisher v. City of Berkeley, 475 U.S. 260 (1986) (unilateral rent-control case illustrating unilateral vs bilateral restraints)
- 324 Liquor Corp. v. Duffy, 479 U.S. 335 (1987) (hybrid restraints; private power vs state-imposed controls)
- Texaco Inc. v. Dagher, 547 U.S. 1 (2006) (unreasonable restraints generally analyzed under rule of reason; per se restraints exceptional)
- State Oil Co. v. Khan, 522 U.S. 3 (1997) (most restraints are analyzed under rule of reason unless per se)
- County of Kern v. San Joaquin Watershed, 581 F.3d 837 (9th Cir. 2009) (zone-of-interests standing in dormant Commerce Clause context)