Brief of National Federation of Independent Business as Amicus Curiae in Federal Trade Commission v. Phoebe Putney Health System, Inc., Arguing that the US Supreme Court Should Apply a Market-Participant Exception to State-Action Immunity from the Antitrust Laws

Abstract

We argue that the U.S. Supreme Court should apply a market-participant exception to the state-action immunity doctrine. Commercial conduct by state and local government units should be subject to the same antitrust scutiny as any other commercial conduct. First, the idea that state commercial conduct should face different treatment than state regulatory conduct has permeated the Court's decisions from the genesis of the state-action immunity doctrine through the Court's most recent pronouncements on the issue. Second, state commercial conduct -- as opposed to state regulatory conduct -- does not fit the federalism and state-sovereignty purposes of the doctrine. Third, federal courts can competently apply a market-participant exception to state-action immunity -- in some cases with greater ease than determining whether an entity is public or private. Fourth, there is no benevolent-monopolist exception, so arguments focused on public goals or the non-profit aspect of the challenged entity are to no avail. The brief also argues that, within the framework of the current Midcal approach, the state creation of a competitor should create a presumption that the State has not expressly displaced competition. The brief concludes that, regardless of whether the Court determines that the acting entity is public or private, the relevant activity involves market participation, so the state-action immunity doctrine should not apply.

Keywords: antitrust, competition, FTC, state action immunity, market participant, hospital, Parker, commercial conduct, Commerce Clause, state sovereign, municipal law, Midcal, federalism