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Antitrust — state-action immunity

U.S. Supreme Court


Antitrust — state-action immunity

State-action immunity does not apply, when a state has not clearly articulated and affirmatively expressed a policy allowing hospital authorities to make acquisitions that substantially lessen competition.

In concluding otherwise, the Eleventh Circuit applied the concept of “foreseeability” too loosely. This Court, recognizing that no legislature “can be expected to catalog all of the anticipated effects” of a statute delegating authority to a substate governmental entity, Hallie, 471 U. S., at 43, has approached the clear-articulation inquiry practically, but without diluting the ultimate requirement that the State must have affirmatively contemplated the displacement of competition such that the challenged anticompetitive effects can be attributed to the “state itself,” Parker, 317 U. S., at 352. Thus, the Court has found a state policy to displace federal antitrust law was sufficiently expressed where the displacement of competition was the inherent, logical, or ordinary result of the exercise of authority delegated by the state legislature. In that scenario, the State must have foreseen and implicitly endorsed the anticompetitive effects as consistent with its policy goals. See Hallie, 471 U. S., at 41; Omni, 499 U. S., at 373. By contrast, when a State grants an entity a general power to act, it does so against the backdrop of federal antitrust law. Entities might transgress antitrust requirements by exercising their powers anticompetitively, but a reasonable legislature’s ability to anticipate that possibility falls well short of clearly articulating an affirmative state policy to displace competition. The Eleventh Circuit’s argument, echoed by respondents, that the case falls within the foreseeability standard used in Hallie and Omni is rejected.

663 F. 3d 1369, reversed and remanded.

11-1160 FTC v. Phoebe Putney Health System, Inc.

Sotomayor, J.

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