Federal Trade Commission v. Penn State Hershey Medical Center
United States Court of Appeals for the Third Circuit
838 F.3d 327 (2016)
- Written by Elliot Stern, JD
Facts
Penn State Hershey Medical Center (Hershey) and PinnacleHealth System (Pinnacle) (defendants) were the two largest hospitals in the Harrisburg area. Hershey had many highly specialized physicians, offered specialized services, and drew many patients from outside the Harrisburg area. In 2015, Hershey and Pinnacle agreed to a merger. The Federal Trade Commission (FTC) (plaintiff) filed an administrative complaint against the merger under Clayton Act § 7. The FTC and Pennsylvania (plaintiff) (collectively, the government) then filed a lawsuit in district court seeking a preliminary injunction against the merger, contending that the proposed merger would substantially lessen competition for acute-care services sold to commercial insurers in the Harrisburg market. The district court, applying the hypothetical-monopolist test, relied on data on patient inflow into the Harrisburg area to find that the government had failed to properly define the relevant geographic market, making an anticompetitive determination impossible, and denied the injunction. The government appealed.
Rule of Law
Issue
Holding and Reasoning (Fisher, J.)
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