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In re Michigan State Medical Society

Federal Trade Commission
101 F.T.C. 191 (1983)


The Michigan State Medical Society (MSMS) (defendant) was composed of competing physicians who practiced in the state. The physicians became frustrated with the financial reimbursement policies and practices of Blue Cross and Blue Shield of Michigan (BCBSM). The MSMS’s collective bargaining division organized a boycott campaign against BCBSM and urged its physician members to write letters stating they would withdraw from all BCBSM programs if the policies did not change. The letters were mailed directly to the MSMS, not to BCBSM, so that the MSMS could use them in negotiations, if necessary. As a result of the boycott and the existence of the withdrawal letters, BCBSM backed off their policies. Thereafter, an action was taken against the MSMS alleging that it unlawfully conspired with its physician members to influence BCBSM’s reimbursement policies. An administrative law judge found the MSMS’s activities amounted to an unlawful restraint of trade in violation of § 1 of the Sherman Act. The MSMS appealed to the Federal Trade Commission.

Rule of Law


Holding and Reasoning (Clanton, Commn’r.)

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