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The Case Against Mountain Health Care Demands Challenge
[June 3, 2003]

By S. M. Oliva

It’s been nearly three months since public comments were filed in the Justice Department’s antitrust settlement with Mountain Health Care. Nicholas Provenzo submitted comments on CAC’s behalf, while I presented a 49-page filing on behalf of Citizens for Voluntary Trade. Both Nick and myself expressed strong opposition to the Mountain settlement, and my comments went to great lengths to pick apart the government’s case point-by-point. The presentation managed to impress Mountain officials, one of whom later told me they wished I had been retained as their counsel (unfortunately for Mountain, I’m not a member of the Bar.)

To date, the DOJ has not responded to any of the filed comments. They will eventually, as they’re required by the law governing antitrust settlements—the Tunney Act—to file all comments received, along with a reply, with the district court overseeing the case. But since the March 7 comment deadline, we’ve heard nothing. This is a long delay, and there’s no sign of when it will end, but sadly the DOJ can afford to stall. For even though the Mountain settlement has not been approved by the district court, the terms of the agreement were carried out more than a month ago—Mountain Health Care is no more, having dissolved under the terms of its DOJ settlement.

In one sense, this demonstrates just how toothless the Tunney Act is, at least when it comes to enforcement. The text of the law clearly implicates that the government should refrain from imposing its antitrust remedies until the court has a chance to determine whether the settlement is in the “public interest,” a process that includes input from the public via a 60-day comment period following the official notice of a proposed settlement. If the government feels that a remedy must be imposed with greater speed, the Tunney Act gives the DOJ the right to ask the court for a shortening of the comment period. This process is rarely utilized, however, because the DOJ simply words their consent agreements to have them take effect before the regular comment period expires. The district courts, which are inclined to do as little work as possible on antitrust settlements, simply go along with this overt flaunting of the Tunney Act.

The DOJ’s explanation for executing settlements before approval is that a quick resolution will satisfy the public interest. But how can they satisfy that interest when the court has yet to determine what it is? Especially in a case like Mountain—where I offered substantial evidence the government committed fraud—it is essential for the courts to exercise direct supervision over the government’s activities. Otherwise, the courts are simply giving the DOJ a blank check to run roughshod over businesses, as was the case with Mountain, a company that was denied its existence without any chance to defend itself before a court of law.

For all the recent talk about how laws like the PATRIOT Act undermine civil liberties, there is appallingly little discussion about the antitrust laws, which eviscerate the Constitution on a daily basis. The first error of antitrust is that it allows the government to conduct criminal prosecutions under the façade of civil law. Civil law is intended to redress private contractual grievances, yet antitrust expands that authority to any act of commerce the government deems “unfair” or unwise. This means that the DOJ can bring an antitrust case under a less stringent burden of proof than in a criminal case, and that the government has wide discretion to decide what constitutes a violation and what the elements of that violation are. Furthermore, in the case of Federal Trade Commission cases, defendants are denied their Seventh Amendment right to a jury trial, and their Fifth Amendment right to due process of law.

And if you require further proof that civil antitrust is a façade, consider this: Mountain Health Care was denied its existence as the result of a “civil” proceeding where the DOJ never had to prove a single fact, and indeed misled the district court and the public as to the precise nature of Mountain’s completely legal activities.

The Tunney Act, in theory, provides a check on the DOJ in the form of judicial review. But as I noted above, the courts are notoriously lazy in reviewing antitrust settlements. Cases like Microsoft are the exception that proves the rule. For their part, the DOJ claims that settlements do not constitute a direct admission that any facts presented are true (save for jurisdictional ones). But this claim is intellectually dishonest at best. The reason the DOJ brings these cases in the first place is to brand businesses with the label of “monopolist.” That Mountain allowed itself to be destroyed without putting up a fight presents the public image that they were guilty of the DOJ’s charges. The fact that the “settlement” was the lesser of two evils—Mountain could commit suicide now or bleed to death financially fighting in court—largely escapes public and judicial notice.

Most people simply accept the lie that antitrust is a necessary part of a capitalist economy, even if innocent businesses are occasionally harmed. Few are willing to look at the facts and proudly state that antitrust has no place in capitalism under any circumstances. Those that do, like CAC, face incredible skepticism from the courts and policymakers. But that doesn’t mean the fight is not worth waging, nor does it mean that we should wait until there are changes in the larger culture. Cases like Mountain demonstrate why the battle must be waged now, and that it must be waged with vigor. The proper arguments in favor of capitalism will never be accepted by society if they aren’t made publicly, and antitrust settlements provide an ideal forum for such presentations.

In the coming months, the DOJ will finally get around to filing its lethargic reply to the Mountain comments, whereupon the judge will officially ratify a settlement that has already run its course. But that will not end the battle. I plan to challenge the DOJ’s actions against Mountain before the U.S. Court of Appeals for the Fourth Circuit. There has never been an appellate review of the federal government’s policy prohibiting physicians from collectively negotiating, and—assuming I’m able to convince the district court to permit my intervention (by no means a sure bet, though not impossible either)—I plan on forcing the DOJ’s hand sooner rather than later. Many of the government’s recent efforts to expand the reach of antitrust doctrine have not fared well upon actual judicial review, and I firmly believe an independent appellate court will give serious consideration to the arguments advanced by pro-capitalist forces. But once again, the courts won’t listen to arguments if they aren’t made.

To make these arguments, however, CAC needs your support. It doesn’t cost much to fight the DOJ in court, but there are costs nonetheless. If you would like to join the battle to liberate physicians from the chokehold of antitrust law, please consider making a donation to CAC.

 

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