In assessing lawsuit, judge cites some evidence that defendants’ practices could violate federal law.
The Wall Street Journal
A federal court struck a blow to Blue Cross and Blue Shield insurers in high-stakes litigation focused on how they work together, finding that some of their practices could represent an automatic violation of federal antitrust law.
U.S. District Judge R. David Proctor in Birmingham, Ala., in a late Thursday ruling, said challengers to the Blue insurers’ practices had presented evidence that the Blue insurers have adopted competitive restrictions “which, considered together, constitute a per se violation of the Sherman Act,” the central federal law that bars unlawful restraints of trade.
The ruling sets important legal rules for a future trial. The judge rejected some of the Blue insurers’ central arguments, and his finding of a potential “per se,” or inherent, violation could make it harder for them to defend some of their longstanding practices.
The case has a long way to go. The judge left open at least one potential defense for the insurers’ actions, and the lawsuits against the Blue insurers haven’t yet been certified to proceed as class actions, an issue that could take several more months to resolve.
Still, “both substantively and tactically, it’s a very big deal,” Tim Greaney, a professor at the University of California Hastings College of the Law, said of the ruling. “It’s a pretty serious blow to the Blues.”