Robinson v. Magovern

• Decision Date: 31 August 1981
• Docket Number: Civ. A. No. 77-75.
• Parties: John N. ROBINSON, Plaintiff, v. George J. MAGOVERN, Cardiothoracic Surgical Associates, Inc., Allegheny General Hospital and Henry G. Allyn, Jr., Gay E. Bodick, Fred Brand, Jr., Henry Chalfant, Ronald R. Davenport, Harry Edelman, III, Harry M. Epstine, William H. Genge, W. H. Krome George, R. Burt Gookin, Thomas C. Graham, Kenneth C. Hewitt, John A. Huffman, Jr., B. F. Jones, III, Bernard H. Jones, Caryl M. Kline, Richard K. Means, Francis B. Nimick, David B. Oliver, II, Robert B. Pease, G. Harton Singer, III, Elizabeth A. Smith, W. P. Snyder, III, Leonard A. Swanson, W. Bruce Thomas, and Paul H. Weyrauch, individually and as Trustees of Allegheny General Hospital, Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

521 F. Supp. 842

John N. ROBINSON, Plaintiff, v. George J. MAGOVERN, Cardiothoracic Surgical Associates, Inc., Allegheny General Hospital and Henry G. Allyn, Jr., Gay E. Bodick, Fred Brand, Jr., Henry Chalfant, Ronald R. Davenport, Harry Edelman, III, Harry M. Epstine, William H. Genge, W. H. Krome George, R. Burt Gookin, Thomas C. Graham, Kenneth C. Hewitt, John A. Huffman, Jr., B. F. Jones, III, Bernard H. Jones, Caryl M. Kline, Richard K. Means, Francis B. Nimick, David B. Oliver, II, Robert B. Pease, G. Harton Singer, III, Elizabeth A. Smith, W. P. Snyder, III, Leonard A. Swanson, W. Bruce Thomas, and Paul H. Weyrauch, individually and as Trustees of Allegheny General Hospital, Defendants.

Civ. A. No. 77-75.

United States District Court, W. D. Pennsylvania.

August 31, 1981.

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Roslyn Litman, H. Yale Gutnick, Pittsburgh, Pa., for plaintiff.

David L. McClenahan, Robert B. Sommer, David A. Borkovic, Kirkpatrick, Lockhart, Johnson & Hutchison, Pittsburgh, Pa., for Allegheny General Hospital etc.

David B. Buerger, Buchanan, Ingersoll, Rodewald, Kyle & Buerger, Pittsburgh, Pa. for McGovern.

Robert L. Frantz, Michael A. Snyder, Buchanan, Ingersoll, Rodewald, Kyle & Buerger, Pittsburgh, Pa., for Cardio-Thoracic Surgical Associates, Inc.

OPINION

COHILL, District Judge.

                                                 Table of Contents
                                                                                                    Page
                     Introduction ................................................................. 848
                         I.  The Parties .......................................................... 848
                             A.  Plaintiff ........................................................ 848
                             B.  The Defendants ................................................... 850
                                 1.  Allegheny General Hospital ................................... 850
                                 2.  The Trustees ................................................. 851
                                 3.  George J. Magovern, M.D. ..................................... 851
                                 4.  Cardio-Thoracic Surgical Associates, Inc. .................... 852
                        II.  The Claims ........................................................... 853
                       III.  Delivery of Open Heart Surgical Services ............................. 854
                             A.  Diagnosis ........................................................ 854
                             B.  Open Heart Surgery — The Procedure ......................... 855
                             C.  Open Heart Surgery — The Major Players ..................... 856
                                 1. The Lead Surgeon .............................................. 856
                                 2. The Hospital .................................................. 857
                        IV.  Allegheny General's Competitive Strategy ............................. 858
                             A.  Institutional Objectives ......................................... 859
                             B.  Marketing ........................................................ 860
                             C.  Role of the Department Directors ................................. 860
                             D.  Results of the Revitalization Campaign ........................... 862
                         V.  The Application of John N. Robinson, M.D. ............................ 863
                             A.  The Interview .................................................... 863
                             B.  Submission of the Application .................................... 864
                             C.  The Magovern Report .............................................. 866
                             D.  The Credentials Committee ........................................ 866
                             E.  The Rejection of the Application ................................. 872
                        VI.  The Legal Action: Jurisdiction And Relevant Market ................... 876
                             A.  Subject Matter Jurisdiction ...................................... 876
                             B.  Relevant Market .................................................. 877
                                 1.  The Product Market ........................................... 877
                                 2.  The Geographic Market ........................................ 878
                

                     VII.  The Legal Action: Antitrust Claims ....................................... 886
                           A.  Overview ............................................................. 886
                           B.  Section 2 Claims ..................................................... 886
                               1.  Monopoly ......................................................... 886
                               2.  Attempt to Monopolize ............................................ 891
                               3.  Conspiracy to Monopolize ......................................... 892
                                   a. Agreement ..................................................... 892
                                   b. Specific Intent to Monopolize ................................. 896
                           C.  Section 1 Claims ..................................................... 903
                               1.  The Standard ..................................................... 903
                               2.  Group Boycott .................................................... 904
                               3.  Essential Facility ............................................... 913
                               4.  Unfair Acts With Intent to Destroy Competition ................... 913
                               5.  Rule of Reason ................................................... 914
                                   a.  Notice of Standards .......................................... 916
                                   b.  Standards Reasonably Advance Hospital's Legitimate Objectives. 917
                                   c.  Standards Do Not Impose Unreasonable Restraint ............... 919
                                   d.  Allegheny General's Conclusions About Dr. Robinson ........... 920
                                   e.  Consistent With Other Personnel Decisions .................... 923
                     VIII.  The Legal Action: Pendent Jurisdiction Claims ........................... 925
                            A.  Breach of Contract .................................................. 925
                            B.  Interference With Prospective Contractual Relationship .............. 926
                            C.  Conspiracy in Restraint of Trade .................................... 926
                     Conclusion ..................................................................... 927
                

Introduction

After Allegheny General Hospital rejected Dr. John N. Robinson's application for staff privileges in October, 1976, Dr. Robinson filed this antitrust action against the hospital, members of its Board of Trustees, and certain thoracic surgeons who are members of the hospital's staff. Three years of extensive discovery followed, punctuated by a variety of motions to compel and motions for protective orders. The litigation culminated in a ten-week non-jury trial that included the testimony of fifty-two witnesses, extensive briefing, and arguments by counsel. We now rule in favor of all defendants on all claims. Pursuant to Federal Rule of Civil Procedure 52, we make the following findings of fact and conclusions of law.

I. The Parties

A. Plaintiff

John N. Robinson, M.D., the plaintiff in this litigation, is a board-certified thoracic surgeon, licensed to practice medicine in the Commonwealth of Pennsylvania. Dr. Robinson graduated from George Washington University Medical School in 1963. He then served an internship with the Harvard Surgical Service at Boston City Hospital and a five-year general surgical residency at Presbyterian Hospital, which is affiliated with Columbia University in New York City. Dr. Robinson's cardiothoracic¹ training began in 1970 with a one-year residency in Texas at the Baylor College School of Medicine in a program headed by Dr. Michael DeBakey. In order to acquire the experience in pulmonary and esophageal surgery that the American Board of Thoracic Surgery requires for certification eligibility, Dr. Robinson cut short his residency at Baylor and transferred to the Veterans Administration Hospital at Little Rock, Arkansas to train for four months under Dr. Raymond Read. The following year, Dr. Robinson served as a resident in thoracic surgery at the Texas Heart Institute, where he worked under Drs. Denton Cooley and Grady Hallman.

While Dr. Robinson was serving his residency at the Texas Heart Institute, Dr. James Giacobine, an established cardiovascular surgeon in the Pittsburgh-McKeesport area, informed Dr. Cooley that he would like to have the assistance of a young surgeon in his thriving practice. Dr. Cooley suggested to Dr. Robinson that he pursue this opportunity, and Dr. Robinson subsequently did enter into practice with Dr. Giacobine. As Dr. Giacobine's junior associate, Dr. Robinson was expected to cover patients at all of the hospitals where Dr. Giacobine practiced medicine. Accordingly, Dr. Robinson made application to, and was accepted on, the medical staffs of various hospitals in the Pittsburgh-McKeesport area, including St. Francis, McKeesport, North Hills Passavant, St. John's, and South Side Hospitals.

With primary care physicians and cardiologists referring more patients to Dr. Giacobine than he could operate on himself, he called upon Dr. Robinson to serve as lead surgeon in from three to five open heart operations per week. This frequency permitted Dr. Robinson to develop and maintain his surgical proficiency.

During Dr. Robinson's association with Dr. Giacobine, St. Francis Hospital sponsored a residency program in thoracic surgery under the guidance of Dr. Giacobine. Dr. Robinson assisted in the teaching of the residents by taking them on rounds and by permitting them to assist in the operating room.

The professional relationship between Drs. Giacobine and Robinson continued for two and one-half years, ending abruptly and with bitterness in December, 1974. The dissolution resulted primarily from disagreements over two points. First, Dr....