Siva v. Am. Bd. of Radiology

• Decision Date: 19 November 2019
• Docket Number: Case No. 19 C 1407
• Parties: Sadhish K. SIVA, Plaintiff, v. AMERICAN BOARD OF RADIOLOGY, Defendant.
• Court: U.S. District Court — Northern District of Illinois

418 F.Supp.3d 264

Sadhish K. SIVA, Plaintiff,

v.AMERICAN BOARD OF RADIOLOGY, Defendant.

Case No. 19 C 1407

United States District Court, N.D. Illinois, Eastern Division.

Signed November 19, 2019

Brian M. Hogan, Michael Jerry Freed, Freed Kanner London & Millen, LLC, Bannockburn, IL, C. Philip Curley, Benjamin E. Schwab, Cynthia H. Hyndman, Laura R. Feldman, Robinson Curley P.C., Katrina Carroll, Carlson Lynch, LLP, Chicago, IL, Jonathan M. Jagher, Freed Kanner London & Millen, Conshohocken, PA, for Plaintiff.

Jaime L. Stilson, Erik D. Ruda, Pro Hac Vice, Dorsey & Whitney LLP, Minneapolis, MN, Ke Liu, Matthew O'Hair Stromquist, Pilgrim Christakis LLP, Chicago, IL, for Defendant.

MEMORANDUM OPINION AND ORDER

HON. JORGE ALONSO, United States District Judge

Plaintiff, Sadhish K. Siva, brings this antitrust action against defendant, the American Board of Radiology ("ABR"), contending that the maintenance of certification ("MOC") requirements for ABR-certified physicians violate sections 1 and 2 of the Sherman Antitrust Act, 15 U.S.C. §§ 1 - 2. Defendant has moved to dismiss. For the following reasons, defendant's motion to dismiss is granted.

BACKGROUND

ABR is one of twenty-four member boards making up the American Board of Medical Specialties, which certify physicians in thirty-nine specialties and eighty-six subspecialties. Plaintiff is a physician who is both licensed to practice medicine and certified by ABR in diagnostic radiology.

Physicians are licensed by medical boards of the individual states, generally after they receive a medical degree and pass a three-step licensing examination. Most states require physicians to complete continuing medical education ("CME") courses periodically in order to maintain their license. Licensure is legally mandatory for any practicing physician.

In addition to licensure, most clinical radiologists also seek certification from ABR, which requires physicians like plaintiff to take an examination to "determine if [they] have acquired the requisite standard of knowledge[,] skill[,] and understanding essential to the practice of diagnostic radiology." (Compl. ¶¶ 18-19; see id. ¶¶ 88-89). Unlike licensure, board certification is technically voluntary, but, as a practical matter, according to plaintiff, it is "increasingly mandatory for radiologists across the country" because radiologists' essential partners in the health care industry require it of them. (Id. ¶ 42.) For example, hospitals often require radiologists to be ABR-certified to obtain consulting and admitting privileges; insurance companies require them to be certified to obtain (higher) reimbursements and malpractice coverage; and medical corporations and other employers require them to be certified before they will consider them for employment.

For most of ABR's history, its certifications were lifelong. By 2002, however, before plaintiff had completed his training in radiology, ABR had eliminated lifetime certificates and begun issuing only time-limited ten-year certificates. ABR imposed a new "maintenance of certification" ("MOC") program, which required ABR-certified radiologists to renew their certification every ten years by passing a "cognitive examination" and periodically completing "Practice Quality Improvement" projects. (Id. ¶ 22.) Under a grandfather rule, radiologists who initially became certified prior to the imposition of the MOC program are not required to participate in MOC. For all other radiologists, MOC is mandatory to maintain a valid certificate.

According to plaintiff, ABR has itself admitted that the MOC program, at least initially, did not meet its "aims" of "aid[ing] in continuous learning and continuous improvement." (Id. ¶ 31.) ABR has twice revamped its MOC program, but, in all three incarnations, plaintiff alleges, "there is no evidence of an actual causal relationship between MOC and any beneficial impact on physicians, patients, or the public." (Id. ¶ 48.) Nevertheless, ABR-certified radiologists, including plaintiff, have been required to pay allegedly exorbitant amounts for MOC and to meet burdensome testing and education requirements, or risk their status as board-certified physicians.

In Count I, plaintiff claims that ABR has tied its initial certification product to its newer maintenance of certification product in violation of section 1 of the Sherman Antitrust Act, forcing radiologists to purchase MOC to their detriment and the detriment of ABR's would-be competitors. These competitors include the National Board of Physicians and Surgeons ("NBPAS"), which seeks to provide MOC services but has been unable to gain purchase in the market, allegedly due to ABR's tying. In Count II, plaintiff claims that ABR has violated section 2 of the Sherman Act by illegally monopolizing the market for MOC. Finally, in Count III, plaintiff asserts a state-law claim of unjust enrichment, alleging that ABR has wrongfully retained the benefit of funds paid for MOC services that served no useful purpose to the physicians who purchased them, given that there is no demonstrable link between MOC services and improvement in the quality of care certified radiologists provide.

ANALYSIS

"A motion under Federal Rule of Civil Procedure 12(b)(6) tests whether the complaint states a claim on which relief may be granted." Richards v. Mitcheff , 696 F.3d 635, 637 (7th Cir. 2012). Under Rule 8(a)(2), a complaint must include "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). The short and plain statement under Rule 8(a)(2) must " ‘give the defendant fair notice of what ... the claim is and the grounds upon which it rests.’ " Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (quoting Conley v. Gibson , 355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957) ).

Under federal notice-pleading standards, a plaintiff's "[f]actual allegations must be enough to raise a right to relief above the speculative level." Id. Stated differently, "a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ " Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Twombly , 550 U.S. at 570, 127 S.Ct. 1955 ). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly , 550 U.S. at 556, 127 S.Ct. 1955 ). Allegations that are as consistent with lawful conduct as they are with unlawful conduct are not sufficient; rather, plaintiffs must include allegations that "nudg[e] their claims across the line from conceivable to plausible." Twombly , 550 U.S. at 570, 127 S.Ct. 1955. "In reviewing the sufficiency of a complaint under the plausibility standard, [courts must] accept the well-pleaded facts in the complaint as true, but [they] ‘need[ ] not accept as true legal conclusions, or threadbare recitals of the elements of a cause of action, supported by mere conclusory statements.’ " Alam v. Miller Brewing Co. , 709 F.3d 662, 665-66 (7th Cir. 2013) (quoting Brooks v. Ross , 578 F.3d 574, 581 (7th Cir. 2009) ).

Plaintiff seeks relief via the Clayton Act, 15 U.S.C. §§ 15, 26, which provides a private right of action for treble damages to any person "injured in his business or property by reason of anything forbidden in the antitrust laws[.]" 15 U.S.C. § 15. Section 1 of the Sherman Antitrust Act prohibits "[e]very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce ..." 15 U.S.C. § 1. This language has long been interpreted to "outlaw only unreasonable restraints" of trade. State Oil Co. v. Khan , 522 U.S. 3, 10, 118 S.Ct. 275, 139 L.Ed.2d 199 (1997). Section 2 of the Sherman Act makes it unlawful to "monopolize, or attempt to monopolize, ... any part of the trade or commerce among the several States." 15 U.S.C. § 2.

I. SHERMAN ACT SECTION 1—TYING

Plaintiff alleges that defendant, which dominates the market for initial certification, violates the Sherman Act by tying its MOC services to its initial certification product, forcing radiologists to purchase MOC in order to receive any continuing benefit from initial certification.

A tying arrangement is "an agreement by a party to sell one product but only on the condition that the buyer also purchases a different (or tied) product, or at least agrees that he will not purchase that product from any other supplier." N. Pac. R. Co. v. United States, 356 U.S. 1, 5-6 [78 S.Ct. 514, 2 L.Ed.2d 545] (1958). Such an arrangement violates § 1 of the Sherman Act if the seller has "appreciable economic power" in the tying product market and if the arrangement affects a substantial volume of commerce in the tied market. Fortner Enters., Inc. v. United States Steel Corp., 394 U.S. 495, 503 [89 S.Ct. 1252, 22 L.Ed.2d 495] (1969).

Eastman Kodak Co. v. Image Tech. Servs., Inc. , 504 U.S. 451, 461-62, 112 S.Ct. 2072, 119 L.Ed.2d 265 (1992) (internal citations altered). The alleged tying arrangement in this case is unlawful per se (i.e. , without proof that anticompetitive effects outweigh procompetitive ones) if "(1) a tie exists between two separate products; (2) the tying seller [ABR] has sufficient economic power in the tying product market to restrain free competition in the tied product market [the MOC market]; (3) the tie affects a not-insubstantial amount of interstate commerce in the tied product [MOC services]; and (4) the tying seller [ABR] has some economic interest in the sales of the tied product [MOC services]." Reifert v. S. Cent. Wis. MLS Corp. , 450 F.3d 312, 316-17 (7th Cir. 2006).¹

In support of its motion to dismiss, defendant argues that the first element of this test is not met because initial certification and MOC are not separate products. According to defendant, it sells only one product:...