U.S. Bd. of Oral Implantology v. Am. Bd. of Dental Specialties

• Decision Date: 30 May 2019
• Docket Number: No. 18 CV 6520,18 CV 6520
• Citation: 390 F.Supp.3d 892
• Parties: UNITED STATES BOARD OF ORAL IMPLANTOLOGY, et al., Plaintiffs, v. AMERICAN BOARD OF DENTAL SPECIALTIES, et al., Defendants.
• Court: U.S. District Court — Northern District of Illinois

390 F.Supp.3d 892

UNITED STATES BOARD OF ORAL IMPLANTOLOGY, et al., Plaintiffs,
v.
AMERICAN BOARD OF DENTAL SPECIALTIES, et al., Defendants.

No. 18 CV 6520

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

Signed May 30, 2019

390 F.Supp.3d 896

Michael Lacovara, Eric L. Taffet, Pro Hac Vice, William O. Reckler, Pro Hac Vice, Latham & Watkins LLP, New York, NY, for Plaintiffs.

James Franklin Herbison, Bryce Allen Cooper, Kevin Benjamin Goldstein, Michael P. Mayer, Winston & Strawn LLP, Kevin Michael O'Hagan, Shane Bradwell, Sheri Angelina Tambourine, O'Hagan Meyer, LLC, Chicago, IL, for Defendants.

MEMORANDUM OPINION AND ORDER

Manish S. Shah, United States District Judge

390 F.Supp.3d 897

Certifications help consumers assess products. In the market for dental services, specialty boards issue certifications to dentists that meet certain criteria, and patients use those certifications to identify qualified dentists. Right now, allegedly, the only organization issuing certifications to dentists in the United States that specialize in oral implantology is one of the defendants, the American Board of Oral Implantology. This board has in turn received a certification from another defendant, the American Board of Dental Specialties (a certifier of certifiers). The plaintiffs—two entities that also issue certifications—allege that the defendants' market stronghold violates both § 1 and § 2 of the Sherman Act. They add that the defendants have disparaged plaintiffs' goods in violation of the Illinois Uniform Deceptive Trade Practices Act. The defendants say that nothing is preventing the plaintiffs from issuing their own certifications, and there is nothing illegal about defendants' conduct. They move to dismiss the complaint in its entirety.

I. Legal Standards

A complaint must contain a short and plain statement that plausibly suggests a right to relief. Ashcroft v. Iqbal , 556 U.S. 662, 677–78, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ; Fed. R. Civ. P. 8(a)(2). In ruling on a motion to dismiss, although a court must accept all factual allegations as true and draw all reasonable inferences in the plaintiffs' favor, the court need not do the same for legal conclusions or "threadbare recitals" supported by only "conclusory statements." Ashcroft , 556 U.S. at 678, 80–82, 129 S.Ct. 1937. The plaintiff must provide "more than labels" or "a formulaic recitation of a cause of action's elements," Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), and the complaint must "contain either direct or inferential allegations respecting all the material elements necessary to sustain recovery under some viable legal theory." Id. at 562, 127 S.Ct. 1955. When the allegations involve complex litigation, a "fuller set of factual allegations may be necessary to show that relief is plausible." Tamayo v. Blagojevich , 526 F.3d 1074, 1083 (7th Cir. 2008).

II. Facts

People that need dental implants have imperfect information; they need a capable dentist but often lack the time and know-how to distinguish between a hack and a crackerjack. They might rely on someone else's opinion, especially if that someone is particularly skilled at telling the two apart. In the dentistry field, that someone could be a "specialty certifying board"; a group that issues certifications to dentists who meet certain criteria (and pay the required fee). See [1] ¶¶ 2–4.¹ The more that patients trust the specialty certifying board, the more dentists value their certifications. See id.

Ordinarily, specialty certifying boards would compete based on the quality of the information they provide. But state governments have regulated this market by, among other things, restricting dentists'

390 F.Supp.3d 898

ability to advertise their certifications. [1] ¶¶ 3, 48. Many states prohibit advertising a dental certification unless it was issued by a specialty certifying board that has been approved by the American Dental Association. [1] ¶¶ 3, 11, 12, 48, 49.²

The defendants include three entities that have changed this regulatory landscape. [1] ¶ 63. The American Academy of Implant Dentistry is an Illinois corporation with its principle place of business in Suite 750B of a building in Chicago. [1] ¶ 31. The Academy provides continuing education and training opportunities to its members, hosts conferences, and publishes an industry newsletter. Id. The American Board of Dental Specialties is an Illinois corporation based in Suite 750C. [1] ¶ 29. Like the American Dental Association, the Board of Dental Specialties reviews and approves specialty boards that wish to issue certifications. [1] ¶ 29. Since its creation in 1967, it has only approved one board in the field of oral implantology: the American Board of Oral Implantology. [1] ¶¶ 30, 60. The American Board of Oral Implantology is an Illinois corporation that issues certifications to dentists that practice oral implantology (and provides other continuing education services). [1] ¶ 30. It is based in Suite 750. Id.³

These entities' efforts to change the status quo included lobbying and litigation. [1] ¶¶ 12, 63, 65. In New Jersey, the American Board of Dental Specialties petitioned the state's board of dentistry to relax its advertising restrictions. [1] ¶ 65. Elsewhere, the Academy filed a lawsuit alleging that Indiana violated the Sherman Act when it delegated regulatory authority to the American Dental Association. [1] ¶ 69. There are other examples, the earliest of which dates back to 2010. See [1] ¶¶ 63, 64, 70, 71. In the process, the defendants told state legislatures and courts that, if granted the authority to approve specialty certifying boards themselves, they would be neutral and impartial. [1] ¶¶ 14, 70, 72.

Defendants have also sought to influence public opinion. See [1] ¶ 73. During an interview, the Academy's general counsel (Frank Recker) said that the Board of Dental Specialties would "not consider competition, political decisions, or turf wars," and that its decisions would not be "made by a group of competitors who could be economically or politically affected by their own decisions." [1] ¶ 73. Ronald Brown, the former secretary of the Board of Dental Specialties, wrote that "[i]t is hoped for that the [Board of Dental Specialties] will take over from the ADA with respect to emerging dental specialties." Id. ¶ 74.

Their efforts have partially paid off: in at least six states, dentists are not restricted to advertising only ADA-approved certifications. [1] ¶¶ 13, 75; see footnote 8

390 F.Supp.3d 899

below. Until one of them—Ohio—finishes amending its rules, dentists there can only advertise their certifications if they were issued by specialty certifying boards approved by either the American Dental Association or the American Board of Dental Specialties. [40] at 13 n.5.

The plaintiffs are in the business of oral implantology certifications, too. See [1] ¶ 7. Similar to the Academy, plaintiff International Congress of Oral Implantologists provides continuing education services. [1] ¶ 7. It also issues certifications to oral implantologists. [1] ¶ 44. In 2017, it formed plaintiff United States Board of Implantology, which wants to be approved by the American Board of Dental Specialties as a specialty certifying board (like the American Board of Oral Implantology) for dentists in the field of oral implantology. [1] ¶¶ 7, 45. It has designed its own rigorous process for determining whether an oral implantology specialist should receive a certification. [1] ¶ 46.

The United States Board of Oral Implantology set out to obtain that approval in early 2018. [1] ¶¶ 16, 87. It submitted an application to the American Board of Dental Specialties that, according to the complaint, satisfied all of the relevant criteria (and included the $ 7,500 filing fee). [1] ¶ 91. It heard back about a month later, when Cheryl Parker (the executive director of both the American Board of Dental Specialties and the Academy) replied in writing (copying Dr. Michael Mashni, president of the American Board of Dental Specialties) to say that they had "suspended applications pending a comprehensive update to the application form." [1] ¶ 92. She also returned the filing fee. Id.

The United States Board of Oral Implantology demanded that the American Board of Dental Specialties complete the revisions quickly, [1] ¶¶ 21, 92–98, 100–102, and even offered to assist with the finalization of the application, [1] ¶ 99, but the revised form did not arrive for eight months. [1] ¶ 103. When it came, it included only minor changes to the substantive requirements of the original application, [1] ¶¶ 23, 88–89, 104, plus two procedural changes: (1) any new applications had to be submitted by February 1, 2019, and would not be considered until January of 2020, id. ¶¶ 24, 105, and (2) any appeals would be limited to procedural issues. Id. ¶¶ 25, 106. The defendants say the United States Board of Oral Implantology has not submitted a new application. [42] at 7.

The plaintiff's theory is that these actions harmed competition. They acknowledge that the defendants' lobbying and litigation efforts are protected, [1]...