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DOCTORS, INC. v. BLUE CROSS OF GREATER PHILADELPHI

June 8, 1973

DOCTORS, INC., a/k/a Doctors Hospital
v.
BLUE CROSS OF GREATER PHILADELPHIA a/k/a Associated Hospital Service of Philadelphia and Hospital Survey Committee, Inc.


Gorbey, District Judge.


The opinion of the court was delivered by: GORBEY

Gorbey, District Judge.

 Plaintiff, Doctors, Inc., a/k/a Doctors Hospital (Doctors), instituted this action against defendants, Blue Cross of Greater Philadelphia, a/k/a Associated Hospital Service of Philadelphia (Blue Cross), and Hospital Survey Committee, Inc. (HSC), under Sections 4 and 16 of the Clayton Act for preliminary injunctive relief and after trial for permanent injunctive relief and damages to redress injuries to Doctors, resulting from defendants' alleged violations of Sections 1 and 2 of the Sherman Act (15 U.S.C. §§ 1 and 2). *fn1"

 
(a) an illegal contract, combination and conspiracy to restrict and eliminate competition in hospital services in the market area;
 
(b) an illegal exercise of monopolistic power to control hospital services and competition in the hospital services in the market area;
 
(c) an illegal refusal to deal; and
 
(d) an illegal group boycott.

 Defendants Blue Cross and HSC have filed motions to dismiss the complaint under Rule 12(b)(1) of the Federal Rules of Civil Procedure, alleging that the court lacks jurisdiction over the subject matter of the complaint. Argument on the motion was held on May 31, 1973. After consideration of the briefs submitted by the parties and the oral argument thereon, this court entered an order on June 4, 1973, granting the motion to dismiss and dismissing the complaint. This memorandum of decision is in support of said order.

 Defendants allege in their motion to dismiss that this court lacks jurisdiction of the subject matter because the antitrust laws do not apply where the alleged illegal restraint is imposed solely upon the intrastate operations of a local business; and interstate commerce is involved only indirectly.

 The jurisdictional allegations which plaintiff makes in its complaint relating to interstate commerce are the following:

 1. The plaintiff transacts a major part of its business in interstate commerce and the acts alleged herein involve and affect a substantial volume of interstate commerce. Plaintiff purchases services and supplies in interstate commerce of almost $2,000,000 annually. *fn2" Its medical staff and patients are drawn from Pennsylvania and adjoining states.

 2. Blue Cross Member Hospitals include hospitals in New Jersey as well as Southeastern Pennsylvania. Defendant Blue Cross has subscribers in New Jersey and Pennsylvania.

 3. Reimbursement and payment for hospital services are made to Doctors and other area hospitals by third-party payers such as defendant Blue Cross and other insurance companies, which invest premiums and funds held for such reimbursement ...


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