Supreme Court Decision Alert - February 19, 2013

Keywords: antitrust, state-action doctrine, competition, special-purpose public entities

Antitrust—State-Action Doctrine

Federal Trade Commission v. Phoebe Putney Health System, Inc., No. 11-1160

Under the "state-action immunity" doctrine, when a local governmental entity acts pursuant to a clearly articulated and affirmatively expressed state policy to displace competition, it is exempt from scrutiny under the federal antitrust laws. Today, in a unanimous decision authored by Justice Sotomayor, the Supreme Court held that a Georgia law that creates special-purpose public entities called hospital authorities and gives those entities general corporate powers does not include authorization to use those powers anticompetitively. Because the Court's decision clarifies the elements necessary for the state-action doctrine to apply and the scope of the doctrine's applicability, it is of interest to businesses (including hospitals) that are subject to supervision by