United States District Court, N.D. Illinois, Eastern Division
ASSOCIATION OF AMERICAN PHYSICIANS & SURGEONS, INC., Plaintiff,
AMERICAN BOARD OF MEDICAL SPECIALITES, Defendant.
R Wood United States District Judge
Association of American Physicians & Surgeons, Inc.
(“AAPS”) has sued Defendant American Board of
Medical Specialties (“ABMS”), alleging restraint
of trade in violation of Section 1 of the Sherman Act and
negligent misrepresentation in connection with ABMS's
program for recertification known as the ABMS Maintenance of
Certification® program. Before the Court is ABMS's
renewed motion to dismiss both claims pursuant to Federal
Rule of Civil Procedure 12(b)(6) (the “Motion”)
(Dkt. No. 30). For the reasons stated below, the Court finds
that AAPS has failed to state a claim with respect to either
count and thus grants the Motion.
forth in the Complaint,  AAPS is a membership organization of
thousands of practicing physicians in virtually all
specialties. (Compl. ¶ 4, Dkt. No. 1.) ABMS is a
nonprofit entity that serves as the umbrella organization for
twenty-four medical specialty boards (the “Member
Boards”). (Id. ¶¶ 5, 11.) Each of
the Member Boards certifies physicians in a given medical
specialty if the physician voluntarily seeks certification,
completes an accredited medical residency program in the
specialty, passes an examination administered by the Member
Board, and otherwise complies with the Member Board's
requirements for certification. (ABMS Br. at 1, Dkt. No. 31.)
The Member Boards are to be distinguished from the official
medical boards of the states, which determine the fitness of
physicians to practice medicine. (Compl. ¶ 19, Dkt. No.
1.) Certification by a Member Board is a voluntary process
and is not required to be licensed to practice medicine-a
patient has the right to seek the medical care of any
physician licensed to practice medicine (whether certified or
not). (Id. ¶ 20.)
a physician certified by a Member Board was originally
certified for life, ABMS and its Member Boards came to
recognize the need for periodic recertification given that
the state-of-the-art in each medical specialty evolved
rapidly and a physician's knowledge of a particular
specialty could deteriorate over time. (ABMS Br. at 2, Dkt.
No. 31.) As such, in addition to initial certification, ABMS
and its Member Boards offer a program for recertification
known as the ABMS Maintenance of Certification®
(“MOC”) program. (Id.) Like
certification, participation in the MOC program is not
required in order to be licensed to practice. (See
Compl. ¶ 20, Dkt. No. 1.) The MOC program has four basic
components: (1) maintenance of a valid license to practice
medicine and adherence to guidelines of the Member Board
calling for professionalism and honorable personal conduct;
(2) regular participation in educational and self-assessment
activities that meet specialty-specific standards set by each
Member Board; (3) successful completion of an examination;
and (4) evaluation of the care provided to patients, and
identification and application of strategies to improve that
care. (ABMS Br. at 2-3, Dkt. No. 31; see also Compl.
¶ 34, Dkt. No. 1.)
November 2009 and subsequently, ABMS and several Member
Boards obtained the agreement of The Joint Commission, a
private company that accredits more than 20, 000 health care
organizations and hospitals, that hospitals must enforce
requirements against physicians for renewal of their medical
staff privileges. (Compl. ¶¶ 13-14, Dkt. No. 1.) To
comply with The Joint Commission's requirements, many
hospitals impose parts or all of the MOC program against
physicians as a condition of having hospital medical staff
privileges. (Id. ¶ 15.)
choice not to participate in the MOC program has affected
physicians in the United States, including members of AAPS.
(Id. ¶¶ 50-51.) For example, in 2011, an
AAPS member identified as “J.E.” was excluded
from the medical staff of SMC, a hospital in New Jersey,
because he chose not to participate in the MOC program.
(Id. ¶¶ 29, 32, 43-44.) J.E. had been on
the SMC medical staff for twenty-nine years and had been
certified by a Member Board. (Id. ¶¶
30-31.) He was told by SMC in 2011, however, that he would
have to comply with recertification requirements under the
MOC program to remain on its medical staff. (Id.
¶ 32.) Due to the expense and time required for
recertification, J.E. chose not to comply. (See id.
¶¶ 34-43.) As a result, he was not allowed to
remain on SMC's medical staff, and patients cannot be
treated by J.E. when taken by emergency to SMC. (Id.
has filed a two-count Complaint alleging (1) restraint of
trade in violation of Section 1 of the Sherman Act, and (2)
negligent misrepresentation. With respect to Count I, AAPS
alleges that ABMS has restrained trade in connection with the
MOC program. (Id. ¶¶ 57- 70.) In
particular, AAPS claims that ABMS has restrained trade by:
(a) seeking and obtaining agreements with the Member Boards
to impose formal recertification requirements as part of the
MOC program, (b) seeking and obtaining agreement by The Joint
Commission to require enforcement by hospitals of formal
recertification requirements, (c) inducing health insurance
companies and plans to exclude physicians who do not purchase
and comply with the MOC program, (d) requiring
recertification by younger physicians while exempting older
physicians, and (e) acting in concert with the Member Boards
to seek an endorsement by the Federation of State Medical
Boards of “maintenance of licensure” to impose
the MOC program as a requirement of licensure by state
medical boards. (Id. ¶¶ 57-62.) AAPS
argues that the relevant service market consists of medical
care provided by physicians to hospitalized patients and that
the relevant geographic market is nationwide. (Id.
¶¶ 27-28.) According to AAPS, ABMS's actions
have no legitimate purpose, reduce the supply of physicians
available to treat patients, and limit patients' access
to their own physicians. (Id. ¶¶ 63-66.)
respect to Count II, AAPS alleges that certain statements of
ABMS are false and have deceived physicians and the public.
(Id. ¶¶ 78-91.) The statements at issue
consist of: (a) a statement on an ABMS website that doctors
who participate in the MOC program “are voluntarily
part of a rigorous process that continually assesses and
enhances their medical knowledge, judgment, professionalism,
clinical techniques, and communication skills;” (b) a
statement on an ABMS website that “you can count on
quality patient care” from doctors who are Board
Certified; (c) ABMS's use of phrases such as “Not
Meeting MOC Requirements” to describe physicians who do
not participate in the MOC program, and (d) inviting patients
to search on the names of individual physicians to see if
they have complied with the MOC program. (Id.
¶¶ 78-81, 82.) AAPS argues that ABMS's
statements “create the false impression that [the MOC
program] is indicative of the medical skills of physicians,
and that as a result physicians who decline to purchase
[ABMS's] product are likely to be less competent”
and “falsely imply that physicians who decline to
participate or who do not fully complete the program are
somehow less competent physicians.” (Id.
Rule of Civil Procedure 8(a) requires that a complaint
contain “a short and plain statement of the claim
showing that the pleader is entitled to relief.”
Fed.R.Civ.P. 8(a). To survive a Rule 12(b)(6) motion, a
complaint must “state a claim to relief that is
plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 547 (2007). While the Complaint
need not include detailed factual allegations, there
“must be enough to raise a right to relief above the
speculative level.” Id. at 555. The plaintiff
must “plead factual content that allows the court to
draw the reasonable inference that the defendant is liable
for the misconduct alleged. Where a complaint pleads facts
that are merely consistent with a defendant's liability,
it stops short of the line between possibility and
plausibility of entitlement to relief.” McReynolds
v. Merrill Lynch & Co., 694 F.3d 873, 885 (7th Cir.
2012) (internal citations and quotation marks omitted)
(quoting Ashcroft v. Iqbal, 556 U.S. 662 (2009)). In
addition, “although the complaint's factual
allegations are accepted as true at the pleading stage,
allegations in the form of legal conclusions are insufficient
to survive a Rule 12(b)(6) motion.” Id.
Furthermore, “a party may plead itself out of court by
either including factual allegations that establish an
impenetrable defense to its claims or by attaching exhibits
that establish the same.” Massey v. Merrill Lynch
& Co., 464 F.3d 642, 650 (7th Cir. 2006).
Count I - Restraint of Trade in Violation of Section 1 of the
1 of the Sherman Act states, “[e]very contract,
combination in the form of trust or otherwise, or conspiracy,
in restraint of trade or commerce among the several States,
or with foreign nations, is declared to be illegal.” 15
U.S.C. § 1. To state a claim for a Section 1 violation,
AAPS must plead facts plausibly suggesting: (1) a contract,
combination, or conspiracy (i.e., an agreement); (2)
a resultant unreasonable restraint of trade in a relevant
market; and (3) an accompanying injury. Agnew v.
Nat'l Collegiate Athletic Ass'n, 683 F.3d 328,
335 (7th Cir. 2012). The Court's analysis focuses on the
second and third factors.
A Resultant Unreasonable Restraint of Trade in ...