The Federal Trade Commission filed a complaint against Anesthesia Partners, Inc. and the outfit, a private equity firm named Welsh Carson, that allegedly took it over before it resold it to a corporation formed for the purpose of the resale. Download FTC v. U.S. Anesthesia Ptrs Inc. Redacted Public Version (of FTC Complaint) DE 69 filed Oct. 26 2023 (S.D. Tex. No. 4.23-cv-03560). The FTC alleged that both Anesthesia Partners (USAP) and Welsh Carson committed antitrust violations. The background of the FTC's case was previously explained here in several articles posted on September 29, 2023, on October 2, 2023, and on October 4, 2023.
USAP filed a motion to dismiss the FTC's lawsuit against it. USAP predictably argued that it was not violating antitrust laws, but it also argued that Section 13(b) of the FTC Act did not support the FTC's lawsuit where the FTC did not file a simultaneous administrative proceeding against USAP, and for good measure that the FTC is unconstitutional. USAP also raised the issue in its motion to dismiss that the FTC based its claims on an impermissible market definition.
USAP's motion to dismiss was denied by the District Court, and USAP filed an appeal from the District Court's denial of its motion to dismiss. FTC v. Anesthesia Ptrs., Inc., No. 4:23-cv-03560, 2024 WL 2137649, at *6-*9 (S.D. Tex. May 13, 2024), app. docketed, No. 24-20270 (5th Cir. June 17, 2024). In the course of denying USAP's motion to dismiss, the District Court quoted several of the FTC's allegations, including this one:
The FTC quotes an insurance executive describing USAP's consolidation strategy as “tak[ing] the highest rate of all ... and then peanut butter spread that across the entire state of Texas.”
FTC v. Anesthesia Partners, 2024 WL 2137649, at *9.
The District Court granted Welsh Carson's motion to dismiss, in contrast. FTC v. Anesthesia Partners, 2024 WL 2137649 at *4-*6. Welsh Carson successfully argued that it, the private equity financier, did not violate and was not about to violate antitrust laws based on the allegations in the FTC's complaint.
So it's on to the Fifth Circuit where USAP hopes that it will find a more receptive audience for its arguments including that the FTC is unconstitutional despite some 90 years of precedent to the contrary.
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