Louisiana Children's Medical Center defeats FTC merger challenge and obtains first-of-its-kind ruling that state-action immunity applies to Hart-Scott-Rodino Act

Client(s) Louisiana Children's Medical Center

Jones Day successfully represented Louisiana Children's Medical Center (LCMC) in a merger case against the Federal Trade Commission involving an issue of first impression in any federal court. LCMC acquired three hospitals in Louisiana without submitting to the pre-merger waiting period and notification requirements mandated under the Hart-Scott-Rodino Act. The deal, however, was approved and supervised by the Louisiana Attorney General under a state statute expressly granting such mergers immunity from federal antitrust law. The FTC sued, claiming that state-action immunity is inapplicable to Hart-Scott-Rodino, even for those mergers that are ultimately immune from substantive merger challenges under Section 7 of the Clayton Act. LCMC successfully moved to transfer the case from the District of Columbia to Louisiana, where it had filed a declaratory judgment action. On the merits, the U.S. District Court for the Eastern District of Louisiana rejected the FTC's arguments, ruling for LCMC that it was in fact immune from federal antitrust law, and that state-action immunity applies to Hart-Scott-Rodino. Before this decision, no court had ever addressed this novel question of statutory interpretation.

LCMC v. United States et al., 2023 WL 6293887 (E.D. La. Sept. 27, 2023)