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Dentists Smiling as $80 Million Settlement Reached in Dental Supply Price-Fixing Class Action Suit

By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

On August 30, 2018, after two years of litigation, a group of dentists tentatively reached an $80 million settlement in a proposed class action accusing the country’s biggest dental supply companies of colluding to fix prices. The three dominant distributors, Henry Schein Inc., Patterson Cos. Inc. and Benco Dental Supply Co. Inc., allegedly artificially inflated prices on crowns, numbing agents, X-ray accessories and other products.

Artificially Inflating Prices.

In 2016, the three distributors were accused of artificially inflating prices on various dental supplies and equipment. Products at issue included supplies such as adhesives, implants, tooth brushes, pins and posts all the way to equipment such as imaging devices and dental chairs. Although there are hundreds of distributors and manufacturers of dental supplies and equipment, the defendants controlled approximately 80% of the market share. Click here to read my prior blog on this case and learn more.

The $80 million settlement comes roughly 30 months after the dentists first launched their lawsuits against the manufacturers. To learn more, click here to view the consolidated class action complaint  and the order in full.

Collusion?

In response to the suit, the three distributors accused the group of dentists of inaccurately portraying isolated actions as a nationwide conspiracy. However, a New York federal judge found reason to believe the distributors colluded to strong-arm lower cost rivals and boycott trade groups that worked with a newer distributor called SourceOne Dental Inc.

Despite reaching the settlement, the distributors deny any wrongdoing even though the Federal Trade Commission (FTC) also filed an administrative complaint against them in February 2018. In the complaint, the FTC accused the nation’s three largest dental supply companies of conspiring to refuse to provide discounts to buying groups representing small dental practitioners in violation of antitrust laws. To view the FTC’s press release, click here. Click here to view the FTC’s complaint.

Contact Health Law Attorneys Experienced in Representing Health Care Professionals.

The Health Law Firm has attorneys who practice in the area of antitrust law and trade regulation. We have defended a hospital in federal court against allegations of violations of the antitrust laws, we routinely provide advice and opinion letters on antitrust and trade regulation matters, we have represented plaintiffs in law suits alleging anticompetitive behavior and violations of state and federal antitrust laws, we have given opinions on and been involved in litigation concerning the Lanham Act and the Robinson-Patman Amendments, and we routinely undertake litigation concerning restrictive covenants.

The attorneys of The Health Law Firm provide advice and representation concerning antitrust law, trade regulation, restraint of trade issues, and regarding deceptive and unfair trade practices. We routinely provide advice and analysis of proposed business ventures that include the foregoing. We have represented both plaintiffs and defendants in state court litigation and in federal court litigation in such matters.

To contact The Health Law Firm, please call (407) 331-6620 and visit our website at www.TheHealthLawFirm.com.

Sources:

Overley, Jeff. “Dentists Get $80M From Supply Cos. To End Collusion Case.” Law360. (August 30, 2018). Web.

“Dentists Get $80M From Supply Cos. To End Collusion Case.” InfoTech Consulting. (September 5, 2018). Web.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

KeyWords: dental class action suit, complex healthcare litigation attorneys, legal representation for antitrust violations, representation for antitrust investigations, complex medical litigation lawyer, representation for complex litigation, representation for healthcare business litigation matters, employment contract representation, representation for physician dentist employment contract, healthcare contract review attorney, restraint of trade legal representation, representation for Board of Dentistry matters, Board of Dentistry representation, dentist lawyer,  attorney for dentists, Board of Dental Examiners legal counsel, representation for Federal Trade Commission (FTC) investigations, dental law defense lawyer, representation for dental law, representation for health care professionals, representation for dental clinics, health law defense lawyer, health defense attorney, legal representation for dentists, The Health Law Firm, reviews of The Health Law Firm Attorneys, The Health Law Firm attorney reviews, board of dentistry defense attorney, dental board defense legal counsel, representation for dentists, dentist defense lawyer

“The Health Law Firm” is a registered fictitious business name of and a registered service mark of The Health Law Firm, P.A., a Florida professional service corporation, since 1999.
Copyright © 2018 The Health Law Firm. All rights reserved.

Dentists Smiling as $80 Million Settlement Reached in Dental Supply Price-Fixing Class Action Suit

By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

On August 30, 2018, after two years of litigation, a group of dentists tentatively reached an $80 million settlement in a proposed class action accusing the country’s biggest dental supply companies of colluding to fix prices. The three dominant distributors, Henry Schein Inc., Patterson Cos. Inc. and Benco Dental Supply Co. Inc., allegedly artificially inflated prices on crowns, numbing agents, X-ray accessories and other products.

Artificially Inflating Prices.

In 2016, the three distributors were accused of artificially inflating prices on various dental supplies and equipment. Products at issue included supplies such as adhesives, implants, tooth brushes, pins and posts all the way to equipment such as imaging devices and dental chairs. Although there are hundreds of distributors and manufacturers of dental supplies and equipment, the defendants controlled approximately 80% of the market share. Click here to read my prior blog on this case and learn more.

The $80 million settlement comes roughly 30 months after the dentists first launched their lawsuits against the manufacturers. To learn more, click here to view the consolidated class action complaint  and the order in full.

Collusion?

In response to the suit, the three distributors accused the group of dentists of inaccurately portraying isolated actions as a nationwide conspiracy. However, a New York federal judge found reason to believe the distributors colluded to strong-arm lower cost rivals and boycott trade groups that worked with a newer distributor called SourceOne Dental Inc.

Despite reaching the settlement, the distributors deny any wrongdoing even though the Federal Trade Commission (FTC) also filed an administrative complaint against them in February 2018. In the complaint, the FTC accused the nation’s three largest dental supply companies of conspiring to refuse to provide discounts to buying groups representing small dental practitioners in violation of antitrust laws. To view the FTC’s press release, click here. Click here to view the FTC’s complaint.

Contact Health Law Attorneys Experienced in Representing Health Care Professionals.

The Health Law Firm has attorneys who practice in the area of antitrust law and trade regulation. We have defended a hospital in federal court against allegations of violations of the antitrust laws, we routinely provide advice and opinion letters on antitrust and trade regulation matters, we have represented plaintiffs in law suits alleging anticompetitive behavior and violations of state and federal antitrust laws, we have given opinions on and been involved in litigation concerning the Lanham Act and the Robinson-Patman Amendments, and we routinely undertake litigation concerning restrictive covenants.

The attorneys of The Health Law Firm provide advice and representation concerning antitrust law, trade regulation, restraint of trade issues, and regarding deceptive and unfair trade practices. We routinely provide advice and analysis of proposed business ventures that include the foregoing. We have represented both plaintiffs and defendants in state court litigation and in federal court litigation in such matters.

To contact The Health Law Firm, please call (407) 331-6620 and visit our website at www.TheHealthLawFirm.com.

Sources:

Overley, Jeff. “Dentists Get $80M From Supply Cos. To End Collusion Case.” Law360. (August 30, 2018). Web.

“Dentists Get $80M From Supply Cos. To End Collusion Case.” InfoTech Consulting. (September 5, 2018). Web.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

KeyWords: dental class action suit, complex healthcare litigation attorneys, legal representation for antitrust violations, representation for antitrust investigations, complex medical litigation lawyer, representation for complex litigation, representation for healthcare business litigation matters, employment contract representation, representation for physician dentist employment contract, healthcare contract review attorney, restraint of trade legal representation, representation for Board of Dentistry matters, Board of Dentistry representation, dentist lawyer,  attorney for dentists, Board of Dental Examiners legal counsel, representation for Federal Trade Commission (FTC) investigations, dental law defense lawyer, representation for dental law, representation for health care professionals, representation for dental clinics, health law defense lawyer, health defense attorney, legal representation for dentists, The Health Law Firm, reviews of The Health Law Firm Attorneys, The Health Law Firm attorney reviews, board of dentistry defense attorney, dental board defense legal counsel, representation for dentists, dentist defense lawyer

“The Health Law Firm” is a registered fictitious business name of and a registered service mark of The Health Law Firm, P.A., a Florida professional service corporation, since 1999.
Copyright © 2018 The Health Law Firm. All rights reserved.

Dentists File Lawsuits Against Supply Distributors Alleging Violations of Antitrust Statues

By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

Several dentists have joined together to file suits against leading dental supply distributors in New York and Texas federal courts alleging the companies jointly conspired to keep prices artificially inflated. Five lawsuits have been filed since Wednesday, January 20, 2016, against Patterson Cos. Inc. (Patterson), Henry Schein Inc. (Henry Schein) and Benco Dental Supply Co. (Benco). These companies are alleged to have control over 80 percent of the distribution channel for dental supplies. Among other allegations, lawsuits allege that the established dental supply distributors schemed to intimidate and squelch newer distributors that offer better (lower) prices in order to maintain exclusive control over the market.

Law360 reported that the suits seem to be partially triggered by a recent settlement reached with Benco announced by Texas Attorney General Ken Paxton, on April 10, 2015. The settlement cost Benco a good amount totaling $300,000, in order to avoid further participation in anticompetitive activities and instituted an antitrust training program for the company.

To read the Plaintiff’s Original Petition filed by the state of Texas against Benco, click here.

To read the full Agreed Final Judgement and Stipulated Injuction Between the State of Texas and Benco Dental Supply, click here.

To read the press release issued by the Texas Attorney General’s office, click here.

Alleged Antitrust Violations and Intimidation Tactics.

The lawsuits alleged that the three dominant distributor companies retained a firm grip on their dominance in the market by engaging in the intimidation of state dental associations. These associations were purportedly threatened by Patterson, Henry Shein and Benco in order to keep their prevalent supremacy in the supply of dental products. The associations were told that if they were to endorse startup distributors they would risk trade-show boycotts. Furthermore, the three established companies threatened to withhold their business if such manufacturers engaged in business with beginning distributors.

As stated by one class action suit filed by Dr. Keith Schwartz, D.M.D., P.A., in Texas federal court on Sunday, January 24, 2016, “At all relevant times Defendants possessed market power–the ability to profitably raise prices significantly above competitive levels while not losing sales […] Defendants abused their dominant collective market power by privately communicating and reaching an agreement to engage in an anticompetitive scheme to foreclose and impair competition, maintain and enhance market power, and artificially inflate prices of dental supplies above competitive levels.” The complaint further stated, “If new, low-cost distributors had not been unlawfully prevented from partnering with state dental associations and/or dental supplies manufacturers, they would have emerged as significant competitors.”

To read the complaint in the Texas federal suit, click here.

The complaints contain similar allegations, and all seek restitution on behalf of dentists suffering damages due to the alleged overcharging for supplies from the three monopolostic distributors since January 2012. More than 135,000 dental practices in the United States are said to be affected by the distributors’ alleged Sherman Act Violations. To read more about the Sherman Act from the Federal Trade Commission (FTC), click here. The complaints reported that investigations into one or more of the three distributors have already been initiated by the FTC.

State Regulatory Boards Have Recently Been in Hot Water Over Antitrust Laws As Well.

The North Carolina State Board of Dental Examiners recently went up against the FTC in a Supreme Court case decided on February 25, 2015. The Supreme Court justices were charged with determining whether professional regulatory boards should be exempt from federal antitrust laws and thus be allowed to eliminate low-cost competitors. Justice Kennedy concluded that immunity was not available because the Board was controlled by “active market participants” and their decision to block services was not “actively supervised” by the state.

To read my prior blog on this case, click here.

To read the full decision by the Supreme Court, click here.

Comments?

Are you currently being investigated by the FTC for possible antitrust violations?

Contact Health Law Attorneys Experienced in Representing Health Care Professionals and Providers.

At the Health Law Firm we provide legal services for all health care providers and professionals. This includes physicians, nurses, dentists, psychologists, psychiatrists, mental health counselors, Durable Medical Equipment suppliers, medical students and interns, hospitals, ambulatory surgical centers, pain management clinics, nursing homes, and any other health care provider. We represent facilities, individuals, groups and institutions in contracts, sales, mergers and acquisitions.

The lawyers of The Health Law Firm are experienced in both formal and informal administrative hearings and in representing physicians in investigations and at Board of Medicine and Board of Osteopathic Medicine hearings. We represent physicians accused of wrongdoing, in patient complaints and in Department of Health investigations.

To contact The Health Law Firm, please call (407) 331-6620 and visit our website at www.TheHealthLawFirm.com.

Sources:

Class Action Complaint 11:39 & 45, Jan. 24, 2016.

Overly, Jeff. “Dentists Pull Together to Sue Supply Distributors.” Law360. Portfolio Media Inc.: 25 Jan. 2016. Web. 26 Jan. 2016.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

KeyWords: dental class action suit, Sherman Act, antitrust violations defense attorney, Supreme Court antitrust decision, North Carolina dental regulatory board, Board of Dentistry, dentist lawyer, dental distributor companies, dental supplies, Board of Dental Examiners, Federal Trade Commission (FTC), federal atitrust lawyer, administrative law judge (ALJ), American Medical Association, suppression of competition, state board of medicine, state board of dentistry, American Dental Association, Federation of State Medical Boards, North Carolina Board of Dental Examiners v. FTC, federal antitrust laws, health defense attorney, health defense lawyer, legal representation for dentists, health law firm, The Health Law Firm

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