$575 Million California Healthcare Antitrust Settlement Approved By Judge

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  • California AG Rob Bonta and healthcare system Sutter Health (“Sutter”) gained the final approval of a California state judge for their settlement agreement, which resolves allegations that Sutter employed anticompetitive practices in violation of California’s Cartwright Act.
  • The complaint alleged, among other things, that Sutter, which is the largest hospital system in Northern California, intentionally concentrated power in the healthcare market and used its power to force vendors to enter into anticompetitive and unduly restrictive healthcare provider agreements that ultimately raised prices for consumers.
  • Under the terms of the final approval order and judgment, which concurrently resolve allegations brought by the United Food and Commercial Workers and Employers Benefit Trust, class action plaintiffs, and the AG’s office, Sutter will pay $575 million in compensation and litigations costs, including approximately $164 million for attorneys’ fees and $21 million for attorneys’ costs. In addition, Sutter agreed to increase transparency about pricing, quality, and costs of its services, stop anticompetitive contracting practices and bundling of services and products, and cooperate with a court-approved compliance monitor who will ensure compliance with the terms of the settlement for a period of at least ten years, among other things.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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