NEW ORLEANS — LCMC Health’s lawsuit against the Federal Trade Commission’s decision to halt the Tulane University-LCMC purchase will now be heard by a federal judge in New Orleans instead of a judge in Washington D.C.
A federal judge in Washington D.C. ruled that because the case regards an issue in Louisiana, it should be handled by the federal judges in that state.
LCMC Health says they support the decision to move the case out of Washington and into a federal courthouse in Louisiana.
“We wholeheartedly agree with the court’s action to transfer this to Louisiana, and we support the decision that the merits of our partnership with Tulane University will be considered in our own community. We remain steadfast that the LCMC Health – Tulane University partnership is of significant benefit to our community and region, bringing another academic center of excellence to the region and enhancing patient care for all,” the health system said in a statement released Thursday.
The lawsuit was filed after federal regulators challenged the hospital system's purchase of three Tulane regional hospitals.
FTC regulators say the purchase was supposed to go through a federal review process for any potential violations of federal anti-trust law. The FTC also wants the hospital system to pay nearly $9 million in fines for not undergoing that federal review process.
However, LCMC says it did not have to seek federal approval under Louisiana law.
Six hospital associations, which include the Louisiana Hospital Association, Federation of American Hospitals, and American Hospital Association, weighed in and urged the FTC to abandon its opposition to LCMC Health’s partnership with Tulane University.
“This is extraordinary. Never before has the Commission attempted to enforce HSR against a state-controlled merger or acquisition. Nor has any court ever held that Hart-Scott-Rodino Act applies to such transactions. This action disregards Supreme Court precedent holding that “state action or official action directed by a state” is exempt from the federal antitrust laws,” the hospital associations said in a letter to FTC chairperson Lina Kahn.
Louisiana Attorney General Jeff Landry also supports the purchase deal. He filed court documents saying that federal approval of the deal is not necessary because Louisiana law gives state leaders the authority to review and approve hospital consolidations.
If the deal were allowed to go through, the Tulane-LCMC purchase would have transferred ownership of Tulane University Medical Center downtown, Tulane Lakeside Hospital in Metairie, and Lakeview Regional Medical Center in Covington to LCMC.
It would also relocate the majority of Tulane's medical residents and patients to East Jefferson General Hospital in Metairie.
As part of the acquisition, the majority of the services at Tulane's downtown hospital will move to East Jefferson General Hospital and University Medical Center.
The deal also would see LCMC invest $220 million in East Jefferson, Tulane Lakeside hospitals, and Lakeview Regional.
Tulane would also commit $600 million to repurpose Tulane's downtown medical center, which includes Charity Hospital, into a new nursing program facility, and dormitories for Tulane's medical students.
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