Steward Health Care Sys., LLC v. Blue Cross & Blue Shield R.I.
Docket: C.A. No. 13–405 WES
Court: District Court, D. Rhode Island; April 23, 2018; Federal District Court
Plaintiffs Steward Health Care System, LLC, and its affiliated entities are engaged in an antitrust lawsuit against Defendant Blue Cross and Blue Shield of Rhode Island. Steward alleges that Blue Cross unlawfully obstructed its entry into the Rhode Island health care and insurance markets by hindering its efforts to acquire Landmark Medical Center, a failing community hospital in receivership. The case is described as complex, with the court noting the confused state of antitrust law relevant to the claims. After thorough review, the court has determined that a trial is necessary for all counts of Steward's Amended Complaint, resulting in the denial of Blue Cross's Motion for Summary Judgment.
Landmark Medical Center, operational since 1988, entered receivership in 2008 due to financial difficulties and was overseen by a court-appointed Special Master, Jonathan Savage. During the receivership, Savage solicited bids from various hospital systems, including Steward and Lifespan, which had expressed interest in acquiring Landmark even as early as 1996. In 2009, a plan developed by Maria Montanaro, CEO of Thundermist Health Center, proposed reducing Landmark's services primarily to urgent and outpatient care, reflecting the belief that sustaining the hospital's acute care services was not feasible given its financial and operational challenges.
Steward is a for-profit hospital system operating multiple hospitals in Massachusetts, which contracts with health insurance companies on a per-member-per-month (PMPM) basis, adopting a risk-based model that involves shared financial responsibility for patient care. Successful collaboration between Steward and health insurers requires a constructive working relationship, including sharing healthcare data and developing strategies to reduce total medical expenses (TME) while improving care quality. Steward aims to establish a new healthcare model in Rhode Island, focusing on community-based care, quality improvement, and negotiating lower premiums through an integrated provider network. In exchange for participating in a narrower network, Steward is willing to accept lower reimbursement rates.
Steward's long-term ambitions include acquiring additional hospitals in Rhode Island, prompting them to seek amendments to state legislation that would facilitate quicker hospital acquisitions. In August 2010, Steward's predecessor, Caritas, submitted a bid to acquire Landmark hospital, contingent upon securing a contract with Blue Cross, which ultimately led to the bid's withdrawal due to inadequate partnerships and unsuccessful negotiations regarding reimbursement rates. In May 2011, Steward submitted a revised bid, proposing an Asset Purchase Agreement (APA) that underwent multiple amendments, primarily extending closing deadlines. Not all significant matters were expressly included in the APA, and Steward viewed many conditions as negotiable rather than strictly binding, continuing its pursuit of the acquisition despite challenges in meeting certain conditions.
In March 2012, the APA included conditions for Steward's acquisition of Rhode Island Specialty Hospital (RISH), a Memorandum of Understanding (MOU) with Thundermist, and an agreement to purchase 21st Century Oncology's interest in the Southern New England Regional Cancer Center (SNERCC). Steward indicated a willingness to waive the Thundermist and SNERCC conditions if necessary to successfully acquire Landmark. A crucial factor in this acquisition was reaching an agreement with Blue Cross on reimbursement rates, as these rates constituted the primary income source for Landmark.
From September 2011 to September 2012, Steward and Blue Cross engaged in extensive negotiations over reimbursement rates, during which Steward perceived Blue Cross as regressing. Blue Cross's proposed quality targets were deemed unrealistic by Steward, which led to frustration, especially since Blue Cross had previously modified targets for other providers. The Rhode Island Attorney General informed Steward that Blue Cross was not supportive of its business operations in the state. Steward proposed alternative quality metrics focusing on year-over-year improvements at Landmark but faced consistent rejection from Blue Cross.
The relationship with Blue Cross was vital for Steward's operational model, and an agreement with them was informally recognized as essential for the Landmark acquisition. Negotiations reached a breaking point on August 6, 2012, when Steward's team walked away due to perceived obstinacy from Blue Cross, which caused significant backlash from stakeholders. However, following some intervention, the parties resumed discussions. On September 4, 2012, Steward proposed two routes to finalize the acquisition: one required satisfying all conditions regardless of a Blue Cross agreement, and the other required a Blue Cross agreement while waiving certain conditions. A final mediation session on September 12, 2012, ultimately did not yield a resolution.
Steward announced its withdrawal from the Landmark bid on September 27, 2012, citing unmet conditions outlined in the Asset Purchase Agreement that had been accepted by the Court. Despite proposing an alternative path that waived two conditions, this was also not fulfilled. The financial disparity between Steward's and Blue Cross's rate proposals was approximately $3 million.
Blue Cross's "Red Team," led by CFO Michael Hudson, was organized in July 2012 to assess competitive threats, including the emergence of Accountable Care Organizations (ACOs) as potential competitors. Linda Winfrey, an Assistant Vice President, identified ACOs as significant threats to Blue Cross's market share and long-term viability, highlighting their potential to disrupt traditional insurance functions. The Red Team's analysis indicated that Steward was strategically positioned to threaten Blue Cross's operations in Rhode Island, particularly if they succeeded in integrating services that could render traditional insurers redundant.
Blue Cross executives expressed concerns regarding "disintermediation," where providers could assume payer roles, posing existential risks to the insurance industry. This was a common topic of discussion among health insurance executives during that period, indicating a widespread recognition of the challenges posed by evolving healthcare delivery models.
The Red Team evaluated possible scenarios involving Prime's entry into Rhode Island. Under the twelfth amendment of Landmark's Hospital Participation Agreement with Blue Cross, the contract was set to expire on July 16, 2012. As negotiations stalled, Blue Cross submitted a material modification application to the Rhode Island Department of Health (DOH) on May 21, 2012, which included draft notifications to subscribers and providers indicating that Landmark could go "out of network." The DOH advised Blue Cross to issue revised notifications to inform members that they could continue receiving services at in-network rates until the review was completed.
This request created significant concern among stakeholders. On July 2, 2012, Special Master Savage sought a temporary restraining order to prevent Blue Cross from declaring Landmark out of network. The Superior Court denied the TRO, and on July 9, Blue Cross informed subscribers and providers about the potential change. The contract officially terminated on July 16, 2012, after which Blue Cross compensated subscribers directly for services at Landmark until a new agreement was reached. Landmark remained out of network until August 31, 2012, when Blue Cross and Landmark extended their contract terms following a court-approved settlement.
Blue Cross's contracting group assessed the risks associated with not renewing contracts with community hospitals, including the financial implications of forcing subscribers to more expensive hospitals. It was acknowledged that removing Landmark could lead to its closure. Steward argued, accepted by the Court for this motion, that Blue Cross was aware the material modification process typically lasted 4-6 months and that being out of contract with Landmark before DOH approval would result in an estimated loss of $3 million per month for Blue Cross.
Blue Cross faced significant costs in removing Landmark from its network, which were deemed higher than the reimbursement rate increases sought by Steward. Despite the financial risks associated with their decision, Blue Cross decided to maintain its stance after filing a material modification. Blue Cross's CFO, Mike Hudson, indicated that further negotiations with Steward would only occur once Landmark accepted their terms, which could potentially eliminate Steward's involvement. After Steward withdrew, Prime submitted a proposal for Landmark, leading to its acquisition on December 31, 2013. The agreement with Prime included a quality evaluation based on Landmark's past performance rather than national averages, a condition that Blue Cross rejected when negotiating with Steward. Although Prime improved Landmark's patient volume and revenue, there is contention over whether it enhanced efficiency and innovation, as operating expenses rose significantly, and Prime failed to develop an accountable care organization or risk-based contracts.
Steward initiated legal action against Blue Cross on June 4, 2013, alleging violations of the Sherman Act and the Rhode Island Antitrust Act. Blue Cross's motion to dismiss was denied in February 2014. Following the start of discovery, Steward amended its complaint on August 26, 2015, to include claims that Blue Cross conspired with Lifespan and Thundermist to exclude Steward from the Rhode Island market.
On July 14, 2017, Blue Cross filed a motion for summary judgment against all counts of Steward's amended complaint. Steward opposed this motion on August 11, 2017, and Blue Cross replied on August 25, 2017. Oral arguments were held on September 26, 2017. As the trial date in January 2018 approached, the Court issued a notice on November 29, 2017, tentatively deciding to grant Blue Cross's motion for summary judgment, which led to the cancellation of the trial date. However, the Court's view on the motion evolved, resulting in a forthcoming Opinion and Order denying the summary judgment.
The legal standard for summary judgment requires the moving party to show that there are no genuine disputes regarding material facts and that they are entitled to judgment as a matter of law. The Court must consider the entire record and draw reasonable inferences in favor of the non-moving party, who must then point out specific facts that demonstrate a trial-worthy issue. The non-moving party cannot rely solely on allegations or denials but must present substantive evidence.
The excerpt also highlights the complexities surrounding the "refusal-to-deal" claims under Section 2 of the Sherman Act. It references historical commentary on the ambiguous nature of monopolist duties to deal and emphasizes the need for the Court to determine whether Steward has raised a triable issue regarding Blue Cross’s alleged predatory refusal to deal, particularly in blocking Steward from entering the Rhode Island health care and insurance markets.
The Court determined that Blue Cross's motion for summary judgment must be denied after a thorough examination of case law, factual circumstances, and antitrust policy goals. Under Section 2 of the Sherman Act, monopolization is defined by two key elements: 1) possession of monopoly power in a relevant market, and 2) willful acquisition or maintenance of that power, distinct from mere growth due to superior product offerings or business acumen. The right of traders to refuse dealings is acknowledged, but is not absolute; under certain conditions, such refusals can constitute anticompetitive behavior. Notable cases include Aspen Skiing and Trinko. In Aspen Skiing, the Court found that the defendant's termination of a joint ski pass with the plaintiff was driven by a desire to harm competition rather than efficiency, supporting a jury's verdict for the plaintiff. Conversely, in Trinko, although Verizon's actions against competitors were scrutinized, the Court distinguished this case from Aspen Skiing, noting that Verizon was regulated under the Telecommunications Act, and the claims of discriminatory practices did not meet the antitrust violation threshold established in Aspen Skiing.
The Court determined that the circumstances in Trinko were not analogous to those in Aspen Skiing. It highlighted that in Aspen Skiing, the defendant's choice to withdraw from a cooperative arrangement was significant, as it indicated a willingness to sacrifice short-term profits for an anticompetitive goal. The defendant's refusal to renew the ticket, even for retail compensation, further demonstrated an anticompetitive motive. Both cases inform the framework for refusal-to-deal claims, but neither prescribes specific factual elements necessary for such claims to proceed. The Supreme Court emphasized that these cases illustrate potential exclusionary conduct rather than providing a strict formula. The Court characterized Aspen Skiing as a key example of unlawful refusals to deal, rather than a definitive checklist. Antitrust evaluations must consider the unique dynamics of the relevant industry. Misinterpretations and rigid applications of Aspen Skiing and Trinko by appellate courts have led to confusion, particularly regarding the necessity of an established prior course of dealing. Courts like Novell and In re Elevator Antitrust Litigation have incorrectly interpreted Trinko as mandating a prior voluntary course of dealing for valid refusal-to-deal claims, reinforcing the notion that unilateral termination of such a course is a requisite element.
Aspen Skiing and Trinko do not support the interpretations suggested by some courts regarding refusal-to-deal claims. The Supreme Court is seen as the appropriate authority to address potential antitrust policy adjustments. Until that occurs, Aspen Skiing and Trinko should be applied as they are, aligned with the First Circuit's approach. The First Circuit has not directly interpreted Trinko but has provided insights on Aspen Skiing, particularly in Data General Corp. v. Grumman Sys. Support Corp., which emphasized the absence of a single rule for determining when a monopolist's refusal to deal is unlawful. The court noted that such refusals could occur in diverse contexts and highlighted that the focus of refusal-to-deal law is on competitive harm without valid business justifications.
In cases like Helicopter Transp. Servs. Inc. v. Erickson Air-Crane Inc., the termination of dealings was considered circumstantial evidence of anti-competitive intent, even in the absence of a pre-existing course of dealing. The Supreme Court has not mandated that such a previous relationship is essential for an antitrust claim; it was simply one factor contributing to findings of exclusionary intent. The court must determine whether there is a genuine factual dispute regarding whether Blue Cross's conduct towards Steward constitutes illegal exclusionary behavior or lawful competition. Following the framework set out in Data General, a plaintiff must establish a prima facie case showing that a monopolist's refusal to deal harms competition. If successful, the monopolist can counter with valid business justifications that enhance consumer welfare, distinguishing legitimate competitive motives from those aimed at maintaining monopoly power or preventing competition.
Blue Cross's argument for summary judgment does not align with the Data General burden-shifting framework, focusing primarily on Steward's prima facie case while intermittently introducing legitimate business reasons for its actions. The Court opts to analyze the arguments presented by Blue Cross rather than adhere strictly to the Data General model. Steward has successfully met its prima facie burden, effectively rebutting Blue Cross's claims of legitimate business reasons. The cases of Aspen Skiing and Trinko offer relevant insights into determining whether Blue Cross's actions constituted an anticompetitive refusal to deal, though the specific indicators of anticompetitive animus differ due to the distinct nature of the healthcare market compared to those in the cited cases.
Steward presents substantial evidence suggesting Blue Cross engaged in exclusionary conduct aimed at monopolizing the relevant markets by preventing Steward's entry into Rhode Island. Notably, evidence indicates that Blue Cross terminated a longstanding and presumably profitable relationship with Landmark to obstruct Steward's acquisition efforts. Blue Cross allowed its contract with Landmark to lapse on July 16, 2012, amidst contentious negotiations with Steward. Furthermore, while seeking approval from the Department of Health (DOH) for a "material modification" to remove Landmark from its network, Blue Cross notified subscribers on July 9, 2012, that Landmark's contract would expire shortly thereafter, signaling a clear intention to exclude Steward from the market.
Blue Cross communicated to its members that a resolution to their ongoing issue was unlikely, marking a significant event as it was the first time the organization had informed doctors and subscribers about a hospital's imminent removal from its network. This action, along with allowing a hospital to go "out of network," was unprecedented. The implications of Blue Cross's decision were substantial enough that the Special Master sought to prevent the notification and extend Blue Cross's contract with Landmark Medical Center. On July 2, 2012, the Special Master filed for an emergency temporary restraining order (TRO), arguing that Blue Cross's notification to subscribers regarding Landmark's potential out-of-network status was premature and misleading, considering the regulatory hurdles Blue Cross faced to obtain necessary approvals.
The Special Master emphasized the chaos that could ensue from such notifications, suggesting that Blue Cross's actions diverged from its usual practices with Landmark or any other hospital. It could be inferred that Blue Cross's aggressive stance towards Landmark was not merely a business decision but intended to undermine the acquisition efforts by Steward Health. Blue Cross acknowledged challenges in negotiating a fair rate with Steward and indicated that if an agreement was not reached by July 16, 2012, Landmark would become nonparticipating in their network. Landmark remained out of network until August 31, 2012, when a settlement was reached to extend the terms of its participation contract until a buyer was found, with the Special Master agreeing to the terms due to the deteriorating financial condition of Landmark.
The Special Master expressed concern for the survival of Landmark and RHRI, stating he had no choice but to sign the MOU under Blue Cross's terms, which he described as a complete capitulation. Blue Cross was aware of the implications of its demands on Steward and its negotiations. Landmark sought judicial intervention to have payments redirected to them instead of the members, showing readiness to accept prior rates. Blue Cross's CFO indicated that if Landmark agreed to the contract, it would likely disadvantage Steward. Evidence suggests Blue Cross prioritized eliminating potential competition from Steward over short-term profits. In a June 2012 assessment, Blue Cross identified risks associated with failing to renew contracts with community hospitals, including financial exposure from non-participation and increased costs from patients seeking care at higher-cost facilities. Landmark was recognized as financially vulnerable, with Blue Cross estimating that its closure would cost $9.8 million, surpassing the $5.4 million loss projected if Blue Cross accepted Steward's proposed rate increases. Landmark received the highest risk assessment score in terms of financial impact among four hospitals reviewed, prompting Blue Cross to consider additional rate increases for the other hospitals to keep them in network.
Blue Cross identified the risk of losing its contract with Landmark but chose to maintain its position despite this risk. It has previously used material modification filings as leverage in negotiations with hospitals, typically resolving issues without terminating contracts. Evidence suggests that Blue Cross may have prioritized long-term strategic goals—specifically, preventing Steward from entering the Rhode Island market—over short-term profits by allowing the Landmark contract to lapse. Steward's experts support this assertion, indicating that rejecting Steward's offers imposed financial costs on Blue Cross. Steward argues that Blue Cross engaged in bad-faith negotiations by consistently offering reimbursement rates lower than those paid to other Rhode Island hospitals. A 2010 OHIC study showed Landmark's rates were significantly lower than average, and Steward's highest proposed rate for Landmark was only 95% of what Blue Cross paid on average, along with a potential quality-based increase, which constituted a substantial rate hike. This situation has led to factual disputes regarding Blue Cross's negotiation practices and its refusal to deal with Steward.
Steward has provided evidence indicating that it proposed reimbursement rates for Landmark lower than those paid by Blue Cross to other hospitals. Blue Cross contends that its offered rates to Steward at Landmark were higher than those for similar hospitals. However, the court is not required to accept Blue Cross's assertions regarding appropriate hospital comparisons at the summary judgment stage. Blue Cross's argument is inconsistent; it initially identifies specific hospitals for comparison but later claims that hospital services are too varied for meaningful comparison. Furthermore, Blue Cross's own evidence suggests it compared Landmark to other hospitals that received more favorable reimbursement rates, which could affect patient retention upon Landmark's closure.
At trial, both parties will argue over which hospitals should be compared for reimbursement rate increases. While Blue Cross argues that Steward's departure from negotiations indicates a lack of refusal to deal, the court clarifies that if Blue Cross made an offer it knew was unacceptable, this constitutes a refusal to deal. The court notes that Blue Cross's belief in its good faith efforts does not negate the evidence suggesting it imposed unreasonable terms during negotiations, including unattainable quality metrics. Steward asserts that Blue Cross's counter-proposals regressed during negotiations, effectively forcing Steward to negotiate against itself.
Steward references comments from Andruszkiewicz in a 2012 article suggesting that Blue Cross may launch a "limited-network" product excluding certain hospitals, potentially including Landmark. Steward also cites an email from Mark Hudson of Blue Cross to Mark Rich of Steward, where Hudson confirms Rich's insistence that Landmark be included in all BCBSRI products, even those with limited or tiered networks. Hudson warns that granting preferred status to non-participating providers could compromise the quality of tiered products. A jury will determine whether Blue Cross acted in bad faith or if its actions were legitimate business practices. Blue Cross contends that Steward's claim requires the Court to impose an unprecedented antitrust duty on a state-regulated insurer to purchase hospital services. Blue Cross argues that recognizing Steward's claim would require the Court to assume a regulatory role that could disrupt the balance maintained by the Office of Health Insurance Commissioner (OHIC) and Blue Cross in fulfilling their public interest mandates. However, it is asserted that the law does not impose specific reimbursement terms on Blue Cross but mandates fair competition and prohibits practices aimed at blocking competition to maintain a monopoly. To enforce this duty, the Court, or a jury, must evaluate the actions of the parties within the relevant market context. If the jury sides with Steward, it will address the damages incurred. Blue Cross's concerns regarding OHIC regulations and the balance they maintain are characterized as overstated, especially when compared to the regulatory environment discussed in the Supreme Court case Trinko, which involved more comprehensive regulatory obligations than those applicable in this case.
The competitive checklist referenced includes a requirement for non-discriminatory access to unbundled network elements (UNEs), a feature absent in the Rhode Island Office of Health Insurance Commissioner's (OHIC) regulatory framework. The OHIC primarily functions as a rate-setting body, ensuring annual rate increases are justifiable and approved, but it does not regulate healthcare providers or their pricing. Former OHIC Commissioner Chris Koller clarified that the office lacks jurisdiction over hospitals, thus failing to establish a regulatory framework aimed at preventing anti-competitive behavior as outlined in the Trinko case. Consequently, Steward's claims of unlawful monopolization and monopsonization withstand summary judgment, leading to the denial of Blue Cross's motion for summary judgment on these counts.
Regarding conspiracy claims under the Sherman Act, Section 1 prohibits contracts or conspiracies that restrain trade. A conspiracy is defined as two or more entities acting together for mutual benefit rather than pursuing independent interests. At the summary judgment stage, evidence must eliminate the possibility of independent actions by defendants. The Supreme Court permits only limited inferences from ambiguous evidence, stating that parallel conduct consistent with competition does not imply an illegal conspiracy. A jury may consider evidence suggesting coordinated behavior unlikely to occur by chance or independent actions.
Steward's case is built on circumstantial evidence, necessitating the use of "plus factors" as indirect indicators of an agreement, as established in Evergreen Partnering Group, Inc. v. Pactiv Corp. and In re Flat Glass Antitrust Litigation. Plus-factor evidence serves to suggest a conspiracy and must demonstrate that defendants were not acting independently. The First Circuit recognizes three key Section 1 plus factors: 1) motive for engaging in an antitrust conspiracy; 2) actions contrary to the defendant's interests; and 3) evidence implying a traditional conspiracy. Statements of parallel conduct require additional factual context to establish a plausible claim. The third plus factor involves non-economic evidence that indicates a manifest agreement not to compete, which can include circumstantial proof of coordinated actions among defendants without explicit meetings or documentation.
Blue Cross contends that establishing an illicit agreement necessitates explicit evidence of mutual intent, which is inaccurate; a tacit understanding suffices. The government only needs to show that defendants had a tacit understanding based on a consistent pattern of conduct. Furthermore, a conspiracy can be inferred from evidence indicating a shared purpose or common plan among participants. Courts have affirmed that conspiracies are typically proven through inferences from circumstantial evidence, including defendants' behaviors. Additionally, the Supreme Court has clarified that the evidence should be evaluated collectively rather than dissecting individual pieces, allowing for reasonable inferences based on the overall context.
Plaintiffs are entitled to present their evidence holistically rather than in isolated parts, as the nature of a conspiracy must be assessed as a whole. Individual allegations may not alone imply an agreement, but collectively they can establish a plausible basis for conspiracy claims. The Court identifies substantial evidence suggesting that the actions of Blue Cross, Lifespan, and Thundermist indicate a coordinated effort to obstruct Steward's entry into Rhode Island's healthcare market.
Four main episodes highlight this conspiracy: 1) the "treat-and-transfer" plan developed by Lifespan and Thundermist with Blue Cross's support to undermine Steward's acquisition of Landmark; 2) Lifespan's rate concessions to Blue Cross for increased patient volume; 3) Thundermist's strategic shift of obstetric patients; and 4) Thundermist's rejection of a memorandum of understanding with Steward. Evidence indicates that the treat-and-transfer model, introduced by Thundermist's CEO in 2009 as a response to concerns about Landmark's potential affiliation with Caritas Christi, aimed to limit Landmark's operations. Discussions in 2010 between Caritas and Blue Cross further reflect Blue Cross's intention to play a more active role in Landmark's future, suggesting complicity in the conspiracy against Steward.
Purcell communicated with Lifespan and Thundermist regarding their response to the Caritas proposal, planning a meeting with Justice Silverstein to discuss the treat-and-transfer strategy. Montanaro and Vecchione noted the intent to send rejection letters to Caritas and the Special Master, with plans to request a meeting with the judge. Lifespan and Thundermist strategized on maintaining support from Blue Cross Blue Shield of Rhode Island (BCBSRI) for their proposed integrated service delivery model. Prior to the judicial meeting, BCBSRI conferred with Lifespan and Thundermist, where they discussed undermining Caritas's efforts to acquire Landmark and promoting treat-and-transfer as the preferred option. In 2012, BCBSRI’s CEO Andruszkiewicz and Lifespan’s CEO Vecchione evaluated the treat-and-transfer plan, believing Landmark would not be acquired by Steward. Montanaro, now a BCBSRI consultant, relayed Andruszkiewicz's belief that Steward would not succeed in Rhode Island, with Vecchione expressing confidence in Lifespan's potential acquisition of the hospital. A subsequent email from Lifespan’s new CEO Babineau detailed a meeting involving BCBSRI and Steward, where BCBSRI presented an offer within regulatory guidelines, and indicated Lifespan's willingness to re-engage with Landmark if Steward withdrew. The CFO emphasized that BCBSRI suggested alternatives to aggressive negotiations. The evidence collectively suggests a coordinated effort among Blue Cross, Lifespan, and Thundermist to prevent Steward's entry into the Rhode Island market through the treat-and-transfer model.
Steward highlights a connection between Lifespan's rate concessions to Blue Cross and a potential increase in patient volume, likely sourced from Landmark. While Thundermist is not implicated, evidence shows Lifespan had been demanding rate increases over six percent but agreed to lower demands in exchange for more patients from Blue Cross. Lifespan indicated it would only consider substantial rate reductions if Blue Cross could deliver additional service volume.
Steward points out that Blue Cross could fulfill this need by directing patients from Landmark, as Lifespan stood to gain significantly from Landmark's decline. Blue Cross's documents revealed that the loss of Landmark would lead to an influx of patients to Lifespan hospitals, with predictions suggesting nearly 45% of former Landmark patients would switch to Lifespan facilities. Lifespan anticipated substantial financial benefits if Landmark failed and foreseen losses if Steward acquired Landmark.
Additionally, a June 2012 analysis by Blue Cross indicated that failing to renew contracts with community hospitals like Landmark would increase costs due to patients moving to pricier hospitals. Blue Cross recommended engaging Lifespan to develop a long-term plan for service capacity at preferable payment levels. An update later confirmed ongoing discussions with Lifespan to address potential service migration and adjust payment levels accordingly. Notably, in September 2012, as negotiations with Steward deteriorated, Lifespan unexpectedly reduced its rate demands to 4.8% for commercial contracts, resulting in a $12 million savings for Blue Cross, contrasting sharply with earlier contentious negotiations.
Total savings or losses regarding Lifespan amount to $11,862,139, as noted in SAUF Ex. 80. In contrast, SAUF Ex. 81 reveals an email from Blue Cross CFO Coleman indicating that Blue Cross of Rhode Island (BCBSRI) nearly met Lifespan's request for an additional $24 million in revenue during the 2011 negotiations. Evidence suggests that Blue Cross obtained rate concessions from Lifespan in return for increased patient volume sourced from Landmark, particularly after Steward was excluded.
Steward's conspiracy claim implicates Thundermist, asserting that its decisions to redirect obstetric (OB) patient referrals from Landmark to Women & Infants Hospital in 2011, and its refusal to sign a Memorandum of Understanding (MOU) with Steward, were driven by exclusionary motives. A reasonable juror might view the shift of OB patients as part of a broader strategy to exclude Steward. In November 2011, Thundermist's representative sought Lifespan's public support for their healthcare vision in Northern Rhode Island amidst concerns about Steward's potential exit. The need for Lifespan's backing indicates a calculated move to justify patient shifts while anticipating criticism from Steward.
Despite Thundermist's patients being redirected to a competitor, Lifespan agreed to pay Thundermist $150,000 annually, compensating for the loss of payments from Landmark set to cease with the termination of their arrangement. Thundermist's Jones claimed this financial support was meant to foster integrated care networks, while Lifespan's George Vecchione framed it as an investment rather than merely compensatory. The continuity of this payment over six years, alongside unclear explanations from both parties, raises suspicions of Blue Cross exerting significant control over the arrangement.
Lifespan provided two grants, one to Thundermist and another to Providence Health, but did not monitor how Thundermist utilized the $150,000 grant. CEO Jones confirmed that there were no specific conditions attached, and Thundermist's obligations remained unchanged, primarily to continue providing charity care without new demands from Lifespan. Reporting to Lifespan regarding the grant’s use was not required, and Jones acknowledged no reporting was conducted. Lifespan CEO Vecchione similarly indicated a lack of knowledge about how Thundermist allocated the funds, stating that part of the grant process did not involve follow-up on the recipient's spending.
Initially, Lifespan’s grant was integrated into a Partnership Model with Thundermist, but it was later included in a different, undisclosed "Public Health Grant Agreement.” Additionally, Jones expressed concerns about Thundermist's future interactions with Steward, especially regarding obstetric (OB) patients. He feared that if Steward remained involved, it could complicate Thundermist's independent decision-making, particularly in patient care.
Jones also sought support from Blue Cross to back his decision regarding patient shifts and planned to coordinate a meeting between Blue Cross representatives and Lifespan to ensure consistent communication. Montanaro, a former Thundermist CEO and future Blue Cross consultant, suggested to Jones that Thundermist should withdraw from the Landmark situation.
Jones sought support to proceed with a transition, which Blue Cross provided. Chuck felt reassured by a prior conversation with Peter. A reasonable juror might infer that Thundermist’s decision to shift OB patients from Landmark to Women and receive payment from Lifespan was part of a strategy to exclude Steward from Rhode Island. Notably, Thundermist abruptly rejected a Memorandum of Understanding (MOU) with Steward during discussions about patient transfers and shifting. Jones had been negotiating an MOU with Steward that included patient referrals and exclusivity agreements. Despite various proposals exchanged, on May 11, 2012, Jones informed Steward he would not pursue the agreement, even rejecting a proposal he had initiated. His decision was influenced by discussions with multiple health leaders, especially Peter from Blue Cross, demonstrating Blue Cross's significant impact on his approach to the MOU with Steward. Jones articulated that signing the MOU would mean relinquishing participation with an organization having a 70% market share, referring to Blue Cross. After his meeting with Steward, Jones strategized his public communications to avoid implying any potential for an agreement with Steward, indicating that his partners, particularly Blue Cross, were instrumental in preparing him for these discussions.
Billing was unnecessary as the speaker was funded by BCBS, who expressed high regard for the recipient and supported their involvement. Positive feedback was given for the recipient's performance during a meeting at BCBS, which was hosted by Peter Andruszkiewicz. Discussions included concerns about Steward’s diminishing influence, with a proposed letter drafted to encourage resistance against Steward. The recipient, Jones, was advised on the necessity for Thundermist to take sides as affiliations with payers and certain hospitals evolve. Jones’s refusal to sign a Steward MOU indicated alignment with Blue Cross and Lifespan to exclude Steward from Rhode Island. Evidence suggests possible conspiracy, as traditional indicators such as conversations and exchanges among parties point to collusion rather than independent action. Consequently, Blue Cross's motion to dismiss Steward’s conspiracy claims should be denied.
The document outlines the legal framework under the Sherman Act, distinguishing between Section 1, which prohibits conspiracies that restrain trade, and Section 2, which addresses monopolization. Blue Cross’s argument for summary judgment hinges on the absence of an unlawful agreement, but the Court maintains that a reasonable juror could infer such an agreement based on the evidence presented. The elements required to prove a conspiracy differ between Sections 1 and 2.
Blue Cross, as the movant, has not adequately addressed the substantive distinctions in Steward's claims, particularly failing to challenge the specific intent required for Steward's Section 2 conspiracy claim regarding monopolistic practices with Lifespan and Thundermist. The determination of specific intent, rather than merely the ability to exclude competitors, is crucial for a conspiracy to monopolize claim, as highlighted in relevant case law. Although Steward has presented limited evidence for the claims against Blue Cross, the absence of a direct rebuttal to the conspiracy allegations means these claims survive the summary judgment phase. Consequently, summary judgment is denied on Counts III, VII, XI, and XV.
In regards to Steward's state-law tort claims (Counts XVII and XVIII), Blue Cross argues that non-violation of antitrust laws equates to non-tortious conduct. However, with the viability of Steward's antitrust claims established, the state-law tort claims also survive summary judgment.
Blue Cross presents additional arguments for its summary judgment motion, all of which are unsuccessful. Notably, Blue Cross claims that other factors, such as Steward's failure to meet APA conditions and regulatory constraints on its rates, are responsible for Steward's injuries. To establish causation under the Sherman Act, a plaintiff must show that the injury was a material result of the defendant's anticompetitive conduct, rather than solely attributable to independent factors. The law acknowledges that if an injury results from other independent factors, the plaintiff has not met their burden of proof. Antitrust laws incorporate common law principles of causation, as previously indicated by the court.
Contingencies, conjecture, and speculation cannot establish proximate cause or antitrust liability. Steward has provided sufficient evidence to warrant a jury's consideration regarding causation, particularly concerning whether the failure to reach an agreement with Blue Cross led to Steward abandoning negotiations for Landmark. Key evidence includes testimony from Steward witnesses and the actions of both Steward and other involved parties.
Blue Cross contends that factors beyond the alleged antitrust violation explain Steward's purported injury, specifically citing three conditions from the Asset Purchase Agreement (APA) that Steward failed to meet: the RISH condition (100% purchase of RISH), the Thundermist condition (a Memorandum of Understanding with Thundermist), and the SNERCC condition (majority interest in SNERCC owned by 21st Century). Steward challenges the necessity of these conditions, suggesting they may have been negotiating tools rather than strict requirements.
Testimony from Steward’s representatives indicates that securing a deal with Blue Cross was the primary condition for success, overshadowing the other conditions. For example, Ralph de la Torre stated that Blue Cross was the only essential factor in their negotiations, while Joshua Putter emphasized that the cancer center was not a decisive factor in abandoning the Landmark deal, which was primarily influenced by Blue Cross's rates.
Additionally, Steward presented a letter indicating a willingness to waive the RISH and Thundermist conditions if a participation agreement with Blue Cross could be executed, and de la Torre confirmed that Steward expressed openness to waiving the SNERCC condition as well, reflecting their flexibility in negotiations.
Steward presents adequate evidence to create a jury question regarding Blue Cross's claim that OHIC regulations limited what Blue Cross could offer, leading to Steward's alleged injury. The OHIC regulations and related communications contradict Blue Cross's strict interpretation. Notably, Blue Cross acknowledges that OHIC has previously granted waivers under specific conditions, but argues that Steward did not discuss these exceptions with OHIC—a point that does not negate Steward's assertion that Blue Cross bore the responsibility to raise such issues. Evidence indicates that insurers are encouraged to seek exceptions and that OHIC regulates insurers rather than hospitals.
Additionally, Steward suggested a "bundling" strategy for reimbursement agreements involving multiple hospitals, which Blue Cross acknowledged as a potentially viable approach that could comply with OHIC regulations. This further challenges Blue Cross's argument that the other major insurers in Rhode Island considered OHIC regulations to be strictly binding. Steward's evidence suggests that compliance was not absolute, as indicated by instances where other insurers, like Tufts, exceeded OHIC caps.
The determination of the impact of OHIC regulations on negotiations and whether they contributed to Steward's alleged injury is a factual matter for the jury, rather than a legal interpretation reserved for the court. Steward ultimately carries the burden of proof at trial regarding the causation of its failed acquisition of Landmark in the context of an alleged Sherman Act injury.
The determination of whether the defendants' actions were a substantial cause of the plaintiff’s claimed losses is a factual issue for the jury. Blue Cross seeks summary judgment, asserting a lack of evidence showing its conduct harmed competition. It argues that replacing one potential buyer (Steward) with another actual buyer (Prime) is not significant under antitrust laws, and that Prime's acquisition of Landmark benefits consumers because it charges lower prices than Steward would have. However, the argument is flawed; evidence of actual competition is not required to establish a jury question on harm to competition, as long as there is potential for competition.
The Sullivan case illustrates this point, where the NFL was found to have harmed competition by preventing team owners from offering public stock sales. The NFL's argument for inadequate evidence of harm relied on a narrow view of competition, suggesting that reducing ownership prices did not equate to injury. The court rejected this perspective, emphasizing that consumer preferences in determining output and prices are crucial in assessing competition injury. It noted that the NFL's policy made the market unresponsive to consumer demand for team ownership, allowing a jury to conclude that the policy harmed competition. Furthermore, the court indicated that it is challenging to provide direct evidence of competition when it is effectively prohibited. Blue Cross misinterprets the requirement to show harm to competition, failing to recognize that it is typically measured by more than just price and output; evidence of efficiency is relevant as well.
The case involves significant competition dynamics related to Steward's innovative health care delivery model, which Blue Cross perceives as a threat. Steward distinguishes its approach from that of Prime, arguing that the distinction impacts how potential harm to competition should be evaluated. Blue Cross's own assessments indicate that Steward introduced a novel and beneficial model to Rhode Island, which contrasts with traditional fee-for-service methods. Observations from various stakeholders, including Thundermist and Blue Cross employees, highlight Steward’s effective partnerships and positive outcomes in care delivery, signifying a serious challenge to the existing healthcare status quo. Blue Cross acknowledges the value of Steward’s integrated delivery capabilities and recognizes that Prime does not match Steward’s innovative approach, as exemplified by Prime's lack of understanding of advanced care concepts like Accountable Care Organizations (ACOs). Overall, the document emphasizes the competitive implications of Steward's model in the healthcare landscape.
Landmark has not experienced substantive improvements in quality or community partnership, as acknowledged by Prime, which lacks Steward's ambitions for implementing a risk-based model or accountable care organizations (ACOs) in Rhode Island. Prime has no plans to engage in an ACO product, citing an absence of acceptable options. Steward's potential introduction of risk-based contracts could have positively impacted competition, and the prevention of such initiatives raises antitrust concerns. The analysis of anticompetitive effects is crucial, particularly regarding the elimination of aggressive competitors in concentrated markets. Steward is characterized as a "maverick" firm that disrupts market norms to benefit consumers, contrasting with the hospital system that replaced it, which lacks similar aspirations. Evidence indicates that Blue Cross's alleged refusal to engage with Steward has harmed competition, as shown by internal assessments of Steward's potential competitive threat. Blue Cross employees expressed concerns that if Steward acquired Landmark, it could leverage its hospitals in Massachusetts to effectively penetrate the Rhode Island market, potentially introducing a competitively priced health plan that threatens existing offerings.
The Steward Community Choice Plan is not expected to launch in Rhode Island initially due to the requirement for community hospitals and affiliated physicians located primarily in Massachusetts, with Saint Anne's Medical Center in Fall River being the closest facility. However, if the acquisition of Landmark proceeds, it could facilitate a more effective entry into the Rhode Island market, potentially serving over 72% of the state's population through nearby Steward facilities in Fall River and Taunton. Evidence suggests that Blue Cross was concerned about the competitive threat posed by Accountable Care Organizations (ACOs) and risk-based contracting, with executives noting the risk of "disintermediation," where insurers could become redundant if providers assume both payer and provider roles. Discussions within Blue Cross indicated recognition of the potential for integrated delivery systems to replace traditional insurers.
Blue Cross argues that Prime's acquisition of Landmark benefits consumers through lower prices compared to those proposed by Steward, yet this assertion is contested by Steward, which presents evidence that a Steward-owned Landmark could have resulted in financial savings for Blue Cross and its consumers. Redirecting care to lower-cost, non-network community hospitals may significantly reduce healthcare costs. The debate over whether competition was harmed hinges on factual determinations by the jury. Additionally, Blue Cross's claim that Steward's acquisition would lead to higher healthcare costs for Rhode Islanders has been criticized as hypocritical.
Steward is not at fault for lacking direct evidence of competitive benefits during the period when Blue Cross's exclusionary actions were in effect. The Supreme Court has established that a wrongdoer must bear the uncertainties resultant from their actions. It is acknowledged that obtaining direct evidence of competition is challenging when such competition is effectively prohibited.
Blue Cross contends that Steward's damages model should be dismissed because most damages could have been mitigated and the model fails to differentiate between lawful and unlawful conduct. However, while antitrust plaintiffs must attempt to mitigate losses, the burden of proving a failure to mitigate lies with the defendant, who must demonstrate this through undisputed facts.
Moreover, any damages model must align with the liability case regarding the anticompetitive effects alleged. Blue Cross claims that Steward could have mitigated $800,000 of its damages by accepting proposed reimbursement rates, which effectively counters their motion for summary judgment, as it indicates a factual disputation exists. The argument that Steward should have recognized a breach during negotiations and accepted Blue Cross's offer is rejected, as it lacks legal support and misapplies the principle of mitigation, which cannot be used to unfairly scrutinize the injured party’s actions.
Courts generally hesitate to mandate that parties, under the duty to mitigate, continue negotiations with a breaching party. Blue Cross's claim that Steward should have accepted its offer is intertwined with allegations of Blue Cross's anticompetitive behavior; thus, Steward is not legally obligated to accept potentially insincere offers to mitigate damages. Blue Cross's assertion that Steward's damages model relies on Blue Cross's failure to foster a "collaborative relationship" is a matter for trial, as Steward has established a genuine factual dispute regarding the potential for a good-faith rate agreement in year three, aligning with antitrust damage calculations. An expert can construct a hypothetical scenario devoid of Blue Cross's unlawful actions to measure potential outcomes. Steward's model envisions a cooperative relationship not mandated by antitrust law but reflective of the parties' historical dealings, embodying the implied covenant of good faith and fair dealing present in contracts. Blue Cross's dismissal of Steward's damages model as failing to differentiate between lawful and unlawful conduct is premature, as there is no pre-existing lawful conduct to consider in this case. Further, at this stage, the viability of Steward's claims suggests that Blue Cross's damages theory should not be evaluated for summary judgment. Lastly, while damages will be scrutinized at trial, a plaintiff is not obligated to precisely quantify damages; demonstration of injury suffices for a jury to award nominal damages, regardless of the specifics of damage quantification. Blue Cross's arguments regarding damages do not justify granting summary judgment against Steward.
Blue Cross claims that the state-action doctrine protects it from Steward's antitrust allegations by asserting that state regulation mandated the allegedly unreasonable rates it charged. The Court questions whether the state-action doctrine applies in this case and finds Blue Cross's argument inadequate for reasons previously discussed concerning OHIC regulations. The state-action doctrine provides immunity for conduct that is a direct result of state policy, requiring two elements: the restraint must be clearly articulated as state policy, and it must be actively supervised by the state. Steward concedes the first element but focuses on the second, emphasizing that mere state involvement is insufficient. The Supreme Court's ruling in Patrick v. Burget establishes that the state must exert ultimate control over any anticompetitive behavior, and state officials must have the authority to review and disapprove such actions. The inquiry aims to ascertain whether the state has genuinely influenced the rates or prices, rather than allowing private agreements to dictate them. The Court concludes that Blue Cross's actions do not genuinely stem from state regulation, denying it state-action immunity from Sherman Act liability. Furthermore, Steward presents factual disputes regarding the active supervision element, indicating that OHIC lacks authority over hospitals and that its regulations allow Blue Cross some flexibility in setting rates. Consequently, the Court denies Blue Cross's Motion for Summary Judgment, allowing all counts of Steward's Amended Complaint to proceed to trial.
Factual discussions in this legal opinion derive from the parties' statements of undisputed and disputed facts, with inferences favoring the nonmoving party, Steward. Thundermist is identified as a major primary care provider in the Woonsocket area, servicing a large patient base, many of whom are uninsured or underinsured, with nearly 40% of its 42,000 patients lacking insurance in 2013. In 2014, Thundermist provided $6.6 million in unreimbursed care. The organization aims to enhance healthcare delivery for underserved populations.
Steward, owned by Cerberus Capital Management, LP, began with six hospitals in Massachusetts in 2010 and expanded to eleven by 2012. Steward's risk-based contract model allows it to compete with health insurers, performing functions traditionally associated with them. The acquisition of Caritas was completed in November 2010, while specific conditions regarding Thundermist and SNERCC were omitted from the May 2011 Asset Purchase Agreement (APA) and its subsequent amendments. These conditions were eventually incorporated into a quality program agreed upon by Blue Cross and Prime, which later acquired Landmark.
Blue Cross altered its quality program for Prime, implementing metrics based on Landmark's historical performance rather than national averages, actions that were perceived as biased and bad faith by Steward's CEO, Dr. de la Torre. Notably, Blue Cross's communication with subscribers and physicians regarding network status changes was unprecedented, as was its decision to stop payments to a still 'in-network' hospital, compelling hospitals to collect payments directly from patients. Prime operates 44 hospitals with 43,500 employees across 14 states, demonstrating significant expertise in reviving distressed hospitals.
Claims under the Rhode Island Antitrust Act are analyzed in conjunction with those under the Sherman Act, as both statutes share similar provisions and are interpreted in the same manner. The Court treats Steward's claims of monopsonization and monopolization collectively, aligning with the legal standards applicable to both. The relationship between monopoly and monopsony suggests that similar criteria should apply to both types of claims. The second element of exclusionary conduct in these claims has been criticized for its ambiguity and lack of clarity, indicating a need for reform.
The existence of Blue Cross's monopoly power has been accepted by the parties for the purposes of the motion, with the relevant market defined by the defendant's dominant share. Although the Supreme Court's ruling in Trinko may have narrowed Section 2 liability, the foundational criteria from Colgate concerning the intent behind maintaining a monopoly remain valid. At the motion-to-dismiss stage, it was implied that Steward needed to satisfy certain baseline requirements for a refusal-to-deal claim, including a significant abandonment of a previous business relationship without a legitimate business rationale. However, the Court has reconsidered this position, suggesting that requiring all these factors could hinder the establishment of new market arrangements and perpetuate existing market conditions.
The court addressed the complexities surrounding antitrust violations related to refusal-to-deal claims, emphasizing that the law would be unreasonable if it deemed Western Union's supportive actions as grounds for such violations. The Supreme Court has not established a comprehensive framework for refusal-to-deal liability, leading to varied interpretations by lower courts, particularly following the *Trinko* ruling. This ruling is criticized for contributing to confusion in antitrust law and failing to provide clear guidelines, especially regarding non-price exclusionary behavior by monopolists. The D.C. Circuit's *Microsoft* case offered a non-binding five-step framework to assess whether a monopolist's actions are exclusionary or competitively vigorous.
In the context of Blue Cross's actions, the argument that it did not refuse to deal with Steward is deemed legally incorrect. Evidence from Blue Cross employees, including CFO Michael Hudson and Director of Government Relations Shawn Donahue, indicates a lack of recollection regarding sending letters about hospitals going out of network. Their depositions suggest that such notifications have not historically impacted hospital usage or that Blue Cross had ever executed this action. Overall, Steward's evidence is sufficient to establish a genuine factual dispute requiring trial consideration under Rule 56.
Justice Silverstein's denial of the temporary restraining order (TRO) is deemed inconsequential; the key issue is the Special Master's view of Blue Cross's actions as potentially disastrous for the economy. The jury will consider statements from the Attorney General indicating that Blue Cross aims to obstruct Steward's business operations, exemplified by Blue Cross cutting off funding to a financially struggling hospital, leaving the Special Master unable to intervene. Evidence suggests Blue Cross's strategy is to provide recommendations for navigating this situation, while Steward claims additional losses beyond initial estimates, including $3 million monthly for four to six months. Disputes arise over the cost of Steward's proposal, with Blue Cross estimating it at $5.4 million, while Steward argues it would only be $3 million. Steward had also proposed a lower rate increase for Landmark, contingent on reducing payments to St. Anne's hospital. The Court will not determine the relevance of Blue Cross's agreements with Prime at this stage. Under the 2012 Rate Approval Conditions, issuers can seek exceptions to index limits if they can demonstrate significant financial responsibility for care costs, a process previously indicated as open by former OHIC Commissioner Chris Koller. Finally, Steward points to Blue Cross's actions concerning St. Anne's and Morton hospitals to illustrate anti-competitive behavior, noting a proposal to shift patients to the BlueCard program—a move projected to save Blue Cross $3.2 million annually, although it would incur substantial administrative fees.
Steward proposed a direct contract with St. Anne's to Blue Cross, offering the same rates as BCBSMA but eliminating the administrative fee. This proposal allowed Blue Cross's Medicare Advantage subscribers continued access to St. Anne's hospitals, which was not possible under the BlueCard program. Blue Cross rejected this offer, potentially sacrificing short-term profits to hinder Steward's market entry in Rhode Island. The court evaluates Steward's conspiracy claims under both the Rhode Island Antitrust Act and the Sherman Act, noting the complexity and ambiguity surrounding conspiracy law and the standards for proving such claims. The court underscores that evidence must be considered collectively to determine if it is sufficient to defeat summary judgment. It highlights that circumstantial evidence, including ambiguous statements, is relevant and should not be disregarded. Furthermore, the court clarifies that Steward's monopolization and conspiracy claims are not mutually exclusive; Blue Cross's actions, even if consistent with unilateral self-interest, could still indicate a conspiracy if they appear irrational in a competitive context. The legal framework supports the coexistence of both claims, as established in relevant case law.
The court rejected the defendant's argument that a finding of no liability under Section 1 of the Sherman Act precludes liability under Section 2. It affirmed that evidence of exclusive dealing can support a Section 2 claim, and a court's acceptance of one theory over another does not undermine the overall claim. It was noted that a plan existed prior to Steward's involvement, but evidence suggested the treat-and-transfer model was revived with Steward's entry. The court clarified that not all conspirators need to participate in every act of a conspiracy, emphasizing a totality-of-evidence approach.
Reference was made to Steven Costantino, significant in Rhode Island's health care sector, and the court indicated it would not separately analyze Steward's conspiracy-to-monopolize and conspiracy-to-monopsonize claims, as the analysis would be the same for both. The court also refuted Blue Cross's interpretation of Ocean State Physicians, asserting that proving an antitrust claim is not necessary to establish tortious interference claims. It was highlighted that not all business torts qualify as antitrust violations, and Blue Cross failed to meet the established test.
The Red Team's motto and logo were noted, along with a disclaimer from their presentation indicating that information was illustrative and not based on real situations. The court acknowledged the potential implications of the Red Team's analysis on the case, raising genuine factual disputes regarding its relevance to Steward's objectives in Rhode Island. The section referenced Steward's earlier motion to exclude certain damages testimony.
