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State Monopolization of a Market Immune from Antitrust Attack
Description Regulations of the state of Massachusetts monopolized the provision of certain medical services. The appeals court rejected a challenge by a private provider to this monopoly, as the state is immune from antitrust law unless otherwise restricted by Congress.
Topic Antitrust
Key Words State Action Immunity
C A S E   S U M M A R Y
Facts Massachusetts, like other states, requires newborn infants to be tested for various diseases at birth. The screening program was run statewide by the University of Massachusetts under a contract with the Department of Public Health. Neo Gen, a Pennsylvania company specializing in such newborn testing, solicited business from hospitals in Massachusetts, offering a more modern comprehensive screening program at half the fee charged by the University. The Department of Public Health issued a regulation preventing any hospital from using any seller of screening services except the University. New Gen sued for monopolization of the "newborn screening services" market. The district court dismissed the suit as prohibited by the Eleventh Amendment. Neo Gen appealed.
Decision Affirmed. Under the Eleventh Amendment, states are generally immune from suits by citizens, unless the state waives its immunity, or Congress overrides that immunity. The Sherman Act does not apply to state action. Hence, states are free to regulate, or act on its own behalf, in ways that are anti-competitive and would not be permitted to private individuals. The state action that created a monopoly for the University is immune from the Sherman Act.
Citation Neo Gen Screening, Inc. v. New England Newborn Screening Program, - F.3d - (1999 WL 486383, 1st Cir.)

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