Constantine Cannon, Lead Class Counsel, Agrees to Settle on Behalf of Premium Payers with Sutter Health in Long-Running Antitrust Class Action Lawsuit

We are pleased to announce that Constantine Cannon, on behalf of a California premium paying class, has reached an agreement in principle to settle a long-running healthcare antitrust case against California’s Sutter Health, one of the nation’s largest and most powerful hospital chains. The parties’ settlement is subject to Court approval. 

The certified class included roughly 3 million health insurance premium payers in California with policies from Aetna, Anthem Blue Cross, Blue Shield, Health Net, or United Healthcare, plans held by many insured California patients. The firm filed first in 2012 and has litigated the case for 13 years. 

The class claimed that Sutter increased costs and forced “all or nothing” network deals for insurers by flexing its market power and making health care costs surge by over $400 million. The class also alleged that Sutter made insurers contractually agree to terms blocking plans that would direct patients to cheaper providers. Insurers were driven toward Sutter’s more costly facilities to get in-network access to the hospitals they needed. 

This agreement was reached on the eve of a 4-week retrial after the rare reversal of a jury verdict by the Ninth Circuit – the second Ninth Circuit reversal achieved in this critical case.  

In March 2022, following a trial, a jury sided with Sutter. The Ninth Circuit determined that the verdict was issued on a record that erroneously excluded important evidence from when the challenged restraints were first imposed and the exclusion was not harmless. (See Ninth Circuit Opinion). Such evidence included “admissions by Sutter executives, Sutter’s switch from the individual negotiating to the systemwide contracting system, Sutter’s imposition of the allegedly anticompetitive contract terms during that transition and the health plans’ objections to those terms and the switch.” The Ninth Circuit also found that the trial court’s rewriting of CACI jury instructions to excise from the jury’s consideration, the “purpose” and history of Sutter’s restraints controverted law.   

A round of applause and an extra special thanks to Constantine Cannon’s fantastic team including Jean Kim, Lloyd Constantine, Matthew Koenig, Deb Givens, Alan Schwartz, Kevin Morrison, and our then current, now former CC attorneys who litigated this important case to victory.  Additional thanks to Shinder Cantor Lerner LLP, Farmer Brownstein, Steyer Lowenthal and the Mehdi Firm.