A Texas judge on Tuesday denied class certification in an antitrust lawsuit alleging that the three largest hospital operators in San Antonio had conspired to keep nurses’ wages artificially low.
The ruling from Chief U.S. District Judge Orlando L. Garcia of the Western District of Texas, was a clear win for defense attorneys from Norton Rose Fulbright, which had taken the lead in opposing class cert in the wage-fixing suit, which has been pending since 2006.
In the complaint, plaintiff Marissa Maderazo alleged that San Antonio-area hospitals had coordinated efforts to avoid pay increases for registered nurses between 2002 and 2007, during a national nurse shortage.
According to the filing, hospital operators Baptist Health Systems HCA Inc., Methodist Healthcare System of San Antonio and Christus Santa Rosa Health Care Corp. had exchanged detailed information regarding wages and agreed, over the course of five years, not to compete with each other in setting rates for compensation.
The lawsuit seeks to recovery lost wages, as well as treble damages, fees and costs.
Norton Rose, which represented Christus, moved to oppose class cert in 2016 and challenged the testimony of Henry S. Farber, a Princeton University economist, who Maderazo had retained as a damages expert in the case. In court documents, Norton Rose attacked Farber’s analysis for failing to show a crucial link between the alleged antitrust violations and Maderazo’s theory of liability for class-wide damages.
On Tuesday, Garcia agreed that no such link existed, noting that the plaintiffs had offered no alternative explanation for how they planned to prove an antitrust injury had occurred.
“There is simply no explanation as to how plaintiffs plan to link the alleged conspiracy to the alleged impact/injury, with either common or individual evidence. Without an evidentiary link, Professor Farber’s analysis would do nothing more than show a difference between agency fees and staff wages,” Garcia wrote in a 24-page order.
“Thus, they have failed to demonstrate that antitrust injury/impact can be addressed through evidence common to the class,” the judge said.
An attorney for Maderazo said he was evaluating his options but declined to comment Wednesday on the ruling. Norton Rose partner Layne E. Kruse did not immediately return a call Wednesday afternoon seeking comment on the ruling.
Maderazo’s attorneys had argued that they tried to obtain information related to causation in discovery, but the defendants had failed to produce it. In response, Garcia said that the issue was not brought to the court’s attention during the discovery period.
“There is a difference between movants that are prohibited from obtaining class certification discovery and those that are permitted but fail to obtain and/or use it. The court cannot conclude that plaintiffs were prohibited from seeking the information they needed for class certification,” he wrote.
Methodist HCA was represented by attorneys from Simpson Thacher & Bartlett in New York and Washington, D.C. Baptist was represented by Gibson Dunn & Crutcher attorneys in New York and Washington, D.C.
Norton Rose partners Darryl Wade Anderson, Seth Isgur and Mario A. Barrera also represented Christus in the case, captioned Maderazo v. VHS San Antonio Partners.