A recent decision by the U.S. Supreme Court confirmed that under certain circumstances, state professional boards may not have the protection of state immunity in antitrust actions. In North Carolina State Board of Dental Examiners v. Federal Trade Commission, the Supreme Court found that because the North Carolina State Board of Dental Examiners was comprised of practicing dentists and was not actively supervised by the State of North Carolina, the Board could not claim state immunity as a defense to violations of antitrust law.
The underlying lawsuit involved attempts by the Board to exclude nondentists from providing teeth whitening services in North Carolina. As a result of the Board’s attempts, the Federal Trade Commission filed an administrative complaint against the Board claiming that the Board’s actions were anticompetitive and an unfair method of competition. The administrative court found that the Board’s actions violated federal antitrust law. The Supreme Court upheld the prior rulings in the case and determined that because the Board was comprised of “active market participants” (practicing dentists), the Board could only invoke state immunity if the Board was subject to active supervision by the State of North Carolina.
The Supreme Court’s ruling may have far reaching effects for state professional boards and those regulated by the boards. Many state boards are comprised of practicing professionals and are not subject to close state supervision. This recent Supreme Court decision could mean that your professional board may be subject to limitations in their regulation of your professional industry.