Indiana Federation of Dentists

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IN THE MATTER OF INDIANA FEDERATION OF DENTISTS Docket 9118. Interlocutory Order, April, 1983 ORDER DENYING PETITION FOR RECONSIDERATION On February 21, 1983, the Commission issued its decision and final order in this matter. On March 11, 1983, respondent fied a petition for reconsideration under Rule 3.55 of the Commission s Rules of Practice. Respondent argues that a regulation promulgated by the Indiana State Board of Dental Examiners on May 8, 1982 conflicts with the mandates ofthe Commission s recent Order. . . (and) compels reconsideration of the Commission s rejection of the state action exemption." (Petition at pp. 6-7) Any petition fied under Rule 3.55 "must be confined to new questions raised by the decision or final order and upon which the petitioner had no opportunity to argue before the Commission." Since respondent made no effort to apprise the Commission of the state regulation before the Commission issued its decision and order, respondent is now hard pressed to argue that the order raises questions upon which it had no earlier opportunity to argue before the Commission Nevertheless, the Commission has consideredrespondent'spetion on the merits and found it unpersuasive. The regulation provides in ",lev'lIlt part"Any person using dental diagnostic materials for the purpose of recommending changes in the treatment plan upon which (reimbursements by a third party) are based is practicing dentistry and must be a dentist. Indiana dentists shall not knowingly submit dental diagnostic materials to any party involved in the Unauthorized Practice of Dentistry." 828 lac 1-4 (Indiana Register, Vol. 5 Number 5, pp. 992- , May 1, 1982). Clearly this regulation has no relevance to respondent' s state action defense in this case, which concerns conduct engaged in by respondent only up to the time the record was closed in 1979. A regulation promulgated in 1982 cannot, as complaint counsel note, retroactively immunize prior unlawful conduct. Furthermore, even ifthe regulation had been in effect during the relevant time period, it would not have compelled the concerted action in which respondent engaged. Respondent asserts that the use ofthe plural word "dentists" in the regulation must mean that Indiana dentists are required to comply as a group and consequently, must conspire together to enforce the regulation among their fellows. This creative analysis exceeds the bounds of reasonableness.

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.L"".L"'H"''''''- -'d "'loJloJ I.Jij 718 Interlocutory Order Contrary to respondent's assertion, the opinion in Gambrel v. Kentucky Board of Dentistry, 689 F.2d 612 (6th Cir. 1982), is not instructive in this matter. Gambrel concerned a state board of dentistry interpretation of a state statute as forbidding dentists from providing prescriptions for dentures directly to consumers. The court upheld the decision in this private suit that the state board' s enforcement activity and the individual conduct of dentists subject to the statute were protected by the state action doctrine. In Gambrel there was no evidence of collective behavior by dentists. 689 F.2d at 20. Respondent asserts that the Commission s order "would place Indiana dentists in a position of choosing between compliance with the new dental regulation, and compliance with the Order." (Petition at p. 17) However, the Commission s order plainly pertains only to activity engaged in by the Indiana Federation of Dentists or a successor organization, acting as an organization, or by its offcers or representatives, acting on behalf ofthe organization. The individual conduct of IFD members is expressly excluded from the order. The order does not even govern the collective conduct of some IFD members, so long as that conduct is not performed by or on behalf of the federation or a successor organization. (However, such concerted conduct might constitute an unfair method of competition subject to challenge under the Federal Trade Commission Act.) Respondent is correct in interpreting the order to prohibit IFD from adopting a policy against the submission of x-rays or other materials to third-party payers or from "coercing any third-party payer to operate or deal in any particular way. (Petition at p. 21) But since the order deals only with collective conduct, and the state regulation concerns only individual conduct, there is no conflict between the two.

Furthermore, the evidence in the record of the Commission s proceeding indicates that none ofthe targets of respondent' s boycott were involved in the unauthorized practice of dentistry as now prohibited by the state regulation. The regulation provides: "Any person using dental diagoostic materials for the purpose of recommending changes in the treatment plan upon which (third party) benefits are based is practicing dentistry and must be a dentist." 828 lac 1--2. Contrary to respondent's assertion, the record does not demonstrate that changes in treatment are recommended by non-dentist employees of dental insurers in Indiana. Rather, all the evidence indicates that lay employees of insurers can only approve claims for reimbursement or refer them to a dental consultant for evaluation. Respondent has also argued that the order is unclear and over broad: Since the language to which respondent refers was contained ,nth" draft order accompanying complaint counsel' s answering brief it is not a matter upon which respondent can claim to have had no 720 FEDERAL TRADE; COMMSSION DECISIONS Interlocutory Order 101 F. previous opportunity to argue. Nevertheless, the Commission has considered respondent's concerns and concluded that its fears are unfounded.

Respondent states that it is unclear whether offcers and representatives ofIFD are prohibited from engaging on an individual basis in conduct forbidden to IFD. Offcers and representatives of IFD are members of that organization. Since the conduct of IFD members acting individually is expressly excluded from the order s effect, it follows a fortiori that the prohibition on conduct by "respondent . . . and its offcers and representatives" refers only to conduct by or on behalf of IFD.

Respondent' s other concern is that the order may preclude IFD from lobbying or encouraging the Indiana Board of Dental Examiners to tae action that "may result in the effect proscribed by the Commission s Order." (Petition, p. 24) However, any effort by the Commission to preclude a respondent from exercising its First Amendment rights would be constitutionally impermissible. Therefore, the only reasonable interpretation of the order is that the Commission did not intend, in prohibiting conduct that might have the "effect" ofrequiring that dentists not submit requested materials to third-party payers, to prohibit IFD from engaging in activities that are protected by the Noerr-Pennington doctrine.

Respondent may at some future time identify certain conduct in which it may wish to engage as an organization and which it believes is or may be prohibited by the Commission s order. The appropriate course for respondent at that time would be to seek informal advice from compliance staff, to seek an advisory opinion, or to fie a request to reopen and modify the order under Rule 2.51. A request for modification must show that a change in the Commission s order is compelled by changed conditions of law or fact or by the public interest. Accordingly, respondent' s petition is hereby denied. 721 Complaint