FORT MYERS — A federal judge has put off approval of a deal to settle a class action lawsuit led by a New Jersey county against two Florida cancer treatment centers accused of inflating prices for treatment under a noncompete deal.
The judge said there were "deficiencies" in the agreement.
According to the April 4 U.S. District Court for the Middle District of Florida Fort Myers Division order, the plaintiff, Monmouth County, on behalf of a proposed class, and the defendants, Florida Cancer Specialists and 21st Century Oncology, petitioned the court for preliminary agreement of their settlement, certification of the class for the purpose of the settlement, appointment as class representative, appointment of class counsel and approval of a notice to the settlement class.
The case, led by Monmouth, was filed on behalf of county employees who underwent cancer treatments in southwest Florida. In its lawsuit, the county alleged the defendants monopolized cancer treatment in that Florida region and inflated their prices for treatment. The defendants, who are competitors, had a noncompete agreement that included referring patients to each other "exclusively," according to the recent court filing.
The parties reached a settlement with Florida Cancer Specialists denying wrongdoing, but wanted to avoid further litigation.
Under the proposed settlement, Florida Cancer Specialists would pay the plaintiff about $7.2 million. Class members who opted out of the settlement would sign a release of any further claims under the Sherman Act, Florida's Antitrust Act, Florida Deceptive and Unfair Trade Practices Act, federal and state False Claims Acts and whistle-blowing retaliation. However, the release excluded claims regarding malpractice or breach of contract.
U.S. District Judge Steven Merryday cited "obvious deficiencies" in the settlement agreement and the notice plan caution. He noted the settlement agreement releases claims that lack "identical factual predicate" and that the settlement and notice provide "insufficient information about the claims process." Merryday also questioned the "clear sailing provision" in the agreement, saying it "might warrant scrutiny" and needs to clearly "dispel any interference of collision" among counsel.
The court mandated an April 26, deadline for the filing of a revised settlement.