Antitrust Law: American Medical Response v. The County of San Bernardino et. al.
On April 19th, the complaint and petition was dismissed without leave to amend. The judge decided, that the county was not in violation of the Sherman Act stating "in creating the state-action immunity doctrine, the Supreme Court made clear the Sherman Act was not intended to reach the activities of state governments," citing Llewellyn v. Crothers, 765 F.2d 769, 774 (9th Cir. 1985). The judge in regards to dismissal without leave to amend wrote, "A claim is futile, and the court may dismiss without leave to amend,“if it determines that ‘allegation of other facts consistent with the challenged pleading could not possibly cure the deficiency,’ or if the [party] had several opportunities to amend its [pleading] and repeatedly failed to cure deficiencies.” Telesaurus VPC, LLC v. Power, 623 F.3d 998, 1003 (9th Cir. 2010).
Case Summary
American Medical Response is suing the board in federal court. This is three months after the San Bernardino County Board of Supervisors voted to stop using them to provide much of the county's ambulance services,
At their Dec. 5 meeting, the supervisors voted unanimously to wind down the county's decades-long relationship with AMR in favor of bringing on a coalition of 15 county fire departments, known as Consolidated Fire Agencies, or CONFIRE, to provide ambulance services. An earlier version of the company that would become AMR has operated in San Bernardino County since the 1970s.
On Friday, Feb. 2, the company responded by suing San Bernardino County, the Board of Supervisors, the Inland Counties Emergency Medical Agency and CONFIRE in federal court. The lawsuit alleges that the board's decision violated state law in awarding the contract to CONFIRE, which scored fewer points in the county's review and evaluation process, and in the process violated federal antitrust law.
"The requirements set forth in the (request for proposals) were strict," the lawsuit reads in part. "Among other things, the county was required to award the exclusive contract to the bidder with the highest scoring proposal. Moreover, any provider whose proposal failed to meet the minimum qualifications specified in the RFP could not be considered at all."
By allegedly ignoring the competitive bid process in selecting CONFIRE, the county runs afoul of federal law, according to AMR's lawsuit. During the bidding process, San Bernardino County also wanted any new ambulance provider to be able to start operating by March 31. But CONFIRE isn't expected to take over until Oct. 1.
"In fact, CONFIRE's proposal should not have been considered to begin with, as it failed to fulfill basic minimum requirements mandated by the RFP," the lawsuit reads in part. According to AMR, the six-month delay suggests CONFIRE isn't ready to take on the responsibility. The County has yet to respond in court.
Judge: Judge Shashi H. Kewalramani
CONFIRE and its member agencies lack the resources and capabilities to perform the services contemplated in the RFP. CONFIRE’s proposal indicated that it would be able to fulfill the RFP’s requirements by subcontracting with a private ambulance provider, Priority Ambulance, LLC.
California Civil Code of Procedure §1060
Any person interested under a written instrument, excluding a will or a trust, or under a contract, or who desires a declaration of his or her rights or duties with respect to another, or in respect to, in, over or upon property, or with respect to the location of the natural channel of a watercourse, may, in cases of actual controversy relating to the legal rights and duties of the respective parties, bring an original action or cross-complaint in the superior court for a declaration of his or her rights and duties in the premises, including a determination of any question of construction or validity arising under the instrument or contract. He or she may ask for a declaration of rights or duties, either alone or with other relief; and the court may make a binding declaration of these rights or duties, whether or not further relief is or could be claimed at the time. The declaration may be either affirmative or negative in form and effect, and the declaration shall have the force of a final judgment. The declaration may be had before there has been any breach of the obligation in respect to which said declaration is sought.
A basic rule of competitive bidding for public contracts is that bids must conform to specifications, and that if a bid does not so conform, it may not be accepted; however, it is further well established that a bid which substantially conforms to a call for bids may, though it is not strictly responsive, be accepted if the variance cannot have affected the amount of the bid or given a bidder an advantage or benefit not allowed other bidders or, in other words, if the variance is inconsequential. Cypress Security, LLC v. City and County of San Francisco (App. 1 Dist. 2010) 109 Cal.Rptr.3d 107, 184 Cal.App.4th 1003.
The new CONFIRE contract doesn’t cost the county anything, according to county spokesperson David Wert. Ambulance services are charged to patients and their insurance companies, and the county charges the ambulance contractor for the expenses involved in monitoring the contract, estimated at $1.8 million the first year, with annual adjustments for inflation after that.
American Medical Response is suing the board in federal court. This is three months after the San Bernardino County Board of Supervisors voted to stop using them to provide much of the county's ambulance services,
At their Dec. 5 meeting, the supervisors voted unanimously to wind down the county's decades-long relationship with AMR in favor of bringing on a coalition of 15 county fire departments, known as Consolidated Fire Agencies, or CONFIRE, to provide ambulance services. An earlier version of the company that would become AMR has operated in San Bernardino County since the 1970s.
On Friday, Feb. 2, the company responded by suing San Bernardino County, the Board of Supervisors, the Inland Counties Emergency Medical Agency and CONFIRE in federal court. The lawsuit alleges that the board's decision violated state law in awarding the contract to CONFIRE, which scored fewer points in the county's review and evaluation process, and in the process violated federal antitrust law.
"The requirements set forth in the (request for proposals) were strict," the lawsuit reads in part. "Among other things, the county was required to award the exclusive contract to the bidder with the highest scoring proposal. Moreover, any provider whose proposal failed to meet the minimum qualifications specified in the RFP could not be considered at all."
By allegedly ignoring the competitive bid process in selecting CONFIRE, the county runs afoul of federal law, according to AMR's lawsuit. During the bidding process, San Bernardino County also wanted any new ambulance provider to be able to start operating by March 31. But CONFIRE isn't expected to take over until Oct. 1.
"In fact, CONFIRE's proposal should not have been considered to begin with, as it failed to fulfill basic minimum requirements mandated by the RFP," the lawsuit reads in part. According to AMR, the six-month delay suggests CONFIRE isn't ready to take on the responsibility. The County has yet to respond in court.
Case Information
Case No.: 5:24-cv-00267-SHK
New Case No.: 5:24-cv-00267-KK-DTBThe case number change was the result of AMR's refusal to have their case heard by a magistrate judge.
P: (951) 328-4450 E: ecf-helpdesk@cacd.uscourts.gov
Court Address:
George E. Brown, Jr. Federal Building and United States Courthouse
3470 Twelfth Street
Riverside, CA 92501-3801P: (951) 328-4450 E: ecf-helpdesk@cacd.uscourts.gov
Judge: Judge Shashi H. Kewalramani
New Judge: Kenly Kiya Kato
Plaintiff: American Medical Response of Inland Empire
Physical Address: 7925 Center Ave, Rancho Cucamonga, CA 91730-3007
Respondent: County of San Bernardino, et al.
Plaintiff's Attorney: Stephen G. Larson and Jonathan E. Phillips of Larson LLP
Physical Address: 7925 Center Ave, Rancho Cucamonga, CA 91730-3007
Respondent: County of San Bernardino, et al.
Physical Address: 555 S. Flower Street, 30th Floor, Los Angeles, CA 90071 P: 213-436-4888
Respondent Attorney: County of San Bernardino, County of San Bernardino Board of Supervisors and Inland Counties Emergency Medical Agency
Devin M. Senelick of HOOPER, LUNDY & BOOKMAN, P.C. 1875 Century Park East, Suite 1600 Los Angeles, California 90067 Telephone: (310) 551-8111 Fax: (310) 551-8181 E-Mail: dsenelick@hooperlundy.com
Respondent Attorney: CONFIRE
Lindsay K. Moore of KINGSLEY BOGARD LLP 600 Coolidge Drive, Suite 160 Folsom, CA 95630 Telephone: (916) 932-2500 Fax: (916) 932-2510 Email: lmoore@kblegal.us
Lindsay K. Moore of KINGSLEY BOGARD LLP 600 Coolidge Drive, Suite 160 Folsom, CA 95630 Telephone: (916) 932-2500 Fax: (916) 932-2510 Email: lmoore@kblegal.us
Causes of Action: 15 U.S.C. § 1 – Violation of Sherman Antitrust; CCP §§ 1085, 1094.5 – Writ of Mandamus; CCP § 1060 – Declaratory Relief – Proposition 26
The Plaintiff's Case
AMR and CONFIRE were the only two providers to submit proposals for consideration.
None of the thirteen member agencies of CONFIRE have ever provided ambulance transport in an EMS system of the size and scope of San Bernardino County, California—which is the largest county in the United States.
None of the thirteen member agencies of CONFIRE have ever provided ambulance transport in an EMS system of the size and scope of San Bernardino County, California—which is the largest county in the United States.
AMR believes, and on that basis alleges, that if CONFIRE be permitted to begin providing ambulance service under the exclusive contract awarded by the County, CONFIRE has admitted that it will charge ambulance service payors for more than the cost of service it incurs to provide the service. Moreover, on information and belief, CONFIRE’s proposed ambulance rates do not include any rate offset to account for the additional revenue it would generate through government funding sources, such as the Public Provider Intergovernmental Transfer PPIGT program. In this regard, CONFIRE will impose a charge that California Constitution Article XIII C deems a “tax” requiring voter approval—which has not been obtained and for which no exception under § 1(e) of the article is provided. The rules governing PPIGT are found here, Welf. & Inst. Code § 14105.945
The Board of Supervisors should grant AMR’s protest and carry out its ministerial duty to award the exclusive ambulance services contract based solely on the procedures mandated by the state-approved RFP.
The Law
15 U.S.C. § 1 – Violation of Sherman Antitrust
The Sherman Antitrust Act is a landmark U.S. law that banned businesses from colluding or merging to form a monopoly. Passed in 1890, the law prevented these groups from dictating, controlling, and manipulating prices in a particular market. The law prohibits activities that restrict interstate commerce and competition in the marketplace. It was intended to "preserve free and unfettered competition as the rule of trade" for the benefit of consumers.
California Civil Code of Procedure §1060
Any person interested under a written instrument, excluding a will or a trust, or under a contract, or who desires a declaration of his or her rights or duties with respect to another, or in respect to, in, over or upon property, or with respect to the location of the natural channel of a watercourse, may, in cases of actual controversy relating to the legal rights and duties of the respective parties, bring an original action or cross-complaint in the superior court for a declaration of his or her rights and duties in the premises, including a determination of any question of construction or validity arising under the instrument or contract. He or she may ask for a declaration of rights or duties, either alone or with other relief; and the court may make a binding declaration of these rights or duties, whether or not further relief is or could be claimed at the time. The declaration may be either affirmative or negative in form and effect, and the declaration shall have the force of a final judgment. The declaration may be had before there has been any breach of the obligation in respect to which said declaration is sought.
(a) A writ of mandate may be issued by any court to any inferior tribunal, corporation, board, or person, to compel the performance of an act which the law specially enjoins, as a duty resulting from an office, trust, or station, or to compel the admission of a party to the use and enjoyment of a right or office to which the party is entitled, and from which the party is unlawfully precluded by that inferior tribunal, corporation, board, or person.
(b) The appellate division of the superior court may grant a writ of mandate directed to the superior court in a limited civil case or in a misdemeanor or infraction case. Where the appellate division grants a writ of mandate directed to the superior court, the superior court is an inferior tribunal for purposes of this chapter.
(b) The appellate division of the superior court may grant a writ of mandate directed to the superior court in a limited civil case or in a misdemeanor or infraction case. Where the appellate division grants a writ of mandate directed to the superior court, the superior court is an inferior tribunal for purposes of this chapter.
Competing bidders may challenge the award of a public contract to an irresponsible bidder by a writ of mandate for injunctive relief. Roy Allan Slurry Seal, Inc. v. American Asphalt South, Inc. (2017) 213 Cal.Rptr.3d 568, 388 P.3d 800.
(a) Where the writ is issued for the purpose of inquiring into the validity of any final administrative order or decision made as the result of a proceeding in which by law a hearing is required to be given, evidence is required to be taken, and discretion in the determination of facts is vested in the inferior tribunal, corporation, board, or officer, the case shall be heard by the court sitting without a jury. All or part of the record of the proceedings before the inferior tribunal, corporation, board, or officer may be filed with the petition, may be filed with respondent’s points and authorities, or may be ordered to be filed by the court. Except when otherwise prescribed by statute, the cost of preparing the record shall be borne by the petitioner. Where the petitioner has proceeded pursuant to Article 6 (commencing with Section 68630) of Chapter 2 of Title 8 of the Government Code and the Rules of Court implementing that section and where the transcript is necessary to a proper review of the administrative proceedings, the cost of preparing the transcript shall be borne by the respondent. Where the party seeking the writ has proceeded pursuant to Section 1088.5, the administrative record shall be filed as expeditiously as possible, and may be filed with the petition, or by the respondent after payment of the costs by the petitioner, where required, or as otherwise directed by the court. If the expense of preparing all or any part of the record has been borne by the prevailing party, the expense shall be taxable as costs.
(b) The inquiry in such a case shall extend to the questions whether the respondent has proceeded without, or in excess of, jurisdiction; whether there was a fair trial; and whether there was any prejudicial abuse of discretion. Abuse of discretion is established if the respondent has not proceeded in the manner required by law, the order or decision is not supported by the findings, or the findings are not supported by the evidence...
(b) The inquiry in such a case shall extend to the questions whether the respondent has proceeded without, or in excess of, jurisdiction; whether there was a fair trial; and whether there was any prejudicial abuse of discretion. Abuse of discretion is established if the respondent has not proceeded in the manner required by law, the order or decision is not supported by the findings, or the findings are not supported by the evidence...
The trial court must review the entire administrative record to determine whether findings are supported by substantial evidence and whether agency committed any errors of law, but trial court need not look beyond the whole record of the administrative proceedings. Also, if decision of administrative agency will substantially affect vested, fundamental rights, the trial court not only examines the administrative record for errors of law but also exercises its independent judgment upon the evidence disclosed in a limited trial de novo. Bixby v. Pierno, 4 Cal. 3d 130, 481 P.2d 242 (1971).
Problems with AMR's Case
Antitrust Law
AMR and CONFIRE were the only two providers to submit proposals for consideration. The lack of overall competition doesn't support a claim of noncompetition as the reason for bias.
Writ of Mandate
AMR must prove that the CONFIRE proposal was improper and that the bid's deviation from specifications facilitates corruption or extravagance.
Advertising company's request for writ of mandate to order county to terminate contract with company's competitor due to alleged defects in the bidding process and to award contract to company was moot, as contract had expired and new invitation to bid had been issued, and there was no allegation that the recent bid invitation or any contracts awarded as a result of that bid invitation were improper. Daily Journal Corp. v. County of Los Angeles (App. 2 Dist. 2009) 92 Cal.Rptr.3d 219, 172 Cal.App.4th 1550.
In a mandamus action challenging the award of a public contract, there is a presumption that the agency's actions were supported by substantial evidence, and the challenger has the burden of proving otherwise.
To merit setting aside a bid for a public contract, a bid's deviation from specifications must be capable of facilitating corruption or extravagance, or likely to affect the number of bids or the response of potential bidders. Cypress Security, LLC v. City and County of San Francisco (App. 1 Dist. 2010) 109 Cal.Rptr.3d 107, 184 Cal.App.4th 1003.
Issues with AMR
Slow response times, bad customer service, low employee retention/ EMT shortages and expense may also be a factor. Below are reviews for American Medical Response which are negative overall.
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| Complaints from the Better Business Bureau for AMR |
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| Reviews from Google for AMR. |
Logistics and Organizational Experience
Service through CONFIRE, Priority Ambulance, County and City Fire departments are capable of handling paramedic and ambulance service throughout the county. In a county that is only large in area not population, AMR might be superfluous. San Bernardino County has a population per square mile of only 108.7 as of 2020 census data. Compare that with Anderson County South Carolina with a population of 285.4 per square mile which is serviced by Priority Ambulance. Priority purchased Medshore Ambulance in 2016 and has since been providing services there.
Also, they provide services in Knox and Loudon Counties in Tennessee and the populations per square mile are over twice that of San Bernardino County. There's no reason to believe that the company cannot handle the volume that San Bernardino County has. Lastly, Fourth District Supervisor Curt Hagman before the vote to go with CONFIRE said, "The mutual aid agreements signed by local fire and police departments provide “seamless coordination of services.”
Cost
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