WILLIAMSPORT – A trio of registered nurses have brought a prospective class action lawsuit against Geisinger Health and Evangelical Community Hospital, claiming the Pennsylvania hospitals engaged in a secret “no-poach agreement” that suppressed professional mobility and salaries in Central Pennsylvania.
Nichole Leib and Kevin Brokenshire of Pennsylvania and Diane Weigley of Georgia (and formerly of Pennsylvania) filed suit in the U.S. District Court for the Middle District of Pennsylvania on Feb. 3 versus Geisinger Health of Danville and Evangelical Community Hospital, of Lewisburg.
“This class action challenges an illegal agreement between two competitors, Geisinger and Evangelical, not to recruit (or “poach”) each other’s physicians, nurses, psychologists, therapists and other health care professional.” the suit says.
“The ‘no-poach agreement’ covered defendants’ health care workers in a region in Central Pennsylvania that included Union, Snyder, Northumberland, Montour, Lycoming and Columbia Counties, and the cities of Danville and Lewisburg, where Geisinger Medical Center and Evangelical are headquartered, respectively.”
The plaintiffs add the allegedly illegal agreement was intended to, and did, reduce competition for health care workers in Central Pennsylvania and, as a result, suppressed the job mobility and wages of the plaintiffs and members of the proposed class below the levels that would have prevailed, but for the agreement.
Furthermore, the plaintiffs added that the U.S. Department of Justice issued comments on such agreements in 2019, noting: “When companies agree not to hire or recruit one another’s employees, they are agreeing not to compete for those employees’ labor. Robbing employees of labor market competition deprives them of job opportunities, information and the ability to use competing offers to negotiate better terms of employment. Under the antitrust laws, the same rules apply when employers compete for talent in labor markets as when they compete to sell goods and services.”
“Geisinger and Evangelical reached their unlawful horizontal agreement at the highest level of their organizations, through secretive verbal exchanges that were later confirmed by emails, which they agreed to conceal from outsiders, their respective employees who make up the proposed class, and the public. As described below, defendants’ senior executives periodically reaffirmed, monitored and policed the no-poach agreement,” per the suit.
“The no-poach agreement began by May 2015, likely existed earlier than May 2015, and continued until at least Aug. 5, 2020, when the DOJ brought a civil antitrust action to enjoin Geisinger’s partial acquisition of Evangelical. The DOJ complaint alleges that Geisinger’s proposed partial acquisition of Evangelical would fundamentally reduce competition for health care services and raise the likelihood of continued unlawful coordination between defendants.”
According to the DOJ, the defendants have a history of collusion, deciding when and when not to compete against the other, including the creation of the no-poach agreement that is the focus of the instant case.
Leib is currently employed with Geisinger, Brokenshire was employed with Geisinger until March 2018 and Weigley, who now lives in Georgia, was employed by Evangelical until August 2017.
Geisinger Health denied the plaintiffs’ account of the events in question.
“We adamantly disagree with allegations that Geisinger restricted its recruitment for staff in any way. In fact, Geisinger regularly conducts outreach to gauge interest and hires talent locally, regionally and nationally, including those from Evangelical Community Hospital, and provides competitive compensation and benefits. This approach allows us to have the best clinicians and staff to care for our patients. Any claims to the contrary are without merit,” the hospital system said, in a statement.
“Geisinger believes strongly that competition is a good thing for our patients, our members, our communities and team members. It helps ensure our organization is doing everything we can to reduce the total cost of care, create better affordability and deliver those benefits to the patient, while retaining and rewarding our staff."
For counts of violating the Sherman Act and the Unfair Trade Practices and Consumer Protection Law, the plaintiff is seeking a declaration that the alleged conduct in question violated same, treble damages, restitution and disengorgement of ill-gotten gains, pre- and post-judgment interest, equitable relief, attorney’s fees, costs of suit, such other and further relief as the Court may deem just and proper and a trial by jury.
The plaintiffs are represented by Shanon J. Carson of Berger Montague, in Philadelphia.
The defendants have not yet secured legal counsel.
U.S. District Court for the Middle District of Pennsylvania case 4:21-cv-00196
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com