Oscar also alleged that Florida Blue enforced its exclusivity policy through “coercion and intimidation.” Oscar asserted that Florida Blue had threatened to terminate permanently any broker appointed by Oscar, meaning “brokers face losing the right to sell Florida Blue plans in all product lines throughout the entire State of Florida if they decide to sell Oscar plans in a single county in the state.” After Oscar entered the Orlando market, Oscar maintained, Florida Blue updated its exclusivity policy, directing its brokers to sign new exclusivity forms. According to Oscar, Florida Blue threatened to withhold commission payments from brokers who violated the exclusivity policy.

Florida Blue asserted that the exclusivity policy came within the exemption from federal antitrust law created by the McCarran-Ferguson Act. The McCarran-Ferguson Act exempts from the Sherman Act activities that (1) constitute “the business of insurance,” (2) are “regulated by State law,” and (3) do not amount to “boycott, coercion, or intimidation.”

The DOJ's Statement of Interest

In its statement of interest, the DOJ explained that the federal government was principally responsible for enforcing the federal antitrust laws and that it sought to ensure that antitrust exemptions, including the McCarran-Ferguson Act, were “not interpreted any more broadly than necessary to carry out their purposes.”

The DOJ asserted that McCarran-Ferguson did not apply in this case for two reasons.

First, the DOJ said, as alleged by Oscar, Florida Blue's exclusivity policy was not the business of insurance because it did not transfer risk or figure as an integral part of the policy relationship between the insurer and the insured. The DOJ asserted that Florida Blue's contention that its exclusivity policy spread risk because it “affect[ed its] ability to attract customers” was “overly broad.”

Moreover, the DOJ continued, as alleged by Oscar, Florida Blue's exclusivity policy was not an “integral part of the policy relationship,” the exclusivity policy was not integral to Florida Blue's relationships with its policyholders, and the “threat to withhold commissions” had “nothing to do with the relationship between the insurer and the insured.”

Second, the DOJ asserted that McCarran-Ferguson did not apply because, as alleged by Oscar, Florida Blue's exclusivity policy involved coercion, and the Sherman Act applied if a policy involved an “act of boycott, coercion, or intimidation.”

Accordingly, the DOJ asserted that the district court should not dismiss Oscar's Sherman Act claims on the basis of Florida Blue's “flawed interpretation of the McCarran-Ferguson Act's antitrust exemption.”

The case is Oscar Ins. Co. of Florida v. Blue Cross and Blue Shield of Florida, Inc., No. 6:18-cv-1944-PGB-TBS (M.D. Fla.).