Health

DaVita, ex-CEO indicted in alleged scheme to suppress competition

A federal grand jury indicted dialysis provider DaVita and its former CEO on two counts of conspiring with competing employers not to hire each other’s key employees.

According to the Justice Department, DaVita and Thiry allegedly had an anti-poaching agreement with Surgical Care Affiliates LLC from 2012 to 2017 that sought to prevent each company from recruiting senior-level employees.

The indictments, announced last week, were handed down by a federal grand jury in Denver. The charges are the result of an ongoing federal investigation being conducted by the Antitrust Division’s Washington Criminal II Section and the Washington Field Office of the FBI. 

“Those who conspire to deprive workers of free-market opportunities and mobility are committing serious crimes that we will prosecute to the full extent of the law,” said Acting Assistant Attorney General Richard Powers of the Justice Department’s Antitrust Division in a statement

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The first count charges DaVita and Thiry for conspiring with Surgical Care Affiliates to not to solicit each other’s senior-level employees from as early as February 2012 until as late as July 2017. The second count alleges the company and the former executive conspired with another healthcare company from as early as April 2017 until as late as June 2019 to allocate employees by agreeing that the other healthcare company would not solicit DaVita’s employees.  

DaVita owns and operates outpatient medical care centers across the country, focusing on dialysis and kidney care. The company provides kidney dialysis services through a network of 2,816 outpatient dialysis centers in the United States.

The company, which generated about $11.6 billion in revenue in 2020, said in a statement that the allegations against the company are “unfair and unjustified,” Reuters reported.

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“These charges show a disturbing pattern of behavior among health care company executives to conspire to limit the opportunities of workers,” said Assistant Director in Charge Steven M. D’Antuono of the FBI’s Washington Field Office in a statement. “The FBI is dedicated to working with our partners to hold those accountable who would engage in labor market collusion to the detriment of their employees.”

The Justice Department indictment quoted an email from an unnamed person to Thiry: “You also have my commitment we discussed that I’m going to make sure everyone on my team knows to steer clear of anyone at DVA and that I’ll come back to you and talk before ever get anywhere near a point that could contemplate someone else.”

If convicted, DaVita faces a maximum penalty of a $100 million fine per count, and Thiry faces a maximum penalty of 10 years in prison and a $1 million fine per count. 

The government charged Surgical Care Affiliates LLC in January, and that case is pending in the Northern District of Texas.  

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