AAI Tells Third Circuit to Be Practical About Substantial Foreclosure in Exclusive Dealing Cases (Reading Hospital v. Hill-Rom Holdings)

On February 5, 2026, the American Antitrust Institute (AAI) filed an amicus brief in Reading Hospital v. Hill-Rom Holdings, Inc., No. 25-2969, asking the Third Circuit to reverse a district court’s dismissal of an exclusive dealing claim for failure to adequately allege substantial foreclosure.

The plaintiff, a Pennsylvania hospital, alleged that the defendant, Hill-Rom, which is a dominant supplier of hospital beds, monopolized national markets for standard hospital beds, ICU beds, and birthing beds by leveraging its large market share to force exclusivity arrangements on major hospital systems, known as Integrated Delivery Networks (IDNs), throughout the United States. Although the plaintiff alleged hundreds of contracts covering the full scope of Hill-Rom’s large market share, which allegedly exceeded 70% in each market, the district court dismissed the complaint because it identified specific exclusivity provisions in only two contracts with major IDNs, which together accounted for only as much as 20% of the relevant markets—well below the 40% foreclosure share that other courts have treated as a guidepost for substantial foreclosure in exclusive dealing cases.

AAI’s brief argues that the district court committed at least three reversible errors. First, it failed to consider the complaint allegations holistically, which led it to demand specificity in fact pleading that goes far beyond what Rule 8 requires. Second, it focused unduly narrowly on the known foreclosure percentage from the two agreements, ignoring accompanying allegations of many other agreements and about the long duration of the agreements relative to industry norms and their imposition by fiat rather than pursuant to competitive bidding. Third, it departed from well established pleading law by penalizing the plaintiff for failing to allege specific contract language, effectively treating factual allegations that were not pled with specificity as though they were not pled at all. Among other things, AAI’s brief emphasizes that precedent requires trial courts to focus on the “practical effect” of challenged exclusive dealing agreements and that plaintiffs cannot be required to ferret out and plead the specific terms of confidential contract provisions prior to discovery.

AAI thanks Fairmark Partners, LLP for serving as pro bono counsel. The brief was written by Fairmark’s Co-Founding Partner Jamie Crooks and Associate Mike Goldberg, with assistance from AAI President Randy Stutz and AAI General Counsel Mark S. Hegedus.

Read the full amicus brief: AAI Amicus Brief (Reading Hospital v. Hill-Rom Holdings, Inc.)