A Long Time Coming

The case: The Federal Trade Commission vs. the California Dental Association regarding advertising guidelines. Many of us who had seen the start of this FTC legal action against CDA back in the mid 1980s were beginning to believe that resolution of this matter might be a career, if not a lifetime, in coming.

It is hoped that the recent 25-page ruling by the 9th Circuit Court will stand as the final decision reversing a seemingly endless series of legal proceedings that have hovered over the association since the FTC initially contended that association advertising restrictions violated antitrust laws. The FTC reasoned that CDA restrictions on price and quality claims by members were subjective and limited consumer access.

We well remember the difficult decisions that have periodically faced leadership to continue the fight by authorizing the resources to affirm the association’s position and pursue the matter at the next level of appeal. Leadership has always believed that the position of the association was correct and was positive about the potential for success based upon the advice and the analysis provided by legal counsel. However, along the long pathway leading up to and including the review by the U.S. Supreme Court in January 1999, it began to look like CDA was engaged in a costly uphill battle on a principle that might no longer be defensible.

After losing an appeal on the FTC ruling by the 9th Circuit Court in 1997 and losing a petition for a rehearing in January 1998, the future looked pretty bleak for a saga that had pestered the association for more than a decade. The fact alone that the U.S. Supreme Court had accepted and agreed to hear the case in early 1999 was considered somewhat of a victory. Hopes were higher than they had been for a long time as the Court began its review. "Our Day in Court" in this space in March 1999 pointed to "guarded optimism that the Supreme Court could come forward with a ruling on the broad issue that would give nonprofit professional associations some relief from an FTC that has appeared to venture beyond the authority granted it in the original legislation creating the commission."

Unfortunately, that optimism crashed as the Supreme Court upheld the FTC’s jurisdiction over associations, which was one of the major issues in the case. However, in what now might be considered a positive note, the court kept the door open on the other issue before it, the appellate ruling supporting the FTC’s contention that CDA’s advertising restrictions were anticompetitive, by returning that part of the case back to the 9th Circuit Court. Considering that the 9th Circuit had previously denied the appeal, this action clearly did not contribute to a feeling of optimism by CDA leadership at the time. The case had already been very costly to organized dentistry and had a life that seemed excessively long.

With a suspension of some sections of the Code of Ethics since 1995 as a condition of earlier decisions, it seemed to many that the FTC objective had long been accomplished and that life would continue on as is. Many longtime members had been unhappy with "negative" changes in the profession they felt had been imposed by regulations set forth by outside agencies such as the FTC. Nonetheless, because of what had become a long-term imposition of restrictions, there seemed to be an acceptance of the way things were by many dentists.

Thus, a surprise announcement that the 9th Circuit Court of Appeals had instructed the FTC to dismiss its suit contending that CDA advertising guidelines are anticompetitive seemed to take a while to sink in. It is also clear that it took the court a long time (translated, another review) to realize that CDA Code guidelines can serve the consumer in a positive, protective fashion.

This victory could be only temporary if the FTC elects to appeal the decision. Initially, however, that does not seem likely to our legal experts. Closure of this saga has depended upon the expertise and guidance of Peter Sfikas, the American Dental Association’s general counsel. We concur with those who have lauded his efforts.

As for the future, CDA’s Judicial Council, and ultimately leadership, will need to look carefully at the advertising guidelines that are now required for contemporary practice. An analysis and reworking of the document should be the order of the day without an urgency to restore the restricted guidelines in total.

The recent court decision suggested that the court has respect for guidelines that offer protection for the consumer. If we use that experience as the template, a document for this millennium will substantially benefit from what has been a long and sometimes disquieting journey in support of some of the time-honored standards held by organized dentistry.