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Memorial Hospital, a hospital in Bordertown, Iowa, has an agreement with Careco, a managed care organization with plan members in the states of Iowa, Nebraska, and South Dakota, to provide medical care to its members.
a) A condition of Memorial's agreement states that Careco cannot contract with other hospitals in the Bordertown, Iowa area. The contract is for a year and either party may terminate the contract for any reason, with a 60-day notice period.
b) Discuss any possible anti-trust laws that Memorial may have violated. Also, discuss any defenses that Memorial can establish to an anti-trust action.
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