As attorney general, Paul Van Dam believes he has a duty to uphold the law, despite criticism that his investigation may harm an institution's reputation.
"It was never my intent to cause the University of Utah or other entities any undue expense or harm, but I owe it to the people who elected me to look into allegations of wrongdoing."In 1988, a governor's task force examining health-care costs in Utah recommended that the attorney general investigate complaints of market abuse by dominant health-care providers.
When Van Dam took office in 1989, he instructed his staff to give high priority to investigating the health-care industry. The probe became more focused after his office received complaints that a lack of competition was creating a monopoly in pediatric health care, driving up costs and reducing access.
One pediatric health-care provider - Intermountain Health Care Inc. - had an 88 percent share of the Salt Lake County hospital market by the end of 1989.
The complainants alleged that University Hospital and certain medical staff affiliated with it were agreeing to divide up patients with a privately owned Utah hospital - Primary Children's Medical Center. If this conduct was true, it conflicted with legal advice the attorney general gave to the university in 1985, Van Dam said.
Later, investigators learned of a "for profit" corporation formed in 1986 that may have violated antitrust laws.
Because the attorney general is the only official authorized to investigate antitrust on behalf of the state, Van Dam instructed his staff to look into these allegations. Other state attorneys, supervised independently from antitrust investigators, represented the university until the U. requested the appointment of experienced antitrust lawyers in 1990, said Van Dam.
"Although the U. provided boxes of documents and allowed investigators to informally interview several university administrators, critical documents and information were withheld," Van Dam said.
In fall 1990, attorney general investigators proposed a settlement to the university's attorneys. The university declined the proposed terms, Van Dam said.
Throughout the probe, investigators were in contact with federal officials to discuss legal and economic theories. In April 1991, Justice Department officials notified Van Dam that they wanted to do their own investigation of the pediatric health-care market and the university, said Van Dam.
"For a number of reasons - including the unwillingness of the university to settle the matter and the superior resources of the Department of Justice to quickly and thoroughly complete the investigation, I stepped aside and terminated this office's inquiry."
In 1990, before the termination of the state's case, a Utah federal judge issued an opinion in the case of Pharmaceutical and Diagnostic Services Inc. vs. the University of Utah, ruling that the university - but not its staff - was immune from antitrust laws, Van Dam said.
University attorneys and antitrust investigators were equally aware of this decision and discussed its implications, Van Dam said.