Judge dismisses radiology practice’s lawsuit against RadNet, University of Maryland
A federal judge has dismissed a private radiology practice’s lawsuit against RadNet Inc. and the University of Maryland one year after the court battle started.
Capitol Radiology in Laurel, Maryland, first filed suit against the two companies on July 31, 2024. The black-owned imaging group had claimed the university inked a no-bid deal to open a new RadNet imaging center on the same campus, just 50 yards from Capitol Radiology’s offices. It claimed the new joint venture was discriminatory, pushing a long-running, minority- and woman-owned business aside.
Leaders contended Capitol Radiology should have had a chance to compete for this work and had unsuccessfully sought an injunction to stop the new center from opening, along with damages from potential loss of business. However, United States District Judge Lydia Kay Griggsby ruled Tuesday the lawsuit does not make a convincing case for a jury trial to settle the dispute.
“The second amended complaint … makes clear that Capitol Radiology fails to state plausible breach of contract and tortious interference with contract claims against the defendants,” the Aug. 12 court order states. “Lastly, a careful reading of the second amended [complaint] also shows that this pleading lacks sufficient factual allegations to show intentional discrimination, to support Capitol Radiology’s discrimination claim in Count VII.”
Griggsby noted that RadNet and the University of Maryland Capital Region Health Inc. are private corporations, “not state actors,” and thus aren’t subject to state-bidding and minority-hiring laws. She further charged the complaint “lacks facts” to show how UM Capital’s decision to seek bids for imaging work could be attributed to the state of Maryland. Further, the judge said Capitol Radiology has failed to prove the university and RadNet violated antitrust laws in forming their partnership. Capitol Radiology submitted this new “amended complaint” in September in response to criticisms of the original court filing from July 2024.
“In this case, the second amended complaint fails to allege any facts that show that Capitol Radiology suffered an antitrust injury because of the joint venture,” the judge wrote. “For example, the second amended complaint lacks facts to show that Capitol Radiology lost customers, lost revenue or missed opportunities for patient referrals, because of the joint venture by and between defendants [the University of Maryland Medical System] and RadNet.”
Capitol Radiology did not immediately respond to a Radiology Business request for comment Tuesday. RadNet said it does not comment on litigation.
Radiologist Doriann Thomas, MD, first founded Capitol Radiology in Laurel, Maryland, in 2005. The black female radiologist had worked at an imaging center owned by RadNet predecessor Radiologix and pulled together the resources to buy the business and pursue her dreams. Thomas and colleagues believe Capitol Radiology is the sole black-owned radiology facility in Prince George’s County, Maryland, and potentially the entire Eastern Seaboard. It has provided imaging services on the University of Maryland’s campus for almost two decades.
Defense attorneys previously cited a 2022 U.S. Food and Drug Administration revocation of Capitol Radiology’s accreditation as reason for the switch in imaging providers. This left the practice unable to perform mammograms for over two years. In previous conversations with Radiology Business, the practice has vehemently denied its breast imaging services were substandard.
Capitol Radiology filed for Chapter 11 bankruptcy protection on July 18, seeking to wipe out nearly $157,000 in debt tied to a rent dispute with its landlord.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.