Full opinion text
RULING AND ORDER STUART, Chief Judge. The Health Care Equalization Committee (“HCEC”), standing as a committee of the Iowa Chiropractic Society, Inc. and purporting to be assignee of the claims of over 150 Iowa chiropractors, initiated this action against fourteen defendants, including six professional and trade associations, Blue Cross and Blue Shield, the Iowa Commissioner of Health, and other individually named physicians. HCEC alleges that these defendants have interfered with the practice of Iowa chiropractors in violation of §§ 1 and 2 of the Sherman Act, the state common law of tort, and federal civil rights statute, 42 U.S.C. § 1983. Defendants have filed motions seeking dismissal of this action based on lack of capacity and standing to sue, lack of personal jurisdiction and venue, and failure to state a claim upon which relief can be granted. I. CAPACITY AND STANDING All defendants have either filed or joined in the filing of a Motion to Dismiss for Lack of Capacity and Standing to Sue. A. Capacity “Generally, capacity is conceived of as a procedural issue dealing with the personal qualifications of a party to litigate and typically is determined without regard to the particular claim or defense asserted.” Wright & Miller, 6 Federal Practice and Procedure § 1559 at 727-28 (1971). Rule 17(b) of the Federal Rules of Civil Procedure governs capacity to sue and provides in part: [Cjapacity to sue or be sued shall be determined by the law of the state in which the district court is held, except (1) that a partnership or other unincorporated association, which has no such capacity by the law of such state, may sue or be sued in its common name for the purpose of enforcing for or against it a substantive right existing under the Constitution or laws of the United States. . .. This rule requires the court to look first to the state law to determine if an entity has the capacity to sue. It will do so assuming for this purpose that plaintiff’s allegations concerning HCEC are true and that it is a committee of the Iowa Chiropractic Society authorized by the society to investigate and prosecute this action. It is governed by ten doctors of chiropractic licensed in Iowa. More than 150 Iowa chiropractors have, in writing, assigned their individual causes of action against these defendants to HCEC, giving it power of attorney in fact and creating an express trust over the funds contributed by them. It authorizes the committee to prosecute the instant action and collect the benefits on behalf of HCEC and its assigning members. 1. Capacity under Chapter 504A, Code of Iowa Plaintiff asserts that HCEC has been delegated the management power to pursue this suit by the Iowa Chiropractic Society, Inc., an Iowa non-profit corporation under Chapter 504A. The Iowa law does not allow a subordinate committee to sue in its own name. Under Iowa Code § 504A.21, a non-profit corporation can delegate to an executive committee the authority of the board of directors except that authority specifically exempted from such a delegation in the statute. Obviously, however, the board cannot delegate authority it does not have in the first place. A board of directors does not have the authority to sue in its own name as a board on behalf of the corporation; instead, legal action must be taken in the name of the corporation itself. Iowa Code § 504A.4(2) (Supp.1979). Therefore, even if HCEC was properly formed under § 504A.21, Chapter 504A would not vest in it the authority to assert the present claims. 2. Capacity under Iowa Common Law The Court believes that HCEC is an unincorporated association with the capacity to sue under Iowa law. In Wilson & Co. v. United Packinghouse Workers of America, 181 F.Supp. 809, 815 (N.D.Iowa 1960), Judge Graven in ascertaining the status of the local union defendant under Iowa law cited the United States Supreme Court’s definition of “association” in Hecht v. Malley, 265 U.S. 144, 157, 44 S.Ct. 462, 467, 68 L.Ed. 949 (1924): It has been defined as a term ‘used throughout the United States to signify a body of persons united without a charter, but upon the methods and forms used by incorporated bodies for the prosecution of some common enterprise.’ Judge Graven concluded that the local union was in fact an unincorporated association. Wilson, 181 F.Supp. at 815. Although the committee concept advanced here is not the type of organization ordinarily considered an association, this Court is persuaded that HCEC comes within this broad definition. It was formed for the purpose of furthering a common goal-prosecution of this action. Even though there is no corporate charter, the committee is given the power to make by-laws, to compensate members, and to conduct activities in furtherance of the association’s purpose. HCEC adopted the society’s by-laws and constitution. Under the law of Iowa, unincorporated associations are given the capacity to sue and be sued as a legal entity. See Wright & Miller, 6 Federal Practice and Procedure, § 1564 at 742 (1971). HCEC, as an unincorporated association with capacity to sue under Iowa law, has capacity to sue pursuant to Federal Rule of Civil Procedure 17(b). 3. Capacity under Federal Substantive Law Even if the Iowa common law did not give an association the capacity to sue, HCEC would have the right to bring this action as a separate entity under the federal substantive right exception found in Rule 17(b)(1), which provides that an unincorporated association not accorded legal status under state law may still have capacity to sue if it is suing for “the purpose of enforcing ... a substantive right existing under the Constitution or laws of the United States, . .. ”. The Federal and Iowa definitions of unincorporated association are the same: a group of persons formed voluntarily without a charter for the purpose of promoting a common enterprise or objective. Hecht v. Malley, 265 U.S. 144, 157, 44 S.Ct. 462, 467, 68 L.Ed. 949 (1924); Associated Students of University of California at Riverside v. Kleindienst, 60 F.R.D. 65, 67 (C.D.Cal.1973); Local 4076, United Steelworkers v. United Steelworkers, 327 F.Supp. 1400, 1402-03 (W.D.Pa.1971); Yonce v. Miners Memorial Hospital Association, 161 F.Supp. 178, 186 (W.D.Va.1958). The Court earlier concluded that HCEC is an unincorporated association under this definition. Further, the plaintiff’s complaint clearly alleges a claim seeking to enforce a substantive right pursuant to federal antitrust law under claims assigned to it. Pursuant to the Court’s responsibility to determine the applicability of the substantive federal right exemption found in Rule 17(b)(1), the Court concludes that HCEC has capacity to sue as an unincorporated association in its own name under Federal Rule of Civil Procedure 17(b)(1). Therefore, all defendants’ requests for. dismissal for lack of capacity to sue are denied. B. Standing 1. Treble Damage Claim The Eighth Circuit Court of Appeals recently affirmed the dismissal of a complaint on the ground that plaintiff, a nonprofit association, lacked standing to assert the federal antitrust claims in either its own right or in its representational capacity. Associated General Contractors v. Otter Tail Power, 611 F.2d 684, 687-691 (8th Cir. 1979). In arguing that HCEC lacks standing to assert the damage claims, the defendants rely heavily on the Eighth Circuit’s observation that associational standing is traditionally denied for treble damage claims asserted pursuant to § 4 of the Clayton Act, 15 U.S.C. § 15. Id. at 689. The Court agrees that under Associated General Contractors, HCEC could not assert the treble damage claims of its members if it based its power to do so on the doctrine of associational standing alone. HCEC, however, is assignee of the claims of 150 chiropractors in the State of Iowa. The Eighth Circuit has recognized that an association can have standing to assert antitrust damage claims validly assigned to it by members. Louisiana Farmers’ Protective Union v. Great A & P Tea Co., 131 F.2d 419, 423 (8th Cir. 1942). See also Warth v. Seldin, 422 U.S. 490, 515, 95 S.Ct. 2197, 2213, 45 L.Ed.2d 343 (1975). Standing cannot exist, however, if the assignments of the claims are invalid. Louisiana Farmers’ Protective Union, 131 F.2d at 424. Defendants claim that the assignments to HCEC are invalid because federal antitrust treble damage claims are not assignable, citing Pardoe v. Iowa State National Bank, 106 Iowa 345, 76 N.W. 800, 802 (1898), which held that § 5197 of the Revised Statutes of the United States authorizing persons who paid usurious interest to a national bank, or his legal representative, to recover twice the usurious amount did not give the debtor the right to transfer the claim to an assignee. The Iowa Supreme Court reached this conclusion upon a review of the statutory language and the policy to make personal to the debtor the right to take advantage of usury. Id. The Court does not believe that Pardoe mandates a finding that federal antitrust claims for treble damage cannot be assigned. The case was decided over eighty years ago interpreting a different statutory provision which was construed at that time in light of a policy strongly favoring the debtor’s personal pursuit of a claim based upon usury. The Court is confident that at this time treble damage claims are assignable. See Hicks v. Bekins Moving & Storage Co., 87 F.2d 583, 585 (9th Cir. 1937); Mercu-Ray Industries, Inc. v. Bristol-Myers Company, 392 F.Supp. 16, 18 (S.D.N.Y.), aff’d sub nom. 508 F.2d 837 (2d Cir. 1974); Isidor Weinstein Investment Co. v. Hearst Corporation, 303 F.Supp. 646, 649 (N.D.Cal.1969); Gerr v. Schering Corporation, 256 F.Supp. 572, 574 (S.D.N.Y.1966); Northern California Monument Dealers Association v. Inter ment Association of California, 120 F.Supp. 93, 94 (D.Cal.1954). The defendants next challenge plaintiff’s standing to assert the treble damage claims on the ground that the assignment is invalid because (1) no consideration was given for the assignments, and (2) the assigning chiropractors did not assign their interest in the claims. The Court rejects these claims. In the Agreement, Assignment and Power of Attorney attached as Exhibit A to plaintiff’s resistance to defendants’ motions, the following paragraph is found: In consideration for this agreement, I shall receive a pro rata or proportionate share of any monies, or things of value which may be recovered or received by the named plaintiffs for the benefit of the limited class as a result of any settlement, trial, or otherwise arising out of the cause of action against the prospective defendants. The Court interprets “pro-rata or proportionate share” to mean per capita for each assigning member and not in relation to the amount of damages each individual might be able to prove. In Cress v. Ivens, 163 Iowa 659, 145 N.W. 325, 327 (1914), the Iowa Supreme Court held that a promise by an association to account for proceeds of litigation and to pay 50% thereof to assignors was adequate consideration for the assignment. In this assignment, each assign- or has exchanged the right to attempt to prove and recover his individual damages for a per capita share of the amount received, if any. This Court, therefore, believes that the assignment in question was supported by adequate consideration. The assignor chiropractors made a complete or full assignment of their claims to HCEC. The agreement states: I hereby assign any and all rights, existing or prospective in my cause or causes of action arising under the antitrust laws or other laws, against the prospective defendants to the Health Care Equalization Committee of the Iowa Chiropractic Society, and further agree to become an assigning member of said committee. There is no reservation of rights clause contained in the agreement. All assignors are bound by the majority vote of the assigning members on the settlement question. The fact that “ten doctors of chiropractic” serve as governing committee does not mean that the assignors have retained control. In fact, the agreement explicitly vests control powers in the committee. The defendants finally argue that the assignments constitute a sham transaction designed to circumvent the holding of Associated General Contractors and the policy set forth in 28 U.S.C. § 1359. Section 1359 provides: “A district court shall not have jurisdiction of a civil action in which any party, by assignment or otherwise, has been improperly or collusively made or joined to invoke the jurisdiction of such court.” The assignments in this case, however, were not necessary for this Court to have jurisdiction of the claims alleged against defendants. The assignor chiropractors could have sued separately, joined together in a suit, or attempted to proceed pursuant to Federal Rule of Civil Procedure 23 as a class. Therefore, the assignments herein could not have been made “improperly or collusively" to invoke federal jurisdiction; jurisdiction was available otherwise. In addition, the Court finds no merit in defendants’ position that plaintiff’s argument, should it prevail, will somehow undermine the Eighth Circuit’s decision in Associated General Contractors. The plaintiff and assignors chose a method recognized by the Eighth Circuit for the presentation of their treble damage claims against defendants. Louisiana Farmers Protective Union, 131 F.2d at 423. As a result, the Court hereby finds that HCEC has standing to assert the treble damage claims contained in the complaint. In Louisiana Farmer’s Protective Union, 131 F.2d at 423-425, the Court required plaintiff to amend the complaint to assert the individual damage claims of each assignor. In this case, plaintiff will be called upon to prove damages in the same manner. However, there will be no need for separate verdicts because of the terms of the assignment. The Court believes that this is a proper matter for discovery and need not be specifically pleaded. 2. Equitable Relief Claim The Court must now face the defendants’ challenge to HCEC’s standing to seek the equitable relief it requests in the complaint on the ground that the requirements for associational standing cannot be met. As the defendants point out, the Eighth Circuit in Associated General Contractors, 611 F.2d at 690, held that an association can have standing to seek equitable relief on behalf of members under § 16 of the Clayton Act, 15 U.S.C. § 26, if the requirements of Hunt v. Washington Apple Advertising Commission, 432 U.S. 333, 97 S.Ct. 2434, 53 L.Ed.2d 383 (1977) are satisfied. In Hunt, the Supreme Court reiterated the three-pronged test for associational standing found in Warth v. Seldin, 422 U.S. 490, 511, 95 S.Ct. 2197, 2211, 45 L.Ed.2d 343 (1975): (a) its members would otherwise have standing to sue in their own right; (b) the interests it seeks to protect are germane to the organization’s purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit. Hunt, 432 U.S. at 343, 97 S.Ct. at 2441. The defendants make no claim that the first two prongs of this test cannot be met, and the Court finds that they are in fact satisfied. The defendants do, however, argue that HCEC fails to meet the final requirement because the claims being asserted will require the participation of individual members of HCEC. The Court disagrees. HCEC requests in its complaint that defendants be permanently enjoined and restrained from continuing the unlawful practices alleged. Contrary to defendants’ contentions, the Court does not believe that such a request will require individualized proof, and believes that the allegations of injury to its members are sufficient for purposes of standing. In addition, the Supreme Court in Warth v. Seldin, 422 U.S. at 515, 95 S.Ct. at 2213, stated: [W]hether an association has standing to invoke the court’s remedial powers on behalf of its members depends in substantial measure on the nature of the relief sought. If in a proper case the association seeks a declaration, injunction, or some other form of prospective relief, it can reasonably be supposed that the remedy, if granted, will inure to the benefit of those members of the association actually injured. Indeed, in all cases in which we have expressly recognized standing in associations to represent their members, the relief sought has been of this kind. This Court has concluded above that HCEC has standing to assert the treble damage claims of its assigning members, and it is appropriate that the committee also be allowed to seek equitable relief on their behalf. Therefore, the Court hereby finds that HCEC does have standing to seek equitable relief on behalf of its members. II. JURISDICTION AND VENUE Defendants AMA and Dr. Sabatier filed a Motion to Dismiss for lack of jurisdiction and improper venue on February 19, 1980. Defendant American College of Radiology (“ACR”) filed a motion seeking dismissal on the same grounds on March 3, 1980. A. Section 12 of the Clayton Act Section 12 of the Clayton Act, 15 U.S.C. § 22, which governs personal jurisdiction as well as venue in actions initiated under the federal antitrust statutes against corporations, provides: Any suit, action or proceeding under the antitrust laws against a corporation may be brought not only in the judicial district whereof it is an inhabitant, but also in any district wherein it may be found or transacts business; and all process in such cases may be served in the district of which it is an inhabitant, or wherever it may be found. This provision authorizes the obtaining of personal jurisdiction by service of process in the district in which the corporate defendant is incorporated (U. S. v. Scophony Corporation, 333 U.S. 795, 809, 68 S.Ct. 855, 862, 92 L.Ed. 1091 (1948)) or is “present . . . by its officers and agents carrying on the business of the corporation” (Eastman Kodak Co. v. Southern Photo Materials Co., 273 U.S. 359, 371, 47 S.Ct. 400, 402, 71 L.Ed. 684 (1927)), if such corporation is subject to venue in the forum district. The only issue the Court need consider here is whether AMA or ACR “transacts business” in this district -so as to meet the venue requirement. If venue is not proper here, plaintiff could not get personal jurisdiction of the moving corporate defendants by extraterritorial service. If venue is proper in this district, this Court has personal jurisdiction over such defendants. A corporation “transacts business” in a district for purposes of § 12 only if in the “ordinary and usual sense” it transacts business of “substantial character”. Eastman Kodak Company, 273 U.S. at 373, 47 S.Ct. at 403; Scophony Corp., 333 U.S. at 807, 68 S.Ct. at 861; Athletes Foot of Delaware, Inc. v. Ralph Libonati Co., Inc., 445 F.Supp. 35, 43 (D.Del.1977); Friends of Animals, Inc. v. American Veterinary Medical Association, 310 F.Supp. 620, 622 (D.C.N.Y. 1970); Philadelphia Housing Authority v. American Radiator & Standard Sanitary Corp., 291 F.Supp. 252, 256 (E.D.Pa.1968). This “transacts business” standard was intended by Congress to be broader than the “may be found” standard, Eastman Kodak Company, 273 U.S. at 372-73, 47 S.Ct. at 403, but “certainly more than a few isolated and peripheral contacts with the particular judicial district ...” must be evident to constitute business of a substantial character. Stern Fish Co. v. Century Seafoods, Inc., 254 F.Supp. 151, 153 (E.D.Pa.1966). See also Athletes Foot of Delaware, 445 F.Supp. at 44; Bogus v. American Speech and Hearing Association, 389 F.Supp. 327, 330 (E.D.Pa.1975) rev’d and aff’d on other grounds, 582 F.2d 277 (3rd Cir. 1978). The determination of whether a corporation “transacts business” for purposes of § 12 can only be made by evaluating the contacts it has with the district. 1. ACR According to the affidavit of its executive director, ACR has no office in Iowa, is not licensed to do business in Iowa, has no agent or property in Iowa, makes no purchases in Iowa, and has held no seminars, workshops or other meetings in Iowa. The governing body of the organization, the Board of Chancellors, has never met in Iowa and no employees of ACR reside in Iowa. Even though the plaintiff alleges in its resistance that ACR is involved in an ongoing process of certifying radiologists and hospitals, it offers no supporting evidence. The Court finds on the basis of Stronach’s supplemental affidavit attached to ACR’s reply memorandum that ACR is not involved in the licensing, certifying or accreditation of hospitals or radiologists. ACR has less than 1% of its membership residing in Iowa. It makes membership mailings but does not “solicit, advertise, promote, or otherwise conduct any of its activities in Iowa”, although some of its mailings go to persons who are not members. Upon a review of ACR’s contacts with Iowa, and pertinent case law, the Court must conclude that ACR does not “transact business” in the State of Iowa within the meaning of § 12 of the Clayton Act. In Bartholomew v. Virginia Chiropractors Association, 612 F.2d 812 (4th Cir. 1979), cert. den. 446 U.S. 938, 100 S.Ct. 2158, 64 L.Ed.2d 791 (1980), five chiropractors challenged the peer review procedure utilized by health insurance carriers in cooperation with the State Chiropractic Association under §§ 1 and 2 of the Sherman Act. The American Chiropractic Association (“ACA”) was a named defendant, and the district court denied its motion to dismiss for lack of venue. On appeal, the Fourth Circuit reversed that decision and held that ACA was not transacting business in the state within the meaning of § 12 of the Clayton Act. Id. at 816. The court described ACA’s contacts with Virginia as follows: Virginia accounted for only 53 of the 8875 national members, .06 per cent of its membership. ACA never qualified to do business in Virginia . . . and its sole office was in Iowa. In Virginia, there were no offices, no officers, no agents, no property, no purchases, no seminars or workshops, and no sales, save of pamphlets, journals, and other educational and public relations materials generating very little revenue. All transactions were by mail. No membership meetings were convened in Virginia; no directors or employees resided there. Id. On the basis of these contacts, the court concluded: ACA’s solicitation of advertising time and its dissemination across Virginia borders of correspondence, informational materials, public service educational programs, by mail, radio, television and newspaper (free of cost to ACA) was not transacting business in the State within the meaning of Section 12 of the Clayton Act, 15 U.S.C. § 22. ... Otherwise, every State in the Union into which such programs were aimed or thrust by media or mail would provide an acceptable forum for suit based on ‘transact[ing] business’ therein. Id. In Golf City, Inc. v. Wilson Sporting Goods Co., Inc., 555 F.2d 426, 428 (5th Cir. 1977), the circuit court held that the Professional Golfers’ Association of America’s (“PGA”) contacts with the district were too tenuous to subject it to suit under § 12 of the Clayton Act. Fifty-five PGA members resided in the district, a golf magazine containing ads of the PGA was circulated in the district, PGA applications were available there, the PGA conducted a five day business school in the district, and it gave prizes to golfers in the district who scored holes-in-one. Id. at 437. The Fifth Circuit concluded these contacts in the aggregate were not sufficient to justify a finding that the PGA transacted business in Louisiana. Id. at 438. In addition, the court noted that “a professional association does not ‘transact business’ in a judicial district merely because some of its members reside in the district and receive the association’s publications there.” Id. at 437-38. In Friends of Animals, Inc., 310 F.Supp. at 620, a district court had before it facts similar to those in this case. In Friends of Animals, the American Veterinary Medical Association, Inc. (“AVMA”) sought dismissal of the antitrust suit as to itself on the ground that venue and extraterritorial service were improper. The AVMA was a voluntary professional society comprised of nearly 20,000 veterinarians. It had no office, employee or agent in the district and was not authorized to do business therein. Id. at 622. The association had .9% of its total membership residing in the- district; two meetings in the last seven years were held in the district; two magazines were distributed to members and non-members in the district; three of its employees had traveled to the district on business in the year prior to the filing of the action; and the AVMA received $12,900 in advertising revenue from the district. Id. at 622-23. The court concluded that “[t]he occasional and sporadic ‘business transactions’ cited above which have been engaged in by AVMA in this District fail to meet the requirement of substantiality which is a component of the [transaction of business test].” Id. at 624. The court also stressed that a professional association cannot be subjected to suit in a district on the basis that members reside and publications are circulated therein. Id. The most recent pronouncement fully in accord with the foregoing authorities is found in State of New York v. American Medical Association, et al, Docket No. 79C1732 (E.D.N.Y.1980). Based upon the above case law as applied to the present controversy, the Court finds that venue is not proper as to defendant ACR since its contacts with this district are too tenuous to satisfy the requirements of § 12 of the Clayton Act. Thus, extraterritorial service of process upon it was improper and jurisdiction cannot be exercised over it in this district pursuant to the Clayton Act. 2. AMA The Court next considers the circumstances of AMA. The affidavit of James H. Sammons, M.D. (“Affidavit of Sammons”) indicates that the AMA is not licensed to do business in Iowa, has no office, employees, or agents in Iowa, and has no property and makes no purchases in Iowa. The AMA has not held any meetings, seminars or workshops in Iowa; the legislative body of the AMA, the House of Delegates, has never met in Iowa; and the Board of Trustees which is responsible for the budget and day to day activities has never met in Iowa. 1.3% of its members reside in Iowa and receive publications, newsletters, and other information from the AMA, and are subject to its canon of ethics. The plaintiff further contends that the AMA accredits hospitals, medical schools, and residency programs in Iowa. The affidavit of Sammons attached to defendants’ reply memorandum filed April 21, 1980 describes in detail AMA’s accreditation activities. On the basis of this uncontested affidavit, the Court finds that the AMA does not accredit hospitals or medical schools; instead, separate entities comprised of representatives of several health related organizations have these accreditation responsibilities. Two AMA employees did visit Iowa in 1979 in connection with accreditation of a residency program. In addition, the AMA had initiated contacts with Iowa through its Committee on Quackery. The first chairman of the committee, John G. Thomsen, M.D., was a resident of Iowa. Robert Throckmorton, an attorney residing in Iowa, served as a representative for the AMA at the Coordination Meeting on Activities Against Quackery in 1964. According to the minutes of a Committee on Quackery meeting held November 13, 1964, Iowa was proposed as the target area for a pilot project to study aspects of the practice of chiropractic. The AMA through the quackery committee had the following additional contacts with the State of Iowa: (1) Mr. Doyl Taylor, Director of the Department of Investigation for the AMA, attended a meeting on October 25, 1967 in Des Moines, Iowa, of the Iowa Medical Society’s Committee on Quackery in which activities adverse to chiropractic were discussed; (2) Iowa appears to have continually had a representative on the committee; (3) Dr. Sabatier, as a member of the Committee on Quackery, delivered a speech in Davenport, Iowa on chiropractic activities in 1967; (4) Dr. Sabatier, as a member of an investigative committee created by the Louisiana legislature, conducted extensive correspondence with leaders of national chiropractic associations while he was a member of the committee; (5) a slide presentation prepared by Dr. Sabatier on chiropractic was shown by Dr. Thomsen, chairman of the quackery committee, in Johnson County, Iowa; (6) Dr. Sabatier, while chairman of the AMA Committee on Quackery, had communications with H. Ronald Frogley, Vice President of Palmer College of Chiropractic in Davenport, Iowa; (7) leaflets, pamphlets and copies of other information were circulated by the AMA to the public as well as to state medical societies across the country regarding the practice of chiropractic- and the activities of the AMA Committee on Quackery; and (8) representatives of the AMA visited Palmer College of Chiropractic in Davenport, Iowa, and there were proposals for additional visits. These additional contacts, which are gleaned from an examination of the exhibits attached to the complaint and offered by plaintiff at the hearing, indicate that the AMA, through the activities of its Committee on Quackery, has significant additional contacts with this state. Without further discovery, it is not possible to establish how many, if any, of the planned activities of the committee resulted in actual contacts with Iowa. It would not be in the interest of justice, however, to deprive plaintiff of the opportunity to pursue investigation of these planned activities. Therefore, when all of these activities are' viewed together, the Court concludes that the AMA is “transacting business” of “substantial character” within this district in the “ordinary and usual sense”. Eastman Kodak Co., 273 U.S. at 373, 47 S.Ct. at 403. The nature of the contacts, their direct relationship to plaintiff’s cause of action, and the fact that it is alleged the AMA made the practice of chiropractic a target, make it reasonable to subject the AMA to suit here. See Courtesy Chevrolet, Inc. v. Tennessee Walking Horse Assoc., 344 F.2d 860, 865 (9th Cir. 1965); State of New York, Docket No. 79CL732 at 21. Should further discovery reveal that the actual contacts of the committee did not follow the proposals outlined in the various exhibits, the contacts may be insufficient to constitute the transaction of business under § 12, and this issue could again be raised in a summary judgment motion. In conclusion, since venue is proper as to defendant AMA in this district, § 12 of the Clayton Act authorizes extraterritorial service of process upon it, and this Court may exercise personal jurisdiction over it. B. Iowa Long-Arm Statute 1. ACR ACR next contends that this court does not have jurisdiction and venue under the Iowa long-arm statute and the general federal venue statute. Iowa Code § 617.3, the state long-arm statute, provides: If a foreign corporation . . . commits a tort in whole or in part in Iowa against a resident of Iowa, such acts shall be deemed to be doing business in Iowa by such foreign corporation for the purpose of service of process or original notice on such foreign corporation under this section, and, if the corporation does not have a registered agent or agents in the state of Iowa, shall be deemed to constitute the appointment of the secretary of state of the state of Iowa to be its true and lawful attorney upon whom may be served all lawful process or original notice in actions or proceedings arising from or growing out of such . . . tort. There is a two part test by which in person-am jurisdiction over defendant ACR allegedly obtained pursuant to Iowa Code § 617.3 must be judged. First, there must have been a tort committed in whole or in part in Iowa against an Iowa resident to satisfy the long-arm statute. Second, defendant ACR must have sufficient minimum contacts with the State of Iowa to satisfy constitutional requirements so that maintenance of this action in Iowa does not offend “traditional notions of fair play and substantial justice.” International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945). The law of the State of Iowa controls on the question of whether the state long-arm statute applies in this case. Caesar’s World, Inc. v. Spencer Foods, Inc., 498 F.2d 1176, 1179 (8th Cir. 1974). The Iowa Supreme Court construes the statute narrowly, Creative Communication Consultants, Inc. v. Byers Transportation Co., Inc., 229 N.W.2d 266, 268 (Iowa 1975), and has noted that the statute was not intended to go “to the full extent of constitutional authority”. Gravelie v. TBS Pacific, Inc., 256 N.W.2d 230, 232 (Iowa 1977). Section 617.3 may be utilized for effecting service of process upon ACR, a nonresident corporation. The plaintiff alleges that the assignors are Iowa chiropractors who were injured by ACR’s allegedly tortious conduct. Section 617.3 may be used to effect service of process even though acts causing injury in Iowa may have occurred outside of Iowa. See Edmundson v. Miley Trailer Co., 211 N.W.2d 269 (Iowa 1973); Anderson v. Nat’l Presto Indus., Inc., 257 Iowa 911, 135 N.W.2d 639, 643 (1965). The Court must now determine if assertion of jurisdiction over ACR would be constitutionally permissible. The Eighth Circuit in Caesar’s World Inc., 498 F.2d at 1180, sets out five factors to be considered in determining if the exercise of jurisdiction pursuant to Iowa Code § 617.3 satisfies constitutional due process: (1) the nature and quality of the contacts with the forum state; (2) the quantity of the contacts with the forum state; (3) the relation of the cause of action to the contacts; (4) the interest of the forum state in providing a forum for its residents; and (5) the convenience of the parties. As the court indicates, these do not establish a mathematical formula for analyzing the defendant’s contacts, but rather serve as a general guide. Id. In addition, the Eighth Circuit has stated that the first three factors are of “primary” concern and that the latter two are of “secondary” importance. Toro Company v. Balias Liquidating Co., 572 F.2d 1267, 1270 (8th Cir. 1978); Gardner Engineering Corp. v. Page Engineering Co., 484 F.2d 27, 31 (8th Cir. 1973). The Court first considers the nature and quality of the contacts of ACR with Iowa. Such contacts were analyzed as part of the Court’s consideration of § 12 of the Clayton Act. The Court concluded that the only contacts ACR had established with Iowa related to the existence and servicing of resident members. The organization had no agents, officers, employees or facilities in Iowa, nor purchased or sold property in Iowa. The Court recognizes that physical presence in the forum is not essential for the assertion of jurisdiction. Kagin’s Numismatic Auctions, Inc. v. Criswell, 284 N.W.2d 224, 229 (Iowa 1979); Norton v. Local Loan, 251 N.W.2d 520, 522 (Iowa 1977). On the other hand, if a party is not present in the forum state, a closer look must be taken at the alleged contacts. The Eighth Circuit in Iowa Electric Light & Power Co. v. Atlas Corporation, 603 F.2d 1301, 1302-06 (8th Cir. 1979), cert.m denied, 445 U.S. 911, 100 S.Ct. 1090, 63 L.Ed.2d 327 (1980), noted that the defendant was not present in any form within the forum state of Iowa and concluded that the seller’s knowledge that a product was destined for the forum was not necessarily a sufficient contact, absent other voluntary contacts, to subject it to jurisdiction. In addition, the quality of defendant ACR’s contacts with Iowa do not enhance a finding of jurisdiction. Its contacts with Iowa consist only of members residing in Iowa and mailings related to membership being sent into this state. The second jurisdictional guideline directs the Court to consider the quantity of contacts with the forum state. Defendant ACR has less than one percent of its membership residing in Iowa, and makes mailings related to membership into the state. The frequency of mailings by the organization is not known. As HCEC indicates, jurisdiction over a defendant can be found to be constitutionally permissible even if that party’s contact with the forum state flows from a single occurrence. Norton, 251 N.W.2d at 522; Edmundson 211 N.W.2d at 272. It is equally true, however, that a defendant can have several contacts with the forum and not be amenable to suit therein. Rath Packing Co. v. Intercontinental Meat Traders, 181 N.W.2d 184, 188-89 (Iowa 1970). The third primary factor to be considered is the relation of the cause of action to the contacts. ACR’s contacts fail to satisfy this critical requirement. Plaintiff alleges that the defendant ACR violated §§ 1 and 2 of the Sherman Act, and tortiously interfered with prospective business relationships. It does not appear from the record, however, that the plaintiff’s cause of action relates directly to ACR’s contacts with Iowa, i. e. membership and membership mailings. In Toro Company, 572 F.2d at 1267, the issue before the court was whether it could constitutionally assert jurisdiction over a foreign corporation under Minnesota’s long-arm statute when the corporation’s connections with the forum were unrelated to the claim. Id. at 1269. The Eighth Circuit held that it would be constitutionally impermissible to do so if the claim sued upon is unrelated to defendant’s contacts with the forum. As it would have “ ‘no reason to expect to be haled before [the forum state’s] court[s].’ ” Id. at 1271. The Supreme Court in Shaffer v. Heitner, 433 U.S. 186, 207, 97 S.Ct. 2569, 2581, 53 L.Ed.2d 683 (1977) reached a similar conclusion in a case where jurisdiction over the defendant was sought on the basis of defendant’s ownership of property in the state. Although the case at bar involves the question of in personam jurisdiction and the above-cited Supreme Court decision considers in rem and quasi in rem jurisdiction, the controlling significance that the Supreme Court placed on the relationship of a defendant’s contacts with the forum and the claim being asserted by plaintiff is equally applicable to. personal jurisdiction questions. See also Rush v. Savchuk, 444 U.S. 320, 327-31, 100 S.Ct. 571, 577-78, 62 L.Ed.2d 516 (1980). The Court is of the opinion that the nature, quality and quantity of ACR’s contacts with Iowa are so limited and their relationship with the cause of action is so tenuous that any assertion of personal jurisdiction over defendant ACR pursuant to Iowa Code § 617.3 would be constitutionally impermissible as a violation of the “traditional notions of fair play and substantial justice”. Thus, HCEC could not gain personal jurisdiction over defendant ACR through extraterritorial service of process under either § 12 of the Clayton Act or Iowa Code § 617.3, and the complaint must be dismissed as to defendant ACR. 2. Dr. Sabatier In his motion to dismiss, Dr. Sabatier challenges any assertion of jurisdiction and venue over him in this district under the federal antitrust laws, the Iowa long-arm statute, or the general federal venue statute, 28 U.S.C. § 1391. Rule 4(d)(7) and (e) of the Federal Rules of Civil Procedure provides that service of process upon a defendant is sufficient if it is served pursuant to federal statute or in the manner prescribed by the law of the forum state. HCEC appears to base extraterritorial service of process upon federal as well as state law. This Court is unable to find any federal statutory provision authorizing service upon Dr. Sabatier outside of Iowa. As the court in Athlete’s Foot of Delaware, 445 F.Supp. at 48, explains: Section 5 of the Sherman Act, 15 U.S.C. § 6 and § 15 of the Clayton Act, 15 U.S.C. § 25, authorize extraterritorial service only in suits brought by the government, and § 12 of the Clayton Act, 15 U.S.C. § 22, authorizes such service only in the context of suits against corporations. Although § 4 of the Clayton Act, 15 U.S.C. § 15, authorizes civil suits against non-corporate defendants ... it does not authorize service in a district other than that in which the suit is brought. Therefore, this Court cannot have personal jurisdiction over Dr. Sabatier based upon federal statute. Plaintiff can, however, attempt to bring this defendant before the Court under the Iowa long- arm statute, Iowa Code § 617.3. The Court earlier engaged in a comprehensive analysis of the long-arm statute as it related to defendant ACR, and references will be made to that discussion to avoid repetition. In considering the two-part test for judging the assertion of jurisdiction over Dr. Sabatier, the Court first finds that § 617.3 can be utilized under F.R.C.P. 4(d)(7) and (e) to effect service of process on this noncorporate defendant. Dr. Sabatier is an alleged wrongdoer under plaintiff’s antitrust and tortious interference claims, and the plaintiff has alleged injury caused to resident chiropractors as a result of the interference. Again, as was the case with defendant ACR, § 617.3 may be utilized even though the acts causing injury to residents in Iowa occurred outside of Iowa. See Edmundson, 211 N.W.2d at 269; Anderson, 135 N.W.2d at 639. In addition, Dr. Sabatier allegedly committed acts resulting in injury while in this state. The Court next must ascertain if the exercise of jurisdiction under § 617.3 satisfies constitutional due process.. In so doing, the test articulated by the Eighth Circuit in Caesar’s World, Inc., 498 F.2d at 1180 must be applied. (a) Nature and quality of contacts. According to the affidavit of Joseph A. Sabatier, Jr., M.D. (“affidavit of Sabatier”) attached to his motion, this defendant resides and practices medicine in Louisiana, where he is licensed to do so. He states that he never resided, practiced or was licensed to practice medicine in Iowa; never has been a member of the Iowa Medical Society; has no agent, employees or offices in Iowa; and owns no property and makes no purchases in Iowa. Sabatier admits that he gave a speech in Davenport, Iowa several years ago while serving on the Committee on Quackery of the AMA. In addition, plaintiff contends and defendant does not dispute that he carried on correspondence with leaders of national chiropractic associations while serving on the Committee on Quackery. Dr. Sabatier’s other contacts with Iowa include a slide presentation on chiropractic prepared by him which was shown by the chairman of the quackery committee in Johnson County, Iowa; written communications by him while he was chairman of the AMA Committee on Quackery to H. Ronald Frogley, Vice President of Palmer College of Chiropractic in Davenport, Iowa and a visit to the Palmer College. (b) Quantity of contacts As is obvious from the discussion above, Sabatier has had significantly more than a few isolated contacts with this state. (c) Relation of contacts to cause of action Unlike the circumstances of defendant ACR, the alleged contacts of Sabatier are related to plaintiff’s cause of action. The complaint alleges that Sabatier as a member of the Committee on Quackery participated in the violations of §§ 1 and 2 of the Sherman Act and the state common law of tort. Because his contacts with Iowa arise from this membership and his activities as a member of the AMA Committee on Quackery, the contacts are directly related to the cause of action. The Court finds that Dr. Sabatier has sufficient contacts with this district to justify the assertion of jurisdiction over him without violating his constitutional right to due process. Because of the nature and quality, quantity, and relationship of the contacts to the forum, the Court is convinced that subjecting Dr. Sabatier to suit would not violate “traditional notions of fair play and substantial justice.” International Shoe Co., 362 U.S. at 316, 66 S.Ct. at 158. Therefore, the Court concludes that personal jurisdiction was properly obtained over defendant Dr. Sabatier through extraterritorial service of process pursuant to Iowa Code § 617.3. The Court next must determine if venue as to Dr. Sabatier is properly laid in this district under the general federal venue statute, 28 U.S.C. § 1391. The applicable provisions of this venue statute, § 1391(b), provides: A civil action wherein jurisdiction is not founded solely on diversity of citizenship may be brought only in the judicial district where all defendants reside, or in which the claim arose, except as otherwise provided by law. Obviously, all defendants do not reside in Iowa. As a result, the Court must determine where plaintiff’s claim arose. An antitrust claim arises “where the contacts weigh most heavily”. Athlete’s Foot of Delaware, 445 F.Supp. at 45; ABC Great States, Inc. v. Globe Ticket Company, 310 F.Supp. 739, 743 (N.D.Ill.1970); Philadelphia Housing Authority, 291 F.Supp. at 260. Further, even when a conspiracy is alleged by plaintiff, the Court must evaluate the appropriateness of venue in the forum as to each individual defendant. ABC Great States, Inc., 310 F.Supp. at 743; Philadelphia Housing Authority, 291 F.Supp. at 262. Based upon the above principles as applied to the circumstances of defendant Dr. Sabatier, the Court finds that plaintiff’s claim against this defendant arose in Iowa. The contacts weigh most heavily here, where defendant delivered his speech challenging chiropractic, where his slide program on chiropractic was presented, and where he directed letters to officials of a chiropractic college and national chiropractic associations. Admittedly, Sabatier as a member of the AMA Committee on Quackery did participate in its meetings held in Illiniois, but the bulk of those activities alleged by the plaintiff as a basis for the federal claims of these Iowa assignors took place in Iowa. Defendant Sabatier’s overt conspiratorial acts were committed in Iowa. Therefore, Sabatier’s motion to dismiss for lack of venue must be denied. Two final points must be discussed in regard to jurisdiction and venue. HCEC in its resistance requested the Court, if it found venue or jurisdiction lacking as to one or more defendants, to allow it the opportunity to discover facts relevant to such determinations rather than dismissing the parties. The Court rejects this request. Six months elapsed before the dismissal motions were filed by defendants; two months elapsed from the time the motions were filed giving plaintiff notice of the issues until the hearing was held on the merits of the motions. The Court at no time during this period was approached with a request for discovery relevant to the issues raised in the preliminary motions. As a result, the Court will not at this time delay the progress of the lawsuit by allowing plaintiff the opportunity to conduct discovery for the purpose of uncovering information for further resistance of defendant ACR’s motion. Plaintiff also requests in the event the Court deems venue improper as to any moving defendants that the action be transferred as it pertains to such defendants pursuant to 28 U.S.C. § 1406(a). Since the Court concluded that it did not have jurisdiction over ACR, and that defendants AMA and Dr. Sabatier are properly before it for both jurisdictional and venue purposes, the Court need not consider plaintiff’s request. III. STATE ACTION DOCTRINE AND THE McCARRAN-FERGUSON ACT Defendants Blue Cross of Iowa (“Blue Cross”) and Blue Shield of Iowa (“Blue Shield”) filed Motions to Dismiss plaintiff’s complaint as to them on several grounds. Because additional claims are discussed in other sections of this opinion, the Court will only consider defendants’ claims that under the state action doctrine of Parker v. Brown, 317 U.S. 341, 350-52, 63 S.Ct. 307, 313 14, 87 L.Ed. 315 (1943), and the McCarran Ferguson Act they are exempt from the antitrust claims alleged in Count I of the complaint. In addition, the Court has before it defendant Norman Pawlewski’s (“Pawlewski”) claim in his motion to dismiss Court I of the complaint that he is exempt from antitrust scrutiny under the state action doctrine of Parker v. Brown. A. State Action Doctrine 1. Defendants Blue Cross and Blue Shield Blue Cross and Blue Shield contend that their failure to provide insurance coverage for chiropractic care is exempt from antitrust challenge to the extent defendants are alleged to have boycotted plaintiff’s members because Iowa law regulates their insuranee coverage of health services. Blue Cross and Blue Shield base their contention on Parker v. Brown. Iowa Code Chapter 514 governs the activities of any corporation organized under that chapter for the purpose of establishing, maintaining and operating health service plans described therein. Under § 514.1, such a corporation may administer four types of health service plans: (1) a hospital service plan “whereby hospital service may be provided by the said corporation or by a hospital with which it has a contract for such service, to such who become subscribers to said plan under a contract which entitles each subscriber to hospital service”; (2) a medical and surgical service plan “whereby medical and surgical service may be provided at the expense of said corporation, by duly licensed physicians and surgeons, dentists, podiatrists, osteopathic physicians, or osteopathic physicians and surgeons, to subscribers under contract, entitling each subscriber to medical and surgical service, as provided in said contract”; (3) a pharmaceutical service plan; and (4) an optometric service plan. Hospital service corporations are authorized to contract with subscribers for the rendering of specifically defined services. Iowa Code § 514.5 (Supp.1979). Medical service corporations are authorized under the same section to contract with subscribers “to furnish medical and surgical service through physicians and surgeons, dentists, podiatrists, osteopathic physicians, or osteopathic physicians and surgeons.” Id. Section 514.17 directs, however, that a medical service corporation cannot operate until it has contracted with specified numbers of physicians and surgeons, dentists, osteopathic physicians and surgeons, or podiatrists who must be licensed under the applicable provisions of state law. Regulation of health service corporations does not end there. Pursuant to § 514.3, the articles of incorporation of hospital and medical service corporations must be approved by the Commissioner of Insurance. The Commissioner must also approve the rates charged subscribers, § 514.6; the contracts entered into with subscribers, § 514.-7; the contracts entered into with participating hospitals or participating “physicians and surgeons, dentists, podiatrists, osteopathic physicians, or osteopathic physicians and surgeons”, § 514.8; and acquisition and administration costs, § 514.11. Further, all health service corporations must report annually to the Commissioner under § 514.9 and are subject to examination under § 514.10. The Eighth Circuit Court of Appeals very recently had before it an antitrust action against the Bell System (“Bell”) in which plaintiff alleged violations of §§ 1, 2, and 3 of the Sherman Act, and of Iowa tort law. Sound, Inc. v. Bell System, 631 F.2d 1324 (8th Cir. 1980). The court was confronted with the issue of whether Iowa’s regulation of Bell’s rate structure exempted it from antitrust scrutiny under Parker v. Brown’s state action doctrine. Pursuant to its consideration of this issue, the circuit court analyzed the major United States Supreme Court state action exemption cases. Id. at 1332-1334. Rather than restating that analysis here, the Court relies upon the Eighth Circuit’s discussion of the relevant case law and will proceed to apply it to the facts of the present case. The Eighth Circuit in Sound, Inc., at 1334-1335 articulated four factors to be considered in making a determination on the applicability of the state action exemption: (a) “the existence and nature of any statutorily expressed policy;” (b) “the nature of the regulatory agency’s interpretation and application of its enabling statute, including the accommodation of competition by the regulator;” (c)“the fairness of subjecting a regulated private defendant to the mandates of antitrust law;” and (d) “the nature of extent of the state’s interest in the specific subject matter of the challenged activity.” (a) Statutorily Expressed Policy Chapter 514 of the Iowa Code clearly expresses a policy excluding chiropractic services from coverage by health care service corporations. Throughout that chapter, the state legislature repeatedly stated precisely the particular services covered. No mention is ever made of chiropractors, the practice of chiropractic or Chapter 151 of the Iowa Code which governs aspects of the practice of chiropractic, including licensing. The Court believes that the omission of any mention of chiropractic coverage in Chapter 514 directly suggests that the legislature intended to prohibit coverage of their activities by health care service corporations. The legislative history of Chapter 514 supports this conclusion. As originally enacted in 1939, the original law applied to hospital services only; it contained no authorization of a health service plan covering medical or surgical services provided by physicians or other health care practitioners. Acts, 48 G.A., Reg.Sess., Ch. 222 (1939). The statute was amended in 1945 for the purpose of “authoriz[ing] nonprofit corporations to contract to furnish medical and surgical service to subscribers and to contract for the furnishing of such service with physicians and surgeons, osteopathic physicians or posteopathic physicians and surgeons.” Acts, 51 G.A. Reg.Sess., Ch. 209 (1945). Chapter 514 has been subject to further amendment since 1945. Each subsequent pertinent amendment by the legislature extended coverage in health care service plans to include other services. The Iowa legislature, however, has never exercised its judgment on behalf of the citizens of Iowa to permit health care service corporations to cover chiropractic services. The case at bar is unlike Cantor v. Detroit Edison Co., 428 U.S. 579, 96 S.Ct. 3110, 49 L.Ed.2d 1141 (1976), and Goldfarb v. Virginia State Bar, 421 U.S. 773, 95 S.Ct. 2004, 44 L.Ed.2d 572 (1975). In Cantor, 428 U.S. at 585, 96 S.Ct. at 3115, the Supreme Court found that the state’s policy was neutral on whether a light bulb exchange program should be conducted by a utility. Similarly, in Goldfarb, 421 U.S. at 790, 95 S.Ct. at 2015, the Supreme Court held that the fee schedule was not mandated by the state supreme court. Instead, the facts herein are more akin to those found in Bates v. State Bar of Arizona, 433 U.S. 350, 97 S.Ct. 2691, 53 L.Ed.2d 810 (1977), and California Retail Liquor Dealers Association v. Midcal Aluminum, 445 U.S. 97, 100 S.Ct. 937, 63 L.Ed.2d 233 (1980). In Bates, 433 U.S. at 362, 97 S.Ct. at 2698, the Supreme Court concluded that the disciplinary rules of the state supreme court restricting attorney advertising reflected a clear statement of state policy. The legislature has clearly formulated its policy herein prohibiting coverage of chiropractic services by not amending Chapter 514 of the Iowa Code to allow coverage. Thus, this case resembles Midcal Aluminum, 445 U.S. at 104-05, 100 S.Ct. at 943, wherein the court held that the state policy of imposing restrictions on wine prices was clearly stated. The plaintiff argues, however, that Chapter 514 in no way prohibits defendants from directly reimbursing subscribers for chiropractic services, as opposed to reimbursing chiropractors with whom defendants contract for providing services to subscribers. The Court rejects plaintiff’s reading of Chapter 514. Chapter 514 on its face removes any discretion or business judgment with respect to coverage by health care service corporations of chiropractic services. This chapter provides that a medical and surgical service plan may provide certain services to subscribers; there is no requirement that reimbursement go only to a participating health care professional. Iowa Code § 514.1 (Supp.1979). The same is true under § 514.5 where the legislature outlines the services that may be furnished to subscribers by contract. Chapter 514 prohibits, therefore, the coverage of chiropractic services under service plans regardless of whether subscribers are directly reimbursed or payments are made to participating health care professionals. (b) The Regulatory Agency’s Interpretation There is nothing before the Court outlining the activities of the Commission on Insurance pursuant to the statutory scheme in question. The record does indicate, however, that both the Attorney General and the Governor of the State of Iowa have issued opinions relevant to the issue of eligibility for coverage of chiropractic services under Chapter 514. Governor Robert D. Ray concluded that “eligibility for [chiropractic] benefit under Chapter 514 is prevented as a matter of law” and “eligibility for Blue Cross and Blue Shield benefits must be by statutory revision.” Iowa Administrative Bulletin, Vol. II, No. 9 at 527 (Oct. 31, 1979). In an Attorney General’s opinion issued March 26, 1980, considering whether physical therapists could be directly reimbursed under Chapter 514 service plans, it is stated: Being creatures of statutes, service corporations under Section 514.1 can contract for these services only and only with those persons or entities listed in Chapter 514; hospitals or corporations, associations, or individuals providing hospital service; physicians and surgeons; dentists; podiatrists; osteopathic physicians and surgeons; pharmacies; and optometrists. The Court believes both opinions provide further support for its conclusions. (c) Fairness Defendants Blue Cross and Blue Shield lack any discretion or opportunity to exercise business judgment on coverage of chiropractic services. If a state’s regulation of a private party’s activities is so pervasive as to forbid certain actions, it would be inherently unfair to subject the regulated entity to antitrust scrutiny based on failure to act. This factor in the case at bar distinguishes it from Cantor. In Cantor, 428 U.S. at 594, 96 S.Ct. at 3119, the Supreme Court found that the option of whether or not to undertake the light bulb program was primarily within the regulated defendant’s discretion. “[T]here was ‘nothing unjust’ in requiring the utility to make business choices that conformed to federal law.” Sound, Inc., at 1333. In this case, the Court must conclude that the state’s involvement through Chapter 514 is “so dominant that it would be unfair to hold a private party responsible . . Cantor, 428 U.S. at 594-95, 96 S.Ct. at 3119 -20. (d) The State’s Interest The nature and extent of the State’s interest in the challenged activity must be weighed. The challenged activity is the refusal to provide service plan coverage for chiropractic services. The state unquestionably has a strong interest in the regulation of health care. Iowa’s interest in regulating health care services is similar to Arizona’s interest in regulating the bar to protect the public. Bates, 433 U.S. at 361, 97 S.Ct. at 2697. Based upon the preceding discussion, to the extent HCEC in Count I alleges that defendants Blue Cross and Blue Shield boycotted or refused to deal with chiropractors, the Court concludes that these defendants are exempt from antitrust scrutiny under the state action doctrine of Parker v. Brown. 2. Defendant Norman Pawlewski Defendant Pawlewski, Commissioner of Public Health for the State of Iowa, contends that the acts alleged in plaintiff’s complaint are exempt from the antitrust laws because they were required by state laws. As the plaintiff indicates in its resistance, the Court must carefully review the statutory scheme that v