In a decisive battle against what was deemed a frivolous lawsuit, Federal Judge William H. Orrick has dismissed a case by U.S. News and World Report aimed at halting a San Francisco City Attorney's investigation into the publication's hospital rankings and its undisclosed financial relationships with those it evaluates, as reported by the city attorney's office. The Northern District of California's court denied the media outlet’s request for a preliminary injunction and sided with the city on an anti-SLAPP motion intended to prevent the stifling of political or legal rights through litigation.
City Attorney David Chiu expressed his satisfaction with the decision, stating, "It’s disappointing that U.S. News chose to waste judicial resources on a red herring lawsuit to evade legitimate questions about its undisclosed financial links to the hospitals it ranks," in an assertion that underlines the growing scrutiny over alleged deceptive practices in the health care information sphere, the media giant's involvement has particularly struck a chord with regulators and the public alike, who increasingly rely on such rankings for making critical healthcare decisions.
The origin of the legal scuffle traces back to last year when the City Attorney's Office unearthed that U.S. News accepts payments from hospitals in various forms, including licensing fees for the use of its "Best Hospitals" badges, subscriptions, advertising, and payments for featured placements, with revenue being substantially significant—one hospital admitted to paying $42,000 to boast the badge for a year. These findings prompted the City Attorney to dispatch subpoenas earlier this year to gather further information on the company's practices, which are now believed to infringe on California consumer protection laws potentially.
Instead of providing the requested information or formally challenging the subpoenas, U.S. News chose to file what the court has now ruled as a meritless lawsuit on January 23, just a day shy of the deadline to respond to the subpoenas; the court described the company's legal gambit as a rash avoidance maneuver that U.S. News did not seek to meet and confer with the City Attorney after the Subpoenas were served. It did ultimately not lessen the scrutiny of their actions. In supporting the City's right to investigate, Judge Orrick affirmed via the City Attorney of San Francisco report, "No one contests that the City Attorney issued the Subpoenas in furtherance of his official responsibilities, which include the right to investigate entities that he believes may be violating California law."
The case, formally named U.S. News & World Report, L.P., v. City Attorney of San Francisco David Chiu, undeniably emphasizes the mounting pressure on publications to ensure not just the accuracy but the authenticity and transparency of the ratings they provide — a pressure which has intensified as information has become a currency of trust in an era fraught with questions about whom to trust with decisions as fundamental as health care. Reinforcing this perspective on accountability, U.S. News is mandated to reimburse the City for the fees and costs incurred in connection with the anti-SLAPP motion.
