Acceptance ≠ Interchangeability: Seventh Circuit Holds ABPN’s MOC Is Not a CME Substitute for Antitrust Tying Purposes

Introduction

In Emily Elizabeth Lazarou v. American Board of Psychiatry and Neurology, the U.S. Court of Appeals for the Seventh Circuit confronted a recurring antitrust challenge to a medical specialty board’s Maintenance of Certification (MOC) program. Two psychiatrists alleged that the American Board of Psychiatry and Neurology (ABPN) unlawfully tied its specialty certifications (the “tying” product) to ABPN’s MOC (the purportedly “tied” product), thereby harming competition in the market for continuing medical education (CME).

The core issue was not whether ABPN holds monopoly power in certification—it does—but whether plaintiffs plausibly alleged that ABPN’s MOC competes with CME such that a tie between certification and MOC could foreclose competition in the CME market. Building on its 2022 decision in Siva v. American Board of Radiology, the Seventh Circuit held the plaintiffs again failed to plead the “separate-products” element of tying because the complaint did not make it plausible that MOC is reasonably interchangeable with CME—i.e., that there is cross-price elasticity between MOC and CME offerings.

The panel affirmed dismissal with prejudice; Judge Maldonado dissented, warning that the court’s trajectory unduly raises the pleading bar in antitrust cases and that plaintiffs met the Siva-specific plausibility threshold.

Summary of the Opinion

Judge Jackson-Akiwumi, writing for the panel (Judges Scudder and Jackson-Akiwumi; Judge Maldonado dissenting), affirmed the district court’s Rule 12(b)(6) dismissal with prejudice. The court:

Reaffirmed that plaintiffs must plausibly allege that MOC is a substitute for CME to satisfy the separate-products element of a tying claim under Section 1 of the Sherman Act.
Held that even accepting plaintiffs’ allegations that (a) ABPN’s Assessment Requirement contains educational content and (b) some states accept MOC toward state CME licensure, the complaint still does not plausibly suggest that psychiatrists and neurologists view MOC as reasonably interchangeable with CME.
Rejected two specific theories for interchangeability:
- Full satisfaction theory: Some states accept participation in MOC as fully satisfying CME requirements. The court found this implausible as a basis for substitution because MOC imposes additional time, effort, and cost (e.g., PIP, article exams or a 10-year recertification exam, annual MOC fee) beyond simply purchasing CME credits.
- Direct credit theory: Completing the Recertification Exam can yield AMA Category 1 “direct credits.” The court deemed it still implausible that rational doctors would choose the MOC pathway solely to avoid purchasing some number of CME credits when MOC also requires a separate fee, substantial additional work, and purchase of CME credits to meet MOC’s Activity Requirements.
Concluded that plaintiffs failed to plead facts supporting cross-price elasticity and thus failed the separate-products test; without separate products, there can be no unlawful tying.
Affirmed dismissal with prejudice because plaintiffs had multiple opportunities to amend after Siva and did not show how further amendment would cure the defects.

In dissent, Judge Maldonado argued that the majority sets the bar too high at the pleadings stage, and that allegations of state acceptance of MOC, AMA conferral of Category 1 credits for MOC assessments, and voluntary purchase of MOC by “grandfathered” physicians together made it plausible that MOC and CME are substitutes in the minds of consumers.

Factual and Regulatory Background in Context

Physicians must be licensed by state medical boards; most states require ongoing CME to maintain licensure. CME typically comes in two categories:

Category 1: Credits earned via accredited CME vendors or by applying to the American Medical Association (AMA) for “direct credit.”
Category 2: Includes self-assessment products; some states allow use of Category 2 credits to satisfy parts of Category 1 requirements.

Specialty board certification—while not required by law—is often a de facto requirement for employment, hospital privileges, and insurance coverage. ABPN offers initial certifications and requires ongoing purchase of MOC (currently $175/year) to maintain certification. ABPN sells MOC only to its own diplomates and revokes certification when diplomates do not maintain MOC.

ABPN’s MOC has two main components:

Activity Requirements (every 3 years):
- 90 CME credits total, comprised of 66 Category 1 and 24 Category 2 self-assessment credits; and
- One Improvement in Medical Practice (PIP) activity.
Assessment Requirement:
- Article-Based Pathway (every 3 years): 30 of 40 short exams tied to ABPN-selected articles/journals; or
- Recertification Exam (every 10 years): a day-long, proctored exam developed and administered by ABPN.

Completing an Assessment Requirement can waive part of the Activity Requirements (e.g., success on the Article-Based Pathway waives 16 of the 24 Category 2 self-assessment credits; passing the Recertification Exam waives 8 of 24). Some physicians can seek AMA Category 1 “direct credits” for successfully completing the Recertification Exam.

Analysis

Precedents and Authorities

North Pacific Railway Co. v. United States, 356 U.S. 1 (1958): Recognizes tying arrangements as potentially unlawful under the Sherman Act because of their pernicious effect on competition.
Jefferson Parish Hosp. Dist. No. 2 v. Hyde, 466 U.S. 2 (1984): Articulates the separate-products inquiry—focusing on demand-side indicators and whether there is sufficient consumer demand for the tied product separate from the tying product to make separate offerings efficient; cautions against relying on functional relationships.
Illinois Tool Works Inc. v. Independent Ink, Inc., 547 U.S. 28 (2006): Not all ties are unlawful; plaintiff must establish the elements of illegal tying, including market power and foreclosure.
Reifert v. South Central Wisconsin MLS Corp., 450 F.3d 312 (7th Cir. 2006): Recites elements of illegal tying in this circuit (separate products; economic power in tying market; not-insubstantial commerce in tied market; seller’s economic interest in tied sales).
Brown Shoe Co. v. United States, 370 U.S. 294 (1962): Introduces the “reasonable interchangeability” standard for defining markets and considering substitutability.
Viamedia, Inc. v. Comcast Corp., 951 F.3d 429 (7th Cir. 2020): Identifies demand-side indicators, including how market participants sell and purchase, separate pricing, and whether products are distinguishable in buyers’ eyes.
Siva v. American Board of Radiology, 38 F.4th 569 (7th Cir. 2022): The critical antecedent case; held plaintiffs must plead facts supporting cross-price elasticity between MOC and CME—i.e., that consumers would shift purchases to MOC in response to changes in relative prices. Found no substitution where the radiology MOC either required buying CME elsewhere or did not yield CME credits.
Association of American Physicians & Surgeons, Inc. v. American Board of Medical Specialties, 15 F.4th 831 (7th Cir. 2021): Applied Twombly’s concerns about costly discovery in an antitrust conspiracy context; underscores that conclusory allegations are insufficient.
Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009): Require facial plausibility, grounded in common sense, to justify the burdens of antitrust discovery.
Right Field Rooftops, LLC v. Chicago Cubs Baseball Club, LLC, 870 F.3d 682 (7th Cir. 2017): De novo review of Rule 12(b)(6) dismissals; reasonable inferences drawn in favor of plaintiffs.
Adebiyi v. South Suburban College, 98 F.4th 886 (7th Cir. 2024); Jauquet v. Green Bay Area Catholic Education, Inc., 996 F.3d 802 (7th Cir. 2021): Standards for leave to amend and dismissal with prejudice.

The Court’s Legal Reasoning

The court frames the market at issue as “an educational content market for doctors’ continuing education obligations.” To plead illegal tying, plaintiffs first had to plausibly allege two separate products—certification and a product that competes in the CME market. Under Jefferson Parish and Siva, the key is demand, not function: the court asks whether relevant consumers (psychiatrists and neurologists) see ABPN’s MOC as reasonably interchangeable with CME products such that, absent the alleged tie, an increase in the price of CME relative to MOC would cause consumers to shift purchases to MOC.

Plaintiffs advanced two avenues to show substitution. Both failed.

1) The “Full Satisfaction” Theory

Plaintiffs argued that some states, such as New Hampshire and Washington, accept MOC participation as fully satisfying CME licensure requirements—making MOC a cheaper or more attractive option than purchasing the requisite number of Category 1 CME credits. The panel rejected this logic because it abstracts away the full cost of MOC. Even if MOC appears to require fewer CME credits on paper, MOC, unlike simply buying CME, also imposes:

An annual MOC fee (currently $175),
A PIP activity every three years, and
Substantial Assessment Requirements—either repeated article-based tests or a high-stakes, day-long recertification exam.

In other words, MOC is not just “fewer credits.” It is a bundle with additional, time-consuming, and costly obligations. In the court’s common-sense view, this added burden makes it implausible that doctors would shift from CME to MOC simply because some states deem MOC sufficient for licensure. Without plausible allegations that, in response to relative price increases, doctors would actually substitute MOC for CME, plaintiffs did not allege cross-price elasticity.

2) The “Direct Credit” Theory

Plaintiffs also contended that doctors who pass the Recertification Exam can obtain AMA Category 1 “direct credits” (Dr. Akhter obtained 60) to meet state CME requirements, reducing or eliminating the need to purchase additional CME from vendors. Even assuming generous arithmetic (the panel noted that 60 credits over a 10-year exam cycle equates to 6, not 20, credits per year), the court held it is still implausible that a rational physician would choose the MOC route for that purpose:

To pursue this path, a physician must still pay the MOC fee, complete the PIP and other MOC Activity Requirements (including purchasing up to 90 CME credits from vendors), and sit for the Recertification Exam.
Those additional costs and burdens make MOC an unattractive alternative to simply purchasing the remaining CME credits from accredited vendors.

The panel further noted that, at this stage, it drew inferences in plaintiffs’ favor regarding the ability to spread AMA direct credits across years (after rejecting ABPN’s citation to Iowa regulations as unsupported). But even with that favorable inference, the alleged substitution remained implausible.

Implications for the Separate-Products Test

The decision underscores that acceptance of MOC for state licensure or AMA’s granting of direct credits for exam performance does not, by itself, transform MOC into a substitute for CME. The court focused on how buyers perceive and choose among products, not on whether the products can be used to achieve the same regulatory outcome. Because the complaint did not plausibly allege that doctors would, in fact, switch to MOC in response to CME price increases (cross-price elasticity), the separate-products element failed, and with it the tying claim.

Dismissal with Prejudice

Applying Rule 15(a)(2), the court affirmed the district court’s decision to deny further amendment. Plaintiffs had already amended after Siva but did not identify how another amendment would cure the defects. Absent a proffer of new facts addressing the court’s concerns about demand-side substitutability, denying further leave was not an abuse of discretion.

The Dissent

Judge Maldonado criticized what she described as the “continuous heightening of the pleading standards for antitrust claims,” tracing the evolution from Rule 8’s “short and plain statement” to Twombly/Iqbal and the Seventh Circuit’s applications in Association of American Physicians & Surgeons and Siva. She argued:

Plaintiffs did exactly what Siva demanded: they alleged that MOC contains educational content, that states accept MOC toward licensure, that AMA grants Category 1 credits for MOC assessments, and that some “grandfathered” doctors voluntarily purchase MOC—together making it plausible that MOC and CME are reasonably interchangeable in the minds of physicians.
The majority’s invocation of MOC’s burdens is speculative at the 12(b)(6) stage; discovery would test whether physicians in fact prefer one path over the other for reasons that go beyond dollar price (e.g., learning style, credentialing benefits, scheduling, or integration).
Given these allegations, the complaint should proceed to discovery rather than be dismissed with prejudice.

Impact and Forward-Looking Implications

This decision refines and reinforces Siva’s demand-side approach to tying in the professional certification context. Key practical effects include:

Higher pleading bar for tying claims against boards: Plaintiffs must allege concrete facts showing that physicians actually treat MOC as a substitute for CME (e.g., survey data, documented purchasing shifts, pricing experiments, or credible econometric indicators of cross-price elasticity) rather than merely that MOC can satisfy regulatory requirements.
Acceptance is not enough: That state boards or the AMA accept MOC artifacts toward CME does not establish consumer substitutability. Courts will look to the total bundle of costs and burdens and whether buyers reasonably switch between products.
Market definition is demand-based: The “educational content” market frame remains controlling. Arguments that focus on functional overlap or regulatory equivalence will not suffice without demand-side facts.
Limited room for tying attacks where MOC redirects to CME vendors: Where MOC’s requirements direct diplomates to buy CME from third parties, MOC is less likely to be a “competing” product in the CME market.
Drafting future complaints: Viable complaints will likely need:
- Evidence that a non-trivial subset of physicians—especially those not coerced by the threat of decertification—choose MOC paths instead of buying CME, and do so in response to relative pricing.
- Data showing purchasing shifts to MOC when CME prices rise, or vice versa.
- Allegations that boards themselves provide accredited CME content within MOC in a way that directly competes with third-party CME vendors.
- Facts showing that the overall burden of MOC (time, cost, effort) is comparable to or less than CME alternatives for enough consumers to affect market outcomes.
Certification boards and CME vendors: Boards gain some insulation from tying claims if their MOC programs either require purchase of third-party CME or add burdens that make MOC unattractive as a CME substitute. CME vendors retain competitive ground where MOC does not function as a market substitute.

Complex Concepts Simplified

Tying (antitrust): When a seller uses its power over one product (tying product) to compel purchase of a second product (tied product), potentially foreclosing competition in the tied product’s market.
Separate-products test: A tie is actionable only if there are two distinct products; courts look to demand-side indicators—do consumers view them as different and buy them separately? Functional overlap does not decide the issue.
Reasonable interchangeability: Products are substitutes if consumers see them as alternatives such that a price increase in one would push purchases to the other.
Cross-price elasticity: An economics measure that, in legal pleadings, is often approximated by factual allegations showing that changing the price of one product causes buyers to switch to another.
CME Category 1 vs. Category 2: Category 1 typically comes from accredited providers or is granted by the AMA as “direct credit.” Category 2 includes self-assessment and other activities; some states allow partial substitution of Category 2 toward Category 1 obligations.
MOC (Maintenance of Certification): Ongoing requirements (fees, activities, assessments) imposed by medical specialty boards to maintain certification.
PIP (Improvement in Medical Practice): A structured activity within MOC focused on practice assessment and improvement.
AMA “direct credit”: Category 1 CME credit conferred by the AMA for qualifying activities (e.g., passing a board recertification exam), even when not directly obtained from an accredited CME vendor.
Dismissal with prejudice: The case is closed on the merits at the pleading stage; plaintiffs cannot file another amended complaint in the same action.

Critical Reflections

The majority’s emphasis on the “total-burden” view of MOC tacitly introduces a comparative-cost lens at the pleadings stage. The court does not require econometric proof, but it does require non-conclusory allegations making it plausible that rational buyers would switch to MOC given relative prices. By contrast, the dissent warns against courts substituting intuition about physician preferences for factual development through discovery—especially where plaintiffs pleaded that some doctors voluntarily choose MOC, that states and the AMA accept MOC artifacts toward CME, and that MOC contains educational content comparable in purpose to CME.

The fault line is familiar: how much market-structure and demand-detail must antitrust plaintiffs plead before unlocking discovery? Lazarou signals that, at least in the Seventh Circuit, tying claims in the certification/CME context must grapple concretely with demand-side substitution and the full opportunity cost of MOC.

Conclusion

Lazarou v. ABPN clarifies and tightens the application of the separate-products test for tying where professional certification and continuing education intersect. The Seventh Circuit holds that state acceptance of MOC for licensure and AMA “direct credit” do not, without more, make MOC a substitute for CME. Plaintiffs must plausibly allege cross-price elasticity—facts showing that physicians, considering the full bundle of costs and obligations, would switch to MOC in response to relative price changes in CME. Absent such allegations, there is no distinct tied-product market and thus no unlawful tying.

Practically, this decision raises the pleading bar for antitrust attacks on certification-linked MOC programs in the Seventh Circuit. Future plaintiffs will need to supply concrete, demand-side allegations—data, market behavior, and buyer preference evidence—to survive Rule 12(b)(6). At the same time, the dissent cautions that the court’s approach risks screening out viable cases before discovery can illuminate how physicians actually behave in this specialized market.

For now, Lazarou stands as a clear statement: acceptance is not interchangeability. Antitrust tying claims in this niche will turn on plausible facts about substitutive demand, not merely on functional overlap or regulatory usability.