Suit challenges Maryland's funeral home law
BALTIMORE --A Maryland law that limits funeral home ownership to licensed funeral directors hurts both consumers and would-be entrepreneurs by restricting competition, according to a lawsuit filed Wednesday in U.S. District Court in Baltimore.
The suit filed by the Arlington, Va.-based Institute for Justice on behalf of five entrepreneurs, four from Maryland and one from Florida, claims the lack of competition adds $800 to the average cost of a funeral yet does little to protect consumers against fraud, incompetence or abuse.
"All that we want to accomplish is to bring Maryland in line with what ... other states do," said Institute for Justice attorney Jeff Rowes. "Only Pennsylvania and New Hampshire have restrictive, anti-competitive laws like Maryland."
Maryland's law allows only licensed funeral directors, one of 58 designated corporations or the holder of a corporate license that has been handed down or sold to operate funeral homes.
"This is like saying that you have to be a pilot to own an airline; there's no reason why you have to be a licensed funeral director to own a funeral home," said Rowes in a press release.
The plaintiffs include three businessmen who are not licensed funeral directors but say they would hire a licensed director to operate their business, and two licensed directors who believe the state has placed an artificial cap on the number of corporate licenses available, driving up the cost of obtaining one. One of the plaintiffs, Charles S. Brown, owns Rest Haven Cemetary in Hagerstown, and has lobbied in Annapolis to have the law changed for over a decade. Brown says owning a funeral home would provide additional revenue after his cemetary gets full.
The suit names the 12 members of the Maryland State Board of Morticians, which regulates the industry, as defendants. Executive Director Laurie Sheffield-James said the board would not comment on pending litigation.
There are 220 funeral homes in Maryland, according to the Institute, and the average cost of a funeral is from $5,500 to $6,500.
