Seventh Circuit Roundup: “Mootness Fees” in Federal Securities Litigation and Private Right of Actions To Enforce Federal Statutes Under Section 1983

In this month’s podcast, Kian and Mark address two cases dealing with two completely different but equally complex areas of federal law: securities litigation and Medicaid.

In Alcarez v. Akorn, the Court examined the avenues of federal review of so-called “mootness fees” in securities litigation. These fees arise when securities plaintiffs sue over lack of disclosures but the case is rendered moot when the company later provides the disclosure. Mootness fees then sometimes become part of the settlement of the now moot litigation. Alcarez provides a roadmap for how shareholders may intervene and oppose the payment of these fees.

The second case – Saint Anthony Hospital v. Whitehorn – came back to the Seventh Circuit on remand from the Supreme Court. The opinion addressed whether a hospital could invoke Section 1983 against state regulators to compel them to enforce timely payment by managed care organizations. It provides an in-depth examination of when plaintiffs may bring Section 1983 claims to enforce federal statutes enacted under the Spending Clause.

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