CMS Extends Deadline For Publication of Final Stark II, Phase III Rule
Client Alert | 1 min read | 03.21.07
As expected, CMS announced today that it is extending the timeline for publication of the final rule implementing the Stark Law (the “Phase III Rule”) for one year. With this extension, the interim final rule issued on March 26, 2004 (the “Phase II Rule”) will remain in effect until March 26, 2008, at which time CMS will publish the Phase III Rule.
The timeline for publishing a final regulation cannot exceed three years from the date of publication of the proposed interim final rule, unless there are “exceptional circumstances.” CMS attributes the “numerous and varied” public comments received following publication of the Phase II Rule, as well as the substantial “interagency coordination” among CMS, the Office of the Inspector General, and the Department of Justice, (resulting from their joint authority to enforce the Stark Law), as the justification for the one-year extension.
This leaves unanswered for at least one more year critical and outstanding issues under the Stark Law, including: 1) the Law’s applicability to Medicaid referrals and claims; 2) the potential for expansion of the physician recruitment exception to accommodate certain practical considerations; and 3) the potential narrowing of the in-office ancillary services exception to preclude certain referral practices that are understood to be deemed questionable by CMS.
Insights
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Kansas Federal Court Applies “Selective Enforcement” Theory to Reject DTSA Claim
A Kansas federal court held that inconsistent enforcement of trade secret rights can defeat a claim under the Defend Trade Secrets Act (DTSA). In Edelman Financial Engines, LLC v. Mariner Wealth Advisors LLC, No. 2:23-cv-02515-HLT (D. Kan. June 5, 2026), the court applied a selective enforcement theory, holding that when a company does not consistently pursue legal remedies against similarly situated former employees, that inconsistency can be affirmative evidence that it failed to protect its trade secrets. While the selective enforcement theory has appeared in academic hypothetical discussions, the decision appears to be one of the clearest judicial applications of a “selective enforcement” theory in a trade secret case.
Client Alert | 3 min read | 06.12.26
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Auto Dealers: The FTC Is Back in the Driver’s Seat — Warning Letters Signal Renewed Federal Scrutiny
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