Recent decisions regarding mutual funds, particularly with regard to advisory fee disputes, have taken on heightened importance for the hedge fund community.  This is because of the growing convergence between hedge fund strategies and mutual fund structures.  As previously reported in the Hedge Fund Law Report, investment managers who manage both hedge and mutual funds may have, for somewhat counterintuitive reasons (i.e., reasons other than short term fee considerations), an incentive to favor mutual funds.  See “New Study Offers Surprising Findings on the Incentives Created by Concurrent Management of Hedge and Mutual Funds,” Hedge Fund Law Report, Vol. 2, No. 23 (Jun. 10, 2009).  Such managers may use the mutual funds to “advertise” their investing prowess to the public and potential hedge fund investors because, with respect to the mutual fund, they have less onerous restrictions with respect to communications with the public, investor solicitations and performance advertising.  Successful mutual fund managers sometimes capitalize on their success by launching hedge funds following similar strategies, but with higher total fees.  Also, an increasing number of mutual funds are employing hedge fund strategies.  As a consequence of this convergence trend, a case now before the U.S. Supreme Court dealing with advisory fees in the mutual fund context has significance for the hedge fund community.  We detail the substantive and procedural history of that case, including the most recent decision from the Seventh Circuit and a dissent from the redoubtable Judge Posner (that could foreshadow the outcome in the U.S. Supreme Court).  We also summarize the arguments advanced by SIFMA, the Independent Directors Council and the Investment Company Institute in amicus briefs.