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  • Two Recent Second Circuit Decisions Provide Opportunity For Supreme Court To Address Whether American Pipe Tolling Extends To Statutes Of Repose
     

    07/18/2016
    The tolling rule established by the Supreme Court in American Pipe & Construction Co. v. Utah generally provides that the commencement of a class action in federal court suspends the applicable statute of limitations for all members of the proposed class.1 Lower courts are divided over whether American Pipe tolling applies to statutes of repose. In 2014, the Supreme Court granted certiorari to review the Second Circuit’s holding in Police & Fire Retirement System of City of Detroit v. IndyMac MBS, Inc. that American Pipe tolling does not apply to the statute of repose in Section 13 of the Securities Act of 1933,2 but subsequently dismissed the writ as improvidently granted after the IndyMac parties resolved that litigation.3 Two recent decisions from the Second Circuit, however, may provide new opportunities for the Supreme Court to consider the issue. In In re Lehman Brothers Securities & ERISA Litigation, No. 15-1879, 2016 WL 3648259 (2d Cir. July 8, 2016), the Second Circuit re-affirmed its IndyMac holding, expressly acknowledged that IndyMac had created a circuit split on the issue,4 and suggested that the question was ripe for Supreme Court review. The next week, in SRM Global Master Fund Limited Partnership v. Bear Stearns Companies, No. 14-507, 2016 WL 3769735 (2d Cir. July 14, 2016), the Second Circuit extended the rationale of IndyMac to the Securities Exchange Act of 1934, holding that American Pipe tolling does not apply to the five-year repose period established by 28 U.S.C. § 1658(b)(2) for claims under Section 10(b) of the Exchange Act.

    Read the whole document below.
    CATEGORY: Statute of Repose

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