On July 13, 2023, the United States Court of Appeals for the Tenth Circuit reversed the dismissal of a putative class action asserting claims against a poultry producer and certain of its officers under Section 10(b) of the Securities Exchange Act of 1934.  Hogan v. Pilgrim’s Pride Corp., —F.4th—, 2023 WL 4508545 (10th Cir. 2023).  Plaintiff alleged that the company made misrepresentations regarding its financial results, business operations, and a purported price-fixing scheme.  The district court dismissed plaintiff’s second amended complaint as barred by the Exchange Act’s statute of repose, but the Tenth Circuit reversed, holding that the statute of repose did not apply.

On September 2, 2021, the United States Court of Appeals for the Third Circuit affirmed the decision by a district court to permit plaintiffs to file a third amended complaint, on behalf of a putative class, against a bank (the “Company”) and certain of its former officers, its underwriters, and its independent auditors, alleging violations of Sections 11, 12(a) and 15 of the Securities Act of 1933, as well as Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.  Southeastern Penn. Trans. Authority v. Orrstown Financial, No. 20-2829 (3d Cir. Sept. 2, 2021).  Plaintiffs’ Third Amended Complaint was filed after the applicable repose period had expired, and after certain defendants had successfully moved for dismissal.  Defendants argued the relation back doctrine under Rule 15(c) of the Federal Rules of Procedure—which allows an amended pleading under certain circumstances to be treated as if filed on the date of an initial pleading despite any applicable statute of limitations—should not similarly apply against the statute of repose, which bars claims after a certain period of time.  The Third Circuit held the district court did not err in granting plaintiffs leave to amend under Rule 15(a)(2), because the relation back doctrine was not in conflict with the statute of repose, and because defendants had not yet had a vested substantive right to repose as the action was still ongoing and plaintiffs sought only to amend to reassert claims they originally brought against the same parties.

On June 3, 2019, Judge Analisa Torres of the United States District Court for the Southern District of New York dismissed a putative class action against the mining company Rio Tinto and certain of its executives.  Colbert v. Rio Tinto plc, 17 Civ. 8169 (AT) (DCF) (S.D.N.Y. June 3, 2019).  Plaintiff—purportedly on behalf of a class of purchasers of Rio Tinto’s American Depositary Receipts (“ADRs”)—alleged that defendants made misrepresentations regarding Rio Tinto’s investment and mining operations in Mozambique, in violation of Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 thereunder.  The Court held that certain of plaintiff’s claims were time-barred and the remaining claims failed to adequately allege an actionable misrepresentation or scienter.

On August 3, 2018, Judge George C. Steeh of the United States District Court for the Eastern District of Michigan dismissed with leave to amend an individual action asserting, among other things, Section 10(b) of the Securities Exchange Act and Rule 10b-5 claims.  Equity Trust Co., et al., v. Kopacka, et al., No. 17-12275 (E.D. Mich. Aug. 3, 2018).  Defendant argued that plaintiffs’ Exchange Act claims were barred by the applicable five-year statute of repose, which he argued was triggered no later than plaintiffs’ final purchase of securities.  Noting that the Sixth Circuit had not ruled on when the Exchange Act repose period begins to run, the Court sided with plaintiffs, the Third Circuit, and district courts in the First and Second Circuits in ruling that the period begins to run with the last alleged misrepresentation, even if it is made after the last alleged security purchase.

On February 27, 2017, Judge Katherine Polk Failla of the United States District Court for the Southern District of New York dismissed with prejudice a putative class action brought on behalf of purchasers of Wal-Mart de México SAB de CV (“Wal-Mex”) American Depositary Shares (“ADRs”) against Wal-Mex, Wal-Mart Stores, Inc. (“Wal-Mart”), and two Wal-Mex executives.  Fogel v. Wal-Mart de México Sab de CV, — F. Supp. 3d —, 2017 WL 751155 (S.D.N.Y. 2017).  The complaint alleged that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder based on allegations that Wal-Mex’s annual reports for 2004 through 2011 failed to disclose an alleged bribery scheme.  In a detailed and thorough opinion that provides an overview of the state of Rule 10b-5 jurisprudence in the Second Circuit, the Court held that many of plaintiff’s claims were time barred, and that plaintiff failed to state a claim with respect to those claims that were timely.

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On August 10, 2016, the Eleventh Circuit affirmed the dismissal of a putative class action alleging that various JPMorgan entities and two JPMorgan employees were liable under federal securities laws and civil RICO for frauds perpetrated by Bernie Madoff’s advisory business, Bernie L. Madoff Investment Securities LLC (“BLMIS”).  Dusek v. JPMorgan Chase & Co., —F.3d—, 2016 WL 4205857 (11th Cir. Aug. 10, 2016).  Plaintiffs claimed that the defendants were liable under section 20 of the Securities Exchange Act of 1934 (“Exchange Act”) and the federal civil RICO statute based on their banking relationship with Madoff and their access to BLMIS’s bank accounts.  The Court held that the securities law claim was barred by the Exchange Act’s five-year statute of repose and that the RICO claim was barred by the Private Securities Litigation Reform Act (“PSLRA”).  

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On July 14, 2016, the U.S. Court of Appeals for the Second Circuit upheld a decision dismissing claims against Bear Stearns Companies L.L.C. (“Bear Stearns”) for violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (“Exchange Act”) and common law fraud under New York law.  SRM Global Master Fund Ltd. P’ship v. Bear Stearns Cos. L.L.C., 14-507-cv, 2016 WL 3769735 (2d Cir. Jul. 14, 2016).  The Court held that the class action tolling rule set forth in American Pipe & Construction Co. v. Utah, 414 U.S. 538 (1974), does not apply to 28 U.S.C. § 1658(b)(2), the five-year statute of repose that limits the time in which plaintiffs may bring various securities related claims, including under Section 10(b) of the Exchange Act. 

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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.

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On April 29, 2016, the United States Court of Appeals for the Second Circuit affirmed a dismissal by the United States District Court for the Southern District of New York, holding that the Oxley Act of 2002 (“SOX”) extended the statute of repose from three years to five years for claims brought under Sections 9(f) and 18(a) of the U.S. Securities Exchange Act of 1934 (the “Exchange Act”), it did not change the three-year statute of repose for Section 14(a) claims.  Bricklayers and Masons Local Union No. 5 Ohio Pension Fund v. Transocean Ltd. et. al., No. 14 Civ. 0894, 2016 WL 1055363 (2d Cir. April 29, 2016).  The Court reached this result despite a prior decision that applied the repose period under Sections 9(f) and 18(a) to Section 14(a), based on the principle that assumes that Congress accounts for existing law when it passes legislation.  

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