Last week, the Second Circuit Court of Appeals affirmed a district court's decision, holding that the American Pipe tolling doctrine does not apply to the three-year statute of repose under the Securities Act of 1933.
In re IndyMac Mortgage-Backed Securities Litigation, the Second Circuit found that the U.S. Supreme Court's ruling in American Pipe & Construction Co. v. Utah that held that "the commencement of a class action suspends the applicable statute of limitations as to all asserted members of the class who would have been parties had the suit been permitted to continue as a class action" does not apply to statutes of repose. These statutes, in general, have an "absolute" three-year limitation that is stricter than the statute of limitations, which can be subject to tolling.
The Second Circuit’s decision resolved a split of authority within the Second Circuit, but other U.S. Courts of Appeals, including the Federal, Fourth and Tenth Circuits, remain split. For more, read the full decision.
Second Circuit rules that equitable tolling principles do not apply to the statute of repose under the Securities Act
