United States: Update: Briefs Filed In CalPERS v. ANZ Securities

Last Updated: April 19 2017
Article by Joel D. Rothman and Angela DiIenno

The Supreme Court is set to hear arguments on Monday in CalPERS v. ANZ Securities. Previously we provided a comprehensive overview of CalPERS's brief. In anticipation of oral arguments, below we discuss the arguments raised in ANZ's brief and CalPERS's reply.

The CalPERS litigation is notable because of the potential impact it will have on the Second Circuit's IndyMac decision, which held that because the three-year limitations period in Section 13 of the Securities Act is a statute of repose, the time to initiate a claim is not tolled by the filing of a class action. In the case now before the Supreme Court, CalPERS argues that the Second Circuit's ruling in IndyMac, and in the instant case, conflicts with the Supreme Court's holding in American Pipe that the filing of a class action tolls the limitations period for any unnamed member of the proposed class.


In sum, in its brief ANZ (a) urges the Court to adopt the Second Circuit's reasoning in IndyMac, which distinguishes the two limitations periods in Sections 13, delineating Section 13's one-year limitations period as a statute of limitations and Section 13's three-year period as a statute of repose; (b) argues that American Pipe establishes an equitable tolling rule that cannot be applied to a congressionally mandated repose period; (c) argues that CalPERS has intentionally distorted the issues to its own advantage by framing its argument to addresses case-specific matters on which the Court declined to grant certiorari; and (d) addresses CalPERS's policy arguments (which we outlined in our prior post).

Three amicus briefs were filed on behalf of the Securities Industry and Financial Markets Association and the Clearing House Association L.L.C., the United States Chamber of Commerce, and the Washington Legal Foundation. The substance of the briefs largely mirrors the arguments raised by ANZ, with a focus on the importance of repose periods, the lack of empirical evidence that the IndyMac rule has produced the policy problems that CalPERS identifies, as well as suggesting that on the contrary, a requirement that investors file their own actions before repose periods expire leads to consolidated discovery, relieving the administrative burden on courts, rather than adding to it.

American Pipe and Statutes of Repose

ANZ begins by pointing to the language of Section 13, which provides that, "[i]n no event shall any . . . action be brought . . . more than three years after the security was bona fide offered to the public . . . ." It argues that the statutory phrase "in no event" clearly distinguishes the three-year limitation period of Section 13 as a statute of repose, not subject to judge-made tolling rules. ANZ also compare the language of the two limitations provisions of Section 13, one of which imposes a one-year limitations period for discoverable claims, providing that, "[n]o action shall be maintained . . . ."; and the other, that sets forth a three-year limitations period based on when the securities in question were offered, containing the "in no event" language. ANZ contends that the differential language of the statute cannot be ignored, nor can the language of comparable two-tiered limitations periods that exist in other statutes, such as 28 U.S.C. § 1658(b), which the Court has interpreted in consonance with ANZ's logic. It also points to the legislative history of Section 13, arguing that Congress intentionally retained the two-tiered framework of the statute in order to be fair to both plaintiffs and defendants.

Building on this logic, ANZ contends that the Court's decision in CTS Corporation v. Waldburger, unquestionably establishes that equitable tolling does not apply to statutes of repose, citing language from Waldburger that provides "[s]tatutes of limitations, but not statutes of repose, are subject to equitable tolling." The Respondents argue that since American Pipe tolling is clearly equitable in nature, as it was based on traditional equitable principles and has been subsequently characterized as such, its tolling rule cannot apply to the three-year limitations period in Section 13. Further, ANZ asks where American Pipe's tolling rule emanates from if not the courts' equitable powers, reasoning that it cannot come from Rule 23, which does not discuss tolling, nor can it come from Section 13 itself pursuant to the plain language of the statute. Further, ANZ contends that even if American Pipe did establish a legal tolling rule, as CalPERS claims, such "judicial gloss" could not abridge a substantive right that would override the clear language of Section 13 in violation of the Rules Enabling Act.

ANZ Rebut CalPERS's Arguments Relating to this Individual Action and CalPERS's Policy Arguments

CalPERS's petition for certiorari presented two questions, and the Court only accepted certiorari on the first:

  1. Does the filing of a putative class action serve, under the American Pipe rule, to satisfy the three-year time limitation in Section 13 of the Securities Act with respect to the claims of putative class members?
  1. May a member of a timely field putative class action file an individual suit on the same causes of action before class certification is decided, notwithstanding the expiration of the relevant time limitations?

ANZ asserts that CalPERS's theory, that its claims were brought within Section 13's three-year repose period because CalPERS was a member of a timely-filed class action, falls squarely within the scope of Question 2. Because the Court granted certiorari limited to Question 1, ANZ asserts that the Court should decline to consider the portion of CalPERS's brief that fall within the scope of the latter question. Regardless, however, ANZ argues that CalPERS's argument regarding the timeliness of its filing fails on the merits, because while similar claims may have been filed in New York within the three-year repose period, Section 13 speaks not of claims, but of actions timely filed, and CalPERS was never a party to such an action because no class had been certified when CalPERS filed its claim in California.

Finally, ANZ addresses CalPERS's policy arguments regarding the effect of IndyMac on the class action system, retorting that IndyMac has been the law in the Second Circuit for almost four years without any negative affect. ANZ also argues that CalPERS misconstrues the constitutional right to opt out of class actions as a non-existent constitutional right that an absent class member will have a viable action to opt into.


CalPERS's reply focuses on ANZ's argument that CalPERS improperly briefed a question that was not certified for consideration by the Court. CalPERS contends that the question of whether it can satisfy Section 13's limitations period is within the scope of the question certified. Question 2, CalPERS argues, addresses class member status, not whether an action was timely filed. CalPERS goes on to assert that it's action was timely filed, arguing that ANZ's reading of Section 13 is erroneous because the meaning of "action" pursuant to Section 13 is a claim brought under Section 11. CalPERS argues that it would be nonsensical to think that Congress intended for each member of a class asserting a claim under Section 11 to file individual suits against a defendant, and that the tolling rule in American Pipe is aimed at reducing such inefficiencies.

If the Court holds true to form, we expect a decision to issue by the end of June.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions