821 F.3d 372
2d Cir.2016Background
- Colonial Bank purchased ~ $300 million of RMBS issued/underwritten by defendants in 2007; Colonial failed and the FDIC became receiver in August 2009.
- FDIC, as receiver, sued under Sections 11 and 15 of the Securities Act on August 10, 2012 — within three years of FDIC appointment but more than three years after the public offerings.
- FDIC relied on the FDIC "Extender Statute" (12 U.S.C. §1821(d)(14)) which sets an "applicable statute of limitations" for actions brought by the FDIC as receiver and can restart or extend certain limitations periods.
- Defendants moved to dismiss, arguing the Securities Act’s three-year statute of repose (15 U.S.C. §77m) barred the claim and that the Extender Statute does not displace statutes of repose.
- The district court granted judgment for defendants after the Supreme Court decided CTS Corp. v. Waldburger; the Second Circuit majority vacated that judgment, holding UBS controls and the Extender Statute displaces the Securities Act repose period.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the FDIC Extender Statute displaces the Securities Act’s 3‑year statute of repose | Extender Statute creates the "applicable statute of limitations" for any FDIC receiver action, thereby superseding other time bars including repose | Extender Statute extends only statutes of limitations (not statutes of repose); CTS requires preserving repose unless text shows otherwise | Majority: UBS controls; Extender Statute displaces the Securities Act repose, so FDIC complaint timely |
| Whether CTS v. Waldburger implicitly overruled UBS and requires a different result | FDIC: CTS does not undermine UBS because Extender Statute differs materially from CERCLA §9658 in text/structure and creates a new limitations framework | Defs: CTS established that extender provisions referring to "statute[s] of limitations" do not reach statutes of repose; UBS is inconsistent with CTS | Held: CTS does not compel overruling UBS; distinctions in statutory text/structure mean UBS remains binding precedent |
| Whether the Extender Statute applies to federal Securities Act claims (not only state tort/contract claims) | FDIC: statute covers "any action" brought by FDIC as receiver, so it governs both federal and state claims | Defs: statutory text refers only to "contract" and "tort" claims; thus does not reach federal Securities Act claims | Held: UBS precedent and statutory phrasing support applying the Extender Statute to the Securities Act claims |
| Whether interpreting the Extender Statute to displace repose violates presumption against implied repeal | FDIC: textual/structural reading and legislative purpose support displacement in this context; precedent supports that outcome | Defs/Dissent: major substantive repose right (Securities Act) cannot be implicitly repealed; Congress knew the distinction and would have said so | Held: Majority rejects presumption argument as insufficient to unsettle UBS; displacement upheld under binding precedent |
Key Cases Cited
- FHFA v. UBS Ams., Inc., 712 F.3d 136 (2d Cir. 2013) (held materially identical extender statute displaced Securities Act statute of repose)
- CTS Corp. v. Waldburger, 134 S. Ct. 2175 (U.S. 2014) (interpreted CERCLA §9658 to preempt state statutes of limitations but not state statutes of repose)
- FDIC v. RBS Secs., Inc., 798 F.3d 244 (5th Cir. 2015) (post‑CTS circuit decision holding FDIC extender statute displaces state repose)
- Nat'l Credit Union Admin. Bd. v. Nomura Home Equity Loan, Inc., 764 F.3d 1199 (10th Cir. 2014) (holding NCUA extender statute displaces Securities Act repose)
- Lotes Co. v. Hon Hai Precision Indus. Co., 753 F.3d 395 (2d Cir. 2014) (panel precedent binding rule; courts must follow prior panels absent en banc or Supreme Court overruling)