Securities & Exchange Commission v. Graham, 21 F. Supp. 3d 1300

SEC sued five individuals (Clark, Coleman, Graham, Stokes, Schwarz) alleging they offered and sold unregistered securities through a Cay Clubs real-estate scheme from 2004–2008, seeking declaratory relief, injunctions, disgorgement, and civil penalties.
SEC filed suit on January 30, 2013 after an investigation that began by at least October 2007; discovery and briefing were complete and the parties submitted cross-motions for summary judgment.
Defendants moved for summary judgment arguing 28 U.S.C. § 2462’s five-year limitations period barred the SEC’s claims.
The court treated § 2462 as jurisdictional for the government’s enforcement actions and held the SEC bears the burden to prove accrual within five years of filing.
The SEC failed to prove by a preponderance of the evidence that any defendant offered or sold the alleged securities within the “red zone” (Jan 30, 2008–Jan 30, 2013); the court concluded it lacked subject-matter jurisdiction and dismissed the action with prejudice.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether § 2462 applies and is jurisdictional to SEC enforcement seeking injunction, disgorgement, declaratory relief	SEC: §2462 does not bar equitable relief; statute applies only to penalties and not to sovereign enforcement seeking injunction/disgorgement	Defendants: §2462 is a jurisdictional statute that bars any enforcement (including disgorgement/injunction/decln) not commenced within 5 years of accrual	Court: §2462 is jurisdictional and applies to the forms of relief sought; it removes power to entertain untimely claims
When accrual occurs for SEC enforcement claims	SEC: accrual can be delayed by discovery rules or continues while scheme effects persist	Defendants: accrual occurs when the conduct giving rise to the claim occurs (last sale/offer)	Court: follows Gabelli — accrual is when the alleged wrongful conduct occurred; fraud-discovery rule not available to SEC enforcement
Who bears burden to show timeliness	SEC: argued defendants should pinpoint acts in the red zone	Defendants: challenged timeliness; required SEC to prove jurisdiction	Court: SEC bears burden to prove jurisdictional timeliness by preponderance of evidence
Remedy when court lacks jurisdiction after full record	SEC: dismissal without prejudice; may refile if timely	Defendants: dismissal with prejudice appropriate given long investigation and closed record	Court: dismissed with prejudice given stage of litigation and policies of repose

Bochese v. Town of Ponce Inlet, 405 F.3d 964 (11th Cir. 2005) (courts must inquire sua sponte into subject-matter jurisdiction)
National Parks Conservation Ass'n v. Norton, 324 F.3d 1229 (11th Cir. 2003) (district court must dismiss claims lacking subject-matter jurisdiction even at summary judgment stage)
Reed Elsevier, Inc. v. Muchnick, 559 U.S. 154 (statutory text governs whether requirement is jurisdictional)
Kontrick v. Ryan, 540 U.S. 443 (2004) (procedural rules vs. jurisdictional statutes)
Arbaugh v. Y & H Corp., 546 U.S. 500 (2006) (courts should treat statutory limitations as nonjurisdictional absent clear congressional statement)
John R. Sand & Gravel Co. v. United States, 552 U.S. 130 (2008) (some statutes of limitations are jurisdictional to serve systemwide goals)
Bowles v. Russell, 551 U.S. 205 (2007) (statutory time limits can be jurisdictional)
Gabelli v. SEC, 568 U.S. 442 (2013) (SEC enforcement claims accrue when the wrongful conduct occurs; fraud-discovery rule does not delay accrual)
McNutt v. Gen. Motors Acceptance Corp., 298 U.S. 178 (1936) (party invoking jurisdiction bears burden to prove jurisdictional facts)
Swain v. Pressley, 430 U.S. 372 (1977) (statutory proscription against entertaining untimely penalty actions is an unequivocal command)
Wallace v. Kato, 549 U.S. 384 (2007) (accrual occurs when plaintiff has a complete and present cause of action)