RMBS Cases Against UBS Dismissed as Time-Barred

On July 31, Judge Cecchi of the District of New Jersey dismissed with prejudice as time-barred claims filed by the Pension Trust Fund for Operating Engineers alleging misstatements and omissions in the offering documents for US$5 million in RMBS. Judge Cecchi determined that there were adequate storm warnings more than a year prior to the date when plaintiffs filed their claims that the originators of the loans underlying the securities at issue had abandoned their underwriting guidelines. The court held that this was sufficient to put the plaintiffs on inquiry notice and to trigger the running of the statute of limitations for their 1933 Act claims. A previous complaint had been dismissed as time barred with leave to amend, but the court determined that a second amended complaint would be futile and dismissed with prejudice. Order.

S.D.N.Y. Judge Finds Potential RMBS Plaintiffs’ Claims Against Indymac Time-Barred Under The Securities Act of 1933

On June 21, 2011, Judge Kaplan in the Southern District of New York denied several potential plaintiffs’ motions to intervene in this action against Indymac on the basis that the intervenors’ claims were time-barred. In this putative class action alleging misrepresentations and omissions in RMBS offering documents, the court had previously dismissed claims based on certain offerings, holding that the lead plaintiff lacked standing to assert claims based on certificates it had never purchased. In an effort to cure these standing issues, several new potential plaintiffs moved to intervene. The intervenors had argued that the ’33 Act statute of repose was tolled by the present lawsuit under the U.S. Supreme Court’s holding in American Pipe Construction Co. v. Utah. Judge Kaplan noted that although some cases had reached a different result, he agreed with Judge Castel’s recent ruling in Footbridge v. Countrywide that neither American Pipe tolling nor any other theory would suffice to toll the three-year statute of repose set forth in Section 13 of the ’33 Act. Decision.