Recent activity at the Supreme Court—with two major cases decided in the past year—has clarified the landscape of when individual claims are equitably tolled by the filing of a class action.
At the outset, it is critical to distinguish between two related but legally distinct concepts: a statute of limitations and a statute of repose. A statute of limitations is a requirement that a claim be brought within a certain time period after the cause of action accrues. In the case of the federal securities laws, statutes of limitations usually begin to run upon discovery of facts that alert the putative plaintiff to the existence of a claim, which often equates to discovery of the injury. A statute of repose, on the other hand, is a legislative extinguishment of claims made after a certain period of time. In the federal securities laws, the running of the statute of repose generally is triggered by the making of the statement or the purchase of the security.