FEDERAL DEPOSIT INSURANCE CORPORATION, as Receiver for Colonial Bank, Plaintiff-Appellant, -
FIRST HORIZON ASSET SECURITIES, INC., FIRST HORIZON HOME LOAN CORPORATION, CREDIT SUISSE SECURITIES (USA) LLC, DEUTSCHE BANK SECURITIES INC., FTN FINANCIAL SECURITIES CORP., HSBC SECURITIES (USA) INC., RBS SECURITIES INC., UBS SECURITIES LLC, and WELLS FARGO ASSET SECURITIES CORPORATION, Defendants-Appellees, CHASE MORTGAGE FINANCE CORP., JP MORGAN CHASE & CO., JP MORGAN SECURITIES LLC, CITICORP MORTGAGE SECURITIES, INC., CITIMORTGAGE, INC., CITIGROUP GLOBAL MARKETS INC., ALLY SECURITIES LLC, and MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, Defendants
October 8, 2015
Federal Deposit Insurance Corporation (" FDIC" )
appeals from a decision of the United States District Court
for the Southern District of New York (Louis L. Stanton,
Judge) dismissing its complaint, which asserts claims under
the Securities Act of 1933, as untimely. The FDIC brought
this action within the limitations period provided by the
FDIC Extender Statute, 12 U.S.C. § 1821(d)(14), but
outside the Securities Act's three-year statute of
repose. In Federal Housing Finance Agency v. UBS Americas
Inc., 712 F.3d 136 (2d Cir. 2013), we held that a
materially identical extender statute for actions brought by
the Federal Housing Finance Agency displaced the Securities
Act's statute of repose. We now further hold that the
Supreme Court's decision in CTS Corp. v.
Waldburger, 134 S.Ct. 2175, 189 L.Ed.2d 62 (2014), did
not abrogate our holding in UBS, which remains good law.
Accordingly, the FDIC's complaint was timely.
SCOTT WATSON, Counsel (Colleen J. Boles, Assistant General
Counsel, Kathryn R. Norcross, Senior Counsel, Jaclyn C.
Taner, Counsel, on the brief), Federal Deposit Insurance
Corporation, Arlington, Virginia, for Plaintiff-Appellant.
J. GIUFFRA, JR. (Bruce E. Clark, David B. Tulchin, Amanda
Flug Davidoff, Jeffrey B. Wall, on the brief), Sullivan &
Cromwell LLP, New York, New York, for Defendants-Appellees
First Horizon Asset Securities, Inc., First Horizon Home Loan
Corporation, FTN Financial Securities Corp., and UBS
W. Clary, Cravath, Swaine & Moore LLP, New York, New York,
for Defendant-Appellee Credit Suisse Securities (USA) LLC.
C. Rice, Andrew T. Frankel, Simpson Thacher & Bartlett LLP,
New York, New York, for Defendants-Appellees Deutsche Bank
Securities Inc. and RBS Securities Inc.
T.G. Dworsky, Munger, Tolles & Olson LLP, Los Angeles,
California, for Defendant-Appellee Wells Fargo Asset
O. Ware, Mayer Brown LLP, New York, New York, for
Defendant-Appellee HSBC Securities (USA) Inc.
M. SULLIVAN, Quinn Emanuel Urquhart & Sullivan, LLP, New
York, New York (Philippe Z. Selendy, Adam M. Abensohn, Quinn
Emanuel Urquhart & Sullivan, LLP, New York, New York, David
C. Frederick, Wan J. Kim, Gregory G. Rapawy, Kellogg, Huber,
Hansen, Todd, Evans & Figel, P.L.L.C., Washington, District
of Columbia, on the brief), for Amici Curiae Federal Housing
Finance Agency and National Credit Union Administration Board
in Support of Plaintiff-Appellant.
J. Dell, Kramer Levin Naftalis & Frankel LLP, New York, New
York, Ira D. Hammerman, Kevin Carroll, Securities Industry
and Financial Markets Association, Washington, District of
Columbia, Thomas Pinder, American Bankers Association,
Washington, District of Columbia, for Amici Curiae Securities
Industry and Financial Markets Association, The American
Bankers Association, and The Clearing House LLC in Support of
Appellees and Affirmance.
M. Jay, Goodwin Procter LLP, Washington, District of
Columbia, Joshua M. Daniels, Goodwin Procter LLP, Boston,
Massachusetts, for Amicus Curiae The Business Roundtable in
Support of Defendants-Appellees.
PARKER, LYNCH, and CARNEY, Circuit Judges. Judge Parker
dissents in a separate opinion.
E. Lynch, Circuit Judge
Federal Deposit Insurance Corporation (" FDIC" )
brought this action under the Securities Act of 1933 as
receiver for Colonial Bank (" Colonial" ). Because
the complaint was filed less than three years after the FDIC
was appointed receiver, it was timely under the terms of
the FDIC Extender Statute, which provides " the
applicable statute of limitations with regard to any action
brought by the [FDIC] as conservator or receiver." 12
U.S.C. § 1821(d)(14)(A). But because the complaint was
filed more than three years after the securities at issue
were offered to the public, it would be untimely under the
terms of the Securities Act's statute of repose, 15
U.S.C. § 77m. Although they recognize that the FDIC
Extender Statute displaces otherwise applicable statutes of
limitations, the defendants argue that it does not displace
the Securities Act's statute of repose, and that the
complaint should be dismissed as untimely.
not consider this argument on a blank slate. In Federal
Housing Finance Agency v. UBS Americas Inc., 712 F.3d
136 (2d Cir. 2013), we held that a materially identical
extender statute for actions brought by the Federal Housing
Finance Authority (" FHFA" ) did displace
the Securities Act's statute of repose. The defendants do
not argue that the FDIC Extender Statute is in any way
distinguishable from the one at issue in UBS; rather, they
assert that our UBS holding was abrogated by the subsequent
Supreme Court decision in CTS Corp. v. Waldburger,
134 S.Ct. 2175, 189 L.Ed.2d 62 (2014), which construed yet
another, somewhat different federal limitations-extending
provision -- 42 U.S.C. § 9658, enacted as an amendment
to the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980 (" CERCLA" ) -- to
preempt only state statutes of limitations, and not state
statutes of repose. The district court agreed, and dismissed
the complaint. We conclude, to the contrary, that UBS remains
good law and that, under UBS, the FDIC's complaint was
timely. Accordingly, the judgment of the district court is
VACATED, and the case is REMANDED for further proceedings
consistent with this opinion.
June 5 and October 19, 2007, Colonial, a federally insured
bank headquartered in Montgomery, Alabama, invested
approximately $300 million in nine residential
mortgage-backed securities (" RMBS" ) issued or
underwritten by the defendants. In a now-familiar turn of
events, Colonial suffered heavy losses on those RMBS, and on
August 14, 2009, the Alabama State Banking Department closed
Colonial and appointed the FDIC as receiver.
August 10, 2012 -- within three years of its appointment as
receiver, but more than three years after the RMBS had been
offered to the public -- the FDIC brought this action in the
Southern District of New York, asserting claims under §
§ 11 and 15 of the Securities Act, which render several
classes of persons liable for material misstatements or
omissions in securities registration statements. 15 U.S.C.
§ § 77k, 77o. Specifically, the complaint alleges
that prospectus supplements for the RMBS at issue
misrepresented the loan-to-value ratios of the mortgage loans
backing the RMBS, the occupancy status of the properties that
secured the mortgage loans, and the underwriting standards
used to originate those loans.
defendants moved to dismiss the complaint on several grounds,
including that it was barred by the Securities Act's
statute of repose, which, the defendants argued, was not
displaced by the FDIC Extender Statute. While that motion was
pending, this Court decided UBS. One of the issues in that
case, which was brought by the FHFA and also involved claims
under § § 11 and 15 of the Securities Act, was
whether those claims' timeliness was governed by the
Securities Act's statute of
repose ore by the FHFA Extender Statute, 12 U.S.C. §
4617(b)(12). Examining the text and legislative history of
the FHFA Extender Statute, we concluded that Congress
intended for it to supplant " any other time limitations
that otherwise might have applied."
UBS, 712 F.3d at 143-44. We
emphasized that the statute by its terms established "
the applicable statute of limitations with regard to
any action brought by [FHFA] as conservator or
receiver." Id. at 141, quoting 12 U.S.C. §
4617(b)(12)(A) (emphasis and alteration in UBS). And we
rejected the argument that the Extender Statute's use of
the term " statute of limitations " meant
that it left in place otherwise applicable statutes of
repose, observing that Congress frequently uses the
term " statute of limitations" to refer to what
might more precisely be designated as statutes of repose.
Id. at 143.
FHFA Extender Statute was modeled on, and is materially
identical to, the FDIC Extender Statute. Recognizing that UBS
controlled, the defendants in this case withdrew their
Securities Act statute of repose argument (reserving the
right to reassert it at a later date), and the district court
(Louis L. Stanton, J.) denied the rest of the motion
following year, the Supreme Court decided CTS, in which the
plaintiffs alleged injury and damage from contaminants on
land on which the defendant had previously operated an
electronics plant. The plaintiffs argued that their claims
were timely under § 9658, the CERCLA amendment, which
creates an " [e]xception" to state statutes of
limitations for state-law toxic tort actions. 42 U.S.C.
§ 9658(a)(1). The Supreme Court, however, held that
CERCLA preempted state statutes of limitations but left state
statutes of repose in place, and that the applicable statute
of repose barred the action. CTS, 134 S.Ct. at 2180. It
chided the court below, which had come to the opposite
conclusion, for using " the proposition that remedial
statutes should be interpreted in a liberal manner" as a
" substitute for a conclusion grounded in the
statute's text and structure." Id. at 2185.
with the CTS decision, the defendants here reasserted their
argument that this action is barred by the Securities
Act's statute of repose, in a motion for judgment on the
pleadings under Fed.R.Civ.P. 12(c). They claimed that UBS was
inconsistent with CTS, because it failed to give weight to
the textual markers that the CTS Court found instructive in
its analysis of § 9658, and instead put too much
emphasis on the FDIC Extender Statute's remedial purpose.
The district court agreed, holding that, after CTS, the FDIC
Extender Statute could not be read to displace the Securities
Act's statute of repose. Accordingly, it granted judgment
in favor of the defendants. The FDIC timely appealed.
In general, a panel of this Court is bound by the decisions
of prior panels until such time as they are overruled either
by an en banc panel of our Court or by the Supreme
Court." Lotes Co. v. Hon Hai Precision Indus. Co.,
753 F.3d 395, 405 (2d Cir. 2014) (internal quotation marks
omitted). The defendants make no attempt to distinguish the
FDIC Extender Statute from the FHFA Extender Statute at issue
in UBS. Consequently, the outcome here is controlled by UBS,
unless the defendants can show that its " rationale
[was] overruled, implicitly or expressly, by the Supreme
Court" in CTS. United States v. Ianniello,
808 F.2d 184, 190 (2d Cir. 1986), abrogated on other grounds
by United States v. Indelicato,865 F.2d 1370 (2d
Cir. 1989). For the following reasons, the