Reviving Time-Barred Financial Litigation In State Courts

Appeared in Law360 on February 29, 2016. Originally appeared in the Kaye Scholer Securities & Derivative Litigation Report. 

With the events of the global financial crisis many years in the past, any resulting litigation would be expected to have dried up, as any potential claims should be time-barred by statutes of limitations. However, enterprising plaintiffs are attempting to skirt statutes of limitations by relying upon the common law doctrine nullum tempus occurrit regi, which provides that statutes of limitations are inapplicable to actions brought by a state in certain circumstances. For example, the Texas County and District Retirement System (TCDRS), a pension fund for government employees in Texas, sued in Texas state court^[1] a group of 11 investment banks alleging that they were fraudulently sold residential mortgage-backed securities (RMBS). While TCDRS did not bring suit until 2014, well after the applicable statutes of limitations had likely run, it