Class action defendants scored a significant victory last term in China Agritech Inc. v. Resh. There, the court held that the so-called American Pipe equitable tolling rule — which provides that the timely filing of a class action tolls the statute of limitations for plaintiffs encompassed by the class complaint — only tolls the limitations period for individual claims, not class claims.
Although China Agritech clarified existing law governing federal claims, it left several open questions in its wake. In this article we address one of those questions: whether China Agritech’s clarification of American Pipe also applies to state law claims asserted in a class action. We argue that China Agritech should apply to state law claims to the same extent as it applies to federal claims.
The American Pipe Tolling Rule
In American Pipe & Construction Co. v. Utah, the U.S. Supreme Court held that “the commencement of a class action suspends the applicable statute of limitations as to all asserted members of the class who would have been parties had the suit been permitted to continue as a class action.” Thus, once a class action lawsuit is commenced, the statute of limitations “remains tolled for all members of the putative class until class certification is denied. At that point, class members may choose to file their own suits or to intervene as plaintiffs in the pending action.” In the years that followed the Supreme Court’s decision, many plaintiffs relied on American Pipe in an attempt to bring class claims that were otherwise barred by the statute of limitations.
This was excerpted from an Expert Analysis - Opinion piece in Law360. To read the full article, click here. (Subscription required)