China Agritech Inc. v. Resh

Upon denial of class certification, the statute of limitations is not tolled for a putative class member who failed to promptly join an existing suit or file an individual action and seeks to commence the class action anew.

Following denial of the certification of two classes, and a year and a half after the statute of limitations ran, Respondent filed a third and identical class action against Petitioner. The district court dismissed the complaint as untimely. On appeal, Respondent argued that tolling of the statute of limitations pending denial of class certification for individual claims under American Pipe v. Utah, 414 U.S. 538 (1974), should extend to class actions. The Ninth Circuit agreed, reversing the district court. On appeal, the Supreme Court reversed, holding that American Pipe only extends the statute of limitations for individual claims. The Supreme Court reasoned that American Pipe does not allow a plaintiff who did not act within the statute of limitations to “piggyback on an earlier, timely filed class action” allowing the statute of limitations to be tolled indefinitely. Furthermore, the Supreme Court reasoned that American Pipe promotes efficiency and economy of litigation by allowing individual claims to be brought after the statute of limitations runs when class certification is denied, this discourages individuals from filing separate but identical actions to preserve individual claims should the class certification fail. Therefore, American Pipe does not apply to class filings and the case was properly dismissed. REVERSED and REMANDED.