The Federal "Opt Out" Institutional Plaintiffs In ENHANCE Securities Cases Now Wait For The Supremes' Word -- In IndyMac

On March 10, 2014, the United States Supreme Court (the "Supremes") granted certorari in IndyMac.

IndyMac is primarily about whether the three year federal securities statute of limitations is "tolled" (or held-in-suspense, if you will) for all putative plaintiffs in a putative federal securities class action. After all, it wouldn't serve judicial economy to require that all would-be class members timely file suit, individually, solely in order to protect their rights (in the event, for example, that they ultimately decide they don't like the outcome of a given class action settlement) -- and then leave those complaints at law dormant, on the docket. No, it seems to me that deciding IndyMac in the favor of the issuers who are selling securities would create mayhem on court calendars -- nationwide. [But who knows what Scalia or Roberts thinks? Heh.]

Having said that, let me explain what North Sound Capital and GIC Private Limited (backgrounder) -- two large institutional holders of legacy Schering-Plough stock -- are thinking now. These two (and two others) have agreed to temporarily suspend their opt out suits, while we all wait to find out what the Supremes think is the law, here via IndyMac. All parties in the Enhance federal securities opt out matters apparently agreed -- on the record -- in the New Jersey federal District courthouse, before the able Judge Freda Wolfson, on March 27, 2014 that their respective rights to bring the suit (or strike it as stale) will be decided by the Supremes in IndyMac. So now we wait until at least Q2 2015 to learn whether these Merck suits (as successor to old Schering-Plough) will go forward. From Judge Wolfson's order, then:

. . . .WHEREAS, on March 10, 2014, the Supreme Court of the United States (the "Supreme Court") granted certiorari in Public Employees' Retirement System of Mississippi v. IndyMac MBS Inc. et al., No. 13-640 ("IndyMac"), to decide whether the filing of a putative class action tolls a statute of repose with respect to the claims of putative class members under the rule of American Pipe & Construction Co. v. Utah, 414 U.S. 538 (1974); and

WHEREAS, the Parties have conferred and agree, subject to Court approval, the proceedings in the above-captioned actions should be stayed pending the Supreme Court's decision in IndyMac, given that it will very likely resolve the threshold issue of whether Plaintiffs' claims are barred by the statute of repose under the Exchange Act.

NOW, THEREFORE, IT IS HEREBY ORDERED as follows:

The above-captioned actions shall be stayed pending the Supreme Court's decision in IndyMac. . . .

We shall keep you posted, but it will be a solid year to 18 months -- almost certainly -- before IndyMac is finally decided.

So sit tight.