SEPTA v. Orrstown Financial Services In

PRECEDENTIAL

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
____________
No. 20-2829
____________

SOUTHEASTERN PENNSYLVANIA
TRANSPORTATION AUTHORITY, on behalf of itself and
all others similarly situated

v.

ORRSTOWN FINANCIAL SERVICES INC; ORRSTOWN
BANK; ANTHONY F. CEDDIA; JEFFREY W. COY;
MARK K. KELLER; ANDREA PUGH; THOMAS R.
QUINN, JR.; GREGORY A. ROSENBERRY; KENNETH F.
SHOEMAKER; GLENN W. SNOKE; JOHN S. WARD;
JOEL R. ZULLINGER; BRADLEY S. EVERLY; JEFFREY
W. EMBLY; SMITH ELLIOTT KEARNS & CO; ANDLER
O'NEILL & PARTNERS, LP; JANNEY MONTGOMERY
SCOTT, LLC

Appellants

Appeal from the United States District Court
for the Middle District of Pennsylvania
(D.C. Civil Action No. 1-12-cv-00993)
District Judge: Honorable Yvette Kane
 Argued on February 10, 2021

Before: AMBRO, GREENAWAY, Jr., and BIBAS, Circuit
Judges

(Opinion filed: September 2, 2021)

David J. Creagan
David E. Edwards
Justin K. Fortescue
White & Williams
1650 Market Street
One Liberty Place, Suite 1800
Philadelphia, PA 19103

Counsel for Appellants Orrstown
Financial Services, Inc., Orrstown
Bank, Anthony F. Ceddia, Jeffrey W.
Coy, Mark K. Keller, Andrea
Pugh, Thomas R. Quinn, Jr., Gregory A.
Rosenberry, Kenneth F. Shoemaker,
Glenn W. Snoke, John S. Ward, Joel R.
Zullinger, Bradley S. Everly, Jeffrey W.
Embly, Smith Elliott, Kearns & Co,
Sandler, O’Neil & Partners, LP, and
Janney Montgomery Scott, LLC.

2
Seth L. Laver
Michael P. Luongo
Jonathan S. Ziss
Goldberg Segalla
1700 Market Street
Suite 1418
Philadelphia, PA 19103

Counsel for Appellant Smith Elliott
Kearns & Co.

Bradley R. Wilson (Argued)
Wachtell Lipton Rosen & Katz
51 West 52nd Street
New York, NY 10019

Counsel for Appellants Sandler O’Neill
& Partners, LP and Janney Montgomery
Scott, LLC

Nicholas E. Chimicles
Kimberly M. Donaldson Smith
Benjamin F. Johns
Timothy N. Mathews (Argued)
Chimicles Schwartz Kriner & Donaldson-Smith
361 West Lancaster Avenue
One Haverford Centre
Haverford, PA 19041

Counsel for Appellee Southeastern
Pennsylvania Transportation Authority

3
 ___________

OPINION OF THE COURT
___________
AMBRO, Circuit Judge

Statutes of limitations, as their name suggests, limit the
amount of time in which a plaintiff can bring a particular claim.
Once the limitations period has expired, a plaintiff who has not
already filed suit is ordinarily out of luck. But statutes of
limitations are subject to various carveouts and exceptions.

Statutes of repose are statutes of limitations’ more
severe cousins. They “protect[] the defendant from an
interminable threat” of a lawsuit by “creat[ing] an absolute bar
on a defendant’s temporal liability.” Cal. Pub. Emps.’ Ret. Sys.
v. ANZ Sec., Inc., 137 S. Ct. 2042, 2050 (2017) (internal
quotation marks omitted) (hereinafter “CalPERS”). “[S]tatutes
of repose pursue similar goals as do statutes of limitations
(protecting defendants from defending against stale claims),
but strike a stronger defendant-friendly balance.” In re Exxon
Mobil Corp. Sec. Litig., 500 F.3d 189, 199–200 (3d Cir. 2007).
Thus statutes of repose are not as flexible as statutes of
limitations. See, e.g., CalPERS, 137 S. Ct. at 2055 (holding
that statutes of repose are not subject to equitable tolling).

We must decide whether Rule 15(c) of the Federal
Rules of Civil Procedure, which provides a carveout more
commonly applied to statutes of limitations, also applies to
statutes of repose. We are persuaded that Rule 15(c) allows
amendment of a pleading after the expiration of a repose period
here—subject to the Rule’s ordinary constraints—because the

4
Rule’s “relation-back” doctrine leaves the legislatively
mandated deadline intact and does not disturb any of the
defendants’ vested rights to repose in this case. We therefore
affirm the District Court’s decision to allow amendment.

I. BACKGROUND

A. Factual Background

We summarize the facts as alleged in the operative
complaint. Defendant Orrstown Bank, a wholly owned
subsidiary of defendant Orrstown Financial Services, provides
“community banking and bank[-]related services” in
Pennsylvania and Maryland. J.A. 478–79. In March 2010,
Orrstown Bank (collectively, with its officers and Orrstown
Financial, the “Orrstown Defendants”) made a stock offering
at $27 per share. Plaintiff Southeastern Pennsylvania
Transportation Authority (“SEPTA”) invested some of its
pension funds in Orrstown stock during this offering. SEPTA
also purchased Orrstown stock on the open market after the
March 2010 offering. Defendant Sandler O’Neill & Partners,
L.P. and Janney Montgomery Scott LLC (collectively, the
“Underwriters”) underwrote the offering, and Defendant Smith
Elliott Kearns & Company, LLC (the “Auditor”) served as the
Orrstown Defendants’ independent auditor.

From July 2011 to March 2012 the Orrstown
Defendants made a series of disclosures concerning the Bank’s
financial health. According to SEPTA, the Orrstown
Defendants revealed they had failed to identify impaired loans
and otherwise misrepresented that the Bank was financially
stable, resulting in material misrepresentations in its financial
disclosures. Orrstown’s stock price dropped following each

5
disclosure; by April 2012, the price had fallen from $27 to just
$8.20 per share.

B. Procedural Background

SEPTA filed suit in federal court in May 2012, bringing
claims against the Orrstown Defendants on behalf of two
classes. The first, the “Securities Act Class,” consisted of
investors who purchased Orrstown stock “in connection with,
or traceable to,” Orrstown’s Registration Statement for the
March 2010 offering. J.A. 119. As the name suggests, SEPTA
asserted claims on behalf of this class under Sections 11, 12(a),
and 15 of the Securities Act of 1933. The second, the
“Exchange Act Class,” consisted of investors who purchased
Orrstown stock on the open market between March 2010 and
October 2011.1 SEPTA asserted claims on behalf of this class
under Sections 10(b) and 20(a) of the Securities Exchange Act
of 1934.
1. First and Second Amended Complaints

In March 2013, before the Orrstown Defendants moved
for dismissal, SEPTA filed its First Amended Complaint.
Defendants concede this complaint was timely filed. It
renewed SEPTA’s claims against the Orrstown Defendants and
added both Securities Act and Exchange Act claims against the
Underwriters and the Auditor. The Orrstown Defendants,
Underwriters, and Auditor (collectively, “Defendants”) then
moved to dismiss the amended complaint in full for failure to
meet pleading requirements, and the District Court granted the
motion without prejudice. The Court’s dismissal order

1
SEPTA’s later complaints lengthened this time period to end
in April 2012.

6
provided that SEPTA could seek leave to file another amended
complaint within thirty days.

With the permission of the Court, SEPTA filed its
Second Amended Complaint against Defendants in February
2016, again asserting both Securities Act and Exchange Act
claims on behalf of the two classes. Unlike the First Amended
Complaint, which cast its factual net more broadly, the Second
Amended Complaint “focused exclusively on alleged
materially false and/or misleading statements” the Orrstown
Defendants made concerning their “internal controls over
underwriting of loans, risk management, financial reporting[,]
and compliance with banking regulations.” J.A. 8 (internal
quotation marks omitted). Defendants again moved for
dismissal.

The Court granted the Orrstown Defendants’ motion in
part and granted the Underwriters’ and Auditor’s motions in
full. As to the Orrstown Defendants, the Court dismissed all
Securities Act claims but did not dismiss the Exchange Act
claims except for a handful of individual Orrstown officers.2
The Court also dismissed all claims against the Underwriters
and the Auditor. Thus the only remaining claims from the
Second Amended Complaint were Exchange Act claims
against certain Orrstown Defendants (including all institutional
defendants and some individual officers).

2
The Court dismissed all claims against some individual
Orrstown officers but retained Exchange Act claims against
officers Thomas Quinn, Bradley Everly, and Jeffrey Embly (in
addition to retaining Exchange Act claims against the
Orrstown institutional defendants).

7
 The parties began discovery in January 2017, but
shortly thereafter the Orrstown Defendants notified SEPTA of
their intent to withhold certain documents containing
confidential supervisory information. This triggered a lengthy
process in which the parties sought to have federal and state
regulators review the relevant documents. The parties
ultimately moved to continue the case-management deadlines
until the regulators finished their review, and the Court granted
the motion.

2. Third Amended Complaint

In April 2019, SEPTA moved for leave to file a Third
Amended Complaint. According to the District Court, this
complaint reasserted “previously dismissed” Securities Act
and Exchange Act claims from the Second Amended
Complaint, including claims against some parties who had
previously enjoyed dismissal of all claims against them (the
Underwriters, the Auditor, and certain individual Orrstown
officers). J.A. 14. SEPTA argued it should be entitled to
reinstitute the claims because it found further evidence to
support them through discovery after the partial dismissal of
the Second Amended Complaint. Defendants countered that,
among other things, the reasserted claims were time barred
because SEPTA sought to file the Third Amended Complaint
outside the three-year repose period for Securities Act claims
and the five-year repose period for Exchange Act claims.
Thus, Defendants argued, the Court should not grant leave to
amend because amendment would be futile.

The District Court granted SEPTA’s motion,
concluding that amendment would not be futile
notwithstanding the expiration of the repose periods. Se. Pa.

8
Transp. Auth. v. Orrstown Fin. Servs., Inc., 335 F.R.D. 54, 82
(M.D. Pa. 2020) (hereinafter “Orrstown”). It observed that
both applicable statutes of repose limit the time in which an
“action” must be “brought.” Id. at 79. It further noted that
SEPTA initially brought the action at issue (first in the First
Amended Complaint, then in the Second Amended
Complaint3) within the repose period. Id. at 80. The Court
thus reasoned that for the statutes of repose to bar the reasserted
claims in the Third Amended Complaint, SEPTA’s first action
must have ended. Id. at 81. The Court looked to Rule 54(b) of
the Federal Rules of Civil Procedure, which states that “any
order . . . that adjudicates fewer than all claims or the rights
and liabilities of fewer than all the parties does not end the
action as to any of the claims or parties . . . .” Id. at 80. It
reasoned that, under this Rule, its dismissal of the Second
Amended Complaint did not decide all of SEPTA’s claims, and
therefore the action did not end with that dismissal order. Id.
at 81. It noted that, through the Third Amended Complaint,
SEPTA only sought to “reassert the same claims against the
same parties originally brought by way of the [First Amended
Complaint],” which was filed within the repose period. Id.
(emphases in original). The Court thus concluded that the
statutes of repose did not bar SEPTA from using the Third

3
The Court dismissed the First Amended Complaint in full but
permitted SEPTA to file the Second Amended Complaint.
And when it filed that Complaint, Defendants did not argue
that the statutes of repose barred any of the claims despite the
repose periods having expired. Moreover, they conceded at
oral argument that the Second Amended Complaint did not
offend the relevant statutes of repose. As those statutes are not
jurisdictional (see infra n.5), we presume that the Second
Amended Complaint was timely.

9
Amended Complaint to assert previously dismissed claims
and, accordingly, granted SEPTA leave to file the Third
Amended Complaint. Id. at 82. But Rule 15(c), described
below, did not apply, according to the Court, because the Rule
concerned only the addition of an entirely new party or claim
and SEPTA only sought to reassert previously dismissed
claims. Id.

Defendants then moved for the District Court to certify
its order for interlocutory appeal. It granted the motion, and
this appeal followed. We later granted Defendants’ request to
appeal the Court’s order. See 28 U.S.C. § 1292(b).

II. JURISDICTION AND STANDARD OF REVIEW

The District Court had subject-matter jurisdiction under
28 U.S.C. § 1331 and 15 U.S.C. §§ 77v(a) (Securities Act) and
78aa(a) (Exchange Act). We have appellate jurisdiction over
this interlocutory appeal under 28 U.S.C. § 1292(b). The
District Court framed the issue on appeal as:
Do previously[] dismissed
Securities and Exchange Act
claims in this multi-party, multi-
claim action remain subject to
amendment pursuant to the
provisions of Federal Rule of Civil
Procedure 54(b), or did the
previous dismissal of those claims
end the “action” with regard to
those claims, such that any future
amendment of those claims would
be subject to the relevant statute of
repose?

10
J.A. 64–65.

On appeal, we may address “any issue fairly included
within the certified order because it is the order that is
appealable, and not the controlling question identified by the
district court.” Egervary v. Young, 366 F.3d 238, 245 (3d Cir.
2004) (internal quotation marks omitted). This appeal presents
a purely legal question that we review de novo. See James v.
City of Wilkes-Barre, 700 F.3d 675, 679 (3d Cir. 2012).

III. DISCUSSION

“Federal Rule of Civil Procedure 15 embodies a liberal
approach to pleading.” Arthur v. Maersk, Inc., 434 F.3d 196,
202 (3d Cir. 2006). Consistent with this approach, the relation-
back doctrine under Rule 15(c) allows a court to treat a later-
filed amended pleading as if it had been filed at the time of the
initial pleading. Specifically, Rule 15(c) provides that an
amended pleading “relates back to the date” of the initial
pleading when, among other things, “the amendment asserts a
claim or defense that arose out of the conduct, transaction, or
occurrence set out—or attempted to be set out—in the original
pleading.” Fed. R. Civ. P. 15(c)(1)(B). The Rule thus
“embodie[s]” a “clear preference . . . for merits-based decision
making.” T Mobile Ne. LLC v. City of Wilmington, 913 F.3d
311, 328 (3d Cir. 2019).

A. Rule 15 governs SEPTA’s amendment.

Although the District Court concluded that Rule 15 did
not apply in deciding to permit SEPTA’s amendment, we are
persuaded otherwise. In Bensel v. Allied Pilots Ass’n, 387 F.3d
298, 310 (3d Cir. 2004), we said that “amendments that restate

11
the original claim with greater particularity or amplify the
factual circumstances surrounding the pertinent conduct,
transaction[,] or occurrence in the preceding pleading fall
within Rule 15(c).” We adopted the Bensel approach in later
cases by applying Rule 15(c) to amendments that merely add
more factual detail to existing claims. See, e.g., United States
v. Santarelli, 929 F.3d 95, 102–03 (3d Cir. 2019); T Mobile Ne.
LLC, 913 F.3d at 328–29; see also United States v. Thomas,
221 F.3d 430, 436 (3d Cir. 2000) (holding, pre-Bensel, that
Rule 15(c) applied when a habeas petitioner sought to add only
facts to his petition). This approach aligns with that of the
Supreme Court, as it has long applied the relation-back
doctrine to amendments that “merely expand[] or amplif[y]”
claims in the initial pleading. Seaboard Air Line Ry. v. Renn,
241 U.S. 290, 293–94 (1916); see also Maty v. Grasselli Chem.
Co., 303 U.S. 197, 197–99 (1938); 6A Charles Alan Wright,
Arthur R. Miller, & Mary Kay Kane, Federal Practice &
Procedure § 1497 (3d ed. 2010 and Supp. 2021).4

4
We acknowledge that the Fifth Circuit has a different view of
this precise question. In Crostley v. Lamar County, 717 F.3d
410, 421 (5th Cir. 2013), the Court held that the relation-back
doctrine did not apply when the plaintiffs sought to reassert
claims against a previously dismissed defendant after the
expiration of the limitations period. It reasoned that the
doctrine, which it viewed as an exception to the statute of
limitations, did not apply because “the statute . . . had not
elapsed” when the plaintffs initially filed suit against the
defendant. Id. We do not adopt this approach, however, as it
conflicts with our precedent and that of the Supreme Court.

12
 Rule 15(c) thus applies here as long as the Third
Amended Complaint “restate[s] the original claim with greater
particularity or amplif[ies] the factual circumstances
surrounding the pertinent conduct.” Bensel, 387 F.3d at 310.
And the Third Amended Complaint does just that: It both
restates claims with greater particularity and amplifies the
factual circumstances surrounding the relevant conduct by
adding significantly more factual detail to SEPTA’s existing
claims. In this context, the relation-back doctrine applies.

B. Rule 15 permits relation back against statutes
of repose.

The key question before us, then, is whether Rule 15(c)
permits amendment outside an otherwise-applicable repose
period. It is well established that Rule 15(c) permits amended
pleadings to relate back past statutes of limitations such that an
amendment filed outside the limitations period is deemed
timely. See generally 6A Wright, Miller, & Kane § 1497. But
both provisions here—the Securities Act’s three-year bar and
the Exchange Act’s five-year bar—are statutes of repose.
CalPERS, 137 S. Ct. at 2049 (Securities Act); Exxon, 500 F.3d
at 199–200 (Exchange Act).

Those statutes “effect a legislative judgment that a
defendant should be free from liability after the legislatively
determined period of time.” CalPERS, 137 S. Ct. at 2049
(quoting CTS Corp. v. Waldburger, 573 U.S. 1, 9 (2014)).
Unlike statutes of limitations, which do not begin to run
typically until all elements of the claim have occurred,
“statutes of repose start upon the occurrence of a specific event
and may expire before a plaintiff discovers he has been
wronged or even before damages have been suffered at all.”

13
Exxon, 500 F.3d at 199. One major difference between statutes
of repose and statutes of limitations is that the former are not
subject to equitable tolling. CTS Corp., 573 U.S. at 10. This
is because the “unqualified nature” of statutes of repose
“supersedes the courts’ residual authority and forecloses the
extension of the statutory period based on equitable
principles.” CalPERS, 137 S. Ct. at 2051. Defendants thus
argue that the “unqualified nature” of repose statutes
categorically prohibits relation back and supersedes Rule
15(c).

At the outset, the rule Defendants propose would
present enormous practical difficulties. It would mean that a
plaintiff could not make any changes—no matter how small—
to its complaint after expiration of the repose period.
Moreover, no circuit court has squarely considered whether
Rule 15(c) allows relation back past statutes of repose in this
context.5 In the absence of circuit-level authority, Defendants

5
The Ninth Circuit has spoken on this issue, though in a
materially different context. In Miguel v. Country Funding
Corp., the plaintiff argued that its amended complaint, which
added a defendant after the expiration of the applicable repose
period, related back to the plaintiff’s initial, timely complaint.
309 F.3d 1161, 1165 (9th Cir. 2002), abrogated on other
grounds by Hoang v. Bank of Am., N.A., 910 F.3d 1096, 1100
(9th Cir. 2018). The Court concluded, among other things, that
Rule 15(c) did not apply. Id. It first stated that statutes of
repose are jurisdictional and that federal rules may not extend
federal jurisdiction. Id. at 1164–65. Relying on those two
premises, the Court reasoned that Rule 15(c) could not permit
relation back because doing so would extend federal

14
argue that relation back under Rule 15(c) is incompatible with
the nature and purpose of statutes of repose. They also contend

jurisdiction when statutes of repose were absolute in declaring
claims dead after a certain time. Id. at 1165.

Miguel does not squarely address the circumstances here
because, unlike the plaintiff in Miguel, SEPTA is not seeking
to add any additional defendants after the repose deadline.
Moreover, as the Ninth Circuit later recognized, statutes of
repose do not create a jurisdictional bar unless they clearly say
so. See McOmie-Gray v. Bank of Am. Home Loans, 667 F.3d
1325, 1329 (9th Cir. 2012), abrogated on other grounds by
Hoang, 910 F.3d 1096; see also Musacchio v. United States,
577 U.S. 237, 246 (2016) (“Statutes of limitations and other
filing deadlines ordinarily are not jurisdictional. We treat a
time bar as jurisdictional only if Congress has clearly stated
that it is.” (citations and internal quotation marks omitted)).
Here, both statutes limit when an “action” or “right of action”
may be “brought.” 15 U.S.C. § 77m (Securities Act); 28
U.S.C. § 1658(b) (Exchange Act). Although the statutes at
issue “use[] mandatory language, [they do] not expressly refer
to subject-matter jurisdiction or speak in jurisdictional terms.”
Musacchio, 577 U.S. at 246. And Defendants have not argued
that the context or history of the text leads to a different result.
See id. The Eleventh Circuit has held that nearly identical
language, prescribing when an “action may be commenced,” is
not jurisdictional. Sec’y, U.S. Dep’t of Lab. v. Preston, 873
F.3d 877, 882 (11th Cir. 2017). We join that Court in
concluding that this “boilerplate” language does not create a
jurisdictional bar. See id. (quoting Jones v. Bock, 549 U.S. 199,
220 (2007)).

15
that the Rules Enabling Act prevents us from applying relation
back here. For the reasons below, we disagree.

1. Relation back is consistent with the
nature of statutes of repose.

First, Defendants argue that statutes of repose, by their
nature, create a right to be “free from liability” after the repose
period. CalPERS, 137 S. Ct. at 2049 (internal quotation marks
omitted). Such a statute “affect[s] the availability of the
underlying right,” as “[t]hat right is no longer available on the
expiration of the specified period of time.” Lieberman v.
Cambridge Partners, L.L.C., 432 F.3d 482, 490 (3d Cir. 2005)
(internal quotation marks omitted). It “admits of no exception
and on its face creates a fixed bar against future liability.”
CalPERS, 137 S. Ct. at 2049. Defendants assert that, because
a statute of repose “extinguishe[s]” a claim upon expiration of
the prescribed period, see Lieberman, 432 F.3d at 492,
applying the relation-back doctrine in this context would create
an exception that allows plaintiffs to revive their time-barred
claims outside the repose period, something that is impossible.

The repose statutes before us provide that an “action” or
“right of action” may not be “brought” outside the repose
period. 15 U.S.C. § 77m (Securities Act); 28 U.S.C. § 1658(b)
(Exchange Act). The parties do not dispute that SEPTA
brought an action under both statutes against all Defendants—
by filing the First Amended Complaint—before the applicable
repose periods expired. Instead, Defendants argue that
SEPTA’s previously dismissed claims were extinguished by
the expiration of the repose period, even though the action
continued. Thus Defendants urge us to read the statutes to bar
“claims,” rather than “actions.”

16
 We acknowledge that the Supreme Court has seemingly
implied that “action” and “claim” may overlap in the context
of statutes of limitations. See Jones v. Bock, 549 U.S. 199,
220–21 (2007). And we ourselves have at times used the terms
interchangeably. See, e.g., Lieberman, 432 F.3d at 492 (“[W]e
are dealing with claims extinguished by a statute of repose.”).
But even if the statutes barred “claims” instead of “actions,”
our conclusion would be the same here. SEPTA brought both
Securities Act and Exchange Act claims against all Defendants
before the applicable repose periods expired. For those claims
to be barred, then, they had to end. But under Rule 54(b), “any
order” that decides “fewer than all the claims or the rights and
liabilities of fewer than all the parties does not end the action
as to any of the claims or parties.” As the District Court had
not decided all claims as to all parties at the time of the repose
period’s expiration—with the exception discussed in note 3—
none of SEPTA’s claims in the action ended. See In re
Raytheon Sec. Litig., Civ. No. 99-12142-PBS, 2003 U.S. Dist.
LEXIS 25197, at *8 (D. Mass. May 21, 2003) (adopting nearly
identical reasoning).

Defendants protest that Rule 54(b) governs when a
decision is final for appellate purposes only. But the text
contains no such limit. And no other circuit has concluded that
the Rule is so limited.6 On this question we agree with the Fifth

6
Defendants urge us to follow the Eighth Circuit’s lead in
Curtis v. United Transportation Union, 648 F.2d 492 (8th Cir.
1981). There the Court declined to apply Rule 54(b) in holding
that a plaintiff could not reinstate claims against a previously
dismissed defendant after the statute of limitations expired,
even though the plaintiff’s action was still pending against

17
Circuit in Crostley v. Lamar County, 717 F.3d 410 (5th Cir.
2013). There, the District Court denied the plaintiffs’ motion
to amend their complaint after the limitations period expired to
reassert a claim against a previously dismissed defendant. Id.
at 418–19. But the Fifth Circuit reversed, observing first that
the plaintiffs filed their initial complaint against the defendant
before the limitations period expired. Id. at 421. It went on to
reason that, under Rule 54(b), the defendant’s dismissal “did
‘not end the action’” as to that defendant because claims
against another defendant were still pending. Id. (quoting Fed.
R. Civ. P. 54(b)). Thus the expired statute of limitations did
not bar the plaintiffs from reasserting the same claim against
the previously dismissed defendant.7 Id. at 418–19, 21.

another defendant. Id. at 495. At the outset, we disagree with
Curtis’s ultimate conclusion; as we discuss next, Rule 54(b)
does “create an exception to the usual rule” that a plaintiff may
not revive dismissed claims after a statute of limitations or
repose expires. See id. Moreover, Curtis declined to apply
Rule 54(b) in large part because the plaintiff had voluntarily
dismissed the defendant under Rule 41(a)(2). See id. (“There
was no ‘adjudication’ of rights as contemplated by Rule 54(b).
It was merely a decision by [the] plaintiff to remove a party
from the suit.”). Here, however, the District Court ruled on the
rights of the previously dismissed parties (and the merits of the
previously dismissed claims). Finally, Curtis framed the issue
as whether “Rule 54(b) tolls the statute of limitations.” Id. at
494 (emphasis added). As we explain later, we disagree that
this circumstance presents a tolling issue when the plaintiff
brings an action within the applicable repose period.
7
The Court so held even though the District Court dismissed
the claims with prejudice. See Crostley, 717 F.3d at 420. We

18
 Crostley, of course, considered a statute of limitations
rather than a statute of repose. See id. at 419. But as it did not
rest on any features unique to statutes of limitations, we are
persuaded that its logic applies here with equal force. Thus,
even if the statutes of repose before us extinguish “claims”
instead of “actions,” that is not at odds with relation back in
our case.

Defendants counter, relying on Brennan v. Kulick, 407
F.3d 603, 606 (3d Cir. 2005), that we should treat SEPTA’s
previously dismissed claims as if they never existed for repose
purposes. But that reliance is misplaced. In Brennan the
District Court dismissed the plaintiff’s entire complaint after
the relevant limitations period expired. Id. On appeal to us,
we recognized “the general rule that a complaint that is
subsequently dismissed without prejudice is treated for statute
of limitations purposes as if it never existed.” Id. But here,
with the exception discussed above in note 3, the District Court
did not dismiss SEPTA’s entire complaint—it dismissed only
some claims and some parties. Brennan’s “general rule”
therefore does not govern whether SEPTA’s previously
dismissed claims count for statute of repose purposes. Put
differently, the District Court’s order in Brennan disposed of
all claims and all parties and thus ended the action under Rule
54(b).8 See also Hogan v. Pilgrim’s Pride Corp., No. 16-cv-

agree, as Rule 54(b) does not distinguish between claims
dismissed with or without prejudice.
8
Brennan also distinguishes between “final” orders, after
which a plaintiff may not revive an otherwise-barred claim,
and “conditional orders,” after which a time bar does not arise.
See 407 F.3d at 607. Some might suggest that the District

19
02611-RBJ, 2021 WL 1534602, at *7–8 (D. Colo. Apr. 16,
2021) (declining to apply the relation-back doctrine when the
Court had previously dismissed the timely filed complaint in
its entirety). That is not the case here.

2. Relation back is consistent with the purpose of
statutes of repose.

Next, Defendants contend that the purpose of the
relation-back doctrine conflicts with the purpose of statutes of
repose. The “touchstone” of the relation-back analysis is
whether would-be defendants had “fair notice” of the claim
within the limitations period. Glover v. F.D.I.C., 698 F.3d 139,
146 (3d Cir. 2012). In contrast, “the purpose of a statute of
repose is to give the defendant full protection after a certain
time.” CalPERS, 137 S. Ct. at 2053. Defendants argue that
these purposes are incompatible because whether the defendant
had notice of the suit or not, a statute of repose creates an
absolute bar to liability after the deadline.

We are again unpersuaded. While we agree that a
repose statute’s purpose is to give defendants protection after
a certain amount of time, it does not defeat that purpose for a
plaintiff to bring an action within the time allotted—even if the
plaintiff later amends the precise form of its pleadings. SEPTA
brought its action initially within the applicable repose periods.
And we reiterate that, under Rule 54(b), reinstatement of
dismissed claims cannot constitute the filing of a new action

Court’s partial dismissal was a conditional order only, as it
could have been “revised at any time” before the Court decided
all of SEPTA’s pending claims. Fed. R. Civ. P. 54(b).

20
until a court has decided all claims against all parties to the
initial action.

Defendants rely heavily on the Supreme Court’s
decision in CalPERS, 137 S. Ct. at 2049, to support that
statutes of repose permit no exceptions. CalPERS, however,
does not help Defendants for two reasons. First, the tolling at
issue there would have been a true exception to the statute of
repose, as it would have been an “extension of the statutory
period” within which plaintiffs could file an action. Id. at 2050.
Here, however, the repose period stays intact; a plaintiff must
still bring an action before the deadline. Rule 15(c) merely
gives plaintiffs a chance to alter the details of an already filed
complaint. See Chumney v. U.S. Repeating Arms Co., 196
F.R.D. 419, 427 (M.D. Ala. 2000); In re Sharps Run Assocs.,
L.P., 157 B.R. 766, 785 (D.N.J. 1993); see also Kenneth
DeCourcy Ferguson, Repose or Not? Informal Objections to
Claims of Exemptions After Taylor v. Freeland, 50 Okla. L.
Rev. 45, 85 (1997). Second, CalPERS rested on the fact that
the kind of tolling at issue there arose “from the equitable
powers of courts.” 137 S. Ct. at 2051. It suggested that the
outcome might have been different were the tolling “mandated
by the text of a statute or federal rule.” Id. at 2052. As relation
back stems from a federal rule, rather than equity, CalPERS’s
reasoning is of limited value here.

Defendants also rely on CalPERS to argue that allowing
relation back to circumvent statutes of repose would permit
“limitless” filing of new claims. See CalPERS, 137 S. Ct. at
2054. But the structure of Rule 15 protects against that specter.
Under Rule 15(a), a party may only amend its pleading once as
of right shortly after filing. See Fed. R. Civ. P. 15(a)(1). All
other amendments require “the opposing party’s written

21
consent or the court’s leave.” Fed. R. Civ. P. 15(a)(2). True,
a court must grant leave to amend under this provision “unless
equitable considerations render it otherwise unjust.” Arthur,
434 F.3d at 204. But it may deny leave to amend based on,
among other things, “undue delay.” Id. And the analyses for
subsection (a) and relation back under subsection (c) are
independent of each other, meaning that a court may deny a
motion for leave to amend even if the proposed amendment
would, if filed, relate back.9 See id. at 202–04; see also Krupski

9
Defendants also argue that this approach would “allow a
plaintiff to circumvent the congressionally mandated discovery
stay” in Securities and Exchange Act cases when a motion to
dismiss is pending. Defendants’ Br. at 31 n.9; see also 15
U.S.C. §§ 77z-1(b)(1), 78u-4(b)(3)(B). We disagree. The
purpose of the discovery stay is “to provide a filter at the
earliest stage (the pleading stage) to screen out lawsuits that
have no factual basis.” In re NAHC, Inc. Sec. Litig., 306 F.3d
1314, 1332 (3d Cir. 2002) (internal quotation marks omitted).
But that purpose is still served if a plaintiff amends its
complaint after discovery has yielded more facts to support
previously dismissed claims—at that point, the plaintiff’s suit
presumably has some factual basis. Had Defendants wished to
seek a final judgment on SEPTA’s previously dismissed claims
before discovery resumed, they could have done so under Rule
54(b). Moreover, the structure of Rule 15 again addresses
Defendants’ concern, as a district court may deny leave to
amend if amendment would prejudice the non-moving party.
Arthur, 434 F.3d at 204. Defendants in fact argued before the
District Court that amendment here would prejudice them, in
part because of the discovery stay, but the Court rejected that
argument based on the specific facts of this case. As

22
v. Costa Crociere S. p. A., 560 U.S. 538, 553 (2010)
(emphasizing that the two subsections are analytically
distinct).

Defendants further argue that Rule 15(c) expressly
applies to statutes of limitations only. But nothing in the text
of the provision at issue here—Rule 15(c)(1) and subsection
(B)—refers to statutes of limitations. Subsection (A) of Rule
15(c)(1), which is not relevant here, provides that the relation-
back doctrine applies if “the law that provides the applicable
statute of limitations allows relation back.” “[T]he absence of
limiting language” in Rule 15(c)(1)(B), however, “indicates
that it applies to statutes of limitations and repose alike.”
United States ex rel. Carter v. Halliburton Co., 315 F.R.D. 56,
64 (E.D. Va. 2016); accord Chumney, 196 F.R.D. at 427.

One final note. Though it seeks to expand its complaint
with additional facts, SEPTA is not bringing any new legal
claims or adding new parties that were not included in the First
Amended Complaint.10 See Thomas, 221 F.3d at 436 n.4
(concluding that a habeas petitioner did not “raise a new claim”
by merely adding additional facts to his petition). Thus our

Defendants do not currently challenge this aspect of the
Court’s decision, we will not disturb it.
10
Defendants assert that some—though not all—of SEPTA’s
new facts included distinct, new breaches of the Securities and
Exchange Acts not included in previous complaints. We
decline to resolve this dispute now because, as we explain later,
before us is the District Court’s decision under Rule 15(a)
rather than Rule 15(c). See infra n.12. We leave the dispute,
which falls under (c), for that Court to decide in the first
instance.

23
holding today does not address whether an entirely new
claim—one that the plaintiffs did not bring before—may relate
back to skirt statutes of repose. Similarly, we do not reach
whether a plaintiff may use relation back in this context to add
new parties. We leave those tougher questions for another
time.

Rule 15(c) encourages courts to decide cases on the
merits, rather than a technicality, if a plaintiff merely seeks to
amend a timely filed complaint after the statutory deadline has
expired. While Defendants insist this principle conflicts with
the protection from liability afforded by statutes of repose, we
see no such conflict. Moreover, district courts retain discretion
to deny plaintiffs leave to amend outside the repose period if
the circumstances of a particular case would make amendment
unjust. Thus statutes of repose themselves are no barrier to
relation back under Rule 15(c) here.

3. The Rules Enabling Act does not compel a
different result.

Beyond the statutes, Defendants also argue that
allowing relation back to defeat statutes of repose would
violate the Rules Enabling Act. The Act prohibits any
interpretation of federal rules of procedure that would
“abridge, enlarge[,] or modify any substantive right.” 28
U.S.C. § 2072(b). We have held, consistent with other circuits,
that statutes of repose create substantive rights that would be
affected by allowing a plaintiff a “new cause[] of action” after
the repose period has run. Lieberman, 432 F.3d at 492; accord
Police & Fire Ret. Sys. v. IndyMac MBS, Inc., 721 F.3d 95, 109
(2d Cir. 2013) (hereinafter “IndyMac”). Defendants assert that
allowing relation back past statutes of repose would abridge or

24
modify their substantive rights to be free from liability once the
repose periods expire.

But statutes of repose do not bar liability for all time.
That bar pops up, creating a vested right to repose, only on
expiration of the repose period. See Bryant v. United States,
768 F.3d 1378, 1383 n.10 (11th Cir. 2014); Fencorp, Co. v.
Ohio Ky. Oil Corp., 675 F.3d 933, 940–41 (6th Cir. 2012);
Baughn v. Eli Lilly & Co., 356 F. Supp. 2d 1166, 1173, 1177
(D. Kan. 2005). Further, the expiration of a repose period
creates a vested right to be free from liability only as against
those plaintiffs who do not have a pending action under the
statute at that time. This is because statutes of repose create a
deadline for filing actions, rather than resolving them. See CTS
Corp., 573 U.S. at 8 (“A statute of repose . . . puts an outer limit
on the right to bring a civil action.” (emphasis added)). Thus
a defendant does not have a vested right for repose as against a
plaintiff who sues before the deadline as long as the plaintiff’s
action is pending when the deadline expires.

Returning to the Rules Enabling Act, it helps
Defendants only insofar as they have a “substantive right” to a
repose. 28 U.S.C. § 2072(b). But again, SEPTA’s Third
Amended Complaint reasserts no more than the same claims,
against the same parties, as the timely filed First Amended
Complaint. See Orrstown, 335 F.R.D. at 81. Defendants had
a vested right to repose against SEPTA if the action ended
before the repose deadline, thus requiring SEPTA to bring a
new action after the deadline expired. Yet, under Rule 54(b),
SEPTA’s action had not ended when the repose deadline
passed because the District Court’s previous dismissal did not
decide all claims as to all parties. Thus none of the Defendants
had vested rights to repose as against SEPTA when the repose

25
period expired, and the Rules Enabling Act’s protections for
substantive rights do not apply here.

Defendants nonetheless urge us to follow the Second
Circuit’s reasoning in IndyMac, 721 F.3d 95. The Court there
stated that the Rules Enabling Act barred any interpretation of
Rule 23 that would permit tolling of the Securities Act’s statute
of repose. Id. at 109. Defendants urge us to adopt similar
reasoning as to Rule 15(c): Because its relation-back doctrine
would impermissibly modify Defendants’ right to repose,
Defendants contend, the Rule cannot apply here. Some in the
Second Circuit have adopted this view, relying on IndyMac’s
reasoning to conclude that the Rules Enabling Act also
prohibits relation back against statutes of repose. See, e.g.,
Barilli v. Sky Solar Holdings, Ltd., 389 F. Supp. 3d 232, 263–
64 (S.D.N.Y. 2019); F.D.I.C. v. First Horizon Asset Sec. Inc.,
291 F. Supp. 3d 364, 371–72 (S.D.N.Y. 2018).
But IndyMac does not help Defendants for several
reasons. First, the decision by its own terms did not consider
“whether Rule 15(c) allows ‘relation back’ of claims otherwise
barred by a statute of repose.” IndyMac, 721 F.3d at 110 n.18.
Second, as we explained previously, tolling extends the repose
period, while relation back keeps the repose period intact.
Hence IndyMac’s reasoning does not apply here. Third,
IndyMac is factually distinguishable. There, members of a
putative class—who were not named parties—sought to
intervene in an existing class action. IndyMac, 721 F.3d at 103.
The Court held that it would violate the Rules Enabling Act to
permit putative plaintiffs either to “file a complaint or
intervene.” Id. at 109. Both courses of conduct would have
subjected defendants to liability to non-parties in the initial
action. See id. at 100–01. But here SEPTA has been a party
to the action from the beginning and is not seeking to file a

26
complaint or intervene in another action. Rather, it merely
seeks to amend its own timely filed complaint.11

We acknowledge that several federal district courts
have declined to permit relation back past statutes of repose.
But those decisions rely on the premise that relation back
would violate the defendants’ substantive rights in those
circumstances. See, e.g., De Vito v. Liquid Holdings Grp., Inc.,
Civ. No. 15-6969 (KM) (JBC), 2018 WL 6891832, at *24
(D.N.J. Dec. 31, 2018); First Horizon Asset Sec. Inc., 291 F.
Supp. 3d at 371–72, 374; In re Lehman Bros. Sec. & Erisa
Litig., 799 F. Supp. 2d 258, 310 (S.D.N.Y. 2011); Resol. Tr.
Corp. v. Olson, 768 F. Supp. 283, 285 (D. Ariz. 1991). Several
of these cases involved entirely new claims or parties that were
added after the repose period expired. See, e.g., De Vito, 2018
WL 6891832, at *22; First Horizon Asset Sec. Inc., 291 F.
Supp. 3d at 369; In re Lehman Bros., 799 F. Supp. 2d at 310.
As we have explained, a defendant does not have a substantive
right to repose when—as here—a plaintiff brings an action
against the defendant containing the claims at issue within the
repose period.

In sum, relation back does not offend the Rules
Enabling Act when a plaintiff merely seeks to amend a timely
filed complaint without adding entirely new claims or parties.
This is because a defendant does not have a vested right to
repose as to a plaintiff who sues before the deadline so long as

11
IndyMac also held that Rule 15(c) did not allow putative
class members to relate back past the applicable statute of
repose. Id. at 110. Yet we reiterate that the Court’s reasoning
rested on the members not being parties to the suit before the
repose deadline. See id. at 110–11.

27
the plaintiff’s action is pending. As Defendants here had no
substantive right to repose as to SEPTA, the Act does not help
them.

C. The District Court did not err in allowing
SEPTA leave to amend under Rule 15(a)(2).

Having concluded that amendments may relate back to
avoid statutes of repose, we turn to the ultimate question:
whether the District Court erred in granting SEPTA leave to
amend under Rule 15(a)(2).12 Defendants, as noted, argued
before the District Court that the expiration of the repose
periods would render SEPTA’s amendment futile. But because
relation back may make the pleading timely, amendment
would not be futile—and Defendants do not argue on appeal
that amendment would otherwise offend Rule 15(a). Hence the
District Court did not err in granting leave to amend.

* * * *

Rule 15(c) embodies the view that plaintiffs should
ordinarily have their day in court. But the rule must
nonetheless give way to a defendant’s right to rest easy after a
legislatively determined time, especially when that time is set
by a statute of repose.

12
As the analyses for Rule 15(a) and (c) differ, see Krupski,
560 U.S. at 553, and the District Court considered only whether
to grant SEPTA leave to amend under (a), we do not reach
whether each of SEPTA’s proposed amendments relates back
to its timely filed pleading under (c).

28
 Nevertheless, the right to repose cannot bar the
courthouse doors if a defendant never had it. Here, SEPTA
brought an action under both the Securities Act and the
Exchange Act against all Defendants before the Acts’
deadlines. Defendants therefore had no right to repose as long
as SEPTA’s action was pending. Moreover, the alternative
approach would risk locking the doors to plaintiffs who wished
to make even the smallest amendment to their timely filed
complaints after a repose period expires. Having found little
support for this harsh stance in the statutes, the federal rules, or
our case law, we decline to adopt it. We accordingly affirm the
District Court’s order granting SEPTA leave to amend.

29