It is well settled that the lengthier two-year/five-year limitations and repose periods provided by the Sarbanes Oxley Act (‛SOX“) do not apply to securities claims that had expired before SOX was enacted, even if those claims were filed after enactment and would be timely under SOX. What about claims that were still viable at the time of enactment? The Third Circuit ruled in In re Exxon Mobil Corp. Secs. Litig., 2007 U.S. App. LEXIS 20460 (3d Cir. Aug. 27, 2007) that the statute is extended for unexpired claims (here, arising out of the November 1999 merger of Exxon and Mobil). Which securities claims’ statutes were extended? Under Judge Thomas Ambro’s carefully reasoned opinion, the statute for § 10/Rule 10b-5 claims is extended, but the statute for § 14(a) claims is not (even if the latter sound in fraud).

The Court also held that the five-year statute of repose begins to run at the time of the alleged misrepresentation, not when the injury occurs — here, the statute accrued on the date of filing of the allegedly false merger proxy statement, without regard to the prior 10-K or subsequent 10-Qs that contained the same alleged misrepresentation, and without regard to when the merger closed.

‛[W]hile it is true that for a § 10(b) claim to ‘accrue’ there must be an exchange of securities (here, the November 1999 consummation of the merger)..., nevertheless the specific acts targeted by a § 10(b) cause of action are fraudulent statements themselves. It therefore is more consonant with the traditional understanding of how a statute of repose functions for the repose periods ... to begin from the date of Exxon's alleged misrepresentation: the March 26, 1999, proxy statement.... Supporting this view is the text of the relevant statutes ... [which] set their statutes of repose relative to the ‘violation,’ not to the ‘accrual,’ of the cause of action.“