China Agritech, Inc. v. Resh

Content sourced from Wikipedia, licensed under CC BY-SA 3.0.

China Agritech, Inc. v. Resh (2018) is a Supreme Court ruling about when a new class action can be filed after a judge denies class certification.

The case involved China Agritech, a Delaware company with operations mainly in Beijing. After fraud allegations, shareholders filed class actions in 2011 and 2012, but the courts did not certify the actions as a class. A third class action was brought in 2014 by shareholder Michael Resh. The district court dismissed it because the two-year statute of limitations under the Securities Exchange Act had passed, and the case was not timely.

The Ninth Circuit said that tolling—pausing the deadline—could allow a new class action to proceed. The Supreme Court disagreed and reversed. The Court held that after a court denies class certification, a plaintiff may not, in lieu of promptly joining an existing suit or promptly filing an individual action, commence a class action anew beyond the time allowed by the applicable statute of limitations.

Holding: Upon denial of class certification, a putative class member may not file a new class action after the deadline and must either join an existing suit or file an individual action promptly.