1 (Slip Opinion) OCTOBER TERM, 2017

Syllabus

NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.


## SUPREME COURT OF THE UNITED STATES

Syllabus

CHINA AGRITECH, INC. v. RESH ET AL

.

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE NINTH CIRCUIT

No. 17–432. Argued March 26, 2018—Decided June 11, 2018

American Pipe & Constr. Co. v. Utah , 414 U. S. 538, established that

the timely filing of a class action to lls the applicable statute of limita

tions for all persons encompassed by the class complaint and that members of a class that fails to gain certification can timely inter

vene as individual plaintiffs in the still-pending acti on, shorn of its
class character. American Pipe ’s tolling rule also applies to putative class members who, after denial of class certification, “prefer to bring
an individual suit rath er than intervene.” Crown, Cork & Seal Co. v. Parker , 462 U. S. 345, 350. The question presented in this case is
whether American Pipe tolling applies not only to individual claims,
but to successive class actions as well.

This suit is the third class action brought on behalf of purchasers of petitioner China Agritech’s common stock, alleging materially identi

cal violations of the Securities Ex change Act of 1934. The Act has both a two-year statute of limitati ons and a five-year statute of re

pose, 28 U. S. C. §1658(b). Here, th e accrual date for purposes of the Act’s limitation period is February 3, 2011, and for the repose period, November 12, 2009. Theodore Dean, a China Agritech shareholder, filed the first class-action complaint on February 11, 2011. As re

quired by the Private Securities Litigation Reform Act of 1995 (PSLRA), his counsel posted notice of the action and invited any member of the purported class to move to serve as lead plaintiff. Six shareholders sought lead-plaintiff status. On May 3, 2012, the Dis

trict Court denied class certification; the action settled in September 2012, and the suit was dismissed. On October 4, Dean’s counsel filed a new complaint ( Smyth ), still timely, with a new set of plaintiffs. Eight shareholders sought lead-pla intiff appointment in response to the PSLRA notice, but the District Court again denied class certifica

-2 CHINA AGRITECH, INC. v. RESH

Syllabus

tion. Thereafter, the Smyth plaintiffs settled their individual claims
and dismissed their suit.

Respondent Michael Resh, who did not seek lead-plaintiff status in the earlier actions, filed the present class action in 2014, a year and a
half after the statute of limitations expired. The other respondents
moved to intervene in the suit commenced by Resh, seeking leadplaintiff status. The District Court dismissed the class complaint as untimely, holding that the Dean and Smyth actions did not toll the time to initiate class claims. The Ninth Circuit reversed, holding that the reasoning of American Pipe extends to successive class
claims.
Held : Upon denial of class certification, a putative class member may

not, in lieu of promptly joining an existing suit or promptly filing an individual action, commence a class action anew beyond the time al

lowed by the applicable statute of limitations. Pp. 5–15.

(a) American Pipe and Crown, Cork addressed only putative class
members who wish to sue individua lly after a class-certification de

nial. The “efficiency and economy of litigation” that support tolling of individual claims, American Pipe , 414 U. S., at 553, do not support maintenance of untimely successive class actions such as the one brought by Resh. Economy of litig ation favors delaying individual
claims until after a class-certificatio n denial. With class claims, on the other hand, efficiency favors early assertion of competing class representative claims. If class treatment is appropriate, and all would-be representatives have come forward, the district court can select the best plaintiff with know ledge of the full array of potential class representatives and class counsel. And if the class mechanism is not a viable option, the decision denying certification will be made at the outset of the case, litigated once for all would-be class repre

sentatives.

Federal Rule of Procedure 23 evin ces a preference for preclusion of untimely successive class actions by instructing that class certifica

tion should be resolved early on. The PSLRA, which governs this lit

igation, evinces a similar preference , this time embodied in legisla

tion providing for early notice and lead-plaintiff procedures. There is little reason to allow plaintiffs who passed up opportunities to partic

ipate in the first (and second) round of class litigation to enter the fray several years after class proceedings first commenced.

Class representatives who commenc e suit after expiration of the limitation period are unlikely to qualify as diligent in asserting claims and pursuing relief. See, e.g., McQuiggin v. Perkins , 569 U. S. 383, 391. And respondents’ proposed reading would allow extension of the statute of limitations time and again; as each class is denied certification, a new named plaintiff could file a class complaint that3 Cite as: 584 U. S. ____ (2018)

Syllabus

resuscitates the litigation. Endless tolling of a statute of limitations is not a result envisioned by American Pipe . Pp. 5–11.

(b) If Resh’s suit meets the requir ements of Rule 23(a) and (b), re

spondents assert, the suit should be permitted to proceed as a class action in keeping with Shady Grove Orthopedic Associates, P. A. v. Allstate Ins. Co. , 559 U. S. 393. Shady Grove , however, addressed a
case in which a Rule 23 class action could have been maintained ab

sent a state law proscribing class actions, while Resh’s class action would be untimely unless saved by American Pipe ’s tolling exception.
Rule 23 itself does not address ti meliness of claims or tolling and nothing in the Rule calls for the revi val of class claims if individual
claims are tolled.

The clarification of American Pipe ’s reach does not run afoul of the Rules Enabling Act by abridging or modifying a substantive right. Plaintiffs have no substantive right to bring claims outside the stat

ute of limitations. Nor is the clar ification likely to cause a substan

tial increase in the number of protecti ve class-action filings. Several Courts of Appeals have already declined to read American Pipe to permit a successive class action filed outside the limitations period, and there is no showing that thes e Circuits have experienced a dis

proportionate number of duplicative, protective class-action filings. Multiple filings, moreover, could aid a district court in determining, early on, whether class treatment is warranted, and if so, who would be the best representative. The Federal Rules provide a range of
mechanisms to aid district courts in overseeing complex litigation, but they offer no reason to permit plaintiffs to exhume failed class ac

tions by filing new, untimely class claims. Pp. 11–15.

857 F. 3d 994, reversed and remanded.

G INSBURG

, J., delivered the opinion of the Court, in which R OBERTS

, C. J., and K ENNEDY , T HOMAS , B REYER , A LITO , K AGAN

, and G ORSUCH , JJ., joined. S OTOMAYOR
, J., filed an opinion concurring in the judgment._________________

_________________ 1 Cite as: 584 U. S. ____ (2018)

Opinion of the Court

NOTICE: This opinion is subject to formal revision before publication in the preliminary print of the United States Reports. Readers are requested to notify the Reporter of Decisions, Supreme Court of the United States, Wash

ington, D. C. 20543, of any typographical or other formal errors, in order that corrections may be made before the preliminary print goes to press.


## SUPREME COURT OF THE UNITED STATES

No. 17–432

CHINA AGRITECH, INC., PETITIONER v. MICHAEL H. RESH, ET AL

.

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE NINTH CIRCUIT

[June 11, 2018]

J USTICE G INSBURG delivered the opinion of the Court.
This case concerns the tolling rule first stated in Ameri

can Pipe & Constr. Co. v. Utah , 414 U. S. 538 (1974). The
Court held in American Pipe that the timely filing of a class action tolls the applicable statute of limitations for all persons encompassed by the class complaint. Where class-action status has been denied, the Court further ruled, members of the failed class could timely intervene as individual plaintiffs in the still-pending action, shorn of
its class character. See id., at 544, 552–553. Later, in Crown, Cork & Seal Co. v. Parker , 462 U. S. 345 (1983),
the Court clarified American Pipe ’s tolling rule: The rule is not dependent on intervening in or joining an existing suit; it applies as well to putative class members who,
after denial of class certifica tion, “prefer to bring an indi

vidual suit rather than intervene . . . once the economies of a class action [are] no longer available.” 462 U. S., at 350, 353–354; see California Public Employees’ Retirement System v. ANZ Securities, Inc. , 582 U. S. ___, ___ (2017) (slip op., at 13) ( American Pipe “permitt[ed] a class action to splinter into individual suits”); Smith v. Bayer Corp.

,2 CHINA AGRITECH, INC. v. RESH

Opinion of the Court

564 U. S. 299, 313–314, n. 10 (2011) (under American Pipe tolling rule, “a putative member of an uncertified class may wait until after the court rules on the certification
motion to file an individual claim or move to intervene in the [existing] suit”). The question presented in the case now before us: Upon denial of class certification, may a putative class member, 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 limi

tations? Our answer is no. American Pipe tolls the stat

ute of limitations during the pendency of a putative class action, allowing unnamed class members to join the action individually or file individual claims if the class fails. But American Pipe does not permit the maintenance of a follow-on class action past expiration of the statute of

limitations.

I
The instant suit is the third class action brought on behalf of purchasers of petitioner China Agritech’s com

mon stock, alleging violations of the Securities Exchange Act of 1934, 48 Stat. 881, as amended, 15 U. S. C. §78a

et seq. In short, the successive complaints each make materially identical allegations that China Agritech en

gaged in fraud and misleading business practices, causing the company’s stock price to plummet when several re

ports brought the misconduct to light. See App. 60–100 ( Resh complaint), 205–235 ( Smyth complaint), 133–156 ( Dean complaint). The Exchange Act has a two-year statute of limitations that begi ns to run upon discovery of the facts constituting the violation. 28 U. S. C. §1658(b). The Act also has a five-year statute of repose. Ibid. 1 The

——————

1 A statute of limitations “begin[s] to run when the cause of action accrues—that is, when the plaintiff can file suit and obtain relief.” California Public Employees’ Retirement System v. ANZ Securities, Inc.

,3 Cite as: 584 U. S. ____ (2018)

Opinion of the Court

parties agree that the accrual date for purposes of the twoyear limitation period is February 3, 2011, and for the five-year repose period, November 12, 2009. Brief for Respondents 8, n. 3. Theodore Dean, a China Agritech shareholder, filed the first class-action complaint on February 11, 2011, at the start of the two-year limitation period. As required by the Private Securities Litigation Reform Act of 1995 (PSLRA), 109 Stat. 737, Dean’s counsel posted notice of the action in two “widely circulated national business-oriented publica

tion[s],” 15 U. S. C. §78u–4(a)(3)(A)(i), and invited any member of the purported class to move to serve as lead plaintiff. App. 274–280. Six shareholders responded to the notice, seeking to be named lead plaintiffs; other shareholders who had filed their own class complaints
dismissed them in view of the Dean action. On May 3, 2012, after several months of discovery and deferral of a lead-plaintiff ruling, the Dis trict Court denied class certi

fication. The plaintiffs, the District Court determined, had failed to establish that China Agritech stock traded on an efficient market—a necessity for proving reliance on a classwide basis. App. 192. Dean’s counsel then published a notice informing shareholders of the certification denial and advising: “You must act yourself to protect your rights. You may protect your rights by joining in the current Action as a plaintiff or by filing your own action against China Agritech.” Id. , at 281–282. The Dean action settled in September 2012, occasioning dismissal of the suit. See 857 F. 3d 994, 998 (CA9 2017). On October 4, 2012—within the two-year statute of limitations—Dean’s counsel filed a new complaint ( Smyth )

—————— 582 U. S. ___, ___ (2017) (slip op., at 5) (internal quotation marks omitted). A statute of repose, by co ntrast, “begin[s] to run on the date of the last culpable act or om ission of the defendant.” Ibid. (internal quotation marks omitted).4 CHINA AGRITECH, INC. v. RESH

Opinion of the Court

with a new set of plaintiffs and new efficient-market evidence. Eight shareholders responded to the PSLRA notice, seeking lead-plaintiff appointment. The District Court again denied class certifi cation, this time on typical

ity and adequacy grounds. S ee App. 254. Thereafter, the Smyth plaintiffs settled their individual claims with the defendants and voluntarily dismissed their suit. Because
the Smyth litigation was timely commenced, putative class members who promptly initiated individual suits in the
wake of the class-action denial would have encountered no
statute of limitations bar.Respondent Michael Resh, who had not sought leadplaintiff status in either the Dean or Smyth proceedings and was represented by counsel who had not appeared in the earlier actions, filed the present suit on June 30, 2014, styling it a class action—a year and a half after the stat

ute of limitations expired. The other respondents moved to intervene, seeking designation as lead plaintiffs; to

gether with Resh, they filed an amended complaint. The District Court dismissed the class complaint as untimely, holding that the Dean and Smyth actions did not toll the
time to initiate class claims. App. to Pet. for Cert. 36a. The Court of Appeals for the Ninth Circuit reversed: “[P]ermitting future class action named plaintiffs, who were unnamed class members in previously uncertified classes, to avail themselves of American Pipe tolling,” the court reasoned, “would advance the policy objectives that led the Supreme Court to permit tolling in the first place.” 857 F. 3d, at 1004. Applying American Pipe tolling to successive class actions, the Ninth Circuit added, would cause no unfair surprise to defendants and would promote economy of litigation by reducing incentives for filing protective class suits during the pendency of an initial certification motion. 857 F. 3d, at 1004. We granted certiorari, 583 U. S. ___ (2017), in view of a division of authority among the Courts of Appeals over5 Cite as: 584 U. S. ____ (2018)

Opinion of the Court

whether otherwise-untimely successive class claims may be salvaged by American Pipe tolling. Compare the in

stant case and Phipps v. Wal-Mart Stores, Inc. , 792 F. 3d 637, 652–653 (CA6 2015) (applying American Pipe tolling to successive class action), with, e.g., Basch v. Ground Round, Inc. , 139 F. 3d 6, 11 (CA1 1998) (“Plaintiffs may not stack one class action on top of another and continue to toll the statute of limitations indefinitely.”); Griffin

v. Singletary , 17 F. 3d 356, 359 (CA11 1994) (similar);
Korwek v. Hunt , 827 F. 2d 874, 879 (CA2 1987) ( American Pipe does not apply to successive class suits); SalazarCalderon v. Presidio Valley Farmers Assn ., 765 F. 2d 1334, 1351 (CA5 1985) (“Plaintiffs have no authority for their contention that putative class members may piggyback
one class action onto another and thus toll the statute of limitations indefinitely, nor have we found any.”). See
also Yang v. Odom , 392 F. 3d 97, 112 (CA3 2004) ( Ameri

can Pipe tolling does not apply to successive class actions where certification was previously denied due to a class defect, but does apply when certification was denied based on the putative representative’s deficiencies).

II
A

American Pipe established that “the commencement of the original class suit tolls the running of the statute [of limitations] for all purported members of the class who make timely motions to in tervene after the court has found the suit inappropriate for class action status.” 414

U. S., at 553. “A contrary rule,” the Court reasoned in American Pipe , “would deprive [Federal Rule of Civil Procedure] 23 class actions of the efficiency and economy of litigation which is a principa l purpose of the procedure.”
Ibid. This is so, the Court explained, because without tolling, “[p]otential class members would be induced to file protective motions to intervene or to join in the event that6 CHINA AGRITECH, INC. v. RESH

Opinion of the Court

a class was later found unsuitable.” Ibid. In Crown, Cork

, the Court further elaborated: Failure to extend the Ameri

can Pipe rule “to class members filing separate actions,” in addition to those who move to intervene, would result in “a needless multiplicity of actions” filed by class members preserving their individual claims—“precisely the situa

tion that Federal Rule of Civil Procedure 23 and the toll

ing rule of American Pipe were designed to avoid.” 462

U. S., at 351. American Pipe and Crown, Cork addressed only putativeclass members who wish to sue individually after a classcertification denial. See, e.g., American Pipe , 414 U. S., at 552 (addressing “privilege of intervening in an individual suit”); Crown, Cork , 462 U. S., at 349 (applying American Pipe to those who “file individual actions”); 462 U. S., at 352 (tolling benefits “class members who choose to file separate suits”). What about a putative class representative, like Resh, who brings his claims as a new class action after the stat

ute of limitations has expired? Neither decision so much as hints that tolling extends to otherwise time-barred
class claims. We hold that American Pipe does not permit a plaintiff who waits out the statute of limitations to piggyback on an earlier, timely filed class action. The “efficiency and economy of litigation” that support tolling of individual claims, American Pipe , 414 U. S., at 553, do not support maintenance of untimely successive class actions; any additional class filings should be made early on, soon after the commencement of the first action seek

ing class certification. American Pipe tolls the limitation period for individual claims because economy of litigation favors delaying those
claims until after a class-certifica tion denial. If certifica

tion is granted, the claims will proceed as a class and there would be no need for the assertion of any claim individually. If certification is denied, only then would it7 Cite as: 584 U. S. ____ (2018)

Opinion of the Court

be necessary to pursue claims individually. With class claims, on the other hand, efficiency favors early assertion of competing class representative claims. If class treatment is appropriate, and all would-be repre

sentatives have come forward, the district court can selectthe best plaintiff with knowledge of the full array of potential class representatives and class counsel. And if the class mechanism is not a viable option for the claims, the decision denying certification will be made at the outset of the case, litigated once for all would-be class representatives. 2 Rule 23 evinces a preference for preclusion of untimely successive class actions by instructing that class certifica

tion should be resolved early on. See Fed. Rule Civ. Proc. 23(c)(1)(A). Indeed, Rule 23(c) was amended in 2003 to permit district courts to take account of multiple classrepresentative filings. Before the amendment, Rule 23(c) encouraged district courts to issue certification rulings “as soon as practicable.” The amendment changed the rec

ommended timing target to “an early practicable time.”
The alteration was made to allow greater leeway, more time for class discovery, and additional time to “explore designation of class counsel” and consider “additional

——————

2 Encouraging early class filings will help ensure sufficient time re

mains under the statute of limitations, in the event that certification is denied for one of the actions or a port ion of the class. Subclasses might be pleaded in one or more complain ts and taken up if necessary; as class discovery proceeds and weaknesses in the class theory or adequacy of representation come to light, the lead complaint might be amended or a new plaintiff might intervene. See Brief of Plaintiffs in Post- Dukes
Successor Class Actions as Amici Curiae 8–10 (describing regional
subclasses asserted in the Dukes v. Wal-Mart litigation following this Court’s decision decertifying the nationwide class, Wal-Mart Stores,

Inc. v. Dukes , 564 U. S. 338 (2011)); Pierce, Improving Predictability and Consistency in Class Action To lling, 23 Geo. Mason L. Rev. 339, 349 (2016) (some Dukes plaintiffs moved to amend the original com

plaint to replead subclasses).8 CHINA AGRITECH, INC. v. RESH

Opinion of the Court

[class counsel] applications rather than deny class certifi

cation,” thus “afford[ing] the best possible representation for the class.” Advisory Committee’s 2003 Note on subds. (c)(1)(A) and (g)(2)(A) of Fed. Rule Civ. Proc. 23, 28

U. S. C. App., pp. 815, 818; see Willging & Lee, From Class Actions to Multidistrict Consolidations: Aggregate Mass-Tort Litigation after Ortiz , 58 U. Kan. L. Rev. 775, 785 (2010) (2003 amendments “raised the standard for certifying a class from an early, conditional ruling to a later, relatively final decisi on” and “expand[ed] the oppor

tunity for parties to engage in discovery prior to moving for class certification”). The PSLRA, which governs this litigation, evinces a similar preference, this time embodied in legislation, for grouping class-representative filings at the outset of litiga

tion. See supra, at 3. When the Dean and Smyth timely commenced actions were first filed, counsel put any shareholder who might wish to serve as lead plaintiff on
notice of the action. Several heeded the call—six in Dean and eight in Smyth . See 857 F. 3d, at 997–998. The PSLRA, by requiring notice of the commencement of a class action, aims to draw all potential lead plaintiffs into
the suit so that the district court will have the full roster of contenders before deciding which contender to appoint. 3

——————

3 Although the Private Securities Litigation Reform Act of 1995 (PSLRA), 109 Stat. 737, includes a presumption that the most adequate plaintiff is the one who moves first and has the largest financial inter

est in the case, see 15 U. S. C. §78u –4(a)(3)(B)(iii)(I), multiple potential lead plaintiffs have reason to appl y for the role because there may not
be an obvious candidate. Which plaintiff has the largest financial interest may not be immediately apparent; the statute does not define the term, and the size of a sharehol der’s financial interest can depend on how many shares were purchased and sold, when, and at what price,
as well as the order in which the losses are tallied. See, e.g., Cortina v. Anavex Life Sciences Corp. , 2016 WL 1337305 (SDNY, Apr. 5, 2016). District courts often permit aggreg ation of plaintiffs into plaintiff groups, so even a small shareholde r could apply for lead-plaintiff9 Cite as: 584 U. S. ____ (2018)

Opinion of the Court

See Brief for Securities Industry and Financial Markets
Association as Amicus Curiae 12–13 (PSLRA “seeks to achieve Congress[’] goal of curbing duplicative . . . litiga

tion by encouraging all interested parties to apply to serve as lead plaintiff at the early stages of the case [and] providing for the consolidation of similar class actions”). With notice and the opportunity to participate in the first (and second) round of class litigation, there is little reason to allow plaintiffs who passed up those opportunities to enter the fray several years after class proceedings first
commenced. Ordinarily, to benefit from equitable tolling, plaintiffs must demonstrate that they have been diligent in pursuit of their claims. See, e.g., McQuiggin v. Perkins , 569 U. S. 383, 391 (2013); Menominee Tribe of Wis. v. United States

, 577 U. S. ___, ___ (2016) (slip op., at 5). Even American Pipe , which did not analyze “criteria of the formal doctrine of equitable tolling in any direct manner,” ANZ , 582 U. S., at ___–___ (slip op., at 10–11), observed that tolling was permissible in the circumstances because plaintiffs who later intervened to pursue individual claims had not slept on their rights, American Pipe , 414 U. S., at 554–555. Those plaintiffs reasonably relied on the class representa

tive, who sued timely, to prot ect their interests in their
individual claims. See Crown, Cork , 462 U. S., at 350. A would-be class representative who commences suit after expiration of the limitation period, however, can hardly qualify as diligent in asserting claims and pursuing relief.

—————— status, hoping to join with other sh areholders to create a unit with the largest financial interest. See Choi & Thompson, Securities Litigation and Its Lawyers: Changes During the First Decade After the PSLRA, 106 Colum. L. Rev. 1489, 1507, 1521, 1530 (2006) (80% of securities class actions in post-PSLRA data sample had two or more co-lead counsel firms). Thus, it is a reason able expectation that, in litigation governed by the PSLRA, a district court will have several competing candidates for lead plai ntiff to choose among.10 CHINA AGRITECH, INC. v. RESH

Opinion of the Court

Her interest in representing the class as lead plaintiff, therefore, would not be preserved by the prior plaintiff ’s timely filed class suit. Respondents’ proposed reading would allow the statute of limitations to be extended time and again; as each class is denied certification, a new named plaintiff could file a class complaint that resuscit ates the litigation. See Yang

, 392 F. 3d, at 113 (Alito, J., concurring in part and dissent

ing in part) (tolling for successi ve class actions could allow “lawyers seeking to represent a plaintiff class [to] extend the statute of limitations almost indefinitely until they find a district court judge wh o is willing to certify the class”); Ewing Industries Corp. v. Bob Wines Nursery, Inc.

, 795 F. 3d 1324, 1326 (CA11 2015) (tolling for successive class actions allows plaintiffs “limitless bites at the ap

ple”). 4 This prospect points up a further distinction be

tween the individual-claim tolling established by Ameri

can Pipe and tolling for successive class actions. The time to file individual actions once a class action ends is finite, extended only by the time the class suit was pending; the time for filing successive class suits, if tolling were al

lowed, could be limitless. Respondents’ claims happen to be governed by 28 U. S. C. §1658(b)(2)’s five-year statute of repose, so the time to file complaints has a finite end. Statutes of repose, however, are not ubiquitous. See

——————

4 Respondents observe that in Smith v. Bayer Corp. , 564 U. S. 299 (2011), we held that federal class- certification denials do not have preclusive effect in subsequent state-court suits, despite concerns about successive class actions. See Brief for Respondents 40–41. But in
Smith , we were guided by “the fundamental nature of the general rule that only parties can be bound by prior judgments.” 564 U. S., at 313 (internal quotation marks omitted). The state-court plaintiffs were not parties to the federal-court litigation, hence they could not be bound by its holding—despite a “stron[g] argu ment” about the inefficiencies of serial class relitigation supporting the contrary position. Id., at 316. No such countervailing presumptio n favors Resh’s untimely third
federal class suit.11 Cite as: 584 U. S. ____ (2018)

Opinion of the Court

Dekalb County Pension Fund v. Transocean Ltd. , 817 F. 3d 393, 397 (CA2 2016). Most statutory schemes provide for a single limitation period without any outer limit to safe

guard against serial relitigation. Endless tolling of a statute of limitations is not a result envisioned by Ameri

can Pipe

. 5

B
Respondents emphasize that in Shady Grove Orthopedic Associates, P. A. v. Allstate Ins. Co. , 559 U. S. 393 (2010), we said that “a class action may be maintained,” id ., at 398 (internal quotation marks omitted), if the require

ments of Rule 23(a) and (b) are satisfied, and “Rule 23 automatically applies in all civil actions and proceedings in the United States district courts,” id., at 400 (internal quotation marks omitted). See Brief for Respondents 21–

23. If Resh’s suit meets the requirements of Rule 23(a) and (b), respondents assert, there is no reason why Resh’s suit cannot proceed as a class action. Shady Grove does
not call for that outcome. In Shady Grove , the Court held that a federal diversity action could proceed under Rule 23 despite a state law prohibiting class treatment of suits

——————

5 J USTICE S OTOMAYOR suggests that the Court might adopt a rule under which tolling “becomes unavailable for future class claims where class certification is denied for a reason that bears on the suitability of the claims for class treatment,” bu t not where “class certification is
denied because of the deficiencies of the lead plaintiff as class repre

sentative.” Post, at 5; see Yang v. Odom , 392 F. 3d 97, 112 (CA3 2004) (embracing similar rule). But Rule 23 contains no instruction to give
denials of class certification different effect based on the reason for the denial. And as the Advisory Committee Notes explain, affording
district courts time to consider co mpeting claims for class representa

tion will advance the likelihood that lead plaintiff or class counsel
deficiencies will be discovered and ac ted upon early in the litigation.
See supra, at 7–8. Rule 23 and putative class members’ own interests in adequate representation, and th e efficient adjudication thereof, weigh heavily against tolling for successive class actions. There is nothing inequitable in following these guides. See post, at 5, n. 2.12 CHINA AGRITECH, INC. v. RESH

Opinion of the Court

seeking damages of the kind asserted in the Shady Grove complaint. 559 U. S., at 396, 416. Our opinion in Shady
Grove addressed a case in which a Rule 23 class action could have been maintained absent a contrary state-law
command. Id. , at 396. Resh’s case presents the reverse situation: The class action would be untimely unless saved by American Pipe ’s equitable-tolling exception to statutes
of limitations. Rule 23 itself does not address timeliness of claims or tolling and nothing in the Rule calls for the
revival of class claims if individual claims are tolled. In fact, as already explained, Rule 23 prescribes the opposite
result. See supra, at 6–8. Today’s clarification of American Pipe ’s reach does not run afoul of the Rules Enabling Act by causing a plaintiff’s attempted recourse to Rule 23 to abridge or modify a substantive right. See Brief for Respondents 23–26 (citing Tyson Foods, Inc. v. Bouaphakeo , 577 U. S. ___ (2016)). Plaintiffs have no substantive right to bring their claims outside the statute of limitations. That they may do so, in limited circumstances, is due to a judicially crafted tolling rule that itself does not abridge, enlarge, or modify any substantive right. American Pipe , 414 U. S., at 558.
Without American Pipe , respondents would have no peg to seek tolling here; as we have explained, however, Ameri

can Pipe does not provide for the extension of the statute of limitations sought by Resh for institution of an untimely
third class suit. Respondents urge that American Pipe ’s logic in fact supports their position because declining to toll the limita

tion period for successive class suits will lead to a “need

less multiplicity” of protective class-action filings. Brief for Respondents 32–34. See also post, at 6–7 (expressing concern about duplicative and dueling class actions). But there is little reason to think that protective class filings will substantially increase. Several Courts of Appeals have already declined to read American Pipe to permit a13 Cite as: 584 U. S. ____ (2018)

Opinion of the Court

successive class action filed outside the limitation period.
See supra, at 5; 3 W. Rubenstein, Newberg on Class Ac

tions §9:64, n. 5 (5th ed. 2012). These courts include the Second and Fifth Circuits (no strangers to class-action practice); both courts declin ed to entertain out-of-time
class actions in the 1980’s. See Korwek , 827 F. 2d 874 (CA2 1987); Salazar-Calderon , 765 F. 2d 1334 (CA5 1985). Respondents and their amici make no showing that these Circuits have experienced a disproportionate number of duplicative, protective class-action filings.

Amicus National Conference on Public Employee Re

tirement Systems cites examples of protective filings responding to courts’ disallowance of American Pipe tolling for statutes of repose, but those examples in fact suggest that protective class filings are uncommon. See Brief of the National Conference on Public Employee Retirement Systems as Amicus Curiae 7–8. Between dozens and hundreds of class plaintiffs filed protective individual
claims while class-certification motions were pending in securities cases and the statute of repose was about to run out, placing a permanent bar against their claims. Ibid. But none of the plaintiffs appears to have filed a protective
class action—even though, if the statute of repose expired and the pending class-certification motions were denied, there would be no further opportunity to assert class
claims. 6 Nor do the incentives of class-action practice suggest that many more plaintiffs will file protective class claims as a result of our holding. Any plaintiff whose individual claim is worth litigating on its own rests secure in the

——————

6 The Second Circuit Petrobras litigation, referenced in amicus ’ brief, illustrates that multiple timely cl ass filings do not sow unmanageable
chaos. Five class actions were file d there and consolidated, along with individual claims, for pretrial purp oses, including class-certification
determination. See In re Petrobras Securities , 862 F. 3d 250, 258 (CA2 2017).14 CHINA AGRITECH, INC. v. RESH

Opinion of the Court

knowledge that she can avail herself of American Pipe tolling if certification is denied to a first putative class. The plaintiff who seeks to preserve the ability to lead the
class—whether because her claim is too small to make an
individual suit worthwhile or because of an attendant
financial benefit 7 —has every reason to file a class action early, and little reason to wait in the wings, giving another plaintiff first shot at representation. In any event, as previously explained, see supra, at 6–8, a multiplicity of class-action filings is not necessarily “needless.” Indeed, multiple filings may aid a district court in determining, early on , whether class treatment is warranted, and if so, which of the contenders would be the best representative. And sooner rather than later filings are just what Rule 23 encourages. See ibid . Multiple timely filings might not line up neatly; they could be filed in different districts, at di fferent times—perhaps when briefing on class certification has already begun—or on behalf of only partially overlapping classes. See Wasser

man, Dueling Class Actions, 80 B. U. L. Rev. 461, 464–465 (2000) (describing variety of “dueling” class filings). But district courts have ample tools at their disposal to man

age the suits, including the ability to stay, consolidate, or transfer proceedings. District courts are increasingly familiar with overseeing such complex cases, given the surge in multidistrict litigatio n. See Cabraser & Issa

charoff, The Participatory Class Action, 92 N. Y. U. L. Rev. 846, 850–851 (2017) (multidistrict litigation frequently combines individual suits and multiple putative class actions). The Federal Rules provide a range of mecha

nisms to aid courts in this endeavor. What the Rules do not offer is a reason to permit plaintiffs to exhume failed

——————

7 The class representative might receive a share of class recovery above and beyond her individual claim. See, e.g., Cook v. Niedert , 142
F. 3d 1004, 1016 (CA7 1998) (affirming class representative’s $25,000 incentive award).15 Cite as: 584 U. S. ____ (2018)

Opinion of the Court

class actions by filing new, untimely class claims.

* * *

The watchwords of American Pipe are efficiency and economy of litigation, a principal purpose of Rule 23 as well. Extending American Pipe tolling to successive class actions does not serve that purpose. The contrary rule, allowing no tolling for out-of-time class actions, will propel putative class representatives to file suit well within the limitation period and seek certi fication promptly. For all the above-stated reasons, it is the rule we adopt today:
Time to file a class action falls outside the bounds of Amer

ican Pipe

. Accordingly, the judgment of the Court of Appeals for the Ninth Circuit is reversed, and the case is remanded for further proceedings consistent with this opinion.

It is so ordered._________________

_________________ 1 Cite as: 584 U. S. ____ (2018)

S OTOMAYOR

, J., concurring in judgment



## SUPREME COURT OF THE UNITED STATES

No. 17–432

CHINA AGRITECH, INC., PETITIONER v. MICHAEL H. RESH, ET AL

.

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE NINTH CIRCUIT

[June 11, 2018]

J USTICE S OTOMAYOR , concurring in the judgment.
I agree with the Court that in cases governed by the Private Securities Litigation Reform Act of 1995 (PSLRA), 15 U. S. C. §78u–4, like this one, a plaintiff who seeks to bring a successive class action may not rely on the tolling rule established by American Pipe & Constr. Co. v. Utah

, 414 U. S. 538 (1974). I cannot, however, join the majority in going further by holding that the same is true for class actions not subject to the PSLRA.

I
A
To understand why the PSLRA is essential to the con

clusion the Court reaches here, recall that this case in

volves a putative class-action lawsuit brought by a plain

tiff with a timely individual cl aim, joined by coplaintiffs with timely individual claims, on behalf of a putative class of absent class members with timely individual claims.
See ante, at 4. One might naturally think, then, that the class claims in the lawsuit are timely. The majority, however, concludes that the named plaintiffs’ and putative
class members’ class claims are time barred. At first blush, this result might seem surprising, for the Court has rejected the idea that class claims are categori

cally different from individual claims. See Shady Grove2 CHINA AGRITECH, INC. v. RESH

S OTOMAYOR

, J., concurring in judgment

Orthopedic Associates, P. A. v. Allstate Ins. Co. , 559 U. S. 393, 398 (2010). Although it did not hold that class claims may never be treated different ly from individual claims, Shady Grove indicates that there must be a special reason for doing so. Here, the PSLRA supplies that special reason. The PSLRA imposes significant procedural requirements on
securities class actions that do not apply to individual or traditionally joined securities claims. See §78u–4(a)(1). Foremost among these require ments is a process for the “[a]ppointment of lead plaintiff.” §78u–4(a)(3). Under the PSLRA, the named plaintiff in a putative class action must publish within 20 days of filing the complaint a nationwide notice alerting putative class members to the filing of the suit and informing them that, “not later than 60 days after the date on which the notice is published, any member of the purported class may move the court to serve as lead plaintiff.” §78u–4(a)(3)(A)(i). The district court then must evaluate all prospective lead plaintiffs and choose the “most adequate” one based on a set of enumerated considerations. §78u–4(a)(3)(B). The PSLRA thus contemplates a process by which all prospective class representatives come forward in the first-filed class action and make their arguments to the court for lead-plaintiff status. See H. R. Conf. Rep. No. 104–369, p. 32 (1995). Respondents here bypassed that statutory process. They do not dispute that notice was published in the two earlier-filed putative class actions concerning the same securities claims as here, as required by the PSLRA. Yet they did not seek to be chosen lead plaintiffs in either of
those actions. See ante, at 3–4, 8. For that reason alone, I agree with the majority that respondents “can hardly qualify as diligent in asserting [class] claims and pursuing
relief.” Ante, at 9. Respondents’ failure to utilize the PSLRA’s lead-plaintiff selection procedure distinguishes
them from the American Pipe absent class members, who3 Cite as: 584 U. S. ____ (2018)

S OTOMAYOR

, J., concurring in judgment

were subject only to the traditional Federal Rule of Civil Procedure 23 class procedure, which is “designed to avoid, rather than encourage, unnecessary filing of repetitious papers and motions.” 414 U. S., at 550. Unlike the PSLRA, Rule 23 contains no requirement of precertification notice to absen t putative class members; it provides only for postcertification notice. See Fed. Rule Civ. Proc. 23(c)(2). There thus is no mechanism for absent putative class members to le arn that a putative class action is pending, much less that they are entitled to seek to displace the named plaintiff in that lawsuit as class representative. Also unlike the PSLRA, Rule 23 contains no process for a district court to choose from among the various candidates for lead plaintiff, nor does it specify what would make a person the most adequate representa

tive of the class. See 7A C. Wright, A. Miller, & M. Kane, Federal Practice and Procedure §1765, p. 321 (3d ed. 2005). In class actions not subject to the PSLRA, the class representative is generally the first person who files the suit, and so is self-selected (subject to an adequacy deter

mination), rather than selected by the court. 1 See Rule 23(a)(4) (“One or more members of a class may sue or be sued as representative parties on behalf of all members only if . . . the representative parties will fairly and ade

quately protect the interests of the class”); Rule 23(c)(1)(A) (“At an early practicable time after a person sues or is sued as a class representative, the court must determine

——————

1 There may, of course, be competition among putative class members to proceed on behalf of the putative class in an action not governed by the PSLRA, and the district court generally considers their relative qualities. But the point is that the court is not required by Rule 23 to identify and designate as lead plai ntiff the person most capable of adequately representing the class; it is only required to determine for certification purposes whether the class representative adequately represents the class. See 7A Wrig ht, Federal Practice and Procedure §1765, at 321.4 CHINA AGRITECH, INC. v. RESH

S OTOMAYOR

, J., concurring in judgment

by order whether to certify the action as a class action”);

H. R. Conf. Rep. No. 104–369, at 33–35. The majority points to Rule 23(c)’s requirement that the determination whether to certify a class be made at “ ‘an early practicable time,’ ” ante, at 7, but there is no signifi

cance to that requirement with respect to the diligence of would-be class representative s. The Advisory Committee notes accompanying the 2003 amendment to Rule 23(c), which changed the recommended timing for a certification determination from “as soon as practicable” to “at an early practicable time,” explained that the change would permit time for “controlled discovery into the ‘merits,’ ” efforts by defendants “to win dismissal or summary judgment as to the individual plaintiffs wi thout certification,” and the considered “designation of class counsel.” Advisory Com

mittee’s 2003 Notes on subd. (c)(1)(A) of Fed. Rule Civ. Proc. 23, 28 U. S. C. App., p. 815. The notes say nothing about lead-plaintiff selection, and Rule 23(c) in no way ensures that potential lead plaintiffs know about the putative class action or about their opportunity to repre

sent the class. Given these important differences between Rule 23’s general class procedures and the specific procedures im

posed by the PSLRA, the majority’s conclusion that absent class members were not diligent because they failed to ask to be the class representative in a prior suit makes sense only in the PSLRA context. The same conclusion simply does not follow in the gene ric Rule 23 context, where absent class members are most likely unaware of the existence of a putative class action. Cf. American Pipe

, 414 U. S., at 551–552 (explaining that even absent class members who are unaware of the putative class action are entitled to tolling).

B
In addition to its focus on plaintiff diligence, the majority5 Cite as: 584 U. S. ____ (2018)

S OTOMAYOR

, J., concurring in judgment

offers a separate line of reasoning to support its broad holding. It explains that its limitation on American Pipe tolling is necessary to prevent a “limitless” series of class actions, each rendered timely by the tolling effect of the previous ones. Ante , at 10. As the majority acknowledges, however, there is no such risk in this case, see ibid. , be

cause the applicable statute of repose puts a 5-year “outer limit on the right to bring a civil action.” CTS Corp. v. Waldburger , 573 U. S. ___, ___ (2014) (slip op., at 6). The majority is right, of course, that in many other types of cases, no statute of repose will apply. See ante, at 10–11. But the Court has elsewhere pointed to the power of “com

ity among courts to mitigate the sometimes substantial costs of similar litigation brought by different plaintiffs.”
Smith v. Bayer Corp. , 564 U. S. 299, 317 (2011). There is no reason to assume that this existing safeguard will prove inadequate if the Court holds that American Pipe tolling is available for successive class actions outside the
PSLRA context. Even if principles of comity prove insufficient such that
some modification to the American Pipe rule is necessary to prevent indefinite tolling, a narrower form of redress is available. Instead of adopting a blanket no-tolling-of

class-claims-ever rule outside the PSLRA context, the Court might hold, as a matter of equity, that tolling only
becomes unavailable for future class claims where class
certification is denied for a reason that bears on the suit

ability of the claims for class treatment. Where, by con

trast, class certification is denied because of the deficien

cies of the lead plaintiff as class representative, or because
of some other nonsubstantive defect, tolling would remain
available. 2 See Yang v. Odom , 392 F. 3d 97, 112 (CA3

——————

2 Such an approach would, of course, be “grounded in the traditional equitable powers of the judiciary,” which are “the source of the tolling rule applied in American Pipe ,” and not Rule 23, which “does not so6 CHINA AGRITECH, INC. v. RESH

S OTOMAYOR

, J., concurring in judgment

2004). This approach would, for instance, ensure that in cases where the only problem with the first suit was the identity of the named plaintiff, a new and more adequate representative could file another suit to represent the class. Preserving the opportunity for such a fix may seem unimportant in a PSLRA case like this one, where the court in the first-filed case will usually have a choice among possible lead plaintiffs. See ante, at 8–9, n. 3. But, as just explained, in class actions not subject to the PSLRA, the certifying court ofte n will have no choice as to the class representative. Whether this or another rule ultimately is the right one, there is no need for the Court today to reach beyond the facts of this case, where the specter of indefinite tolling is merely hypothetical, and foreclose the possibility of a more tailored approach.

C
Finally, the majority suggests that its broader approach will encourage multiple potential class representatives to come forward early, which may “aid a district court” in making class certification decisions. Ante, at 14. This may well be so in the PSLRA context, given the statute’s notice requirement and built -in mechanism for selecting the most adequate lead plaintiff. But in suits not covered by the PSLRA, absent class members may not know of the pending class action early enou gh to “aid” the court, and will likely have to file a completely separate lawsuit if what they seek is lead-plaintiff status. In addition to increasing the number of unnecessary filings, a result at odds with American Pipe ’s concern with avoiding “needless duplication,” 414 U. S., at 554, the existence of multiple putative class actions covering the

—————— much as mention the extension or su spension of statutory time bars.” California Public Employees’ Retirement System v. ANZ Securities, Inc.

, 582 U. S. ___, ___ (2017) (slip op., at 10); see ante, at 11, n. 5.7 Cite as: 584 U. S. ____ (2018)

S OTOMAYOR

, J., concurring in judgment

same harm to the same class may lead to a “race toward judgment or settlement.” Wasserman, Dueling Class Actions, 80 B. U. L. Rev. 461, 472 (2000). Each class lawyer knows that only the lawyers in the first-resolved case will get paid, because the other suits will then be dismissed on claim-preclusion grounds. Ibid . Defense lawyers know this, too, so they are “able to engage in a ‘reverse auction,’ pitting the various class counsel against one another and agreeing to settle with the lawyer willing to accept the lowest bid on behalf of the class.” Id., at 473. This gamesmanship is not in class members’ interest, nor in the interest of justice. I therefore think it unwise to encourage the filing of such dueling class actions outside
the PSLRA context.

II
Although there is ample support for denying American Pipe tolling to successive cla ss actions subject to the PSLRA, the majority’s reasoning does not justify denying American Pipe tolling to other successive class actions. The majority could have avoide d this error by limiting its decision to the issues presented by the facts of this case. Despite the Court’s misstep in adopting an unnecessarily broad rule, district courts can help mitigate the potential unfairness of denying American Pipe tolling to class claims not subject to the PSLRA. Where appropriate, district courts should liberally permit amendment of the pleadings or intervention of new plaintiffs and counsel. Because I agree with the majority’s conclusion just as applied to class actions governed by the PSLRA, like this one, I concur only in the judgment.