On May 19, 2016, in FDIC v. First Horizon Asset Securities, Inc., the US Court of Appeals for the Second Circuit held that the Federal Deposit Insurance Corporation's (FDIC) Extender Statute supersedes any and all other time limitations, including statutes of repose, reaffirming its own decision in FHFA v. UBS Americas, Inc.. The Second Circuit concluded that the FDIC's complaint was timely, and vacated the district court's dismissal of the complaint. ( (May 19, 2016).)

In 2009, the FDIC was appointed receiver for Colonial Bank (Colonial), a federally insured bank that closed after suffering massive losses on residential mortgage-backed securities (RMBS). Colonial purchased these RMBS in 2007 from the defendants, who were issuers and underwriters including First Horizon Asset Securities, Inc., Credit Suisse Securities (USA), LLC, and HSBC Securities (USA) Inc.

The FDIC brought suit in federal court against the defendants in 2012, within three years of its appointment as receiver but more than three years after the RMBS had been offered to the public. The FDIC alleged that the prospectus supplements for the RMBS contained material misstatements or omissions in violation of §§ 11 and 15 of the Securities Act of 1933 (Securities Act) (15 U.S.C. §§ 77k, 77o). The defendants moved to dismiss the FDIC's complaint, arguing that it was barred by the Securities Act's three year statute of repose. This period runs from the date the securities are offered to the public. In so moving, the defendants argued that the statute of repose was not displaced by the FDIC Extender Statute, which provides the applicable statute of limitations with regard to any action brought by the FDIC as receiver (12 U.S.C. § 1821(d)(14)(A)). This period runs from the date the FDIC is appointed as receiver.

While the defendants' motion was pending, the Second Circuit decided FHFA v. UBS Americas, Inc. (712 F. 3d 136 (2d Cir. 2013)), holding that the Federal Housing Finance Agency's (FHFA) Extender Statute supplants all other applicable time limitations, including statutes of repose, even though the statute only uses the term "statute of limitations." Recognizing that UBS controlled, the defendants in this case withdrew their statute of repose argument and the district court denied the rest of the motion to dismiss.

However, the following year, the Supreme Court construed a different federal limitations-extending provision in CTS Corp. v. Waldburger, holding that the provision at issue (the CTS Provision) preempted state statutes of limitations but left state statutes of repose in place (134 S. Ct. 2175 (2014)). The First Horizon defendants then reasserted their statute of repose argument, claiming that the UBS decision was inconsistent with CTS. This time, the district court agreed with the defendants, finding that the FDIC Extender Statute did not displace the Securities Act's statute of repose. Under this reading, the FDIC's complaint was not timely and the court granted judgment for the defendants. The FDIC appealed.

The Second Circuit vacated the dismissal of the complaint and held that the UBS decision controlled, so the FDIC's Extender Statute supersedes all other time limitations, including statutes of repose. The defendants failed to show that the Supreme Court's CTS decision overruled the UBS holding.

The court relied primarily on the Extender Statute's text to conclude that:

Litigants in the Second Circuit should be aware that in actions brought by the FDIC or FHFA, the Extender Statutes replace the applicable statutes of limitations or repose, and will control when a court rules on timeliness issues.