Broker-Dealer Litigation - Greenberg Traurig LLP

equitable estoppel did not apply as there was no allegation that the defendant made any
affirmative representations or had a fiduciary duty to plaintiff; (2) the discovery accrual rule does
not apply to constructive frauds; and (3) repudiation applies only to claims seeking an accounting
or other equitable relief.
Orr v. Calvert, 2011 WL 6130799 (N.C. Dec. 9, 2011).
The Supreme Court of North Carolina held that a ten-year limitations period applied to an
investor action against an unlicensed securities advisor for breach of fiduciary duty. The
Supreme Court’s opinion incorporated the reasoning set forth in the dissenting opinion in the
Court of Appeals (713 S.E.2d 29 (2011)). The dissenting judge at the Court of Appeals asserted
that the plaintiffs’ claim rose to the level of constructive fraud and was therefore subject to a tenyear
rather than a three-year statute of limitations. The dissenting judge found that the defendant
received a benefit in the form of commissions, that the benefit was illegal because the defendant
was unlicensed, and that the agent–principal relationship between plaintiffs and defendant was
sufficient to show a confidential relationship of trust.
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3. RICO
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Milo v. Galante, 2011 WL 1214769 (D. Conn. Mar. 28, 2011).
The court held that the four-year statute of limitations had run on the plaintiff’s RICO
claims against the defendant. The court noted that such claims begin to run when a plaintiff has
actual or inquiry notice of the injury. The plaintiff did not plead with particularity that the
limitations period should have been tolled because of the defendant’s wrongful concealment nor
did she indicate what due diligence she had conducted to show that tolling should be applied.
Further, the court held that the separate accrual rule – where an expired RICO claim can be
revived by new and independent violations that fall outside the limitations period – did not apply
because the plaintiff did not allege separate and distinct fraudulent acts by the defendant.
4. SRO Rules
Asensio v. SEC, 2011 WL 6032933 (11th Cir. Dec. 5, 2011).
The Eleventh Circuit affirmed the SEC’s dismissal of the petitioner’s appeal of two
NASD and FINRA decisions because the petitioner neither filed his appeal within thirty days of
receiving notice of the decision (as required under 15 U.S.C. § 782(d)(2)) nor made a showing of
extraordinary circumstances for the delay. The petitioner acknowledged that he waited three
years to file an application for review of the NASD decision and sixteen months to file an
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