Fed. Sec. L. Rep. P 93,640 John William Davis v. Birr, Wilson & Co., Inc., a California Corporation, Defendants

Davis appeals from the district court’s grant of summary judgment in favor of Birr, Wilson & Company. The single issue on appeal is whether Davis’ section 10(b) action is barred by the statute of limitations. We affirm.

These claimed violations of section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), are subject to California’s three-year statute of limitations for fraud, *1370 Cal.Civ.Proc.Code § 338(4). Robuck v. Dean Witter & Co., Inc., 649 F.2d 641, 643 (9th Cir.1980). The statute of limitations begins to run when the plaintiff has actual knowledge of the fraud or knowledge of facts sufficient to put a reasonable person on notice. Id. at 644 .

In April 1981, Davis transferred his investment account from Merrill Lynch to Birr, Wilson in order to retain his current sales representative, who was transferring to Birr, Wilson. In the same year, the challenged investments occurred. During that year, Davis received confirmation slips, accountings, and monthly reports. Further, Davis was aware that these investments resulted in losses. However, Davis claims that he did not suspect fraud until 1985, when he received legal advice that his Birr, Wilson account had…

839 F.2d 1369 Fed. Sec. L. Rep. P 93,640 John William DAVIS, Plaintiff-Appellant, v. BIRR, WILSON & CO., INC., a California Corporation, et al., Defendants- Appellees. No. 87-1768. United States Court of Appeals, Ninth Circuit. Argued and Submitted Jan. 15, 1988. Decided Feb. 24, 1988. William N. Woodson, III, Palo Alto, Cal., for plaintiff-appellant. Robert J. Stumpf, San Francisco, Cal., for defendants-appellees. Appeal from the United States District Court for the Northern District of California. Before ALDISERT, * SKOPIL and SCHROEDER, Circuit Judges. PER CURIAM: 1 Davis appeals from the district court's grant of summary judgment in favor of Birr, Wilson & Company. The single issue on appeal is whether Davis' section 10(b) action is barred by the statute of limitations. We affirm. 2 These claimed violations of section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. Sec. 78j(b), are subject to California's three-year statute of limitations for fraud, Cal.Civ.Proc.Code Sec. 338(4). Robuck v. Dean Witter & Co., Inc., 649 F.2d 641, 643 (9th Cir.1980). The statute of limitations begins to run when the plaintiff has actual knowledge of the fraud or knowledge of…

concurring:

Although I join in the per curiam opinion of the court, I write separately to suggest that the Supreme Court has now sent signals that a uniform limitations period should be established nationwide for cases brought under section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), and its nubile offspring, Rule lob-5, 17 C.F.R. § 240 .10b-5 (1987). I think that it is both timely and appropriate for this court to adopt a clear-cut limitations period because of the rapidly accelerating growth of securities transactions in the states and territories that fall within this court’s extensive jurisdiction.

I.

I recognize that the Supreme Court has yet to rule on the applicable limitations period for a section 10(b) and Rule 10b-5 action. See Ernst & Ernst v. Hochfelder, 425 U.S. 185 , 210 n. 29, 96 S.Ct. 1375 , 1389 n. 29, 47 L.Ed.2d 668 (1976). The absence of a uniform limitations period in such actions has been described by Judge Easter-brook as “one tottering parapet of a ramshackle edifice. Deciding what features of state periods of limitation to adopt for which federal statutes wastes untold hours.” Norris v. Wirtz, 818 F.2d 1329, 1332 (7th Cir.), cert.…