28 U.S. Code § 1658: Time limitations on the commencement of civil actions arising under Acts of Congress

(a) Except as otherwise provided by law, a civil action arising under an Act of Congress enacted after the date of the enactment of this section may not be commenced later than 4 years after the cause of action accrues.

(b) Notwithstanding subsection (a), a private right of action that involves a claim of fraud, deceit, manipulation, or contrivance in contravention of a regulatory requirement concerning the securities laws, as defined in section 3(a)(47) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(47)), may be brought not later than the earlier of-

(1) 2 years after the discovery of the facts constituting the violation; or

(2) 5 years after such violation.

Louis J. Levy's account had been closed since on or about March 8, 1982 with no

evidence of there being any assets in the account. In 1998 a similar case was brought

by Suzanne Sillman, daughter of Mr. Levy and mother of Richard J. Sillman

in respect of Mr. Levy's account. It was dismissed. Rule 12206(a) is a statute of repose, not a statute of limitation and is not subject to equitable tolling. It has been 35 years since the occurrence or event that gave rise to this claim. Although the Panel does not have to reach a decision under 28 U.S.C. §1658(b)(1) and (b)(2) cited by Claimant, it could be denied under that statute for exceeding the statute of repose under clause (b)(2) which prohibits an action brought "five years after the violation". The claimant must under such statute choose the earlier of the 2-year discovery statute of limitations under clause (b)(1) and the 5-year statute of repose under clause (b)(2). Clause (b)(2) is the earlier of the two. In addition, under the 2-year discovery period the Claimant alleges that he first learned of violations at the 55 Water Street branch in 2014 and instituted this action in 2016 within the 2-year statute of limitation discovery period. Even ignoring that statutes of repose control, there is doubt about what a reasonable claimant would discover given the Claimant's footnote 3 in his June 5, 2017 Opposition to Respondent's Motion to Dismiss The revelations of the violations at 55 Water Street were reported by both the Los Angeles Times and the New York Times in 1991 and 1992. This information would have been knowable to Ms. Sillman, or the "reasonable" claimant. It is unknown whether these violations had anything to do with Mr. Levy's account. The regulatory action principally addressed trading issues at that branch with limited discussion of record retention policies, with no express mention of Mr. Levy's account. As stated by the arbitrator deciding Ms. Sillman's arbitration "Industry requirements mandate that Smith Barney retain copies of the monthly account statements for six years after an account was closed." Mr. Sillman's speculation about violations at 55 Water Street would be insufficient to permit equitable tolling under the 2-year discovery period, even if the statutes of repose did not control.

In sum, the Panel holds that Claimant's Claim is dismissed under FINRA Rule 12206(a) a six-year statute of repose. The Panel would not have to address the Claimant's Motion to Dismiss under FINRA Rule 12206(b)(7) but has. The dismissal of Claimant's case has met all prerequisites under FINRA public arbitration rules. The Panel was cognizant of the admonition under FINRA Rule 12504(a)(1). Dismissal of a claim prior to the conclusion of a party's case in chief under FINRA Rule 12504(a)(1) is not a prohibition. The Panel unanimously agreed to grant Respondents Motion to Dismiss based on eligibility and the Panel thinks its decision is correct and appropriate given the facts before it and the law.

In the Matter of Shearson Lehman Brothers, Inc. (NYSE Hearing Panel Decision (Settlement), 91-69, May 14, 1991): "In view of the above findings, the Hearing Panel, by unanimous vote, imposed the penalty consented to by the Firm of a censure, a fine of

$750,000, and an undertaking by the Firm that a review will be performed under the supervision of the Audit Committee of the Board of Directors of the Firm (the "Audit Committee"), of the policies, procedures and systems for compliance with Regulation T in the Firm's margin department, which review will be in addition to any regularly scheduled audit of the margin department, and that a written report of the findings and recommendations of such review will be submitted to the Audit Committee . . ."

A Wall Street Case Study in Abuse, Light Punishment  Brokers: Lucrative office's questionable tactics went unchecked. But managers cited in NYSE case stayed on./ INVESTORS AT RISK: The dark side of the brokerage business. (Los Angeles Times, by Scot J. Paltrow, July 2, 1992)