On May 19th, the Southern District Court of New York partially denied motions to dismiss a securities fraud case stemming from an offering of mortgage-backed securities. Plaintiffs allege that the offering documents for the interests in the pool of securitized mortgages misrepresented the underlying mortgages' compliance with underwriting standards. Partially denying motions to dismiss, the Court found that plaintiffs who still hold the securities sufficiently stated a claim under Section 11 of the Securities Act. By noting the losses incurred by those who have sold the securities, these plaintiffs pleaded a cognizable injury. The Court also held that certain Securities Act claims were not time-barred. Relying on the Supreme Court's decision in Merck & Co. v. Reynolds, as elaborated upon by the Second Circuit in City of Pontiac Gen. Emps. Ret. Sys. v. MBIA, Inc., the Court found that the statute of limitations did not begin to run until plaintiff would have sufficient information to survive a motion to dismiss. New Jersey Carpenters Health Fund v. Residential Capital.