201 F.3d 848 (7th Cir. 2000)
J.E. Liss & Company and Dennis Waisman,    Plaintiffs-Appellees,v.Harold A. Levin,    Defendant-Appellant.
No. 99-1716
In the  United States Court of Appeals  For the Seventh Circuit
Argued November 8, 1999Decided January 10, 2000

Appeal from the United States District Court  for the Eastern District of Wisconsin.  No. 98 C 385--J. P. Stadtmueller, Chief Judge.
Before Posner, Chief Judge, and Ripple and Diane P. Wood, Circuit Judges.
Posner, Chief Judge.


1
A brokerage firm that  belongs to the National Association of Securities  Dealers, and one of its brokers, brought this  suit under the Federal Arbitration Act to vacate  an arbitration award of $30,000 to Harold Levin,  a former customer. 9 U.S.C. sec. 10(a)(4). Levin  counterclaimed to confirm the award. sec. 9. The  district court sided with the plaintiffs on the  ground that the arbitrators had exceeded their  jurisdiction.


2
In 1990 Waisman had sold Levin an interest  (conceded to be a security) in a limited  partnership known as Vintech. The following year  Vintech sought protection from its creditors  under Chapter 11 of the Bankruptcy Code, but as  so often happens the proceeding was soon  converted to a Chapter 7 liquidation. In 1996, a  month or so after six years since the purchase of  the interest, Levin, pursuant to Rules 10101(c)  and 10301(a) of the NASD Uniform Code of  Arbitration Procedure (these rules can be found  in NASD Manual para.para. 10000 et seq. (CCH  1999)), filed a claim against Liss and Waisman  before a panel of arbitrators. Levin accused  Waisman and Liss of having violated the purchase  agreement, the rules of the NASD, and state and  federal law, including the SEC's Rule 10b-5, in  recommending the purchase of the Vintech interest  and, after Vintech declared bankruptcy, in  assuring Levin that the company would emerge from  bankruptcy with its value intact.


3
Rule 10304 of the NASD Code provides that no  dispute "shall be eligible for submission to  arbitration under this Code where six (6) years  have elapsed from the occurrence or event giving  rise to the . . . dispute." Waisman and Liss  failed to plead in their answer to the statement  of claim that the claim was barred by this  provision, and Levin argues that by doing so they  waived it. Arbitrators are authorized to treat  the failure to plead a defense as a waiver; but  they don't have to, see Rule 10314(b)(2)(B), and  they did not do so here. Instead they held that  since their award was based on conduct subsequent  to the 1990 sale--namely the assurance that  Vintech would emerge from bankruptcy with its  value intact--the dispute on which Levin's claim  was based arose less than six years before the  filing of the claim, and so Rule 10304 was  inapplicable.


4
So there was no waiver, but Waisman and Liss  argue that, in any event, the six-year limitation  is nonwaivable because it defines the  arbitrators' jurisdiction. In so arguing they  rely on Edward D. Jones & Co. v. Sorrells, 957  F.2d 509 (7th Cir. 1992), and similar decisions  in other circuits. E.g., Osler v. Ware, 114 F.3d  91, 92-93 (6th Cir. 1997); Merrill Lynch, Pierce,  Fenner & Smith, Inc. v. Cohen, 62 F.3d 381, 385  n. 4 (11th Cir. 1995); PaineWebber Inc. v.  Hofmann, 984 F.2d 1372, 1381 (3d Cir. 1993). Read  narrowly, these decisions hold only that Rule  10304 is the equivalent of a statute of repose  rather than a statute of limitations. So  interpreted the rule would exclude defenses to  the statute of limitations, such as equitable  tolling and equitable estoppel, the latter  including fraudulent concealment--the basis on  which the plaintiffs in Sorrells had asked to be  allowed to sue after the deadline had passed. 957  F.2d at 512-13. See, e.g., Cada v. Baxter  Healthcare Corp., 920 F.2d 446, 451 (7th Cir.  1990); Short v. Belleville Shoe Mfg. Co., 908  F.2d 1385, 1391 (7th Cir. 1990); Webb v. United  States, 66 F.3d 691, 701 (4th Cir. 1995); First  United Methodist Church v. United States Gypsum  Co., 882 F.2d 862, 865-66 (4th Cir. 1989).


5
The argument, though it has support in language  in Sorrells and the other cases we've cited, that  the six-year limitation in Rule 10304 is  "jurisdictional" and so cannot be waived. At  first glance, the argument seems highly dubious.  A statute of repose and a statute of limitations  are ordinary defenses to liability, differing  from each other only in length, accrual, and  tolling rules. Securities laws typically specify  both a statute of limitations, which runs from  when the plaintiff should have discovered that he  had a claim, and a (longer) statute of repose,  which runs from some fixed date such as the date  on which the security was purchased. E.g., 15  U.S.C. sec.sec. 77m, 78i(e); Cal. Corp. Code sec.  25506. Both normally are waivable. E.g., Lawyers  Title Ins. Corp. v. Dearborn Title Corp., 118  F.3d 1157, 1166 (7th Cir. 1997); McMahon v. Eli  Lilly & Co., 774 F.2d 830, 837-38 (7th Cir.  1985); First Interstate Bank of Denver, N.A. v.  Central Bank & Trust Co., 937 P.2d 855, 861-62  (Colo. App. 1996). Statutory language specifying  an outside date for suing is sometimes, though  rarely, as we pointed out in Lawyers Title Ins.  Corp. v. Dearborn Title Corp., supra, 118 F.3d at  1166-67; see also Hubbard v. State, 920 P.2d 991  (Nev. 1996) (per curiam), taken to be a  legislative determination that the court or other  tribunal that enforces the statute has no  jurisdiction to adjudicate a claim that is  outside the limit, e.g., State v. Mason, 941 P.2d  437, 440 (Mont. 1997); Price v. Maxwell, 681 P.2d  384, 386 (Ariz. 1984), and a statute of repose is  more likely to be taken in that sense than a  statute of limitations. See, e.g., Cheswold  Volunteer Fire Co. v. Lambertson Construction  Co., 489 A.2d 413, 421 (Del. 1984). But the six-  year limitation in Rule 10304 was not imposed by  any legislature. It is the rule of a trade  association and if the members want to arbitrate  a dispute on terms different from those laid down  by the association there would seem to be no  "jurisdictional" bar to their doing so.


6
But this turns out to be wrong. By joining the  association a brokerage firm agrees to abide by  its rules, and the rules of this association  forbid members to opt out of the provisions  governing arbitration. "Any dispute . . .  eligible for submission . . . between a customer  and a member . . . shall be arbitrated under this  Code," that is, the NASD Code of Arbitration  Procedure. Rule 10301(a); and see "Clarification  of NASD Notice to Members 95-16," 1995 Notice to  Members 85, 1995 NASD Lexis 122 (Oct. 1995),  threatening members with disciplinary action for  attempting to contract out of the provisions of  the Code dealing with punitive damages and venue.  And Rule 3110(f)(4) of the NASD Conduct Rules  provides that no arbitration agreement "shall  include any condition which limits or contradicts  the rules of any self-regulatory organization,"  presumably including the NASD itself. NASD  Manual, supra, at 4893.


7
The history of and practice under the specific  provision at issue here, the six-year limitation,  confirm this understanding. See "Self-Regulatory  Organizations: Notice of Filing of Amended  Proposed Rule Change by National Association of  Securities Dealers," 59 Fed. Reg. 39373, 39374  (Aug. 2, 1994); and remarks of Deborah Masucci,  the NASD's Director of Arbitration, in "New York  Stock Exchange Inc.: Symposium on Arbitration in  the Securities Industry," 63 Fordham L. Rev.  1501, 1544 (1995). Masucci explains that when  someone files a complaint with the NASD, the  association's staff dismisses it if it is clearly  beyond the six-year limit, without giving the  parties a chance to decide whether to extend the  limit. See also Pamela Jeanne Turbow Rush,  "SecuritiesArbitration: The Six-Year Eligibility  Rule," 26 Stetson L. Rev. 329, 330 (1996). This  procedure was changed in the middle of the  present arbitration, but the new procedure has  the same filter only administered by the  arbitrators themselves rather than by the staff.  See "Self-Regulatory Organizations: Notice of  Filing of Proposed Rule Change by NASD  Regulation," 61 Fed. Reg. 68081 (Dec. 26, 1996).


8
Why the NASD should want to prevent its members  from waiving rules designed for their protection  is obscure, and recently the association has been  having second thoughts. It is proposing to amend  Rule 10304 to make the association's Director of  Arbitration the sole judge of whether the six-  year deadline has expired and, more to the point,  to waive the deadline if the party against whom  the claim has been made fails to raise the issue  with the Director. "Self-Regulatory  Organizations: Notice of Filing of Proposed Rule  Change by the National Association of Securities  Dealers," 63 Fed. Reg. 588, 589 (Jan. 6, 1998).  But the proposal has not yet been adopted.


9
A separate question is whether the application  of Rule 10304 (we are speaking of course of the  current, not the proposed, rule) is for the  arbitrators or for the court. That is an issue  about who decides whether the six-year limit has  been exceeded, as distinct from whether the limit  can be waived. A majority of courts, including  ours, applying the principle that courts decide  issues of arbitrability unless the parties have  clearly indicated that the arbitrators are to  decide them, First Options of Chicago, Inc. v.  Kaplan, 514 U.S. 938, 944 (1995); AT&T  Technologies, Inc. v. Communications Workers of  America, 475 U.S. 643, 649 (1986), hold that  whether the six-year limit has been exceeded is  for the courts rather than the arbitrators to  decide. E.g., Miller v. Flume, 139 F.3d 1130,  1134 (7th Cir. 1998); Cogswell v. Merrill Lynch,  Pierce, Fenner & Smith Inc., 78 F.3d 474, 476-81  (10th Cir. 1996); Merrill Lynch, Pierce, Fenner &  Smith Inc. v. Cohen, supra, 62 F.3d at 383.


10
Also separate is whether the "jurisdictional"  character of Rule 10304 carries over to judicial  review; and the answer is that it does not. The  limitation imposed by the rule on the  consideration of stale claims is a limitation on  the power of the arbitrators, not on the power of  the courts. If a party challenging an arbitration  award in court failed to argue Rule 10304, the  issue of timeliness would be waived. See  Washington v. Indiana High School Athletic Ass'n,  181 F.3d 840, 846 n. 9 (7th Cir. 1999);  Huntzinger v. Hastings Mutual Ins. Co., 143 F.3d  302, 307 (7th Cir. 1998).


11
So the six-year bar is nonwaivable before the  arbitrators and its applicability is to be  determined by the court, but none of this helps  Waisman and Liss because we conclude that the bar  is inapplicable in the circumstances of this  case. Rule 10304 does not bar a claim that arises  within the six-year period merely because the  securities involved in the claim were bought more  than six years before the claim was filed. If the  only basis for the claim were Rule 10b-5, which  limits its protections to securities  transactions, Blue Chip Stamps v. Manor Drug  Stores, 421 U.S. 723 (1975), the plaintiff could  not win a case based on post-sale conduct, such  as a representation designed to prevent the  plaintiff from selling the security. But the  claim would fail on the merits, not because of  the six-year bar. If as in this case the  plaintiff bases his claim on conduct that took  place after he bought the security, the six-year  period begins to run as of the date of that  conduct, not the date of the purchase. Merrill  Lynch, Pierce, Fenner & Smith Inc. v. Cohen,  supra, 62 F.3d at 384-85; Osler v. Ware, supra,  114 F.3d at 93; PaineWebber Inc. v. Hofmann,  supra, 984 F.2d at 1379-1382. (The NASD's  proposal that we mentioned earlier to amend Rule  10304 is explicit that the six-year period runs  from the date of the event giving rise to the  claim rather than from the date the securitieswere purchased. "Self-Regulatory Organizations:  Notice of Filing of Proposed Rule Change by the  National Association of Securities Dealers,"  supra, 63 Fed. Reg. at 589, 593.) Otherwise if  Mr. Waisman, driven to distraction by Levin's  incessant complaints about the dismal performance  of Vintech, had hit Levin over the head with a  mallet in year seven he would be immune from any  claim under the dispute-resolution provisions of  the NASD's arbitration code. We can't see the  sense in that.


12
It is true that Levin alleged fraud in the sale  of the Vintech security, as well as post-sale  fraud. But the arbitrators said they were basing  their award on the latter. The fact that the  post-sale fraud could be said to have arisen from  the sale fraud, in the sense that had Levin never  bought the interest in Vintech the defendants  would never have represented to him that Vintech  would emerge intact from bankruptcy, no more  brings the six-year limitation into play than the  fact that in our hypothetical case the incident  with the mallet would not have occurred had it  not been for the sale of the security more than  six years before the claim was filed. If a claim  accrues as soon as a necessary condition to its  existence arises, then Mr. Levin's claim accrued  when Columbus discovered America, if not, indeed,  at the time of the Big Bang.


13
What is true is that if the only allegation  about the post-sale conduct had been that it had  lulled Levin into delaying the filing of a claim  based on the fraudulent inducement of the sale,  he would be arguing fraudulent concealment of the  wrong and we know from Sorrells that fraudulent  concealment would not extend the six-year  deadline for filing the claim. 957 F.2d at 512-  14. But that is not the allegation. The  allegation is of an independent fraud designed  not to lull Levin into not suing but rather to  dissuade him from selling his investment in  Vintech.


14
No defense to the suit to confirm the  arbitrators' award other than Rule 10304 is  suggested and the judgment of the district court  is therefore reversed with directions to confirm  the award.


15
Reversed.

