Vathana v. EverBank, No. 12-15587 (9th Cir. 2014)
Annotate this CasePlaintiff and a certified class of EverBank customers filed suit against EverBank for breach of contract. Plaintiff and the class purchased EverBank WorldCurrency certificates of deposit (CDs) denominated in Icelandic krona (ISK), which matured between October 8, 2008, and December 31, 2008. Applying Florida law, the court agreed with the district court that plaintiff failed to introduce evidence sufficient for a reasonable jury to find that EverBank breached the Terms and Conditions of the contract by exercising its discretion to close the CDs at maturity under paragraph 1.17 in bad faith; plaintiff's Truth in Savings Act section 266 (TISA), 12 U.S.C. 4305(c), argument is unpersuasive where the TISA does not provide a private right of action to enforce its provisions; the court agreed with the district court that the Lock-In Alternative suggests that many customers might desire to have their balances converted into U.S. dollars upon maturity, and that it would therefore be reasonable for the Terms and Conditions to provide for a generally understood currency conversion rate; but the court disagreed that the Lock-In Alternative establishes as a matter of law that paragraph 2.7.1 of the Terms and Conditions provides that rate; because the Terms and Conditions do not unambiguously supply a currency conversion rate applicable when the CDs are closed, EverBank may have breached its agreement with the class members by returning the value of their CDs using a currency conversion rate within 1% of the wholesale spot price. Accordingly, summary judgment was not appropriate on this issue. The court affirmed in part, reversed in part, and remanded.
Court Description: Florida Law. The panel affirmed in part and reversed in part the district court’s summary judgment in favor of EverBank on a breach of contract claim brought by a certified class of Everbank customers who purchased EverBank WorldCurrency certificates of deposit denominated in Icelandic króna. The class alleged that EverBank breached the terms and conditions of the WorldCurrency CDs by closing the WorldCurrency CDs without the class members’ consent, and delivering the value of the closed CDs in U.S. dollars at the exchange rate that EverBank obtained in the wholesale market. Under Florida law, the panel held that no reasonable jury could find that EverBank acted in bad faith when it exercised its discretion to close the WorldCurrency CDs to limit losses to itself or its customers. The panel also held that a reasonable jury could find that the terms and conditions were silent with respect to the currency conversion rate that applied when the WorldCurrency CDs were closed and the proceeds from the CDs returned to the class members. The panel reversed on this ground, and remanded to the district court to resolve whether EverBank breached the terms and conditions when it returned the value of the WorldCurrency CDs to the class members.
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