Wailea Partners, Lp v. HSBC Bank USA, N.A.

FILED
NOT FOR PUBLICATION APR 21 2014

MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

WAILEA PARTNERS, LP, a Delaware No. 11-18041
limited partnership,
D.C. No. 3:11-cv-03544-SC
Plaintiff - Appellant,

v. MEMORANDUM*

HSBC BANK USA, N.A., a national
banking association,

Defendant - Appellee.

Appeal from the United States District Court
for the Northern District of California
Samuel Conti, Senior District Judge, Presiding

Argued and Submitted January 15, 2014
San Francisco, California

Before: BYBEE and BEA, Circuit Judges, and RESTANI, Judge.**

Wailea Partners, LP (“Wailea”), seeks rescission of a swap agreement it

entered into with HSBC Bank USA, N.A. (“HSBC”), that was tied to the value of a

*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The Honorable Jane A. Restani, Judge for the U.S. Court of
International Trade, sitting by designation.
fund managed exclusively by Bernie Madoff. Wailea brought several state law

causes of action claiming mistake, failure of a condition precedent, and

misrepresentation.

At oral argument, the court sua sponte questioned whether subject matter

jurisdiction existed in this case, as Wailea had failed to identify in its complaint all

of the relevant entities and persons upon which it based its allegation of diversity

jurisdiction. After supplemental briefing, diversity jurisdiction still has not been

established, and Wailea no longer alleges as much.1 Just as we lack jurisdiction, so

too did the district court lack subject matter jurisdiction in this case ab initio, and

therefore it was without power to render judgment.

VACATED.

1
Although HSBC attempts to save Wailea’s complaint by asserting an
alternative basis of jurisdiction under the Edge Act, 12 U.S.C. § 632, we decline to
exercise jurisdiction pursuant to the act, as it is not clearly supported by the
complaint and has not been advanced by Wailea.
2