FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

EK VATHANA, individually and on

behalf of all others similarly

situated,

Plaintiff-Appellant,

v.

EVERBANK, AKA EverBank Direct,

AKA EverBank Federal Savings

Association; EVERBANK FINANCIAL

CORP.; EVERBANK WORLD

MARKETS,

Defendants-Appellees.

No. 12-15587

D.C. No.

5:09-cv-02338-

RS

OPINION

Appeal from the United States District Court

for the Northern District of California

Richard Seeborg, District Judge, Presiding

Argued and Submitted

February 14, 2014—San Francisco, California

Filed October 31, 2014

Before: Alex Kozinski, Chief Judge, and Diarmuid F.

O’Scannlain and Mary H. Murguia, Circuit Judges.

Opinion by Judge Murguia
2 VATHANA V. EVERBANK

SUMMARY*

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

WorldCurrencyCDs 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 currencyconversion 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.

* This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.
VATHANA V. EVERBANK 3

COUNSEL

Michael Millen (argued), Law Office of Michael Millen, Los

Gatos, California, for Plaintiff-Appellant.

Deborah S. Birnbach (argued), Goodwin Procter LLP,

Boston, Massachusetts; Robert B. Bader, Goodwin Procter

LLP, San Francisco, California; William M. Jay, Goodwin

Procter LLP, Washington, D.C., for Defendants-Appellees.

OPINION

MURGUIA, Circuit Judge:

Ek Vathana and a certified class of EverBank customers

purchased EverBank WorldCurrency certificates of deposit

(CDs) denominated in Icelandic króna (ISK), which matured

between October 8, 2008, and December 31, 2008. They

appeal the district court’s order granting summary judgment

for EverBank on their breach of contract action. We have

jurisdiction under 28 U.S.C. § 1291. We affirm in part and

reverse in part.

BACKGROUND

A. EverBank’s WorldCurrency CD

Unlike traditional certificates of deposit, an EverBank

WorldCurrencyCD is denominated in foreign currency. This

means that, in addition to earning interest, the principal itself

may rise or fall in value over the maturity period of the CD,

depending on the strength of the foreign currency relative to

U.S. dollars.
4 VATHANA V. EVERBANK

When a customer opens a WorldCurrencyCD, EverBank

adds the customer’s investment to its treasury and credits the

customer’s WorldCurrency CD in a foreign currency of the

customer’s choice. Under paragraph 2.7.1 of the terms and

conditions applicable to the WorldCurrencyCDs (the “Terms

and Conditions”), the exchange rate that EverBank uses to

convert the customer’s initial investment into the foreign

currency is a rate “within 1% of the wholesale spot price we

pay for your currency.” The “wholesale spot price” is the

currency’s price in the wholesale currency market when the

customer opens the CD.1

This conversion occurs only as a book transaction:

EverBank does not actually exchange the currency invested

for the physical currency in which the CD is denominated.

Instead, in separate transactions, EverBank purchases

“forward contracts” to hedge the risks associated with its

foreign currency liabilities to its WorldCurrency CD

customers. The forward contracts allow EverBank to acquire

a set amount of foreign currency on a specified date and at a

set price, or exchange rate, that is based on the currency’s

wholesale spot price when EverBank purchases the contract. 

By entering into forward contracts for the foreign currency in

its WorldCurrency CDs, EverBank is assured delivery of the

currency from which to pay its customers on the date the CDs

mature, should its customers choose to liquidate their

investments. Id. The forward contracts protect EverBank

1 The wholesale currency market is where financial institutions like

EverBank trade large amounts of currency. By contrast, when an

individual goes to a bank to exchange currency, he purchases currency in

the retail market. The retail spot price available to an individual

exchanging money at a bank can differ from the wholesale spot prices

available to banks in the wholesale market.
VATHANA V. EVERBANK 5

from the risks of exchange rate fluctuation before the CDs’

maturity dates.

Paragraph 2.7.10 of the Terms and Conditions sets out the

WorldCurrency CD’s renewal policies upon maturity. It

provides in relevant part,

Renewal Policies: Except as provided in the

Lock-In Alternative section above, your

WorldCurrency CD is automatically

renewable; however, you may do one of the

following options by providing instructions to

the Trading Desk at least one week prior to

the maturity date of the outstanding CD:

1. liquidate your account upon maturity.

2. remove the interest and re-invest the

principal.

3. roll over the CD proceeds (principal

plus interest).

If you choose to roll over the CD, it will be reinvested in the same currency for the same

maturity, at the current prevailing interest

rate.

. . . .

If we do not receive maturity instructions

from you at least one week prior to maturity,

your CD will automaticallyrenew, reinvesting

your principal and any interest into a CD of
6 VATHANA V. EVERBANK

the same currency and maturity, at the

prevailing interest rate on the date of renewal.

B. Lead Plaintiff Ek Vathana’s WorldCurrency CDs

and Iceland’s Financial Crisis

On July 23, 2008, lead plaintiff Ek Vathana opened the

first of two ISK-denominated WorldCurrency CDs that

matured during the class period. The price of ISK when

Vathana opened the CD was 78.65 ISK per U.S. dollar. Id.

The value of the CD when Vathana opened it was 747,676.53

ISK, or $9,447.49. Vathana opened his second

WorldCurrency CD on September 10, 2008. The exchange

rate was 88.05 ISK per U.S. dollar, and the value of the CD

was 3,547,501.93 ISK, or $40,040.07. Both of Vathana’s

WorldCurrency CDs had three-month maturities.

A month later, Iceland’s financial system was in crisis. 

The Prime Minister addressed the nation on October 6, 2008,

describing the “major difficulties” facing Iceland’s banks,

which had grown so rapidly before the recession that their

liabilities were “many times Iceland’s GNP.” The Prime

Minister warned the country that “[m]ajor credit lines to the

banks have been closed and it was decided this morning to

suspend trading with the banks and with the savings funds in

the Icelandic Stock Exchange.” The Icelandic government

passed emergency legislation allowing it effectively to put

Iceland’s major banks into receivership. The Central Bank of

Iceland imposed restrictions on the exchange of ISK into

foreign currency.

Because of the crisis in Iceland, EverBank was unable to

find any counterparties willing to offer forward contracts for

ISK. Because it could not hedge the risk of offering
VATHANA V. EVERBANK 7

WorldCurrency CDs denominated in ISK going forward,

EverBank decided not to roll over its ISK-denominated

WorldCurrency CDs set to mature in early October 2008. Id.

EverBank paid the proceeds of the matured CDs in U.S.

dollars, calculating their value using the available wholesale

spot price. Id.

In mid-October, EverBank was again unable to find

anybody willing to enter into forward contracts for ISK.

However, unlike the week before, it could not even find any

parties willing to trade ISK for U.S. dollars on the wholesale

market.

Vathana’s first WorldCurrency CD matured on October

22, 2008. Two days before it matured, Vathana emailed

EverBank, instructing it to roll over his CD. He wrote, “I will

not accept a forced liquidation conversion. If you choose to

close my accounts, I demand you send me the actual physical

ISKs.” Id.

In late October 2008, EverBank finally located a party

willing to offer a ISK/Euro forward contract, on the basis of

which EverBank could calculate a wholesale conversion rate

for U.S. dollars. The exchange rate was about 253 ISK per

U.S. dollar, dramatically worse than the 78.65 ISK per U.S.

dollar rate at which Vathana opened the CD. Id. EverBank

notified Vathana that it had closed his CD, converted the ISK

to U.S. dollars at the 253 ISK per U.S. dollar rate, and

deposited the proceeds, $2,958.03, into Vathana’s account

with EverBank. Vathana lost $6,489.46.

On December 10, 2008, EverBank closed Vathana’s

second WorldCurrency CD and returned the value of that

account to Vathana in U.S. dollars at a slightly better
8 VATHANA V. EVERBANK

exchange rate of about 217 ISK per U.S. dollar. The rate was

still significantly worse than the approximately 88 ISK per

U.S. dollar rate at which he opened the CD. Vathana lost

$23,700.88 on that CD.

EverBank did not renew or roll over any of its ISKdenominated WorldCurrencyCDs maturing between October

8, 2008, and December 31, 2008. Instead, it closed the CDs

on their maturity dates and returned the value of the CDs to

its customers in U.S. dollars according to the rates that

EverBank obtained in the wholesale market.

C. Proceedings Before the District Court

Vathana brought a class action for breach of contract

against EverBank on behalf of all EverBank WorldCurrency

CD customers whose ISK-denominated WorldCurrencyCDs

matured between October 8, 2008, and December 31, 2008.

Vathana claims that EverBank breached the Terms and

Conditions by (1) closing the WorldCurrency CDs without

the class members’ consent, and (2) delivering the value of

the closed CDs in U.S. dollars at the exchange rate that

EverBank obtained in the wholesale market. Vathana alleges

that the Terms and Conditions required EverBank to

automatically renew the CDs and did not specifya conversion

rate that applied when the WorldCurrency CDs were closed

and liquidated.

The parties twice moved for summaryjudgment. First, the

parties cross-moved for summary judgment on Vathana’s

claim that EverBank breached the Terms and Conditions by

paying the CDs’ proceeds in U.S. dollars at the wholesale

spot price. The district court granted summary judgment to

EverBank on this claim, rejecting Vathana’s argument that
VATHANA V. EVERBANK 9

the currency conversion rate in paragraph 2.7.1 of the Terms

and Conditions, “within 1% of the wholesale spot price we

pay for your currency,” applies when the WorldCurrencyCD

is opened but does not clearly apply when the CD is closed.

The district court agreed with EverBank that the conversion

rate in paragraph 2.7.1 applies to all conversions applicable

to the account, including when the account is opened and

when it is closed.

Second, the parties each moved for summary judgment on

whether EverBank breached the Terms and Conditions by

unilaterally closing the CDs when they matured. The district

court concluded that, although EverBank was ordinarily

required under paragraph 2.7.10 of the Terms and Conditions

to automatically renew the CD or honor the customer’s

instructions, EverBank was released from doing so under

paragraph 1.17 of the Terms and Conditions. This paragraph

provides that “if we [EverBank] believe that it is necessary to

close your account immediately in order to limit losses by

you or us, we may close your account prior to providing

notice to you.” Because the district court saw no factual

dispute over whether EverBank closed the class members’

accounts in good faith under this provision, the district court

determined that EverBank had not breached the Terms and

Conditions. The district court also disagreed with Vathana

that EverBank’s decision to close the accounts was an

“amendment” to the CD’s renewal policies set forth in

paragraph 2.7.10. The district court therefore rejected

Vathana’s argument that EverBank violated the Truth in

Savings Act by failing to notify the class members of the

“amendment.” Having concluded that Vathana could not

prevail as a matter of law on either of his theories of breach,

the district court entered judgment for EverBank. Vathana

now appeals.
10 VATHANA V. EVERBANK

DISCUSSION

We review de novo the district court’s grant of summary

judgment. Posey v. Lake Pend Oreille Sch. Dist. No. 84,

546 F.3d 1121, 1126 (9th Cir. 2008). Summary judgment is

appropriate if “the movant shows that there is no genuine

dispute as to any material fact and the movant is entitled to

judgment as a matter of law.” Fed. R. Civ. P. 56(a).

The parties agree that the Terms and Conditions are

governed by Florida law. Under Florida law, clear and

unambiguous contract language may be interpreted as a

matter of law. Smith v. Shelton, 970 So. 2d 450, 451 (Fla.

Dist. Ct. App. 2007). Whether contract language is

ambiguous is also a question of law. Id. A contract’s wording

is ambiguous if it is “reasonably susceptible to more than one

interpretation.” Lambert v. Berkley S. Condo. Ass’n, 680 So.

2d 588, 590 (Fla. Dist. Ct. App. 1996). If the wording is

ambiguous, interpreting the contract involves a factual

question and summary judgment is inappropriate. Smith,

970 So. 2d at 451.

1. EverBank’s Closure of the CDs at Maturity

We decide first whether EverBank breached the Terms

and Conditions by unilaterally closing the class members’

WorldCurrency CDs when they matured. The district court

concluded that EverBank’s decision to close the CDs was

justified by paragraph 1.17, which provides, in relevant part,

“[i]f we believe that it is necessary to close your account

immediately in order to limit losses by you or us, we may

close your account prior to providing notice to you.”
VATHANA V. EVERBANK 11

Under Florida law, “where the terms of the contract afford

a party substantial discretion to promote that party’s selfinterest, the duty to act in good faith nevertheless limits that

party’s ability to act capriciously.” Cox v. CSX Intermodal,

Inc., 732 So. 2d 1092, 1097–98 (Fla. Dist. Ct. App. 1999).

“Yet, the limit placed on a party’s discretion is not great. . . .

Unless no reasonable party . . . would have made the same

discretionary decision . . . , it seems unlikely that [the party’s]

decision would violate the covenant of good faith.” Ernie

Haire Ford, Inc. v. Ford Motor Co., 260 F.3d 1285, 1291

(11th Cir. 2001) (alterations in original) (internal quotation

marks omitted).

We agree with the district court that Vathana failed to

introduce evidence sufficient for a reasonable jury to find that

EverBank breached the Terms and Conditions by exercising

its discretion under paragraph 1.17 in bad faith. Vathana’s

own expert testified that forward contracts for ISK were

unavailable from October 2008 to December 2008. It is

undisputed that, had EverBank rolled over the

WorldCurrencyCDs without entering into forward contracts,

and had ISK continued to lose value, EverBank could have

been exposed to up to $12 million in losses. It is also

undisputed that, if EverBank had continued to offer ISKdenominated WorldCurrency CDs, it would have had to

charge the CD-holders interest, rather than pay them interest.

In hindsight, EverBank liquidated the class members’

WorldCurrencyCDs when they were least valuable. The CDs

would have regained value if EverBank had remained in the

ISK market until Iceland’s economyimproved. But paragraph

1.17 gave EverBank discretion to close the WorldCurrency

CDs immediately to limit its or its customers’ losses –

discretion that was limited only by EverBank’s obligation
12 VATHANA V. EVERBANK

under Florida law to act in good faith. Vathana has not

pointed to any facts demonstrating that no reasonable person

would have made the same discretionary decision that

EverBank made under the circumstances. See Ernie Haire

Ford, 260 F.3d at 1291.

Vathana also argues that EverBank’s decision not to

renew the WorldCurrency CDs was a change to its renewal

policy, and that its failure to disclose this change to the class

members with sufficient notice violated federal law. Vathana

relies on the Truth in Savings Act § 266 (TISA), 12 U.S.C.

§ 4305(c), which requires depository institutions like

EverBank to notify its customers of any changes to its

renewal policies 30 days before the changes come into effect.

We agree with the district court that Vathana’s TISA

argument is unpersuasive.

TISA does not provide a private right of action to enforce

its provisions. See 12 U.S.C. § 4309 (providing for

administrative enforcement of TISA). But, even if it did,

EverBank has always reserved the right to terminate any

deposit account to limit losses: Paragraph 1.17 has always

modified the automatic renewal policy in paragraph 2.7.10.

Moreover, TISA does not provide that a bank’s failure to give

notice prevents the change from coming into effect, as

Vathana contends. Vathana’s unavailingTISA argument does

not alter our conclusion that the district court properly held

that Vathana failed to produce sufficient facts for a

reasonable jury to find that EverBank acted in bad faith in

closing the class members’ CDs.
VATHANA V. EVERBANK 13

2. The Currency Conversion Rate

Vathana argues that paragraph 2.7.1 of the Terms and

Conditions does not supply the currency conversion rate that

applies when the WorldCurrencyCDs are closed. According

to Vathana, if paragraph 2.7.1 does not apply to an account’s

closing, then he and the rest of the class were entitled to

payment in ISK, not U.S. dollars. While we do not address

whether the plaintiffs were entitled to payment in ISK absent

a contractual conversion rate, we disagree with the district

court’s conclusion that paragraph 2.7.1 unambiguously

provides this rate. The Terms and Conditions could

reasonably be interpreted as providing a currency conversion

rate applicable only when a WorldCurrency CD is opened.

Therefore, the district court erred in deciding as a matter of

law that EverBank did not breach its agreement with the class

members by converting the value of their CDs into U.S.

dollars at a currency conversion rate within 1% of the

wholesale spot price.

Paragraph 2.7.1 of the Terms and Conditions provides:

Conversion Information: This account will

be used to hold funds denominated in a

currency other than U.S. dollars. If you

request funds in this account to be

denominated in a currency other than the

currency sent to us to fund the account, we

will convert your funds using a then current

conversion rate set by us. Your currency

conversion rate will be within 1% of the

wholesale spot price we pay for your

currency. Exceptions may occur when a
14 VATHANA V. EVERBANK

specific conversion rate is agreed upon

between you and us.

The district court acknowledged that reading paragraph 2.7.1

alone, the currency conversion rate “within 1% of the

wholesale spot price we pay for your currency” appears only

to apply when EverBank converts the customer’s U.S. dollars

into foreign currency to fund the account. The district court

also recognized that paragraph 2.7.1 appears at the beginning

of the section of the Terms and Conditions specifically

applicable to the WorldCurrency CD, whereas provisions

governing the withdrawal of funds from the CDs and the

renewal of the CDs appear later, suggesting that the

conversion rate in paragraph 2.7.1 applies only when the

account is opened. Id.

However, the district court reasoned that, looking at the

Terms and Conditions as a whole, paragraph 2.7.1 provides

the WorldCurrency CDs’ generally applicable, default

conversion rate. The district court pinpointed the paragraph

of the Terms and Conditions offering a “Lock-In Alternative”

rate as conclusive evidence that the currency conversion rate

in paragraph 2.7.1 otherwise applies to all conversions. Under

that paragraph, the customer can contact EverBank at any

point during the CD’s maturity period to lock in an exit

currency conversion rate for the CD rather than risk further

fluctuations in the market before the CD matures. Because

EverBank offers the customer this alternative exit currency

conversion rate, the district court reasoned that the alternative

rate must be “distinct from an otherwise understood currency

conversion rate that is generally applicable to the account.”

Thus, the district court concluded that paragraph 2.7.1

necessarily provides the generally applicable conversion rate.
VATHANA V. EVERBANK 15

We agree 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 we disagree that the Lock-In Alternative

establishes as a matter of law that paragraph 2.7.1 provides

that rate.

First, the structure of paragraph 2.7.1 strongly suggests

that its conversion rate applies only when EverBank converts

a customer’s deposit to a foreign currency when the CD is

opened. The paragraph begins by explaining that, if the

customer “request[s] funds in this account to be denominated

in a currency other than the currency sent to us to fund the

account,” EverBank will convert the customer’s initial

investment into foreign currency “using a then current

conversion rate set by us.” The sentence “[y]our currency

conversion rate will be within 1% of the wholesale spot price

we pay for your currency” immediately follows.

Second, the wording of the sentence “[y]our currency

conversion rate will be within 1% of the wholesale spot price

we pay for your currency” supports the interpretation that the

currency conversion rate applies only when the account is

opened, but not when it is closed, as EverBank only

purchases foreign currencywhen the customer first opens the

CD, and not when it closes the account.

Third, other references to currency conversion rates in the

Terms and Conditions do not refer to a wholesale spot price

or refer back to paragraph 2.7.1. For example, paragraph

2.7.8, which provides the penalties for early withdrawal,

states that if the customer wishes to withdraw the value of the
16 VATHANA V. EVERBANK

WorldCurrency CD before it matures, the customer will pay

an early withdrawal penalty and receive the value of the CD

“converted to U.S. dollars at prices prevailing in the market

at the time of early withdrawal, minus a conversion cost of up

to 1.5%.”

The Terms and Conditions do not unambiguously supply

a currency conversion rate applicable when the

WorldCurrency CD is closed. Thus, EverBank may have

breached its agreement with the class members by returning

the value of their WorldCurrency CDs using a currency

conversion rate within 1% of the wholesale spot price.

Because the Terms and Conditions are ambiguous, summary

judgment for EverBank on this issue was inappropriate.

CONCLUSION

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.

However, we conclude that a reasonable jury could find that

the Terms and Conditions are 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. We reverse the district

court’s entry of summary judgment on this ground. We

remand 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.

Each party shall bear its own costs on appeal.

AFFIRMED in part, REVERSED in part, and

REMANDED.