Sinoying Logistics Pte Ltd. v. Yi Da Xin Trading Corporation , 619 F.3d 207 ( 2010 )

09-5368-cv
Sinoying Logistics Pte Ltd. v. Yi Da Xin Trading Corporation
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
August Term 2009
(Argued: June 23, 2010 Decided: August 31, 2010)
Docket No. 09-5368-cv
______________
SINOYING LOGISTICS PTE LTD ., ACOAXET 1 SHIPPING PTE LTD .,
Plaintiffs-Appellants,
THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED,
Intervenor-Plaintiff,
v.
YI DA XIN TRADING CORPORATION , YI DA XIN TRADING CO . LTD ., YI DA XIN LIMITED,
Defendants-Appellees.*
Before: WINTER, CABRANES, WESLEY, Circuit Judges.
______________
Plaintiffs appeal from a December 15, 2009 order of the United States District Court for the
Southern District of New York (Denny Chin, Judge) vacating the process of maritime attachment and
garnishment dated April 21, 2008 pursuant to Rule B of the Supplemental Rules for Admiralty or
Maritime Claims and Asset Forfeiture Actions of the Federal Rules of Civil Procedure and
*
The Clerk of Court is directed to amend the official caption in this case to conform to the
listing of the parties above.
1
dismissing the complaint for lack of personal jurisdiction. We hold that the District Court acted
within its discretion in vacating the attachment. We also now hold that the District Court properly
dismissed the case sua sponte for lack of personal jurisdiction, and we hold that the District Court did
not err in declining to fashion an equitable remedy in circumstances where it was clear that the
original attachment order could not be sustained in light of Shipping Corp. of India Ltd. v. Jaldhi Overseas
Pte Ltd., 585 F.3d 58 (2d Cir. 2009). The order of the District Court is AFFIRMED.
CHRISTOPHER R. NOLAN (Michael J. Frevola, on the brief), Holland &
Knight, LLP, New York, NY; and Patrick F. Lennon,
Lennon Murphy Caulfield & Phillips, LLC, New York, NY,
for Plaintiffs-Appellants.
BRUCE E. CLARK (H. Rodgin Cohen, Michael M. Wiseman, and Erez
J. Davy, of counsel), Sullivan & Cromwell LLP, New York, NY,
for amicus curiae The Clearing House Association L.L.C. in support of
affirmance.
JOSÉ A. CABRANES, Circuit Judge:
The question presented is whether a district court can dismiss a maritime complaint sua
sponte for lack of personal jurisdiction where the sole basis for quasi in rem jurisdiction asserted under
Rule B has been eliminated.
Plaintiffs appeal from a December 15, 2009 judgment of the United States District Court for
the Southern District of New York (Denny Chin, Judge) in which the District Court dismissed their
complaint for want of jurisdiction after vacating an order attaching funds at several banks pursuant
to Rule B of the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions
of the Federal Rules of Civil Procedure (“Rule B”). On appeal, plaintiffs argue that the District
2
Court erred in (1) raising the question of personal jurisdiction sua sponte and (2) declining to fashion
an equitable remedy.
BACKGROUND
This case arises out of a maritime dispute between plaintiffs Sinoying Logistics Pte Ltd. and
Acoaxet 1 Shipping Pte Ltd. (jointly, “Sinoying”) and defendants Yi Da Xin Trading Corporation, Yi
Da Xin Trading Co. Ltd., and Yi Da Xin Limited (jointly, “YDX”). The dispute concerns YDX’s
alleged breach of a charterparty (i.e., a maritime contract), signed January 18, 2008, under which
Sinoying, a foreign-based charter company, agreed to deliver the vessel M/V Acoaxet Lady to YDX,
a Philippines- and Hong-Kong-based shipping company, in the port of Santa Cruz, Phillippines.
Shortly before delivery, YDX, Sinoying alleges, attempted to cancel the charterparty and refused to
pay Sinoying for delivery of the vessel.
Pursuant to the charterparty, Sinoying and YDX have agreed to resolve all aspects of this
dispute in arbitration in Hong Kong. However, on April 21, 2008, Sinoying filed a complaint in the
District Court, seeking to attach YDX’s property in New York as pre-judgment security for the
pending arbitration in Hong Kong. On April 21, 2008 the District Court—consistent with the law
at the time—signed an order of maritime attachment and garnishment (“the attachment”) under
Rule B attaching, among other things, electronic funds transfers (“EFTs”) originating from or
intended for YDX at several banks in the district. YDX has not appeared in the District Court to
raise or waive an objection to the District Court’s personal jurisdiction over it or to argue the merits
of the case.
3
Between July 16, 2008 and September 4, 2009, three “intermediary banks”1 in the Southern
District of New York restrained four EFTs in compliance with the attachment order. Each of the
restrained EFTs were either originated by or intended for YDX and transmitted by originating banks
in Hong Kong, Vietnam, China, and the Philippines to beneficiary banks in those countries.2 In
each case, the intermediary bank in New York “cleared” a foreign dollar-denominated interbank
transaction, which required that the EFT be routed, momentarily, through the Southern District of
New York. See Citibank, N.A. v. Wells Fargo Asia Ltd., 495 U.S. 660, 663 (1990) (explaining the
process of “clearing” transactions between foreign-dollar-denominated accounts in New York); see
also Shipping Corp. of India Ltd. v. Jaldhi Overseas Pte Ltd., 585 F.3d 58, 60 n.1 (2d Cir. 2009) (explaining
the operation of EFTs). Thus, despite the fact that no aspect of the merits of the underlying dispute
would be litigated in the United States, Sinoying attempted—successfully at first— to use the fact
1
Under New York law, an “[i]ntermediary bank” is “a receiving bank other than the
originator’s bank or the beneficiary’s bank.” N.Y. U.C.C. § 4-A-104(2); see also Shipping Corp. of India
Ltd. v. Jaldhi Overseas Pte Ltd., 585 F.3d 58, 70 (2d Cir. 2009) (“When there is no federal maritime law
to guide our decision, we generally look to state law to determine property rights.”).
2
The District Court’s first attachment order dated April 21, 2008 granted Sinoying’s request
to attach up to $440,480 arising from YDX’s alleged breach of the charterparty. On July 16, 2008,
Bank of America, N.A. restrained an EFT from an originating bank in China in the amount of
$400,000 intended for YDX’s account at a bank in the Philippines, leaving the attachment
undersecured by $40,480. HSBC USA, N.A. subsequently restrained an EFT originated by YDX in
Hong Kong in the amount of $196,870.28. At the request of plaintiff-intervenor Hongkong and
Shanghai Banking Corporation Limited, the District Court ordered the release of $156,390.28—the
amount in excess of the $40,480 that fully secured Sinoying’s attachment order.
On July 2, 2009, at Sinoying’s request, the District Court increased the amount of the
attachment order to $649,480 to account for Sinoying’s arbitral costs in Hong Kong and the interest
on the principal owed to Sinoying by YDX. On September 4, 2009, Wachovia Bank, N.A.
restrained two additional EFTs—originating from bank accounts in Vietnam and the Philippines
and intended for bank accounts in the Philippines and Hong Kong, respectively— in the amount of
$521,928.50 cumulatively. As a result, the District Court’s attachment orders left Sinoying fully
secured in aid of any recovery in the arbitration in Hong Kong.
4
that wire transfers between two foreign banks might be processed momentarily at a bank in New
York to establish the District Court’s personal jurisdiction over YDX.
On October 13, 2009, a Hong Kong arbitration panel issued an “Interim Final Arbitration
Award” in favor of Sinoying finding YDX to be fully liable.
On October 16, 2009, we decided Jaldhi, overruling Winter Storm Shipping, Ltd. v. TPI, 310
F.3d 263 (2d Cir. 2002).3 Jaldhi held that EFTs temporarily in the hands of an intermediary bank
were not attachable property of the originator or beneficiary under New York law, and accordingly
not subject to attachment under Rule B. Jaldhi, 585 F.3d at 71.4 As a consequence of Jaldhi, EFTs
between two banks outside of the United States that “pass[] through New York electronically for an
instant” cannot be attached and therefore cannot be used to vest a district court with personal
jurisdiction over the beneficiary or originator of the transaction. Id. at 60. Because Jaldhi
transformed the law of Rule B attachments in our Circuit, the District Court on October 26, 2009
ordered Sinoying to show cause why it should not vacate the attachment order.
In response to the District Court’s order to show cause, Sinoying argued that Jaldhi (1) was
incorrectly decided; (2) should not be applied retroactively to EFTs restrained pursuant to
attachment orders entered pre-Jaldhi; and (3) was inapplicable where the intermediary bank had
secured funds associated with the restrained EFT in a suspense account within the Southern District
3
We overruled Winter Storm without a formal en banc proceeding with the consent of all
active judges on our Court. See Jaldhi, 585 F.3d at 67 & n.9.
4
Rule B(1)(a) of the Admiralty Rules provides, in relevant part:
If a defendant is not found within the district when a verified complaint praying for
attachment and the affidavit required by Rule B(1)(b) are filed, a verified complaint may
contain a prayer for process to attach the defendant’s tangible or intangible personal
property—up to the amount sued for—in the hands of garnishees named in the process.
Fed. R. Civ. P. Supp. R. B(1)(a).
5
of New York. Sinoying did not allege that there was an alternative basis on which to establish
personal jurisdiction over YDX. The District Court rejected each of Sinoying’s arguments and
concluded that, pursuant to Jaldhi and Hawknet Ltd. v. Overseas Shipping Agneices, 590 F.3d 87, 91 (2d
Cir. 2009) (“[T]he rule announced in [Jaldhi] has retroactive effect to all cases open on direct
review.”) (emphasis added), the District Court did not have personal jurisdiction over YDX.
Accordingly, on December 15, 2009, the District Court vacated the attachment and dismissed the
complaint for want of personal jurisdiction. That same day—December 15, 2009—the Hong Kong
arbitration panel issued a “Final Arbitration Award” in Sinoying’s favor.
Sinoying filed a timely appeal of the District Court’s December 15, 2009 judgment. It also
filed a motion before this Court seeking to stay the District Court’s judgment pending appeal. On
January 4, 2010, Judge Katzmann ordered that the stay motion “be determined by a motions panel
in due course.” He also provided that the District Court’s judgment be “stayed temporarily pending
the decision of the panel on the motion.” On April 14, 2010, a motions panel granted Sinoying’s
stay motion. As a result, the funds seized in this case have remained in suspense accounts
throughout the pendency of this appeal.5
In addition, following the District Court’s December 15, 2009 judgment—but before this
Court granted Sinoying’s stay motion—Sinoying brought an action in the Supreme Court of New
York, New York County, seeking to confirm its arbitral award under the New York Convention on
the Recognition and Enforcement of Foreign Arbitral Awards, June 10, 1958, 21 U.S.T. 2517, 330
U.N.T.S. 38. Sinoying informs us that on April 8, 2010, the Supreme Court of New York, New
5
A “suspense account” is an account into which funds associated with suspended EFTs are
often placed pending further instructions to the bank. See Scanscot Shipping Serv. (Deutschland) GmbH v.
Metales Tracomex LTDA, No. 09-5280, — F.3d —, 2010 WL 3169304 at *2 (2d Cir. Aug. 12, 2010)
(holding that, following Jaldhi, suspense accounts are not attachable property of the defendant under
Rule B).
6
York County, entered a judgment against YDX in the amount of $757,610.95. Appellants’ Br. in
Resp. to Amicus Curiae 8. We consider Sinoying’s proceeding in the Supreme Court to be wholly
collateral to the judgment of the District Court under review here.
DISCUSSION
“We generally review a district court’s decision to vacate a maritime attachment for abuse of
discretion.” Jaldhi., 585 F.3d at 66 (internal quotation marks omitted); see also Lynch v. City of N.Y.,
589 F.3d 94, 99 (2d Cir. 2009) (“A district court has abused its discretion if it has (1) ‘based its ruling
on an erroneous view of the law,’ (2) made a ‘clearly erroneous assessment of the evidence,’ or (3)
‘rendered a decision that cannot be located within the range of permissible decisions.’” (quoting Sims
v. Blot, 534 F.3d 117, 132 (2d Cir. 2008)).
We review de novo a decision to dismiss a complaint for lack of personal jurisdiction. Porina v.
Marward Shipping Co., 521 F.3d 122, 126 (2d Cir. 2008).
A.
Sinoying does not dispute that the District Court was empowered to revisit and vacate sua
sponte the order attaching YDX’s assets in New York. There is no question that a district court has
the authority to “revise[]” any non-final order “at any time before the entry of a judgment.” Fed. R.
Civ. P. 54(b); accord In re WTC Disaster Site, 414 F.3d 352, 381 (2d Cir. 2005). Indeed, “a district
court must vacate an attachment if the plaintiff fails to sustain his burden of showing that he has
satisfied the requirements of Rule[ ] B . . . .” Aqua Stoli Shipping Ltd. v. Gardner Smith Pty Ltd., 460
F.3d 434, 445 (2d Cir. 2006) (emphasis added), abrogated on other grounds by Jaldhi, 585 F.3d 58.
Therefore, if, at any point, a plaintiff in a maritime attachment case ceases to be able to satisfy the
requirements of Rule B, a district court may—and indeed should—revisit and vacate any orders of
attachment. That is exactly what happened here.
7
In the wake of Jaldhi and Hawknet, the District Court correctly concluded that the attached
EFTs, which were suspended at intermediary banks in New York, were not attachable property of
YDX within the meaning of Rule B. It therefore did not err, much less “abuse its discretion,” in
vacating the attachment order with respect to the funds that had already been seized.6
Nor did the Court “abuse its discretion” when it vacated the attachment order in its entirety,
preventing any future funds from being seized. A Rule B attachment is proper only where, among
other things, “the defendant’s property may be found within the district.” Aqua Stoli, 460 F.3d at
445. Because EFTs from or to YDX at intermediary banks are not YDX’s property following Jaldhi,
and because plaintiff’s have acknowledged that the funds associated with the EFTs in this case are
the only known assets of YDX, the District Court had good reason to conclude that no property of
YDX would ever be found within the district. Rather than vacate the attachment order immediately,
however, the District Court—rightly, we think—first gave Sinoying the opportunity to show cause
why the attachment order should not be vacated. In response, Sinoying was unable to show that
YDX would ever have property in the district that could be attached under Rule B. In those
circumstances, is was by no means an abuse of discretion for the District Court to vacate the
attachment order.
Third, and finally, with the order of attachment vacated, the District Court did not err when,
acting sua sponte, it raised its lack of personal jurisdiction over YDX and dismissed the complaint on
that ground. Sinoying argues that “[p]ersonal jurisdiction is a right that is the defendant’s [alone] to
raise or waive,” and thus the district court was not empowered to raise its lack of personal
6
Because the attachment order was properly vacated, the funds seized in this action should
now be released and routed in accordance with the instructions of the original EFTs (i.e., as if they
had never been attached in the first place). We intimate no view as to whether the funds can be
subsequently attached in aid of Sinoying’s judgment in New York Supreme Court. That is an issue
to be decided by the New York Supreme Court.
8
jurisdiction sua sponte. Appellants’ Br. in Resp. to Amicus Curiae 16. That argument, however, ignores
the important distinction in our case law between appearing and non-appearing parties with respect
to defenses of personal jurisdiction.
Because personal jurisdiction can be waived by a party, see Ins. Corp. of Ir., Ltd. v. Compagnie des
Bauxites de Guinee, 456 U.S. 694, 703-05 (1982); “R” Best Produce, Inc., v. DiSapio, 540 F.3d 115, 123 (2d
Cir. 2008), a district court should not raise personal jurisdiction sua sponte when a defendant has
appeared and consented, voluntarily or not, to the jurisdiction of the court, see, e.g., Popper v. Podhragy,
48 F. Supp. 2d 268, 271-72 (S.D.N.Y. 1998) (“Once waived, lack of personal jurisdiction may not be
raised by the court sua sponte.”) (citing Zelson v. Thomforde, 412 F.2d 56, 58 (3d Cir. 1969)). But when a
defendant declines to appear, a plaintiff generally proceeds by means of a motion for default
judgment, see generally Fed. R. Civ. P. 55, and we agree with our sister circuits that before a court
grants a motion for default judgment, it may first assure itself that it has personal jurisdiction over
the defendant, see, e.g., In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999) (“In most circumstances, a defect
in personal jurisdiction is a defense that may be asserted or waived by a party. Nevertheless, when a
court is considering whether to enter a default judgment, it may dismiss an action sua sponte for lack
of personal jurisdiction.” (citation omitted)); Williams v. Life Sav. & Loan, 802 F.2d 1200, 1203 (10th
Cir. 1986) (“[W]hen entry of a default judgment is sought against a party who has failed to plead or
otherwise defend, the district court has an affirmative duty to look into its jurisdiction both over the
subject matter and the parties. In reviewing its personal jurisdiction, the court does not assert a
personal defense of the parties; rather, the court exercises its responsibility to determine that it has
the power to enter the default judgment.”); accord System Pipe & Supply, Inc. v. M/V Viktor
Kurnatovskiy, 242 F.3d 322, 324 (5th Cir. 2001) (same); see also Mwani v. Bin Laden, 417 F.3d 1, 6 (D.C.
9
Cir. 2005) (“[A] court should satisfy itself that it has personal jurisdiction before entering judgment
against an absent defendant.”).7
Here, Sinoying’s complaint asserted a breach-of-maritime-contract claim and sought a Rule
B attachment.8 The District Court did not “abuse its discretion” in denying the Rule B attachment.
Because YDX has never appeared “to plead or otherwise defend” the breach-of-maritime-contract
claim, Fed. R. Civ. P. 55(a), were Sinoying permitted to pursue that claim, it would do so by means
of a motion for default judgment. It was therefore correct for the District Court—in anticipation of
an eventual motion for default judgment—to inquire into its personal jurisdiction over YDX and to
order Sinoying to show cause why the complaint should not be dismissed. In so doing the Court
was not asserting a defense on behalf of YDX, as Sinoying contends, but rather, “exercis[ing] its
responsibility to determine that it ha[d] the power to enter [a] default judgment.” Williams, 802 F.2d
at 1203. Again, moreover, the District Court did not act without first giving Sinoying an
opportunity to establish that the Court had personal jurisdiction over YDX. Rather, the District
Court first ordered Sinoying to show cause why the complaint should not be dismissed, and in
response to that order, Sinoying was unable to establish any basis on which the Court might
establish personal jurisdiction over YDX. Indeed, YDX is a foreign entity with no operations or
contacts in the United States, and Sinoying was unable to identify any property of YDX that was
7
Our sister circuits appear to require a district court to investigate its personal jurisdiction
over a defendant before entering a default judgment. See, e.g., Williams, 802 F.2d at 1203 (“[W]hen
entry of a default judgment is sought against a party who has failed to plead or otherwise defend, the
district court has an affirmative duty to look into its jurisdiction both over the subject matter and the
parties.” (emphasis added)). We need not—and explicitly do not—address here whether a district
court must investigate its personal jurisdiction over defendant before entering a default judgment.
We leave that issue for another day and hold only that a court may raise personal jurisdiction sua
sponte when a defendant has failed to appear.
8
We note that Sinoying has never moved to amend its complaint to add a claim to confirm
its arbitration award. It has, instead, sought to confirm its arbitration award in the collateral
proceeding in New York Supreme Court.
10
likely to pass through the district and thereby provide the basis for quasi in rem jurisdiction (that is,
apart from EFTs in the hands of intermediary banks, which, following Jaldhi, are not attachable
property). Accordingly, the Court properly raised its lack of personal jurisdiction sua sponte and
correctly dismissed the complaint on that ground.
B.
Sinoying makes one further argument. It contends that Hawknet should be read to apply
selectively to pre-Jaldhi attachments based on an examination of equitable considerations.
Accordingly, Sinoying claims that the District Court erred in failing to consider the equities in this
case, which, according to Sinoying, “overwhelmingly favor” sustaining the attachment and eventually
releasing the attached funds to Sinoying. Appellants’ Br. in Resp. to Amicus Curiae 20. We reject that
claim.
First, the District Court did not err in refusing to disregard Jaldhi. Hawknet holds
unequivocally that “the rule announced in [Jaldhi] has retroactive effect to all cases open on direct
review.” 590 F.3d at 91 (emphasis added). Thus, far from encouraging district courts to apply Jaldhi
selectively based on an examination of the equitable considerations in the remaining EFT-
attachment cases, Hawknet requires district courts to vacate any attachment orders granted before
our decision in Jaldhi insofar as those orders are now inconsistent with Jaldhi.
Anticipating future parties’ reliance on Winter Storm for the proposition (rejected by the
District Court) that Hawknet should not be applied to attachments entered before Jaldhi, we observed
in Hawknet:
Although we recognize that the parties relied on Winter Storm Shipping,
Ltd. v. TPI . . . when structuring their transactions, the Supreme Court
has held that a reliance interest is insufficient to overcome the
presumption of retroactivity set forth in Harper [v. Virginia Department of
Taxation, 509 U.S. 86, 97 (1993)]. Reynoldsville Casket Co. v. Hyde, 514 U.S.
11749, 753-54 (1995). Accordingly, the presumption of retroactivity set
forth in Harper applies in this case.
Id. at 91 n.7. Sinoying now argues that our reference to the “presumption of retroactivity set forth
in Harper” requires the selective application of Jaldhi in circumstances where that presumption can be
overcome by equitable considerations.
This argument misconstrues the law of retroactivity and is explicitly foreclosed by our case
law. See Scanscot, 2010 WL 3168304, at *3 (“We reject [the] argument that Jaldhi’s retroactivity is
subject to a case-by-case rebuttable presumption.”). In Harper, the Supreme Court held that a rule
applied to the parties in a case before the Court “is the controlling interpretation of federal law and
must be given full retroactive effect in all cases still open on direct review and as to all events,
regardless of whether such events predate or postdate our announcement of the rule.” Harper, 509
U.S. at 97. That is precisely our holding in Hawknet with respect to the retroactive application of the
rule announced in Jaldhi.
In subsequent cases, the Supreme Court has recognized two classes of cases in which
“special federal policy concerns” may justify suspending the ordinary presumption in favor of
retroactivity. See, e.g., Reynoldsville, 514 U.S. at 757-58; see also id. at 761 (Kennedy, J. concurring)
(recognizing that courts “may shape relief in light of disruption of important reliance interests or the
unfairness caused by unexpected judicial decisions” to overcome the ordinary rule of retroactivity
but citing as examples only “two classes of cases”).
The first class of cases involves qualified immunity, in which a government official sued at
Time 1 for conduct which does not give rise to a legitimate cause of action until Time 2 has a
qualified immunity defense because the new rule of law was not “clearly established” at Time 1. See
Harlow v. Fitzgerald, 457 U.S. 800, 818 (1982) (“If the law at [the] time [an action occurred] was not
clearly established, an official could not reasonably be expected to anticipate subsequent legal
12
developments, nor could he fairly be said to ‘know’ that the law forbade conduct not previously
identified as unlawful.”).
The second class of cases involves the finality bar to habeas corpus petitions, a rule established
by the Supreme Court in Teague v. Lane, 489 U.S. 288, 310 (1989), under which “[n]ew legal
principles, even when applied retroactively, do not apply to cases already closed,” Reynoldsville, 514
U.S. at 758 (discussing Teague and the presumption of retroactivity).
The equitable interests Sinoying asserts fall into neither of those narrow exceptions to the
presumption in favor of retroactivity. Sinoying can point to no support for the proposition that the
equitable considerations present in the lingering cases in which an attachment order was granted
before our holding in Jaldhi raise the kind of “special finality-related concerns” which justify an
exception to the normal rule of retroactivity. Id. To the contrary, the Supreme Court has
characterized the presumption of retroactivity to which we referred in Hawknet, 590 F.3d at 91 n.7,
as an approach which “scarcely permit[s] the substantive law to shift and spring according to the
particular equities of individual parties’ claims of actual reliance on an old rule and of harm from a
retroactive application of the new rule,” Harper, 509 U.S. at 97 (internal quotation marks and
alterations omitted). To suspend the retroactive application of Jaldhi based on the “particular
equities” of Sinoying’s claims would be to “permit the law to shift and spring” in precisely the
manner the Supreme Court has forbidden.
CONCLUSION
To summarize, we hold as follows:
(1) The District Court did not err, much less “abuse its discretion,” in vacating the order of
maritime attachment because (1) the only funds seized were EFTs in the hands of intermediary
banks and thus no longer considered attachable property of YDX; and (2) Sinoying was unable to
13
make any showing that other attachable funds or property of YDX were likely to pass through the
district.
(2) The District Court did not err in raising the issue of personal jurisdiction sua sponte and
dismissing the complaint on that ground because YDX had not appeared to defend Sinoying’s claim
and the sole basis for quasi in rem jurisdiction had been eliminated.
(3) Sound policy and justice—as well as our case law—foreclose the selective application of
Shipping Corp. of India Ltd. v. Jaldhi Overseas Pte. Ltd., 585 F.3d 58, 71 (2d Cir. 2009), based on equitable
considerations such as those raised by appellants here.
Accordingly, the judgment of the District Court is AFFIRMED. Our order of April 14,
2010 granting Sinoying’s stay motion is hereby VACATED.
14