Aydin Corporation v. Union of India

940 F.2d 527 AYDIN CORPORATION, Plaintiff-Appellant, v. UNION OF INDIA, Defendant-Appellee. No. 90-15656. United States Court of Appeals, Ninth Circuit. Argued and Submitted May 14, 1991. Decided Aug. 2, 1991. Michael L. Harrison, Harrison & Kaylor, San Jose, Cal., for plaintiff-appellant. Margaret Ecker Nanda, Matteoni, Saxe & Nanda, San Jose, Cal., Durvasula S. Sastri, Schnader, Harrison, Segal & Lewis, Washington, D.C., for defendant-appellee. Appeal from the United States District Court for the Northern District of California. Before ALARCON, KOZINSKI and RYMER, Circuit Judges. RYMER, Circuit Judge: 1 In 1976, Aydin contracted to sell equipment to the government of India. The agreement called for the parties to submit any dispute arising out of it to arbitration. India claimed that Aydin violated the contract and in 1986 commenced arbitration proceedings in India. Aydin then filed this suit, seeking a declaration that any award from the pending arbitral proceeding in India would be unenforceable against it in the United States. The district court dismissed for want for jurisdiction, holding that Aydin's claim was not ripe for review. We affirm. 2 The existence of…

In 1976, Aydin contracted to sell equipment to the government of India. The agreement called for the parties to submit any dispute arising out of it to arbitration. India claimed that Aydin violated the contract and in 1986 commenced arbitration proceedings in India. Aydin then filed this suit, seeking a declaration that any award from the pending arbitral proceeding in India would be unenforceable against it in the United States. The district court dismissed for want for jurisdiction, holding that Aydin’s claim was not ripe for review. We affirm.

The existence of subject matter jurisdiction is a question of law we review de novo. Kruso v. International Tel. & Tel. Corp., 872 F.2d 1416 , 1421 (9th Cir.1989), cert. denied, — U.S. -, 110 S.Ct. 3217 , 110 L.Ed.2d 664 (1990).

“Jurisdiction to award declaratory relief exists only in ‘a case of actual controversy.’ ” Wickland Oil Terminals v. Asarco, Inc., 792 F.2d 887, 893 (9th Cir.1986) (citing 28 U.S.C. § 2201 (a)); see Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 U.S. 270, 272 , 61 S.Ct. 510, 512 , 85 L.Ed. 826, *528 828 (1941) (district court is “without power to grant declaratory relief unless such a controversy…

concurring:

Be it through clever pleading or blind luck, Aydin has managed to assert two types of injury in its complaint for declaratory relief. In its opinion, the majority addresses only one of Aydin’s alleged injuries while overlooking the other.

Aydin first claims it will be injured by an adverse award in the Indian arbitration unless the district court declares that an award against Aydin would be unenforceable in the United States. As the majority concludes, any claim arising from this injury does not yet create a case or controversy under Article III. So far we agree.

But Aydin also claims it is injured by being compelled to participate in an arbitration proceeding from which any decision, either favorable or unfavorable to Aydin, will be invalid because the structure and format of the arbitration are fatally flawed. 1 It seeks a declaration from the district court that any decision from the arbitrator is unenforceable in the United States so that it can spare itself the expense and uncertainty of participating in an arbitration it claims is a legal nullity.

Admittedly, the expense and uncertainty of participating in an adjudicative proceeding normally are not adequate…