Zero Point Management v. Chase Bank/JP Morgan Chase Co.

Background

Zero Point MGMT moved under Federal Rule of Civil Procedure 17(a)(3) to substitute Malcolm Blair Boyce as the plaintiff. Chase opposed the motion, and Zero Point filed a response.

In an earlier opinion and order, the court found that Boyce, who is not an attorney, could not represent Zero Point pro se because Zero Point is a trust. The court required Zero Point to retain counsel. It also rejected the argument that the problem had been resolved by assigning Zero Point’s interest in the lawsuit to Boyce after the case was filed.

Court’s Analysis

The court rejected Zero Point’s argument that the new assignment cured the earlier problem because the claim was now assigned to Boyce in his personal capacity rather than his fiduciary capacity as trustee. The court held that the capacity in which Boyce received the claim did not matter. In either capacity, the assignment was an attempt to avoid the rule that a nonlawyer may not represent a trust.

The court also held that Rule 17(a) did not apply. That rule’s requirement that an action be brought by the real party in interest applies at the beginning of a lawsuit. For a transfer of an interest during a pending action, the court stated that Rule 25(c) applies instead, and substitution under that rule generally rests within the trial court’s discretion.

The court concluded that the requested substitution was another attempt to bypass the requirement that Zero Point be represented by counsel. It therefore did not cure the defect identified in the earlier opinion and order.

Disposition

The court denied Zero Point’s motion for substitution. It also reiterated that Zero Point had to notify the court by January 9, 2026, whether it had retained counsel, or risk dismissal of its claims.