ImagePoint, Inc. v. JPMorgan Chase Bank, National Ass'n
27 F. Supp. 3d 494
S.D.N.Y.2014Background
- ImagePoint and JPM entered into a Master Procurement Agreement in July 2005 under which JPM was to pay ImagePoint for services and materials; ImagePoint asserts JPM owes about $762,287.92 plus interest and fees.
- ImagePoint granted Wachovia a security interest in all collateral to secure repayment of loans under a 2003 Loan and Security Agreement (Wachovia later became Wells Fargo).
- Wachovia assigned its security interests to James Haslam III in 2010, who then assigned them to James R. Martin in 2011; Martin asserts rights in ImagePoint’s accounts receivable arising from the JPM procurement relationship.
- During ImagePoint’s Chapter 7 bankruptcy, a stay was in effect; bankruptcy orders permitted stay relief for Martin to enforce rights as a secured creditor, and JPM’s rights were preserved subject to the settlement orders.
- In 2012, bankruptcy court considered standing and dismissed related actions; ImagePoint later filed suit in this district in September 2012, with Martin joining as plaintiff and seeking enforcement of ImagePoint’s rights and related claims.
- JPM moved to dismiss the second amended complaint under Rule 12(b)(1) for lack of standing and Rule 12(b)(6) for failure to state a claim; the court’s disposition is to deny the 12(b)(1) standing challenge and deny the 12(b)(6) claims except for dismissal of unjust enrichment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Martin has standing to sue as real party in interest | Martin is holder of Wachovia’s security interest via assignment chain | Chain of assignments is defective; Martin lacks enforceable rights | Martin has standing; assignments valid and real party in interest |
| Whether Article 9 of the New York Uniform Commercial Code applies to Wachovia’s security interest | Security interest arises from Article 9 financing, not mere collection | Either §9-109(d)(5)/(d)(7) exclude; or the assignment is outside Article 9 | Article 9 applies to the Wachovia security interest |
| Whether Martin may enforce against JPM under Article 9 §9-607(a)(3) to collect from JPM | §9-607(a)(3) authorizes secured party to enforce against account debtors | §9-607(e) limits enforcement of duties; case law limits rights | Martin may enforce and collect from JPM under §9-607(a)(3) |
| Whether the anti-assignment provisions in the Procurement Agreement invalidate Wachovia’s or Haslam’s assignments | Anti-assignment clause is ineffective against a secured party under §9-406(d) and related comments | Clauses prevent assignment absent consent; enforceable | Anti-assignment clause is ineffective; does not defeat Wachovia/Haslam/Martin assignments |
| Whether the Second Assignment via Haslam to Martin was valid under governing law | Georgia law governs and supports validity; waiver applies | Anti-assignment elsewhere in agreement may void | Second Assignment to Haslam and then to Martin valid under Georgia law; waiver found if applicable |
Key Cases Cited
- Makarova v. United States, 201 F.3d 110 (2d Cir. 2000) (standing can involve evidentiary materials beyond the pleadings)
- Sprint Communications Co. v. APCC Servs., Inc., 554 U.S. 269 (U.S. 2008) (assignee may sue on assigned claim in federal court)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (U.S. 1992) (standing requirements: injury, causation, redressability)
- De Sole v. Knoedler Gallery, LLC, 974 F. Supp. 2d 274 (S.D.N.Y. 2013) (explanation of assignment transfers and 'standing in shoes' principle)
- Barzun? Barzingus v. Wilheim, 306 F.3d 17 (10th Cir. 2010) (arbitration/settlement context (illustrative))