This case, in which plaintiff is proceeding pro se, is before the
undersigned pursuant to Eastern District of California Local Rule
302(c)(21). Plaintiff has numerous actions currently proceeding in
this court. In March 2011, in several of those actions, plaintiff
filed a "Notice of Filing Bankruptcy," indicating that an involuntary
Chapter 7 bankruptcy petition was filed against him.*fn1
See, e.g., Louie v. Cal. Judicial Council,
2:10-cv-2530-LKK-EFB, Dckt. No. 12; Louie v. Volvo-California Swedish,
2:11-cv-74-JAM-EFB, Dckt. No. 23; Louie v. Stomer Valley 2000
Revocable Trust, 2:11-cv-108-MCE-EFB, Dckt. No. 27.
In light of the pending bankruptcy actions, it appears that plaintiff does not have standing to proceed in the current action. Upon a declaration of bankruptcy, all of the debtor's legal or equitable interests in property become the property of the bankruptcy estate. Manlangit v. Nat'l City Mortg., 2010 WL 2044687, at *1 (E.D. Cal. May 20, 2010) (citing 11 U.S.C. § 541(a)). This includes causes of action. See id.; see also Switchboard Co. v. Westinghouse Elec. Corp., 789 F.2d 705, 707 (9th Cir.1986); Rowland v. Novus Fin. Corp., 949 F. Supp. 1447, 1453 (D. Haw. 1996). Therefore, "a bankruptcy petitioner loses standing for any causes of action and the estate becomes the only real party in interest unless the bankruptcy trustee abandons the claims" or the claims are exempt from the bankruptcy estate. Manlangit, 2010 WL 2044687, at *1 (citing In re Lopez, 283 B.R. 22, 28-29 (9th Cir. 2002); In re Pace, 146 B.R. 562, 565-66 (9th Cir. 1992)); Rowland, 949 F. Supp. at 1453.
Here, there is no indication that the bankruptcy trustee(s) has/have
abandoned the claims against defendants or that this action is exempt
from or should be excluded from the bankruptcy estate(s).*fn2
Therefore, plaintiff and/or the bankruptcy trustee(s)will be
required to substitute or join the bankruptcy trustee(s), or show the
trustee's ratification of this action, pursuant to the requirements of
Federal Rule of Civil Procedure 17(a)(3) ("The court may not dismiss
an action for failure to prosecute in the name of the real party in
interest until, after an objection, a reasonable time has been allowed
for the real party in interest to ratify, join, or be substituted into
the action. After ratification, joinder, or substitution, the action
proceeds as if it had been originally commenced by the real party in
interest."). If plaintiff and the bankruptcy trustee(s) fail to do so,
the undersigned will recommend that this action be dismissed with
prejudice. Additionally, all pending motions will be denied without
prejudice to being re-filed once the Rule 17 issues are resolved.
Accordingly, IT IS HEREBY ORDERED that:
1. On or before August 3, 2011, plaintiff and/or the bankruptcy trustee(s)shall substitute or join the bankruptcy trustee(s), or show the trustee's ratification of this action, pursuant to the requirements of Federal Rule of Civil Procedure 17(a)(3).*fn3
2. If plaintiff and the bankruptcy trustee(s)fail to comply with the Rule 17 requirements on or before August 3, 2011, the undersigned will recommend that this action be dismissed with prejudice.
3. Defendants' motion to sever misjoined defendants and/or to dismiss, Dckt. No. 11, is denied without prejudice to being re-filed once the Rule 17 issues have been resolved.
4. The status (pretrial scheduling) conference currently set for hearing on August 10, 2011 is continued to October 19, 2011 at 10:00 a.m. in Courtroom No. 24. The parties shall file status reports, as required by this court's April 4, 2011 order, on or before October 5, 2011.
5. Within five days of the date this order is filed, plaintiff shall serve a copy of this order on the bankruptcy trustee(s) and shall file a proof of such service.
6. Defendants need not file a response to plaintiff's complaint pending resolution ...