I'm not sure why you bolded the JACs, but not K KUZ and T LYN right ahead of them on both lists.

I would read this as positions 1-9 on the upgrade list for the flight being occupied by people who already have confirmed seats on the flight - and then the remainder of the list (which matches the standby list) being people who are standing by and, if they get on the flight, and if there are seats up front, would qualify for an upgrade (elites or whatever).

Seems completely logical.