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Roberts v. Generation Next, LLC

United States District Court, D. New Mexico

May 2, 2019

GALE ROBERTS, Plaintiff,
v.
GENERATION NEXT, LLC, RICHARD COOK, Estate of, KATHARINE COOK FISHMAN, PAUL MATTHEW CASTER, ANTIQUITY ENCOUNTER, JOHN MELANCON, EXPEDITION RESOURCES, LLC, EXPLORATION OPES, LLC, DONALD PATTERSON, GERALD KEMLAR, HOWARD TALKS, WILLIAM FLOTO, JOHN AND JANE DOES, Defendants.

          MEMORANDUM OPINION AND ORDER GRANTING IN PART AND DENYING IN PART EXPEDITION DEFENDANTS' MOTION TO DISMISS

         THIS MATTER comes before the Court upon Expedition Defendants' Motion to Dismiss, filed January 28, 2019 (Doc. 37). Having reviewed the parties' pleadings and the applicable law, the Court grants and denies Expedition Defendants' motion to dismiss as follows:

(1) GRANTED with regard to Counts 5 and 9;
(2) GRANTED as to Counts 1, 2, 3, 6 and 7; and
(3) DENIED as to Counts 4, 8, 10 and 11, for reasons described below.

         BACKGROUND

         This lawsuit is about a hunt for buried treasure on Black Mesa, a hill area located northwest of Espanola, New Mexico where some believe that several large caches of gold treasure and antiquities are hidden. Plaintiff is a resident of Wyoming who conducted business in New Mexico, Texas and Florida, and claims that he contractually agreed with Defendants Melancon, Patterson, Kemler and Talks, to fund a gold treasure exploration mission near Espanola, New Mexico, known as the “Black Mesa Expedition.” Black Mesa is a hill area located northwest of Espanola, New Mexico where some believe that several large caches of gold treasure and antiquities are hidden in Spanish Vaults.

         Plaintiff, who is proceeding pro se, claims that he contractually agreed with Defendants to fund the expedition. He alleges that other individuals on the expedition conspired against him to steal buried gold from Black Mesa land owned by one of the Cook Defendants and stashed it elsewhere; and that the theft was part of a scheme to prevent Plaintiff from discovering hidden reserves of gold in order to deprive him of his share.

         The individual movants in this motion, Donald Patterson, Gerald Lee Kemler and William Floto, are proceeding pro se. The other two movant-companies, Expedition Resources, LLC (“Expedition Resources”) and Expedition OPES (“OPES”) were involved in the expedition. Defendant Patterson and Kemler were two of the managing members of these companies.[1]

         I. Relevant Facts

         The following are the bare relevant facts as alleged in the complaint, arranged chronologically:

November 2012: According to the complaint, Plaintiff entered into a Joint Venture Agreement in November 2012 with Defendants Patterson/Expedition Resources, which was captioned as a “Memorandum of Understanding for a Joint Venture Agreement.” Doc. 3 at 48 (also referred to as the “New Agreement” by Plaintiff, see Doc. 3, ¶¶44, 53). Under its terms, Plaintiff was to pay all costs and would be entitled to a 50/50 split in discovered uncovered gold and artifacts. The agreement was brokered by Defendant Melancon with the approval of Richard Cook, who owned the treasure maps used in the expedition and whose company, Generation Next, LLC (“Gen Next”) owned property on Black Mesa. Doc. 3, ¶46.[2]
March 2013: Using testing equipment Roberts had purchased specifically for the expedition, two gold targets were located. As the targets were located, tension grew between him and Defendants Patterson and Kemler. Although unknown to Plaintiff at the time, Defendants Patterson and Kemler located two other gold targets with the help of Defendant William “Bill” Floto, who was flown up from Florida, using Floto's “proprietary science.” Doc. 3, ¶62.
March 6, 2013: in Plaintiff's absence, the Melancon team members-Defendants Patterson, Kemler and Floto-dug up the gold in one of these two targets and secreted it away. These men then hid the Bill Floto's test results and manufactured false results in their place in order to deceive Plaintiff about these other two locations where gold was hidden.
March 15, 2013: Plaintiff met Richard Cook for the first time, during which time Cook related the story about treasure hidden by robbers that held up a pack train of mules hauling gold and silver coins in the late 1800's (“OJO Robbery”). Doc. 3, ¶73.
March 16, 2013: with the permission of Richard Cook and Defendant Caster, the excavation to locate the Spanish Vaults on Black Mesa began. Doc. 3, ¶74. The team was several days into the excavation when Plaintiff Roberts discovered that Defendant Kemler had tried to hide the test results from March 6, 2013 in his personal notebook. Id., ¶74.
Mid-March 2013: Defendants Patterson and Kemler informed Plaintiff that they needed to return to Florida. Plaintiff intended to use the time they were away to report his concerns regarding suspicious activity at the expedition site to Cook and Melancon. Doc. 3, ¶78.
March 24, 2013: Defendants Patterson and Kemler began transporting the gold and artifacts they had secretly removed and took them to Florida. Doc. 3, ¶82.
May 1 - Sept 13th 2013: Plaintiff pleaded with Defendants Melancon, Fishman and Caster to meet with him and resolve everything, but Defendants remained silent and waited for the agreements to expire. Doc. 3, ¶ 99.
Mid- to late September 2013: Plaintiff and Richard Cook entered into a verbal agreement to allow Plaintiff to finish the excavation of the gold from the Spanish Vaults on Black Mesa. However, Defendants Caster and Fishman would not allow Roberts to return to the Black Mesa property. Fishman filed for restraining order against Plaintiff which limited direct communication between Plaintiff and the Cook family.[3] Doc. 3, ¶¶101, 106-115.
Feb 21, 2014: Gen Next sent Plaintiff e-mail claiming that all contracts had expired; that Black Mesa Expedition had ended poorly for all involved; and that they had no intention of any further expedition of Black Mesa. However, Plaintiff was aware that two weeks later, Defendants Patterson, Kemler and Floto had located and removed gold from Black Mesa on March 6, 2013. Plaintiff also discovered that about two weeks later, Defendant Gen Next, Fishman and Caster renewed efforts to recover gold and artifacts from Chamber #1 of the Spanish Vaults at Black Mesa. Doc. 3, ¶¶130, 132.

         The complaint refers to three agreements or contracts that were relevant to the expedition. The first was a contract between Gen Next and Defendant Expedition Resources, executed in July 2010. This was a one-year exclusive Recovery Agreement allowing Defendant Expedition Resources the right to access the property for exploration. Doc. 3 at 45. The agreement expired on July 22, 2011 without Expedition Resources ever having entered the property due to a lack of funding. Am. Compl., ¶41.

         The second agreement is the 2012 Joint Venture Agreement, which is most relevant to the issues raised in this motion. This agreement was between Plaintiff and Defendants Patterson/Expedition Resources. It is captioned as a “Memorandum of Understanding for a Joint Venture Agreement.” Doc. 3 at 48. This agreement identifies and refers to Plaintiff throughout as “GW” which is the anacronym for his company “Gone Working.” Under the Joint Venture Agreement, the purpose of the expedition was “to locate, recover inventory, value and sell or distribute to the Joint Venturers the natural and cultural precious metals, gems, or artifacts.” Doc. 3 at 49. The signatories to the agreement are Gale Roberts as a “Joint Venturer” and Donald Patterson as Managing Member of Expedition Resources, LLC, and the agreement was signed by both signatories on November 26, 2012. Under the agreement, Plaintiff was required to pay all costs and monthly salaries of $2, 000 to Defendants Melancon, Patterson and Kemler. In return, Plaintiff would receive a share of the value of whatever treasure was recovered, and his costs would be reimbursed prior to any distribution of the liquidated assets recovered as well. Doc. 3 at 52.

         The third agreement is the Black Mesa Recovery Agreement, dated February 12, 2013 (referred to by Plaintiff as the “New Agreement, ” see Doc. 3, ¶¶44 & 53). This was an exclusive contract between Defendants Gen Next and Melancon/Antiquity Encounter. See Doc. 23-1 at 3. Defendants Richard Cook and Fishman signed this agreement as Co-Managers of Gen Next.

         II. Legal Standard

         Rule 12(b)(6) permits the Court to dismiss a complaint for “failure to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). To survive a motion to dismiss, the complaint must have sufficient factual matter that if true, states a claim to relief that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 677 (2009) (“Iqbal”). As such, a plaintiff's “[f]actual allegations must be enough to raise a right to relief above the speculative level.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (“Twombly”). All well-pleaded factual allegations are “viewed in the light most favorable to the nonmoving party.” Brokers' Choice of Am., Inc. v. NBC Universal, Inc., 757 F.3d 1125, 1136 (10th Cir. 2014). In ruling on a motion to dismiss, “a court should disregard all conclusory statements of law and consider whether the remaining specific factual allegations, if assumed to be true, plausibly suggest the defendant is liable.” Kan. Penn Gaming, LLC v. Collins, 656 F.3d 1210, 1214 (10th Cir. 2011). Mere “labels and conclusions” or “formulaic recitation[s] of the elements of a cause of action” will not suffice. Twombly, 550 U.S. at 555.

         Although a statute of limitations bar is an affirmative defense, it may be resolved on a Rule 12(b)(6) motion to dismiss “when the dates given in the complaint make clear that the right sued upon has been extinguished.” Lymon v. Aramark Corp., 728 F.Supp.2d 1207, 1215-16 (D.N.M. 2010) aff'd, 499 Fed.Appx. 771 (10th Cir. 2012); (Cosgrove v. Kan. Dep't of Soc. & Rehab. Servs., 332 Fed.Appx. 463 (10th Cir. 2009) (dismissal is proper when it is clear from the face of the complaint that the claims are time barred).

         Plaintiff asserts the following claims against these Defendants (“Defendants” hereinafter):

1. Intentional Misrepresentation of ...

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