United States District Court, W.D. North Carolina, Statesville Division
DANZIG LTD., et. al., Plaintiffs,
INCEPTION MINING, INC., et. al., Defendants.
MEMORANDUM AND RECOMMENDATION AND ORDER
S. Cayer United States Magistrate Judge
MATTER is before the Court on “Defendants'
Rule 12(B)(2) Motion to Dismiss for Lack of Personal
Jurisdiction” (document #7), “Defendants'
Rule 12(B)(2) Motion to Dismiss Plaintiff's First Amended
Complaint for Lack of Personal Jurisdiction” (document
#13), and “Defendants' Motion to Strike Affidavit
of Elliott Foxcroft” (document #15), as well as the
parties' briefs and exhibits.
January 31, 2018, these Motions were referred to the
undersigned Magistrate Judge pursuant to 28 U.S.C. §
Court has considered the “Affidavit of Elliott
Foxcroft” (document 9-5). Accordingly,
“Defendant's Motion to Strike” (document #15)
8, 2017, Plaintiffs filed their First Amended Complaint as a
matter of right. Fed.R.Civ.P. 15(a)(1)(B)(party may amend
once as a matter of course, provided that it does so within
“21 days after service of a responsive pleading or 21
days after service of a motion under Rule 12(b), (e), or (f),
whichever is earlier”). Accordingly, the Court will
deny as moot “Defendants' Rule 12(B)(2)
Motion to Dismiss for Lack of Personal Jurisdiction”
(document #7). See Young v. City of Mount
Ranier, 238 F.3d 567, 573 (4th Cir. 2001) (amended
pleading renders original pleading of no effect and motions
directed at superseded pleadings are to be denied as moot).
fully considered the arguments, the record, and the
applicable authority, the undersigned respectfully recommends
that “Defendants' Rule 12(B)(2) Motion to Dismiss
Plaintiff's First Amended Complaint for Lack of Personal
Jurisdiction” (document #13) be granted, as
FACTUAL AND PROCEDURAL BACKGROUND
matter arises from the sale of Idaho gold mining property by
non-party Inception Resources LLC to Gold American Mining
Corporation (“Gold American”) through a purchase
of assets. Gold American is a Nevada corporation and has
never been registered in North Carolina. Plaintiff Brett
Bertolami was the majority shareholder in Gold American and a
North Carolina resident. Defendant Michael Ahlin, a Utah
resident, is the owner/manager of Inception Resources LLC, a
Utah limited liability company.
the allegations of the Amended Complaint as true, the
relevant business transactions were primarily negotiated
between non-party Elliott Foxcroft on behalf of Plaintiff
Bertolami and Defendant Trent D'Ambrosio on behalf of
Defendant Ahlin. D'Ambrosio is a Utah resident.
Defendants D'Ambrosio and Ahlin have had no contacts with
North Carolina other than telephone and email communications
during the negotiations. Foxcroft is the principal of
Plaintiff Danzig Ltd (“Danzig”). Danzig is a
North Carolina corporation with its principal place of
business in Iredell County.
exchange for the gold mines, Gold American issued Inception
Resources, LLC sixteen million shares of its stock. Gold
American was later renamed Inception Mining Inc. and is a
Defendant herein. For the purposes of this Motion, the
parties agree that their objective was to allow Inception
Resources, LLC, to place its gold mining assets into a
publicly-traded corporation and have access to capital
markets without incurring the costs of an initial public
the sale of assets, Plaintiffs were also issued nearly 1.8
million shares in the new entity, Inception Mining Inc.
Plaintiffs allege that Defendants were contractually bound to
raise an additional $1 million in capital, register
Plaintiffs' shares with the Securities and Exchange
Commission by a certain date, and issue no other shares at a
price below 35 cents per share. Plaintiffs allege that their
shares were significantly devalued as a result of
Defendants' breach of these obligations. Plaintiffs
assert claims for securities fraud under federal and state
law as well as state law claims for breach of contract,
unjust enrichment, fraud, breach of fiduciary duty, and
15, 2017, Defendants moved to dismiss, arguing there is no
basis for this Court to exercise personal jurisdiction.
their response, Plaintiffs concede that there is no basis for
general personal jurisdiction. They argue that the series of
emails and telephone calls primarily between Foxcroft and
D'Ambrosio along with the fact that Gold American was