Case 2:13-cv-00736-WPL-GBW Document 13 Filed 10/21/13 Page 1 of 13

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW MEXICO

HOT SPRINGS LAND DEVELOPMENT, LLC, A New Mexico Limited Liability Company, and HOT SPRINGS MOTORPLEX DEVELOPMENT, LLC A New Mexico Limited Liability Company, Plaintiffs, vs. CITY OF TRUTH OR CONSEQUENCES, A New Mexico Municipality, Defendant. JOINT STATUS REPORT AND PROVISIONAL DISCOVERY PLAN Pursuant to FED. R. CIV. P. 26(f), a meeting was held telephonically on Wednesday, October 8, 2013, and was attended by: Justine Fox-Young, Paul Kennedy & Associates, P.C., for Plaintiffs. Gerald Coppler, Coppler Law Firm, P.C., for Defendant. NATURE OF THE CASE This lawsuit stems from allegations of civil rights violations and violations of New Mexico state law. Plaintiffs bring their claims against the Defendant under the Fifth and Fourteenth
Amendments to the United States Constitution and 42 U.S.C. 1983, under New Mexico state law, and for declaratory judgment pursuant to 28 U.S.C. 2201.

No. 2:13-cv-736 WPL/GBW

AMENDMENTS TO PLEADINGS AND JOINDER OF PARTIES Plaintiff intends to file: a motion to amend the pleadings and join additional parties if warranted by the results of discovery.

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Plaintiffs should be allowed until January 3, 2014 to amend the pleadings and to join additional parties in compliance with the requirements of Fed. R. Civ. P. 15(a). Defendants intend to file: a response to any motion to amend the pleadings made by Plaintiffs and an answer or response to any amended pleadings permitted by the Court. Defendants should be allowed until February 3, 2014 to amend the pleadings and join additional parties. STIPULATIONS The parties hereto stipulate and agree that venue is properly laid in this District, and that the United States District Court for the District of New Mexico has jurisdiction of the parties and the subject matter. The parties are willing to further stipulate to the facts previously admitted in the Defendants Answer to Plaintiffs Complaint. The parties further stipulate and agree that the law governing this case is: Fifth and
Fourteenth Amendments to the United States Constitution and 42 U.S.C. 1983, 28 U.S.C. 2201,

and New Mexico state law. PLAINTIFFS CONTENTIONS: Plaintiffs incorporate the allegations set forth in their Complaint [Doc. 1], filed August 8, 2013. As elaborated in Plaintiffs Complaint, this case arises from disputes between Plaintiffs, Hot Springs Land Development, LLC and Hot Springs Motorplex Development, LLC, (Plaintiffs), who own property within the City of Truth or Consequences and Defendant City of Truth or Consequences (Defendant). Plaintiffs seek declaratory and injunctive relief, and damages, for Defendants violations of Plaintiffs Fifth and Fourteenth Amendment rights and for

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Defendants breaches of various agreements between the parties, in reliance on which Plaintiffs expended significant resources in order to further development of their property. As described more fully in Count I of Plaintiffs Complaint, Plaintiffs seek a judgment declaring Defendants Ordinance 633, which presumes to restrict the height of structures on a portion of Plaintiffs property, invalid on the basis that it is preempted by federal law governing aviation safety. In Count II of their Complaint, Plaintiffs request preliminary and permanent injunctive relief, preventing Defendant from regulating Plaintiffs development of their land pursuant to any local law which is preempted by federal law in this area. Count III of the Complaint details violations of Plaintiffs Fifth and Fourteenth Amendment Rights, on the basis that Defendant has deprived them of all economically beneficial use of their property without just cause. In the alternative, Plaintiffs claim in Count IV that

Defendant has inversely condemned their property. Count V of the Complaint details Plaintiffs request for Judgment declaring the Defendants collection of $200,000 in impact fees from Plaintiffs invalid. In Counts VI and VII, Plaintiffs request damages and equitable relief, respectively, for Defendants breach of the parties water and sewer option agreement, which granted Plaintiffs an exclusive option to purchase rights to eighty percent of Defendants excess water and sewer capacity and ninety-five percent of its future capacity. As detailed more fully in Count VIII, Plaintiffs request damages for Defendants breach of the parties contract regarding development of the Truth or Consequences Airport. In Count IX, 1 Plaintiffs request damages for Defendants breach of the parties water well development

Plaintiffs Count IX is mistakenly numbered VIII. See Doc. 1 at 31.

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agreement. Count X 2 outlines Plaintiffs claim that Defendant has breached its covenant of good faith and fair dealing, with respect to each of the contractual agreements Defendants breached, as outlined above. DEFENDANTS CONTENTIONS Defendant, the City of Truth or Consequences (the City), incorporates the allegations set forth in its Answer [Doc. 4] filed September 10, 2013. The City contends, generally, that the City has made all appropriate efforts to permit Plaintiffs to proceed with their proposed development on lands annexed into the City at Plaintiffs request, and to provide City services required by Plaintiffs for their development. To that end, the City has entered into multiple agreements with Plaintiffs, at Plaintiffs request, under each of which Plaintiffs have failed to perform their obligations to the City. Plaintiffs have made numerous false representations to the City regarding the viability of their proposed land development, the status of organizations and entities supposedly interested in participating in the development, and the readiness of Plaintiffs to go forward with their proposed development. Plaintiffs development has failed to go forward through no fault of the City. As to Plaintiffs Count I, it is the Citys contention that the City may limit the height of structures in any zone of the City as a matter of New Mexico zoning law, and such law is not preempted by federal law governing aviation safety, whether or not the land is located in the general vicinity of an airport. The City therefore contends that Plaintiffs are not entitled to injunctive relief as demanded in their Count II, whether preliminary or permanent, which would have the effect of exempting Plaintiffs lands from the zoning ordinances of the City.

Plaintiffs Count X is mistakenly numbered IX. See Doc. 1 at 32.

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The City states that it has not deprived Plaintiffs of the use of their lands in any way (as alleged in Plaintiffs Count III), and on the contrary has rendered those lands more valuable by annexing them into the City so that they are entitled to City services, some of which (e.g., police and fire protection) are presently provided and others of which (e.g., water and wastewater utility service) the City stands ready to provide when and if Plaintiffs actually go forward with their proposed development. In the meantime, Plaintiffs lands retain at least the value they had when they were acquired by Plaintiffs from the State of New Mexico, that is, value as grazing land. For the same reasons, the City states that there has been no inverse condemnation of Plaintiffs lands by the City as alleged in Plaintiffs Count IV. The City contends that it has not imposed or collected any impact fees whatever on Plaintiffs proposed development, and the $200,000 cited in Plaintiffs Count V was a contract payment to reimburse the City for costs expected to be incurred, and actually incurred, by the City in performance of the Citys obligations under the contract. The City contends that Plaintiffs are not entitled to damages or equitable relief as demanded in Plaintiffs Counts VI and VII because Plaintiffs did not exercise their options under the water and sewer option agreement, and the time to exercise such options has expired. The City states that Plaintiffs entirely failed to perform any of their obligations under the agreement related to development of the Truth or Consequences Airport, that they failed to take any action to effect such development, and that Plaintiffs therefore breached the agreement, so that the City was entirely justified in terminating the agreement (with Plaintiffs consent), all contrary to Plaintiffs Count VIII. The City also contends that it never breached the parties water well agreement as alleged in Plaintiffs Count IX (numbered as Count VIII in the Complaint, see Doc. 1 at 31), and the City

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fully performed its obligations to the Plaintiffs under the water well agreement, notwithstanding Plaintiffs unreasonable dissatisfaction with the Citys decision not to proceed immediately with use of the well. With regard to Plaintiffs contention that the City breached the covenant of good faith and fair dealing (Plaintiffs Count X, numbered as Count IX in the Complaint, see Doc. 1 at 32), the City contends that it has at all times dealt with Plaintiffs fairly and in good faith, despite Plaintiffs repeated false representations to the City and Plaintiffs systematic failure to perform on their contractual obligations, and therefore Plaintiffs Count X is without merit. PROVISIONAL DISCOVERY PLAN The parties jointly propose to the Court the following discovery plan. The parties wish to utilize written discovery as well as depositions in this matter, as described below. List all witnesses who, at this time, you think will either testify or be deposed, giving their name, title, address and a brief summary of their testimony. It is insufficient to list witnesses addresses, save for clients, in care of counsel. List all documents which you believe, at this time, will be exhibits at the trial. List all experts who you believe, at this time, will testify at the trial, giving their name, address, area of expertise, and a brief summary of the anticipated testimony. I. PLAINTIFF: 1. Witnesses: A. Alan Payne PO Box 1686 Elephant Butte, NM 87935 813.917.8402

Alan Payne is expected to testify about the incidents that gave rise to Plaintiffs complaint as well as the injuries and damages Plaintiffs suffered and will continue to suffer as a result of those incidents. B. Bing Kearney

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9625 Wes Kearney Way Riverview, FL 33578 813.379.3830 Bing Kearney is expected to testify about the incidents that gave rise to Plaintiffs complaint as well as the injuries and damages Plaintiffs suffered and will continue to suffer as a result of those incidents. C. Nicholas Lamoriello 1525 International Parkway Lake Mary, FL 32746 407.585.1160

Nicholas Lamoriello is expected to testify about the incidents that gave rise to Plaintiffs complaint as well as the injuries and damages Plaintiffs suffered and will continue to suffer as a result of those incidents. D. Greg Neal P.O. Box 1686 Elephant Butte, NM 87935 575.824.7280

Greg Neal is expected to testify about the incidents that gave rise to Plaintiffs complaint as well as the injuries and damages Plaintiffs suffered and will continue to suffer as a result of those incidents. E. Lori Montgomery Address & Phone Unavailable

Lori Montgomery is expected to testify about the incidents that gave rise to Plaintiffs complaint and her knowledge of Defendants agreements with and representations made to Plaintiffs during her tenure as Mayor of Truth or Consequences. F. Jaime Aguilera Address & Phone Unavailable

Jaime Aguilera is expected to testify about the incidents that gave rise to Plaintiffs complaint and his knowledge of Defendants agreements with and representations made to Plaintiffs during his tenure as City Manager of Truth or Consequences. G. Mayor John Mulcahy 505 Sims Truth or Consequences, NM 87901 575.894.6673

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Mayor John Mulcahy is expected to testify about the incidents that gave rise to Plaintiffs complaint and his knowledge of Defendants agreements with and representations made to Plaintiffs during his tenure as Mayor of Truth or Consequences. H. Any witness identified and/or yet to be identified by other parties.

I. Any witness identified and/or yet to be identified through discovery, including but not limited to other employees of Defendant who witnessed or participated in acts that gave rise to this case during the relevant time period. J. Any witness, such as records custodians, necessary to authenticate documents or to identify, calculate, or explain information regarding employee pay, benefits, and taxation. 2. A. B. C. 3. Documents: Documents referenced in Plaintiffs Complaint. Records and physical evidence identified by other parties to this case. Records and physical evidence identified through discovery in this case. Expert Witnesses

Experts have not yet been identified. The above information will be supplemented as required by the Federal Rules of Civil Procedure. II. DEFENDANT 1. Witnesses: A. City Manager Juan Fuentes 505 Sims Street Truth or Consequences, NM 87901 575.894.6673

Juan Fuentes is expected to testify about the status of the parties agreements, the Citys zoning ordinances as they relate to Plaintiffs proposed development, and the Citys actions taken to accommodate Plaintiffs demands for services from the City. B. City Commissioner Steven Green 505 Sims Street Truth or Consequences, NM 87901

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575.8946673 Commissioner Steven Green is expected to testify regarding the history of Plaintiffs dealings with the City, the factual basis of Plaintiffs allegations and the Citys denials of those allegations, the parties actions in connection with their various agreements, and the Citys actions taken to accommodate Plaintiffs demands for services from the City. C. Rose Garretson, Clerk-Treasurer City of Elephant Butte 103 Water Street Elephant Butte, NM 87935 575.744.4892

Rose Garretson was an assistant to Greg Neal who may be called to testify concerning the course of proceedings between the parties. D. Cathy Clark c/o Charles Motel 601 Charles Truth or Consequences, NM 87901 575.894.7154

Cathy Clark may be called to testify concerning the Cuchillo Well and the parties agreements and proceedings related to that well. E. Evelyn B. Renfro 726 Charles, Truth or Consequences, NM , 87901 575-894-3715

Evelyn Renfro is a former City Commissioner and Mayor Pro Tem for the City and is expected to testify regarding the history of Plaintiffs dealings with the City, the factual basis of Plaintiffs allegations and the Citys denials of those allegations, the parties actions in connection with their various agreements, and the Citys actions taken to accommodate Plaintiffs demands for services from the City F. Jerry Stagner Citizens Bank 1920 N. Date Truth or Consequences, NM 87901 575.894.4143 575.894.0820

Jerry Stagner is a former City Commissioner for the City and is expected to testify regarding the history of Plaintiffs dealings with the City, the factual basis of Plaintiffs allegations and the Citys denials of those allegations, the parties actions in connection with

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their various agreements, and the Citys actions taken to accommodate Plaintiffs demands for services from the City G. Any witness identified and/or yet to be identified by other parties.

H. Any witness identified and/or yet to be identified through discovery, including but not limited to other representatives or agents of Plaintiffs who witnessed or participated in acts related to this case during the relevant time period and representatives of other organizations or entities purportedly involved in Plaintiffs proposed development. I. Any witness, such as records custodians, necessary to authenticate documents or to identify, calculate, or explain information. 2. A. B. C. 3. Exhibits: Documents referenced in Plaintiffs Complaint and Defendants Answer. Records and physical evidence identified by any party to this case. Records and physical evidence identified through discovery in this case. Expert Witnesses:

Experts, if any, have not yet been identified. The above information will be supplemented as required by the Federal Rules of Civil Procedure.

III.

DISCOVERY WILL BE NEEDED ON THE FOLLOWING SUBJECTS: 1. Plaintiffs request for declaratory judgment declaring Defendants Ordinance No. 633 invalid. 2. 3. 4. 5. Plaintiffs request for preliminary and permanent injunctive relief. Plaintiffs claim of violations of the Fifth and Fourteenth Amendments. Plaintiffs claim of inverse condemnation. Plaintiffs request for declaratory judgment declaring Defendants collection of impact fees invalid. 6. Plaintiffs claim of breach of the Water and Sewer Agreement.

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7. 8. 9. 10.

Plaintiffs claim of breach of the Airport Development Agreement. Plaintiffs claim of breach of the Water Well Development Agreement. Plaintiffs claim of breach of the covenant of good faith and fair dealing. Plaintiffs remedies, including economic damages, equitable relief, declaratory and injunctive relief.

Maximum of 25 interrogatories per side. (Responses due in accordance with the Federal Rules of Civil Procedure). Plaintiffs request a maximum of 25 requests for production per side. Defendant does not propose a limit on requests for production. (Responses due in accordance with the Federal Rules of Civil Procedure). Maximum of 25 requests for admission by each party to any other party. (Responses due in accordance with the Federal Rules of Civil Procedure). Maximum of 7 depositions by Plaintiffs and 7 by Defendant.
Each deposition (other than parties) limited to a maximum of four hours, unless extended by agreement of the parties. Depositions of Fed. R. 30(b)(6) designees and experts limited to a maximum of seven hours unless extended by agreement of parties.

Reports from retained experts under Rule 26(a)(2) due: from Plaintiffs by February 3, 2014. from Defendant by March 4, 2014. Supplementation under Rule 26(e) due 30 days before the close of discovery. All discovery commenced in time to be complete by Monday, May 5, 2014. The parties request that pretrial motions and Daubert motions, other than discovery, be due by Wednesday, May 14, 2014.

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PRETRIAL MOTIONS Plaintiffs intend to file: motions for partial summary judgment, discovery motions, motions in limine, post-trial motions, and motions for attorney fees if necessary or appropriate. Defendant intends to file: motions to dismiss and/or for summary judgment, discovery motions, motions in limine, post-trial motions, and motions for attorney fees and costs as appropriate. ESTIMATED TRIAL TIME The parties estimate trial will require 3-4 days. ____ This is a non-jury case. X This is a jury case. The parties request a pretrial conference 30 days before trial. SETTLEMENT The possibility of settlement in this case cannot be evaluated prior to conducting discovery. The parties request a settlement conference prior to trial. EXCEPTIONS As noted above, Plaintiffs request 25 Requests for Production for each side, and Defendant does not propose a limit on Requests for Production.

PAUL KENNEDY & ASSOCIATES, P.C. /s/ Justine Fox-Young Paul J. Kennedy Arne R. Leonard Justine Fox-Young Nan E. Erdman 201 12th Street N.W. Albuquerque, NM 87102

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505.842.8662 Attorneys for Plaintiff COPPLER LAW FIRM, P.C. /s/ Gerald A. Coppler Gerald A. Coppler 645 Don Gaspar Avenue Santa Fe, New Mexico 87505 505.988.5656

Attorneys for Defendants