SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION DOCKET NO. A-3081- 21 LAWRENCE J. MILLS, a/k/a JUSTIN MILLS, and DANIEL CHUN, Plaintiffs-Appellants,

v. GOLDEN NUGGET ONLINE GAMING, INC., Defendant-Respondent.

_________________________

Submitted October 2, 2023

– Decided December 8, 2023 Before Judges DeAlmeida and Berdote Byrne. On appeal from the Superior Court of New Jersey, Law Division, Atlantic County, Docket No. L

- 0025

- 22. Lawrence J. Mills appellant pro se, on the joint br ief. Daniel Chun appellant pro se, on the joint brief. Yankwitt LLP, attorney for respondent (George Cheesman Godfrey III, Esq., of counsel and on the brief)

. NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on t he internet, this opinion is binding only on the parti es in the case and its use in other cases is limite d. R. 1:36- 3.2 A- 3081

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PER CURIAM Plaintiffs, Lawrence Mills (Mills) and Daniel Chun (Chun), appeal the Law Division's May 23, 2022, order dismissing their complaint against Golden Nugget Online Gaming, Inc. (GNOG or defendant) with prejudice and argue the trial court erred when it found plaintiffs failed to state a claim upon which relief could be granted pursuant to Rule 4:6 -2(e) because res judicata, collateral estoppel, and the entire controversy doctrine barre d their complaint. Mills also claims the trial court erred in finding he lacked st anding to bring a claim against defendant. We agree with the trial court's finding Mills lacks standing to bring a claim. We disagree with the trial court's conclusi on that res judicata, collateral estoppel, or the entire controversy doctrine apply to bar Chun's sole claim of conversion. We also hold the court erred in dismis sing the complaint with prejudice. However, we conclude Chun's complaint for conversion fails to state a claim upon which relief may be granted pursuant t o Rule 4:6 -2(e). The dismissal of the pleading is affirmed, but without prejudice as to Chun. We remand this matter to the trial court for entry of a conforming order.
I.3 A- 3081

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We glean the following facts from the record: on N ovember 2, 2017, Chun opened an online gaming account through GNOG using $1,000 given to him by Mills. Mills gave Chun the money in exchange for t he oral promise they would split any winnings resulting from gambling the $1,0 00. Chun deposited the money in cash at Golden Nugget Atlantic City Casino , owned by Golden Nugget Atlantic City LLC (GNAC) and opened an online gamin g account (the account). Pursuant to the account's terms and conditions, def endant was permitted to place a hold on an account for security review, block a user's account, or terminate a user's account under certain circumstan ces. These terms are in addition to statutes and regulations imposed upon o nline gaming accounts by the State of New Jersey. The same day Chun deposited the money, defendant pl aced a hold on the account for security-related reasons. Chun attempt ed to immediately withdraw the money but was prohibited due to the hold on the account. Plaintiffs filed suit against GNAC 1 in Federal District Court for the District of New Jersey and alleged, among other things, conversion of the mone y deposited in the account

1 It is unclear whether defendant, GNOG, was a party to that lawsuit.4 A- 3081

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(the Federal Action). 2 The Federal Action was filed on October 31, 2019. Defendant claims it sent Chun an email on October 2 5, 2019, stating the account would be terminated due to account inactivity and t he money would be deemed forfeited if Chun did not log into the account with in the next thirty days. It is undisputed Chun did not log into his account within the thirty -day period. Defendant terminated the account and deemed the mon ey forfeited on December 2, 2019. The District Court granted summary judgment to GNAC and dismissed plaintiffs' complaint on August 18, 2021. The Dist rict Court found the temporary hold GNAC placed on Chun's account was valid pursuant to the terms and conditions of the contractual agreement between it and Chun. On September 27, 2021, after the Federal Action was dismissed, Chun contacted GNOG's support team to withdraw the money. Coun sel for GNAC in the Federal Action informed Chun the money was deem ed forfeited on

2 The casino was not named as a party to this action, but we understand it was a party to the related Federal Action. These facts are taken from the parties' briefs because both parties have failed to supply t he online gaming contract at issue. The opinion disposing of the Federal Action is not part of the record. We denied plaintiffs' motion to supplement the record with th e opinion disposing of the Federal Action.5 A- 3081

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December 2, 2019 "[p]ursuant to NJ Regulations and the Terms and Conditions of the Agreement with GNOG . . . ." Plaintiffs filed this complaint in the Law Division asserting one count of conversion three months later, on December 31, 2021 . GNOG moved to dismiss plaintiffs' complaint on four grounds: (1) the taki ng of plaintiffs' $1,000 was not wrongful; and (2) res judicata, (3) collateral esto ppel, and (4) the entire controversy doctrine each barred the present case. Defendant also moved to dismiss Mills for a lack of standing. The trial court granted GNOG's motion to dismiss wi th prejudice and found for defendant on each of the five issues rais ed in its motion. This appeal followed.
II. Standing. We review the issue of Mill's standing first, as it is a threshold determination we review de novo on appeal. Cheroke e LCP Land, LLC v. City of Linden Planning Bd., 234 N.J. 403, 414 (2018). No deference is afforded to the trial court's conclusions. Ibid. We review de novo the trial court's dismissal of a complaint pursuant to Rule 4:6 -2(e), applying the same standard as the trial court . Dimitrakopoulos v.6 A- 3081

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Borrus, Goldin, Foley, Vignuolo, Hyman, & Stahl, P. C., 237 N.J. 91, 108 (2019). Our role is limited to reviewing "the plea dings themselves," id. at 107 (quoting Roa v. Roa, 200 N.J. 555, 562 (2010)), to ascertain "the legal sufficiency of the facts alleged," (quoting Printin g Mart-Morristown v. Sharp Elecs. Corp., 116 N.J. 736, 746 (1989)). Our review is performed "with a generous and hospit able approach." Ibid. (quoting Printing Mart-Morristown, 116 N.J. at 746) . The plaintiff is entitled to every reasonable factual inference to determine whether a cause of action exists in the complaint. Ibid. We are not concerned at this stage of the litigatio n whether the claim will be successful. Mac Prop. Gr p. LLC v. Selective Fire & Cas. Ins. Co., 473 N.J. Super. 1, 16 (App. Div. 202 2) (quoting Leon v. Rite Aid Corp., 340 N.J. Super. 462, 472 (App. Div. 2001)). A dismissal of a complaint pursuant Rule 4:6 -2(e) is generally made without prejudice, Nostrame v. Santiago, 213 N.J. 109, 128 (2013), unless any futu re amendment is patently insufficient to support a claim, Mac Prop. Grp., 47 3 N.J. Super. at 17. Plaintiffs argue Mills retained a property interest in the money, conferring standing upon him to bring a claim for conversion. Standing is governed by Rule 4:26 -1. EnviroFinance Grp., LLC v. Env't Barrier Co., 440 N.J. Super. 325, 339 (App. Div. 2015). The rule permits "[e]ve ry action [to] be prosecuted7 A- 3081

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in the name of the real party in interest . . . ." R. 4:26 -1. The relationship between Chun and defendant is governed by the rules of contract. In that setting, an individual generally only has standing to pursue a bre ach of contract claim if they are party to the contract

. Med. Soc'y of N.J. v. AmeriHealth HMO, Inc. , 376 N.J. Super. 48, 61 (App. Div. 2005). Mills was never a party to the contractual relationship between Chun and defendant , and the most generous reading of the pleadings fails to confer upon GNOG any contractual duty or benefit owed to Mills. Therefore, Mills has no standing to sue GNOG. At best, perhaps Mills has standing to sue Chun as a third-party plai ntiff, pursuant to the alleged oral promise between Mills and Chun, for re turn of the funds if Chun is successful in obtaining reimbursement from GNOG. W e see no reason to disturb the trial court's order in this respect and affirm the dismissal of Mill's complaint, with prejudice.
III. The Conversion Claim. Conversion is the "[(1)] wrongful exercise of domin ion and control over property [(2)] owned by another [(3)] inconsistent with the owners' rights." Sun Coast Merch. Corp. v. Myron Corp., 393 N.J. Super. 55, 84 (App. Div. 2007)8 A- 3081

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( quoting Port-O-San Corp. v. Teamsters Loc. U. No. 863 Welfa re & Pension Funds, 363 N.J. Super. 431, 440 (App. Div. 2003)). When Chun opened the account and deposited the mone y therein, the parties agreed to abide by the account's terms and conditions. Among those terms was section 4.8, which states:

After 365 days of account inactivity (meaning no ac tual wagering, game play, deposit or withdrawal), you wi ll be informed via email that you have been inactive a nd whether or not you have any remaining funds in the account. You hereby acknowledge that, if your acco unt remains dormant for more than 365 days, we have the right to close the account and any funds remaining in the account shall be forfeited. This section complies with N.J.S.A. 5:12-95.24, whi ch requires "[a]ll amounts remaining in [dormant] Internet gaming accounts . . . under such conditions as established by regulation by [the New Jersey Division of Gam ing Enforcement] shall be paid 50% to the casino licensee and 50% to the casino control fund." The statute requires GNOG attempt contact with the account owner via mail, phone, or computer. An account is dormant if there is no activity for one year. N.J.A.C. 13:690-1.1. At the time the account was o pened, defendant was required to include in the terms and conditions "[n ]otification that if the patron's internet gaming account remains dormant for a perio d of one year any funds9 A- 3081

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remaining on deposit and any pending wagers shall b e forfeited." N.J.A.C. 13:690 -1.2(1)(8) (amended Jan. 2018). 3 On appeal, there is no dispute Chun demanded retur n of the money and defendant refused to return it. The issue is wheth er defendant's refusal was inconsistent with Chun's contractual rights. Chun does not dispute he agreed to the terms and conditions associated with the accoun t. Nor does he dispute GNOG had the authority to terminate the account pur suant to the terms and conditions and pursuant to New Jersey law. In his arguments to the trial court and to us, Chun claims he never received the required notice. The complaint does not allege Chun did not receive the December email notifying him his account would be t erminated for inactivity. Nothing in the complaint disputes the receipt of the December 2019 email or the validity of the email account Chun used when openin g the account. The complaint instead disputes the account was dorm ant because it was "the subject of active litigation," without citatio n to any statute or caselaw. Because the complaint does not allege any actions w hich could be considered activity by either section 4.8 of the terms and con ditions (wagering, game play,

3 The regulation was changed to require merely a "[f]ul l explanation of all rules applicable to dormant Internet gaming accounts." N .J.A.C. 13:69O-1.2(l)(8).10 A- 3081

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deposit, or withdrawal) or N.J.A.C. 13:690-1.1 (the broader "patron initiated activity") there is no wrongful conduct alleged to justify a claim of conversion and the trial court was correct to dismiss the conv ersion claim. Chun's rights are governed by the agreed contractual terms and co nditions or applicable laws and regulations. However, because a grant of dismissal is usually wi thout prejudice, Flinn v. Amboy Nat'l Bank, 436 N.J. Super. 274, 286-87 (A pp. Div. 2014), Chun should have been given an opportunity to amend his complaint to plead any contractual claim, assuming jurisdiction and venue is properly laid pursuant to the online gaming contract.
IV. Res Judicata, Collateral Estoppel, and The Entire C ontroversy Doctrine. We part company with the trial court in finding Chu n's claims are barred by res judicata, collateral estoppel, or the entire controversy doctrine. It is our understanding, without the benefit of any of the pl eadings in the Federal Action, the conversion claim in the Federal Action was pred icated upon the initial temporary hold of the funds in the account, whereas the present suit is based upon GNOG's later refusal to return the money after the account was terminated for inactivity. According to plaintiffs, the curre nt lawsuit "has nothing to do11 A- 3081

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with [the] initial hold placed on [the] account whi ch was the basis for the [Federal Action]." Because Chun disputes the perma nent seizure of the money "which occurred on November 3, 2021, [this case] is not the same as the temporary and lawful hold on the funds which occurr ed on November 2, 2017." Further, because defendant did not refuse to return the money until after the Federal Action concluded, Chun could not bring his claim while the Federal Action was ongoing, thus foreclosing the applicatio n of the entire controversy doctrine. The doctrine of res judicata precludes the re- litig ation of substantially the same cause of action once it is finally determined on the merits by a court of competent jurisdiction. Wadeer v. N.J. Mfrs. Ins. Co., 220 N.J. 591, 606 (2015). Collateral estoppel is a subset of res judicata, In re Liquidation of Integrity Ins. Co./Celotex Asbestos Tr., 214 N.J. 51, 66 (2013) (q uoting Div. of Youth & Fam. Servs. v. R.D., 207 N.J. 88, 114 (2011)), and precl udes the re-litigation of issues actually determined in the previous action between the same or similar parties, but involving a different cause of action, R.D., 207 N.J. a t 115 (quoting State v. Gonzalez, 75 N.J. 181, 186 (1977)). Similarly, the entire controversy doctrine

— codified at Rule 4:30A

— "stems directly from the principles underlying the12 A- 3081

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doctrine of res judicata . . . ." Bank Leumi USA v . Kloss, 243 N.J. 218, 227 (2020) (quoting Prevratil v. Mohr, 145 N.J. 180, 18 7 (1996)). To invoke res judicata, there must be (1) a final j udgment on the merits; (2) the same parties, or parties in privity with th ose of the prior suit; and (3) the same or substantially similar claims arising from t he same transaction or occurrence. N.J. Div. of Child Prot. & Permanency v. J.Y., 467 N.J. Super. 235, 244 (App. Div. 2021); Rippon v. Smigel, 449 N.J. Su per. 344, 367-68 (App. Div. 2017). 4 "[R]es judicata does not bar claims that are predic ated on events that postdate the filing of the initial complaint." Ripp on, 449 N.J. Super. at 368 (quoting Whole Woman's Health v. Hellerstedt, 136 S . Ct. 2292, 2305 (2016) abrogated by Dobbs v. Jackson Women's Health Org., 597 U.S. ___, 142 S. Ct. 2228 (2022)). Likewise, "a prior judgment does not preclude new claims based on acts occurring after the time of the first judgment." Hel lerstedt, 136 S. Ct. at 2335 (Alito, J. dissenting).

4 The requirements for collateral estoppel are substa ntially similar: (1) identical issues, (2) actually litigated in the prior proceed ing, (3) by a court which issued a final judgment on the merits, (4) where the deter mination was essential to the prior judgment, with (5) identical parties or parti es in privity to those in the prior proceeding. Adelman v. BSI Fin. Servs., Inc., 453 N.J. Super. 31, 40 (App. Div. 2018) (quoting Allen v. V & A Bros., Inc., 208 N.J. 114, 137 (2011)).13 A- 3081

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Privity exists when there is a legal connection bet ween the parties. Rutgers Cas. Ins. Co. v. Dickerson, 215 N.J. Super. 116, 122 (App. Div. 1987). Put differently, privity is present when one party is, in essence, the representative of the non-party or controlled the p rior litigation. O'Brien v. Telcordia Techs., Inc., 420 N.J. Super. 256, 269 (A pp. Div. 2011) (quoting Zirger v. Gen. Accident Ins. Co., 144 N.J. 327, 338 -39 (1996)); State v. K.P.S. , 221 N.J. 226, 277-78 (2015) (using the same test fo r collateral estoppel). Similarly, the primary consideration for the entire controversy doctrine is whether the claims against the parties are rooted i n the same transaction or occurrence. Wadeer, 220 N.J. at 605. It does not "bar component claims that are unknown, unarisen, or unaccrued at the time of the original action." Higgins v. Thurber, 413 N.J. Super. 1, 12 (App. Div. 2010) (quoting Mystic Isle Dev. Corp. v. Perskie & Nehmad, 142 N.J. 310, 323 (1995) ). Contrary to the trial court's findings, the record before us does not suggest res judicata, collateral estoppel, or the entire co ntroversy doctrine apply based on the complaint's allegations. Plaintiff mentions the prior Federal Action, but states GNAC was dismissed because it removed the te mporary hold on the account and made the funds available for Chun to wi thdraw. GNAC is not a14 A- 3081

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party to this action and defendant permanently refused to return the money only after the Federal Action concluded. There was no basis to dismiss the complaint pursuan t to res judicata, collateral estoppel, or the entire controversy doct rine based on any of the complaint's allegations. We agree with the trial c ourt's finding Mills lacks standing to bring a claim against GNOG. We also ag ree Chun's complaint for conversion fails to state a claim upon which relief may be granted pursuant to Rule 4:6 -2(e) but we conclude the court erred in dismissing the complaint with prejudice to Chun's ability to bring an action soun ding in contract, assuming jurisdiction and venue is proper. The dismissal of the complaint is affirmed, but without prejudice as to Chun. We remand this matter to the trial c ourt for entry of a conforming order. Affirmed in part, reversed in part, and remanded fo r a conforming order. We do not retain jurisdiction.