INTERSAL, INC. v. WILSON, 2023 NCBC 15

STATE OF NORTH CAROLINA
COUNTY OF WAKE
IN THE GENERAL COURT OF JUSTICE
SUPERIOR COURT DIVISION
15 CVS 9995
INTERSAL, INC., Plaintiff,
v.
D. REID WILSON, Secretary, North
Carolina Department of Natural and
Cultural Resources; NORTH
CAROLINA DEPARTMENT OF
NATURAL AND CULTURAL
RESOURCES; THE STATE OF
NORTH CAROLINA; and FRIENDS
OF QUEEN ANNE’S REVENGE, a
Non-Profit Corporation,
Defendants.
ORDER AND OPINION ON
CROSS-MOTIONS FOR
SUMMARY JUDGMENT
I. 	INTRODUCTION
1. 	In 1996, after almost a decade of searching, Intersal, Inc. (“Intersal”), a
marine research and recovery company, discovered the storied Queen Anne’s Revenge
(“QAR”), flagship of the notorious pirate Blackbeard, off the coast of North Carolina.
The vessel reportedly sank near Beaufort Inlet in 1718, and it has been the stuff of
legend since.
2. 	Although no treasure chests of gold were found in the debris, historical
relics have been recovered from the QAR, and the rights to make images, replicas,
and 	narratives 	about 	the 	relics 	have 	amounted 	to 	another 	form 	of 	treasure.
Persistent disputes over the division of these rights have led to this litigation.
Intersal, Inc. v. Wilson, 2023 NCBC 15.

3. 	Intersal and Defendants, including the North Carolina Department of
Natural and Cultural Resources (“DNCR”),1 present their claims to the Court on
cross-motions for summary judgment, (the “Motions”) (ECF Nos. 153, 160). 	For the
reasons stated below, the Court GRANTS in part and DENIES in part the Motions.
Linck Harris Law Group, PLLC, by David H. Harris Jr. and Kilpatrick
Townsend & Stockton, LLP by Dustin T. Greene, Richard J. Keshian,
Elizabeth Winters and Kyleigh E. Feehs for Plaintiff Intersal, Inc.
N.C. Department of Justice, by Michael Bulleri, Amar Majmundar,
Brian D. Rabinovitz, Orlando L. Rodriguez and Charles G. Whitehead
for Defendants D. Reid Wilson, et al.
Earp, Judge.
II. 	FACTUAL BACKGROUND
4. 	The Court does not make findings of fact when ruling on motions
for summary judgment. 	“Rather, the Court summarizes the relevant evidence of
record, noting both the facts that are disputed and those that are uncontested, to
provide context for the claims and the Motions.” 	Aym Techs., LLC v. Rodgers, 2019
NCBC LEXIS 64, *2 (N.C. Super Ct. Oct. 16, 2019) (citing Hyde Ins. Agency, Inc. v.
Dixie Leasing Corp., 26 N.C. App. 138, 142 (1975)). 	The following background,
describing the evidence and noting relevant disputes, is intended to provide context
for the Court’s analysis and ruling.
5. 	Intersal is a Florida corporation registered to do business in North
Carolina. (Third Am. Compl. ¶ 14, ECF No. 106.)
1 DNCR was formerly known as the North Carolina Department of Cultural Resources
(“DCR”). The two names are used interchangeably in this Order and Opinion.

6. 	DNCR is an executive agency of the State of North Carolina. (Third Am.
Compl. ¶ 16.) 	Defendant Wilson is the Secretary of DNCR. 	(Notice of Substitution
of Def., ECF No. 149.)
7. 	In 1994, DNCR issued Permit No. 94 BUI 585 (the “QAR Permit”) to
Intersal, authorizing Intersal to search for the QAR, which sank off the North
Carolina coast in 1718. (Third Am. Compl. ¶ 21; Pl.’s Resp. Defs.’ Mot. Dismiss, Ex.
6 [“QAR Permit”], ECF No. 79.)
8. 	Shortly thereafter, DNCR issued Permit No. 94 BUI 584 to Intersal,
authorizing Intersal to search for a second ship, the El Salvador, which also
reportedly sank near Beaufort Inlet in 1750. 	(Third Am. Compl. ¶ 20; Defs.’ Mot.
Summ. J., Ex. 25 [“El Salvador Permit”], ECF No. 159.25.)
9. 	The QAR Permit specified that Intersal would be entitled to 75% of
“[a]ny [coins and precious metals] recovered during Phase Five [the salvage phase] of
the project.”2 	(QAR Permit, at 2.) 	In contrast, the El Salvador Permit authorized
only “site assessment activities,” (target relocation, limited recovery of artifacts, data
analysis and reporting), as opposed to salvage activities.3 (El Salvador Permit at 1.)
In the event the El Salvador was located, “more extensive investigations” such as
2 The federal Abandoned Shipwreck Act of 1987, 43 U.S.C. § 2105(c), and State law, N.C.G.S.
§ 121-22, provide that a shipwreck recovered from the submerged lands of the State of North
Carolina belongs to the State. However, the State is free to cede some or all of its ownership
rights.
3 The 2013 El Salvador Permit allowed for the recovery of artifacts or other site materials on
a limited basis for commercial salvage with DNCR approval. 	With that exception, all
materials recovered were to remain the property of the State of North Carolina. (El Salvador
Permit, at 2-3.)

“large scale excavation and/or the recovery of an extensive number of artifacts” would
require a separate agreement with the State. (El Salvador Permit at 4-5.)
10. 	The El Salvador Permit limited Intersal’s activities to one year, but it
could be renewed annually, “subject to any changes in the permit terms [DNCR]
deems appropriate, providing [Intersal] has satisfactorily met all the terms and
conditions 	of 	this 	permit.” 	Moreover, 	the 	Permit 	stated 	that 	it 	“in 	no 	way
constitute[d] a guarantee by [DNCR], as the permitting agency, that future Permits
[would] be automatically granted to [Intersal].” (El Salvador Permit at 1-2.)
11. 	The 	El 	Salvador 	Permit 	required 	Intersal 	to 	demonstrate 	to 	the
satisfaction of DNCR that it had “provided for facilities within the State of North
Carolina, sufficient in size, security, equipment, staffing, and supplies” to perform
conservation and analytical work on the artifacts before it could undertake recovery
efforts. (El Salvador Permit at 3).
12. 	On 21 November 1996, operating under the authority of its permits,
Intersal discovered the QAR near Beaufort Inlet, just over a mile off Bogue Banks,
North Carolina. (Third Am. Compl. ¶ 22.)
13. 	On 1 September 1998, Intersal, DNCR, and a non-party, the Maritime
Research Institute (“MRI”), entered into an agreement regarding the QAR and any
resulting projects (the “1998 Agreement”). (Third Am Compl. ¶ 24, Ex. 1, pp. 11-25.)
As a result of the 1998 Agreement, Intersal relinquished its right to receive 75% of
the coins and precious metals recovered from the QAR in exchange for promotion

opportunities arising from the QAR “Project,”4 as well as for assurances from DNCR
that the El Salvador Permit would be renewed except for just cause.5 (Third Am.
Compl. ¶ 24, Ex. 1, pp. 11-25.)
The 1998 Agreement
14. 	The 1998 Agreement described Intersal and DNCR as partners “to
research, survey, search, recover, preserve, protect, conserve, curate, and promote the
[QAR artifact] collection for the life of this Agreement.” 	(1998 Agreement at 2.) 	It
provided in relevant part:
14. 	Subject to their rights under this Agreement, Intersal and MRI
hereby assign to the Department, and the Department hereby accepts,
on behalf of the People of North Carolina, the interests of Intersal and
MRI in the title and ownership of QAR and its artifacts.
* * * *
16. 	. . . Intersal shall have the exclusive right to make and market all
commercial narrative (written, film, CD Rom, and/or video) accounts of
project related activities undertaken by the Parties[.]
17. 	All Parties agree to cooperate in the making of a non commercial
(sic) educational video and/or film documentary, or series of such
documentaries . . . and there is no distribution or dissemination for sale
of 	the 	said 	educational 	documentary 	without 	Intersal’s 	written
permission[.]
* * * *
4 The term “Project” is defined in the 1998 Agreement to mean “all survey, documentation,
recovery, preservation, conservation, interpretation and exhibition activities related to any
portion of the shipwreck of QAR or its artifacts.” (1998 Agreement ¶ 11.)
5 The 1998 Agreement provided that other artifacts, such as the vessel structure, ship’s
fittings, weapons, personal effects, and non-precious cargo would be sent to a suitable facility,
possibly in the Beaufort area, where the material could be curated for scientific study and
public display. Intersal agreed to forego any right to receive the coins and precious metals
recovered “in order that all QAR artifacts remain as one intact collection and in order to
permit the Department to determine the ultimate disposition of the artifacts.” (1998
Agreement at 2.)

33. 	Subject to the provisions of Article 3 of Chapter 121 of the General
Statutes of North Carolina and subchapter .04R of Title 7 of the North
Carolina Administrative Code, the Department agrees to recognize
Intersal’s and MRI’s efforts and participation in the QAR project as
sufficient to satisfy any performance requirements associated with
annual renewal of Intersal’s permits for . . . El Salvador . . . , and for the
life of this Agreement, renewal of said permit[ ] cannot be denied
without just cause.
(1998 Agreement ¶¶ 14, 16, 17, 33.)
15. 	Almost fifteen years passed. While Intersal and the State undoubtedly
hoped that the 1998 Agreement would keep them anchored, their relationship went
off course. 	Multiple disputes regarding the 1998 Agreement arose, and both sides
held their ground. 	Consequently, on 26 July 2013, Intersal filed a Petition for a
Contested Case with the Office of Administrative Hearings (“OAH”), Intersal v. N.C.
Dep’t of Cultural Resources, 13 DCR 15732 (the “Petition”). 	(Br. Supp. Pl’s Mot.
Partial Summ. J., Ex 5, ECF No. 154.5.)
16. 	OAH 	ordered 	mediation 	in 	the 	matter, 	which 	resulted 	in 	a 	new
agreement executed by Intersal and DNCR on 24 October 2013.6 (Third Am. Compl.,
Ex. 1 [ “2013 Agreement”], ECF No. 159.1.)
The 2013 Agreement
17. 	Among other things, the 2013 Agreement required Intersal to dismiss
the Petition. (2013 Agreement ¶ 25.) Additionally, the parties expressly agreed that
the 2013 Agreement superseded the 1998 Agreement. (2013 Agreement ¶ 1.)
6 Nautilus Productions, LLC (“Nautilus”) and its President, Rick Allen, are also parties to the
2013 Agreement. Nautilus was Intersal’s “QAR Video Designee” under the 1998 Agreement.
(Third Am. Compl. ¶ 29.)

18. 	The 2013 Agreement again made clear that Intersal relinquished its
right to share in any coins and precious metals recovered from the QAR site in
exchange for a more streamlined renewal process for its El Salvador Permit and the
rights to certain promotion opportunities with respect to the QAR Project. As for the
latter, the 2013 Agreement contained requirements for the production and use of
digital images and other media, and it established a means for Intersal to publish its
terms of use to third parties before they were given access to the QAR Project.
19. 	Relevant paragraphs of the 2013 Agreement provided:
3. 	El Salvador Permit. 	In consideration for Intersal’s significant
contributions 	toward 	the 	discovery 	of 	the 	QAR 	and 	continued
cooperation 	and 	participation 	in 	the 	recovery, 	conservation, 	and
promotion of the QAR, DCR agrees to continue to issue to Intersal an
exploration and recovery permit for the shipwreck El Salvador. . . .
DCR agrees to issue the permit through the year in which the QAR
archaeology 	recovery 	phase 	is 	declared 	complete 	so 	long 	as 	the
requirements contained in the permit are fulfilled. 	Subject to the
provisions of Article 3 of Chapter 121 of the North Carolina General
Statutes 	entitled, 	“Salvage 	of 	Abandoned 	Shipwrecks 	and 	Other
Underwater 	Archaeological 	Sites,” 	and 	the 	North 	Carolina
Administrative Code, DCR agrees to recognize Intersal’s efforts and
participation in the QAR project as sufficient to satisfy any performance
requirements associated with annual renewal of Intersal’s permit for the
El Salvador[.]
* * * *
9. 	Replicas 	to 	be 	Used 	in 	Exhibits, 	Scientific 	Study, 	or
Educational Tools. 	Understanding that there may be times when
original artifacts cannot be used, DCR may make, or have made, molds
or otherwise reproduce, or have reproduced, any QAR artifacts of its
choosing for use in museums or traveling exhibits, as educational props
in its exhibits, museums, or laboratories, as scientific tools, or for
scientific study. These replicas shall not be sold.
* * * *

14. Commercial Documentaries. 	Intersal, through Nautilus, has
documented approximately fifteen (15) years of underwater and other
activities 	related 	to 	the 	QAR 	project. . . . 	Intersal 	shall 	have 	the
exclusive right to produce a documentary film about the QAR project for
licensing and sale. 	Intersal may partner with DCR if it chooses to do
so[.]
15. 	Other 	Commercial 	Narrative. 	DCR 	and 	Intersal 	agree 	to
collaborate in making other commercial narrative, such as, but not
limited to, books and e-books, mini- and full-length documentaries, and
video games. 	Any profit-sharing agreements shall be based on the
amount of work contributed by each entity. If DCR and Intersal cannot
reach 	an 	agreement 	on 	the 	sharing 	and 	production 	of 	any 	such
commercial ventures that they propose to undertake, DCR and Intersal
will refer the issues to a mutually selected, neutral arbitrator for binding
arbitration, with arbitration to be concluded within three (3) months of
selection of the neutral arbitrator.
16. Media and Access Passes.
a. 	Procedure
1) DCR agrees to establish and maintain access to a website for
the issuance of Media and Access Passes to QAR-project related
artifacts and activities.
2) 	DCR shall manage the issuance of Media and Access passes
after receiving access requests from third parties via the website.
3) The website shall be the primary means of access for requests,
and shall include, at a minimum:
(a) An Intersal terms of use agreement, to be electronically
submitted;
(b) The QAR media fact sheet; and
(c) 	Links 	to 	DCR, 	Intersal, 	and 	Nautilus 	Productions
websites.
4) 	Upon electronic submission of requests and terms of use, if
applicable, electronic notice shall be sent to DCR and Intersal or
its designee showing acceptance or nonacceptance of the terms of
use.

5) 	Intersal shall bear the sole responsibility for managing and
enforcing its terms of use.
6) 	For requests for access that are not received through the
website, DCR shall provide the requestor with substantially the
same information contained on the website.
b. 	Non-commercial Media.
1) 	All non-commercial digital media, regardless of producing
entity, shall bear a time code stamp, and watermark (or bug) of
Nautilus and/or DCR, as well as a link to DCR, Intersal, and
Nautilus websites, to be clearly and visibly displayed at the
bottom of any web page on which the digital media is being
displayed.
2) 	DCR agrees to display non-commercial digital media only on
DCR’s website.
c. 	Termination. 	This 	Media 	and 	Access 	Pass 	section 	shall
terminate 	after 	the 	5 th 	anniversary 	of 	the 	signing 	of 	this
Agreement. 	After five (5) years, DCR and Intersal may agree to
extend this provision by mutual written consent.
17. 	Public Records. 	Nothing in this Agreement shall prevent DCR
from making records available to the public pursuant to North Carolina
General Statutes Chapters 121 and 132, or any other applicable State
or federal law or rule related to the inspection of public records.
18. 	Records Management. 	During the recovery phase of the QAR
project, DCR and Intersal agree to make available to each other records
created or collected in relation to the QAR project. . . . Within one (1)
year after the completion of the recovery phase, Intersal shall allow DCR
to accession duplicate or original records that were created or collected
by Intersal during the project. . . . These materials shall become public
records curated by DCR. 	All digital media provided by Intersal under
the terms of this paragraph shall include a time code stamp and
watermarks (or bugs)[.]
(2013 Agreement, ¶¶ 3, 6, 9, 14, 15, 16(a), 16(b), 17, 18.)

20. 	Unfortunately, any harmony achieved by the 2013 Agreement did not
last, and it was not long before disagreements again arose between Intersal and
DNCR. 	The claims in this action turn on whether Defendants have breached
Intersal’s rights as specified in the 2013 Agreement.
Events Giving Rise to Alleged Breaches of 2013 Agreement
21. 	On 28 October 2013, less than a week after the 2013 Agreement was
executed, DNCR participated with the United States Coast Guard in raising five
cannons from the seabed at the QAR site. (Third Am. Compl. ¶ 35A.) 	Although
certain members of the media were informed of the event, Intersal alleges that it was
not informed. Intersal further alleges that, as a result, it was denied an opportunity
to video the event for a planned documentary film pursuant to Paragraph 14 of the
2013 Agreement, as well as the chance to collaborate with DNCR to use the footage
for other “commercial narratives” pursuant to Paragraph 15 of the same agreement.
22. 	In addition, as discussed below, Intersal contends that because it was
unaware of the event before DNCR allowed third parties to access the site, it lost the
opportunity to impose a terms of use agreement that would have governed the ability
of the third parties to take and use photographs and video of the site. 	Intersal
complains that DNCR’s inaction resulted in the U.S. Coast Guard taking and
publishing footage of the event on the internet. 	(Third Am. Compl. ¶ 35A, ECF No.
107; see also Pl.’s Br. Supp. Mot. Partial Summ. J., Ex. 1 [“Meyer Dep.”] 177:11-25,
ECF No. 154.1; Coast Guard images, ECF No. 154.17.)

23. 	A month later, on 9 December 2013, Intersal submitted its terms of use
agreement to DNCR for posting on the website the parties had agreed would be used
to issue media and access passes. 	DNCR questioned the submission and proposed
that representatives from both Intersal and DNCR meet to discuss the terms in mid-
January 2014. (Pl.’s Mot. Partial Summ. J., Ex. 44, ECF No. 154.44.) On 13 January
2014, DNCR e-mailed Intersal to arrange the meeting. (Pl.’s Mot. Partial Summ. J.,
Ex. 45, ECF No. 154.45.) 	About a week later, Intersal responded, agreeing to meet
and requesting that DNCR provide their proposed revisions to the terms beforehand.
(Pl.’s Mot. Partial Summ. J., Ex. 45.) 	In reply, DNCR sent Intersal a proposed fact
sheet, but it did not propose any revisions to the terms of use agreement that Intersal
provided. (Pl.’s Mot. Partial. Summ. J., Ex. 46, ECF No. 154.46.)
24. 	When the terms of use agreement was still not in place by 9 June 2014,
Intersal submitted a second version to DNCR. Intersal represented that the language
of this version was taken “verbatim” from the State’s Division of Tourism, Film and
Sports Development website, changing only the names. (Pl.’s Mot. Partial Summ. J.,
Ex. 47, ECF No. 154.47.) 	But DNCR did not post or disseminate the terms of use
agreement because it did not agree with the content. 	(Pl.’s Mot. Partial Summ. J.,
Ex. 51 [“Masters’ Dep.”] at 116:12-13, ECF No. 154.51; Defs.’ Mot. Summ. J., Ex. 14,
ECF No. 159.14.) 	Indeed, to date DNCR has not posted an Intersal terms of use
agreement pursuant to Paragraph 16(a)(3)(a) of the 2013 Agreement.

25. 	In the days following the QAR cannon-raising event, DNCR provided
media outlets a Flickr7 link for use to access un-watermarked images of the event.
(ECF No. 154.14; ECF No. 154.15; Pl.’s Br. Supp. Mot. Partial Summ. J., Ex. 7 [“Cox
Dep.”] 32:15-33:20, 38:2-41:21, ECF No. 154.7; Meyer Dep. 174:7-177:10.)
26. 	Both before and after the 2013 Agreement, Defendants posted QAR
digital media to websites other than DNCR’s own website. Much of the digital media
was posted and continues to be displayed without watermarks, time code stamps, or
website links. (ECF Nos. 154.21, 154.25, 154.27-.33.)
27. 	For example, in October 2014, DNCR provided images of the cannon
raising event to then-Governor Pat McCrory’s office via email, (ECF No. 154.23), and
the Governor’s office posted the images on its Facebook page, (ECF No. 154.22).
28. 	In 	January 2014, both 	the 	Smithsonian and National Geographic
España magazines published QAR digital media supplied by DNCR in response to a
public records request. Intersal complains that it was not afforded an opportunity to
collaborate with the State on this “commercial narrative” in violation of paragraph
15 of the 1998 Agreement. (Third Am. Compl. ¶ 35B; Pl.’s Br. Supp. Mot. Summ. J.
Ex. 14, ECF Nos. 154.14-15.)
29. 	On two days in September 2015, Defendants allowed the nonprofit
Friends of the Queen Anne’s Revenge (“FoQAR”) and a radio show host and crew to
dive the site and collect footage of the QAR. 	Because there was no agreement on
Intersal’s terms, however, DNCR did not provide a terms of use agreement to FoQAR
7 Flickr is an online photo management and sharing application. 	See www.flickr.com (last
visited 23 February 2023).

or to the radio host and crew. Intersal complains that it was not invited to collaborate
with DNCR on this event. (Third Am. Compl. ¶ 35G.) 	On 28 October 2015, FoQAR
allegedly posted video footage from this dive to Facebook without watermarks, time
code stamps, or website links. (Third Am. Compl. ¶ 35H.)
30. 	Images of the QAR Project, including photographs of recovered cannons,
were published on YouTube on 22 January 2019, (ECF No. 154.20). The record does
not indicate who produced or posted the photographs. 	At least two photographs of
QAR cannons that appear to have been produced by the U.S. Coast Guard are
available for the public to purchase from third parties online, without compensating
either the State or Intersal. (ECF No. 154.19.)
31. 	Defendants have charged admission to State facilities where they have
displayed a traveling exhibit of QAR Project artifacts. 	Intersal complains that
Defendants have done so without collaborating or sharing profits with Intersal.
(Third Am. Compl. ¶ 35J; Pl.’s Br. Resp. Defs.’ Mot. Summ. J. 8-9.) 	Defendants
respond that these exhibitions are not “commercial narratives” from which they have
profited and that Intersal is not entitled to any portion of their museum admission
fees. 	(Defs.’ Answer to Pl.’s Third Am. Compl. ¶ 35J, Defs.’ Br. Supp. Mot. Summ.
J. 6.)
32. 	In 2018, authors Mark Wilde-Ramsing and Linda Carnes-McNaughton
published Blackbeard’s Sunken Prize, a book about the QAR that contains images of
recovered QAR artifacts. 	(Pl.’s Mot. Partial Summ. J., Ex. 61, ECF No. 154.61.)

Wilde-Ramsing is the former State Deputy Archeologist for DNCR. (Pl.’s Mot. Partial
Summ. J., Ex. 34 [“Wilde-Ramsing Dep.”] at 8:3-5, ECF No. 154.34.)
33. 	The authors initially reached out to two publishing companies, but after
meeting with DNCR, the authors chose UNC Press, a State entity, to publish the
book. 	(Pl.’s Mot. Partial Summ. J., Exs. 40, 41, 62, 63, ECF Nos. 154.40, 154.41,
154.62, 154.63; Wilde-Ramsing Dep. 58:3-59:9.)
34. 	Wilde-Ramsing and Carnes-McNaughton received an advance to write
the book, (Wilde-Ramsing Dep. at 74:6-12), and they had an agreement with the
publisher to receive royalties from sales of the book, as well as a share of net proceeds
from the sale or licensing of subsidiary rights. (Pl.s’ Mot. Partial Summ. J., Ex. 65 at
4-5, ECF No. 154.65.)
35. 	Intersal observes that the book is commercially available. 	It contends
that although Defendants collaborated with the book’s authors, Defendants did not
collaborate or share profits with Intersal with respect to this “commercial narrative.”8
36. 	Defendants 	respond 	that 	they 	did 	not 	provide 	any 	funding 	for
Blackbeard’s Sunken Prize, (Wilde-Ramsing Dep. at 65:8-66:25), did not write any
content for the book, (Wilde-Ramsing Dep at 59:15-59:20), and did not help pick any
8 Intersal argues that this failure was intentional. 	In support of its allegation, Intersal
provides evidence that Wilde-Ramsing initially proposed the book to DNCR in early 2015 and
described the book as “targeted for general audiences.” (Pl’s Mot. Partial Summ. J., Ex. 61,
ECF No. 154.61.) 	However, the description was later changed to “an educational book
targeting the general audiences” in a proposal sent by the authors to DNCR, in anticipation
of a meeting about the book that was to take place on 26 February 2015. (Pl.’s Mot. Partial
Summ. J., Ex. 62, ECF No. 154.62.) The agenda for the meeting included a discussion of the
“[d]efinition of ‘commercial narrative’ [1998 & 2013 MOA with Intersal and MRI].” (Pl’s Mot.
Partial Summ. J., Ex. 62.)

of the images used in the book, (Wilde-Ramsing Dep. at 60:12-60:17). 	However,
DNCR “suggest[ed] that UNC Press might be a good publisher,” (Wilde-Ramsing Dep.
at 58:3-59:23), and DNCR informed Wilde-Ramsing that unwatermarked digital
images of the QAR were available through a public records request. (Wilde-Ramsing
Dep. at 59:23-60:2, 61:11-17.)
37. 	Finally, 	in 	June 	2013, 	FoQAR 	contracted 	with 	Think 	Out 	Loud
Productions (a/k/a Shark Brothers), a commercial documentary maker, to make a
multi-part documentary series about the QAR. On the same date that it executed the
agreement with Think Out Loud Productions, FoQAR also executed an agreement
with DNCR assigning all rights in the documentary series to DNCR and giving DNCR
the “exclusive right to broadcast and distribute” the series. (Pl.’s Mot. Partial Summ.
J., Exs. 52-53, ECF Nos. 154.52, 154.53.)
38. 	The parties dispute how far production of the documentary series had
progressed at the time the 2013 Agreement was reached, but they agree that the
series had not been completed. They further agree that this series is not mentioned
in the 2013 Agreement.9 	(Pl.’s Mot. Partial Summ. J., Ex. 54, ECF No. 154.54) (email
from 	October 	2014 	sent 	to 	DNCR 	employee 	Claggett 	from 	Think 	Out 	Loud
Productions regarding “approval for the Blackbeard and Queen Anne’s Revenge
documentary”); (Pl.’s Mot. Partial Summ. J., Ex. 55, ECF No. 154.55) (November 2014
9 DNCR contends that the agreement between Think Out Loud Productions and FoQAR
specifies that all filming (“field production”) would be completed by June 2013, well before
the 2013 Agreement was executed. (Pl.’s Mot. Partial Summ. J., Ex. 52 at 2.) DNCR contends
that any activity on the project that occurred after the 2013 Agreement was limited to post-
production work. (Defs.’ Br. Resp. Pl.’s Mot. Partial Summ. J. 38.)

emails between Claggett and Think Out Loud Productions regarding the same); (Pl.’s
Mot. Partial Summ. J., Ex. 9 [“Claggett Dep."], at 63:10-64:5, ECF No. 154.9.)
39. 	Moreover, the parties dispute whether the documentary series is a
commercial narrative requiring DNCR to collaborate with Intersal pursuant to
Paragraph 15 of the 2013 Agreement. 	There is some evidence that the series was
intended to be used for educational purposes but that it was never used that way.
(Pl.’s Mot. Partial Summ. J. at 28-29, Ex. 57 [“Morris Dep.”] at 39:7-23, 57:9-58:5,
ECF No. 154.57.)
40. 	Portions of the series containing DCR’s watermark (but without time-
code stamps or links to DCR, Intersal, and Nautilus websites) were later posted on
YouTube rather than to DCR’s own website.10 	Intersal contends that even if this
content is considered “non-commercial,” posting the video in this manner violated
Paragraph 16(b) of the 2013 Agreement. 	Intersal further argues that the series
constitutes a documentary film produced in violation of the exclusive right it was
afforded by Paragraph 14 of the 2013 Agreement.
Renewal of the El Salvador Permit
41. 	In early November 2015, Intersal sought renewal of its El Salvador
Permit. 	(Third Am. Compl. ¶ 40.) 	After some administrative wrangling,11 on 1
10 Episodes of the multi-part documentary series are still available on YouTube. 	See e.g.,
Documentary Episode 7 of 7: Blackbeard and the Queen Anne’s Revenge – Shark Brothers
Multimedia, https://www.youtube.com/watch?v=QGFsd_UvAjQ.
11 On 3 November 2015, Intersal received a Notice of Termination of Permit. 	The reason
given for termination was Intersal’s failure to submit a request for renewal prior to expiration
of the existing permit. (Third Am. Compl. ¶ 40; Br. Response Defs.’ Mot. Summ. J., Ex. 13,

December 2015, Intersal received a Notice of Termination of Permit for the following
reasons: (1) “Intersal failed to fulfill the requirements set forth in [the permit]; and
(2) Issuance of further renewal permits is no longer deemed to be in the best interest
of the State.” (Defs.’ Mot. Summ. J., Ex. 22, ECF No. 159.22.)
42. 	Intersal contends that, by denying the permit, the State breached its
promise in the 2013 Agreement to waive the performance requirements associated
with annual renewal. 	(Br. Response Defs.’ Mot. Summ. J., Ex. 14 [“Claggett Dep.”]
at 152:14-153:3, ECF No. 173.14) (agreeing that the “real basis [for denying the
permit] was [Intersal’s] failure to make substantial progress towards finding the El
Salvador.”)
43. 	In addition, although the State had been aware for years that the
Kingdom of Spain claimed to own the El Salvador, it is undisputed that in November
2015, DNCR’s counsel contacted Spain to determine that country’s position regarding
renewal of the permit. 	In response, on 30 November 2015, Spain’s counsel sent a
letter to DNCR restating Spain’s position that it claimed ownership of the El
Salvador. 	(Pl.s’ Br. Resp. Defs.’ Mot. Summ. J., Ex. 16 [“Howell Dep.”] at 20:17-23,
ECF No. 173.16; Ex. 14 [“Claggett Dep.”] at 170:1-7.) Intersal contends that DNCR
purposefully solicited a statement from the Kingdom of Spain as a pretext to support
DNCR’s conclusion that renewal of Intersal’s permit was not in the State’s best
interest. (Third Am. Compl. ¶¶ 42, 47 n.14.)
ECF No. 173.13.) 	However, after Intersal notified DNCR that it had submitted a request
before the deadline, DCR withdrew its denial. (Pl.s’ Br. Resp. Defs.’ Mot. Summ. J. 23.)

44. 	After the El Salvador Permit was terminated, Intersal filed a Petition
for a Contested Case with the OAH. 	(Pl.’s Br. Supp. Mot. Partial Summ. J., Ex. 5,
ECF No. 154.5.) 	On 27 May 2016, Intersal’s case was dismissed, and Intersal
appealed to the Superior Court of Wake County. 	(Third Am. Compl. ¶ 49; Defs’ Br.
Supp. Mot. Dismiss and Mot. Strike Pl.’s Second Am. Compl., Ex. A, ECF No. 57.) On
7 November 2016, citing N.C.G.S. § 121-25(a), the Court issued a decision upholding
termination of the El Salvador Permit because it was not in the “best interest of the
State.” (Intersal, Inc. v. N.C. Dep’t of Cult’l Resources, 16 CVS 8149; Defs’ Br. Supp.
Mot. Dismiss and Mot. Strike Pl.’s Second Am. Compl., Ex. B.)
III. 	PROCEDURAL BACKGROUND
45. 	Intersal initiated this action on 27 July 2015. (Compl. and Mot. for Rule
65 Relief, ECF No. 1.) On 10 September 2015, the case was designated a mandatory
complex business case, (Designation Order, ECF No. 5).
46. 	On 20 February 2017, this Court granted Intersal’s Amended Motion for
Leave to File Second Amended Complaint, (ECF No. 43). 	The Second Amended
Complaint asserted breach of contract claims against Defendants under both the
1998 and 2013 Agreements. (Second Am. Compl., ECF No. 44.)
47. 	Thereafter, on 30 March 2017, Defendants moved to dismiss the Second
Amended Complaint. (Answer, Defenses, and Mot. Dismiss Pl.’s Second Am. Compl.,
and Mot. Strike, ECF No. 85.) 	After considering the motion, on 13 October 2017,
Business Court Judge Gregory P. McGuire dismissed with prejudice: (1) Intersal’s
breach of contract claims under the 1998 Agreement, and (2) Intersal’s breach of

contract claims under the 2013 Agreement resulting from DNCR’s refusal to renew
the El Salvador Permit. The Court dismissed without prejudice Intersal’s breach of
contract claim for alleged violations of Intersal’s digital media and promotion
opportunity rights in the 2013 Agreement. 	Intersal, Inc. v. Hamilton, 	2017 NCBC
LEXIS 97, at *37-38 (N.C. Super. Ct. Oct. 12, 2017).
48. 	On 1 June 2018, Intersal filed a petition for writ of certiorari to the
Supreme Court of North Carolina seeking review of Judge McGuire’s decision.12 The
Supreme Court allowed the petition on 5 December 2019. Intersal v. Hamilton, 373
N.C. 89, 97 (2019).
49. 	Subsequently, on 	1 November 2019, 	the Supreme 	Court 	issued a
decision determining that this Court: (1) properly dismissed Intersal’s breach of
contract claims arising from the 1998 Agreement; (2) erred when it dismissed
Intersal’s breach of contract claim with respect to its digital media rights and
promotion opportunities for lack of subject matter jurisdiction (failure to exhaust
administrative remedies); and (3) erred by dismissing on res judicata grounds
Intersal’s breach of contract claim against the Defendants arising from Defendants’
failure to renew Intersal’s El Salvador Permit. Id. at 110-111. 	The case was
remanded to this Court for further proceedings.
12 	On 9 November 2017, Intersal filed a Notice of Appeal to the North Carolina Court of
Appeals which, by statute, was the incorrect judicial body to hear the appeal. 	(Notice of
Appeal, ECF No. 86. See N.C.G.S. § 7A–27(a)(2).) As a result, on 10 April 2018, Defendants
filed a Motion to Dismiss Intersal’s Appeal, (ECF No. 90), which this Court granted, and the
original appeal was dismissed on 3 May 2018, (Order Granting Defs.’ Mot. Dismiss Appeal,
ECF No. 96). The Supreme Court of North Carolina heard the case after issuing a writ of
certiorari.

50. 	On 31 January 2020, Intersal filed its Third Amended Complaint to
reflect the Supreme Court’s ruling. 	(Third Am. Compl., ECF No. 106.) 	Defendants
responded with defenses challenging, among other things, the enforceability of the
2013 Agreement. (Defs.’ Answer to Pl.’s Third Am. Compl., ECF No. 107.)
51. 	All discovery is now complete, and before the Court are the parties’
cross-motions for summary judgment. 	Intersal has affirmatively moved for partial
summary judgment, seeking (1) to establish as a matter of law that Defendants’
second and ninth affirmative defenses are barred by the law of the case doctrine,
judicial estoppel, and quasi-estoppel, and (2) a declaratory judgment that Defendants
have breached Paragraphs 14, 15, and 16 of the 2013 Agreement (“Intersal’s Motion”).
(Pl.’s Mot. Partial Summ. J., ECF No. 153.) 	Conversely, Defendants move for
summary judgment in their favor on both of Intersal’s claims for breach of contract
(“Defendants’ Motion”; together, the “Motions”). (Defs.’ Mot. Summ. J., ECF No. 160.)
52. 	With the benefit of full briefing and a hearing on 6 January 2022 during
which all parties were heard through counsel, the cross-motions are now ripe for
determination.
53. 	The Court, having considered the Motions, the briefs filed by the parties,
the arguments of counsel, and other relevant matters of record, concludes that the
Motions shall be GRANTED in part and DENIED in part as specified below.
IV. 	LEGAL STANDARD
54. 	Summary 	judgment 	is 	appropriate 	“if 	the 	pleadings, 	depositions,
answers to interrogatories, and admissions on file, together with the affidavits, if any,

show that there is no genuine issue as to any material fact and that any party is
entitled to a judgment as a matter of law.” N.C. R. Civ. P. 56(c). “An issue is ‘genuine’
if it can be proven by substantial evidence and a fact is ‘material’ if it would constitute
or irrevocably establish any material element of a claim or a defense.” 	Lowe v.
Bradford, 305 N.C. 366, 369 (1982).
55. 	In deciding a motion for summary judgment, the Court views the
evidence in the light most favorable to the nonmoving party, taking its evidence as
true and drawing inferences in its favor. See, e.g., In re Will of Jones, 362 N.C. 569,
573 (2008).
56. 	Affirmative summary judgment on a party’s own claims for relief carries
a greater burden. Brooks v. Mount Airy Rainbow Farms Ctr., Inc., 48 N.C. App. 726,
728 (1980). 	The moving party “must show that there are no genuine issues of fact,
that there are no gaps in his proof, that no inferences inconsistent with his recovery
arise from the evidence, and that there is no standard that must be applied to the
facts by the jury.” 	Parks Chevrolet, Inc. v. Watkins, 74 N.C. App. 719, 721 (1985).
Therefore, it is “rarely . . . proper to enter summary judgment in favor of the party
having the burden of proof.” 	Blackwell v. Massey, 69 N.C. App. 240, 243 (1984); see
Banc of Am. Merch. Servs., LLC v. Arby’s Rest. Grp., Inc., 2021 NCBC LEXIS 61, at
*10-11 (N.C. Super. Ct. June 30, 2021).
57. 	In any case, when ruling on a motion for summary judgment, a trial
court may not resolve issues of fact but must deny the motion if there is any genuine
issue of material fact. Singleton v. Stewart, 280 N.C. 460, 464 (1972).

V. 	ANALYSIS
A. 	Enforceability of the 2013 Agreement
58. 	Defendants argue that Intersal’s two claims for breach of contract fail
because there is no contract. Without a meeting of the minds on all material terms,
Defendants contend that the 2013 Agreement is unenforceable. (Defs.’ Br. Supp. Mot.
Summ. J. 9, 19-23, ECF No. 161.)
59. 	Citing the law of the case doctrine and principles of estoppel, Intersal
responds that whether the 2013 Agreement is enforceable is a question that has
already been raised and answered on appeal. 	Intersal contends that Defendants
endorsed the enforceability of the 2013 Agreement in their arguments to the Supreme
Court, and that the Supreme Court, relying on that endorsement, has determined
that the 2013 Agreement is valid and enforceable. Intersal contends that this issue
has been finally decided and that no new evidence has been unearthed in discovery
that 	could serve 	as the 	basis 	for Defendants 	to 	resurrect 	their enforceability
challenge. (Pl.’s Br. Resp. Defs.’ Mot. Summ. J. 1-4, ECF 174.)
60. 	The law of the case doctrine provides that “when an appellate court
passes on a question and remands the cause for further proceedings, the questions
there settled become the law of the case . . . in subsequent proceedings in the trial
court.” Bank of Am., N.A. v. Rice, 244 N.C. App. 358 (2015); see Tennessee-Carolina
Transp., Inc. v. Strick Corp., 286 N.C. 235, 239 (1974) (stating that the Supreme
Court’s decision in prior appeal “constitutes the law of the case, both in subsequent
proceedings in the trial court and on a subsequent appeal”); Premier, Inc. v. Peterson,

2016 NCBC LEXIS 39, at **14 (N.C. Super. Ct. May 13, 2016) (applying law of the
case doctrine to question of contract interpretation).
61. 	The law of the case doctrine applies to “points actually presented and
necessary to the determination of the case.” Condellone v. Condellone, 137 N.C. App.
547, 551 (2000). It requires that “[n]o judgment other than that directed or permitted
by the appellate court may be entered.” 	D & W, Inc. v. City of Charlotte, 268 N.C.
720, 722 (1966). “As a result, ‘[o]n remand of a case after appeal, the mandate of the
reviewing court is binding on the lower court, and must be strictly followed, without
variation or departure.’ ” 	Premier, Inc., 2016 NCBC LEXIS 39, at **15 (quoting
Couch v. Private Diagnostic Clinic, 146 N.C. App. 658, 667 (2001)).
62. 	In this case, the Supreme Court has spoken. It affirmed the trial court’s
determination that the 2013 Agreement was a novation of the 1998 Agreement.
Intersal, 373 N.C. at 99. 	The Court held that the language of the 2013 Agreement,
“clearly demonstrate[d] the parties’ intent that it would function as a novation of the
1998 Agreement[.]” Id. It concluded: “[b]ecause the 2013 Settlement Agreement was
a novation of the 1998 Agreement, plaintiff’s breach of contract claims arising from
the 1998 Agreement are ‘extinguished.’ ” Id.
63. 	As the Supreme Court explained, “ ‘[t]he essential requisites of novation
are a previous valid obligation, the agreement of all parties to the new contract, the
extinguishment of the old contract, and the validity of the new contract.’ ” Intersal,
373 N.C. at 98 (quoting Tomberlin v. Long, 250 N.C. 640 (1959)) (emphasis added).
Therefore, in determining that the 2013 Agreement was a novation of the 1998

Agreement, the Supreme Court necessarily determined that the 2013 Agreement
itself was valid.
64. 	Defendants protest that new developments unveiled in discovery since
the Supreme Court’s decision reveal that the parties never agreed on material terms.
Therefore, they argue that the enforceability of the 2013 Agreement must be
reconsidered. 	Defendants point to the deposition of Intersal’s President, David
Reeder, who testified that the 2013 Agreement was a “working document” and a
“starting point to finally spur on our cooperation and a successful conclusion of the
QAR project.” 	(Defs.’ Br. Supp. Mot. Summ. J. 20, Ex. 5, Reeder Dep. 30:16-23.)
Reeder testified that Intersal’s terms of use were not discussed “item by item” but
that similar terms were used by other State departments and that the parties had
agreed to the same concept. (Reeder Dep. 82:17-83:14.) He thought that some of the
operational details for the Business Panel needed to be refined. 	(Reeder Dep. 31:3-
10.) However, he “didn’t feel like there was anything else left incomplete, as you call
it.” (Reeder Dep. 31:13-14.)
65. 	Reeder 	also 	testified 	about 	profit-sharing 	with 	respect 	to 	future
commercial narratives and described how the parties were to calculate a split based
on the division of work and their relative participation. 	The 2013 Agreement
specifically contemplates such a formula and provides for arbitration in the event of
a dispute. 	(Reeder Dep. 134:21-135:22; 2013 Agreement ¶ 15.) 	Reeder further
observed that the Agreement “was binding on all parties that signed it,” but, as is

typical, there was a provision that allowed for amendment if necessary. (Reeder Dep.
221:8-11.)
66. 	Significantly, even if Reeder’s testimony were sufficient to raise doubts
with respect to a meeting of the minds on the terms he mentions, Defendants concede
that Reeder’s testimony was consistent with that of their own officials who were
involved in the negotiations. (Defs.’ Br. Supp. Mot. Summ. J. 22.)
67. 	Based on the above, the Court concludes that Reeder’s post-appeal
testimony did not reveal facts that were unknown to Defendants at the time they
argued to the Supreme Court. 	Consequently, the Court concludes that there have
been no new developments that would warrant reconsideration of the enforceability
of the 2013 Agreement. That issue has been finally decided for purposes of this case.13
See Ray v. Hill Veneer Co., 188 N.C. 414, 415 (1924) (holding that exception to the
law of the case doctrine applies only when there is a “material difference” between
the record on the prior appeal and the present record); cf. Metts v. Piver, 102 N.C.
App. 98, 100-01 (1991) (holding even new evidence did not entitle party to a second
chance at summary judgment on the same issues, otherwise “an unending series of
motions for summary judgment could ensue”).
68. 	Intersal also contends that Defendants are judicially estopped from
arguing that the 2013 Agreement is invalid as a result of the position they took before
13 Whether North Carolina recognizes a claim for breach of a duty to negotiate in good faith
is unsettled. 	See HD Hospitality, LLC v. Live Oak Banking Co., 2022-NCCOA-638 (2022).
However, even if the 2013 Agreement is read as an “agreement to agree,” Defendants, by
arguing that it constitutes a novation, have conceded that it is sufficiently definite to be
enforceable, and the Supreme Court has accepted that position.

the Supreme Court. 	(Pl.’s Br. Supp. Mot. Partial Summ. J. 12, ECF No. 162.)
“Judicial estoppel protects the integrity of the court judicial process by prohibiting
parties from deliberately changing positions according to the exigencies of the
moment.” 	Powell v. City of Newton, 364 N.C. 562, 568 (2010) (alteration omitted).
The Court may invoke the doctrine to “prevent a party from acting in a way that is
inconsistent with its earlier position before the court.” Id. at 569.
69. 	“[W]hen determining whether to invoke the doctrine three aspects to
consider are whether: (1) the party’s subsequent position is “clearly inconsistent with
its earlier position; (2) judicial acceptance of a party’s position might threaten judicial
integrity because a court has previously accepted that party’s earlier inconsistent
position; and (3) the party seeking to assert an inconsistent position would derive an
unfair advantage or impose an unfair detriment on the opposing party as a result.”
In re Southeastern Eye Center-Pending Matters, 2021 NCBC LEXIS 43, at *22-23
(internal quotation marks and citations omitted).
70. 	In this case the Supreme Court observed, “Here, neither Intersal nor the
State Defendants have argued before this Court that either the 1998 Agreement or
the 2013 Agreement are invalid.” 	Intersal, 373 N.C. at 99. 	Indeed, in Defendants’
brief to the Supreme Court, Defendants stated: “[i]n this appeal, neither [Defendants]
nor [Intersal] has challenged the validity of the 2013 Agreement[,]” (ECF No. 175.1
at 20), and “[i]n sum, this record offers no sound basis to predict that the 2013
Agreement would ever be held void[,]” (ECF No. 175.1 at 28–29, emphasis added).

71. 	The Supreme Court further observed that Defendants chose not to argue
that the 2013 Agreement was unenforceable despite the fact that they raised
unenforceability as an affirmative defense in their Answer. Intersal, 373 N.C. at 99
n.3. 	Although it is true, as Defendants argue, that the Rules of Civil Procedure allow
litigants to plead alternative legal theories, the problem here is that Defendants did
not preserve their ability to argue in the alternative when they represented to the
Supreme Court that the 2013 Agreement was a novation. 	Defendants inextricably
chose 	a 	path, 	and 	the 	Supreme 	Court 	clearly 	based 	its 	decision 	on 	their
representation. Cf. Whiteacre P’ship v. BioSignia, Inc., 358 N.C. 1, 26 (2004) (“where
a party gives a reason for his conduct and decision touching anything involved in a
controversy, he cannot, after litigation has begun, change his ground, and put his
conduct upon another and a different consideration. He is not permitted thus to mend
his hold.”) (quoting Ry. Co. v. McCarthy, 96 U.S. 258, 267-68 (1877) (emphasis in
original)). 	Under these circumstances, this Court concludes that application of the
doctrine of judicial estoppel is appropriate.
72. 	Because the issue has been determined, this Court must conclude that
the 2013 Agreement is a valid, enforceable contract. See Collins v. Simms, 257 N.C.
1, 8 (1962) (“[T]he courts, whose judgments and decrees are reviewed by an appellate
court of errors, must be bound by and observe the judgments, decrees and orders of

the latter court, within its jurisdiction. 	Otherwise, the courts of error would be
nugatory and a sheer mockery.”).14
73. 	Therefore, 	Plaintiff’s 	Motion 	with 	respect 	to 	Defendants’ 	Second
Affirmative Defense (that the 2013 Agreement is illegal and void as against public
policy) and Defendants’ Ninth Affirmative Defense (to the extent Defendants contend
that terms of the Agreement are unenforceable) is hereby GRANTED.
B. 	Alleged Breach of Promotion Opportunities in 2013 Agreement
74. 	Section IV of the Agreement, governing the rights and obligations of the
parties with respect to promotion opportunities, is divided into several parts.
Intersal’s exclusive right to produce a commercial documentary is described in
Paragraph 14. 	The parties’ duty to collaborate on commercial narratives exists in
Paragraph 15. 	Rules regarding third party access to QAR Project-related artifacts
and activities are in paragraph 16(a). The parties’ duty to mark, and restrictions on
their ability to display, non-commercial media are specified in paragraph 16(b). The
parties have filed cross-motions for summary judgment with respect to Plaintiff’s
claim that Defendants breached each of these provisions.15
14 The Court’s holding that the 2013 Agreement is an enforceable contract does not, however,
preclude its conclusion that some interpretations of the Agreement proffered by the parties
are not reasonable because they would violate the law. See infra, Section V(B)(4).
15 Plaintiff alleges that some events give rise to multiple breaches of the 2013 Agreement. By
highlighting the event with respect to one of those alleged breaches in its analysis, the Court
does not suggest that no other possible breaches exist with respect to the same event.

1. 	Paragraph 14 (Commercial Documentaries)
75. 	Paragraph 14 of the 2013 Agreement gives Intersal “the exclusive right
to produce a documentary film about the QAR project for licensing and sale. Intersal
may partner with DCR if it chooses to do so [.]” (2013 Agreement ¶ 14.)
The Cannon Raising
76. 	Intersal presents testimony that it was not notified of the cannon
raising event that took place just days after the 2013 Agreement was reached. 	See
e.g., Meyer Dep. at 125:12-25 (unaware of any notice to Intersal). It argues that
Defendants breached Paragraph 14 by not telling it about the event in order to
prevent its video-designee, Nautilus, from filming this sentinel moment in the QAR
recovery operations.16 (Pl.’s Br. Resp. Defs.’ Mot. Summ. J. 7.)
77. 	Defendants 	respond 	with 	testimony 	that 	the 	event 	was 	publicly
announced days in advance, that nothing in the agreement required them to notify
Intersal of every QAR-related activity, and that, in any event, they believe they did
inform Intersal. 	(Defs.’ Br. Supp. Motion Summ. J. 5; Claggett Dep. 53:12-19 (“I
directed Billy Ray Morris to contact them.”) (But see Pl.s’ Br. Resp. Defs.’ Mot. Summ.
J., Ex. 1, ECF No 173.1 [Morris Dep.] 64:15-21) (Q: Do you recall personally reaching
out to either Rick Allen or Intersal about participating in that dive? A: No. Q. Do
you know if anyone else from DNCR ever did? A. I don’t know.”).
16 Intersal also argues that DNCR breached Paragraph 15 of the 2013 Agreement because
DNCR did not “collaborate” with it in the “making” of a “commercial narrative.” 	(Pl.’s Br.
Resp. Defs.’ Mot. Summ. J. 7.) For the reasons stated below, the Court concludes that the
parties’ ambiguous contract language in Paragraph 15 precludes summary judgment with
respect to this contention.

78. 	“Whenever a court is called upon to interpret a contract[,] its primary
purpose is to ascertain the intention of the parties at the moment of its execution.”
Howard v. IOMAXIS, LLC, 2020 NCBC LEXIS 57, at *15 (N.C. Super. Ct. May 1,
2020) (quotation omitted). “To do so, the Court must first look to the language of the
contract and determine if it is clear and unambiguous.” 	Id. 	“Whether or not the
language of a contract is ambiguous is a question for the court to determine.” W & W
Partners, Inc. v. Ferrell Land Co., LLC, 2018 NCBC LEXIS 52, at *12 (N.C. Super.
Ct. May 22, 2018) (quoting Lynn v. Lynn, 202 N.C. App. 423, 432 (2010)).
79. 	“If a court finds a contract ambiguous, the intent of the parties becomes
a question of fact.” 	Howard, 2020 NCBC LEXIS 57, at *15 (quotation omitted); see
Robertson v. Hartman, 90 N.C. App. 250, 252-53 (1988) (Where the language of a
contract is "subject to more than one reasonable meaning," its interpretation is an
issue for the jury); Leonard v. Pugh, 86 N.C. App. 207, 210 (1987) (“Ambiguous
contracts must be interpreted by a jury[.]”).
80. 	“The fact that a dispute has arisen as to the parties’ interpretation of
the contract is some indication that the language of the contract is, at best,
ambiguous.” Salvaggio v. New Breed Transfer Corp., 150 N.C. App. 688, 690 (2002).
81. 	The record is far from clear regarding whether the parties intended for
Intersal to be notified of significant events in the recovery process and, if so, whether
Intersal knew or should have known of the planned cannon raising. Accordingly, the
Court determines that genuine issues of 	material fact, evident from this record,
preclude summary judgment.

The Think Out Loud Documentary Series
82. 	It is undisputed that in June 2013, prior to execution of the October 2013
Agreement, 	FoQAR 	arranged 	with 	Think 	Out 	Loud 	Productions 	to 	make 	a
documentary series about the QAR Project. 	It is also undisputed that at the same
time it reached agreement with Think Out Loud Productions, FoQAR simultaneously
assigned the rights to the series to DNCR, giving DNCR the exclusive right to
broadcast and distribute it. (Pl.’s Mot. Summ. J. Ex. 53; Claggett Dep. 47:15-49:14.)
83. 	Intersal 	alleges 	that 	Steve 	Claggett, 	head 	of 	the 	Office 	of 	State
Archeology, was “well-aware” of this arrangement but did not reveal it during
negotiations with Intersal for the 2013 Agreement. (Pl.’s Mot. Partial Summ. J. 26;
Claggett Dep. 49:15-50:24.) 	Intersal argues that the 2013 Agreement does not
contain an exception allowing for the continued production of this documentary series
in violation of its exclusive right to produce a documentary as stated in Paragraph 14
of the 2013 Agreement.
84. 	Defendants argue that the OAH action resulting in the 2013 Agreement
was not filed until 26 July 2013, more than a month and a half after the agreement
between FoQAR and Think Out Loud Productions was signed. 	Consequently,
Defendants contend, they had no obligation to apply the terms of the 2013 Agreement
retroactively to the production of a documentary series that was already underway.
(Pl.’s Mot. Partial Summ. J., Ex. 52, ECF No. 154.52; Defs.’ Br. Resp. Pl.’s Mot. Partial
Summ. J. 38.) Defendants point out that the agreement between FoQAR and Think
Out Loud Productions required that all filming be completed by the end of June 2013.

(See Pl.’s Br. Supp. Mot. Partial Summ. J., Ex. 52 at ¶ 8.) Finally, Defendants note
that FoQAR “was not a party to the 2013 Agreement,” and they contend that Intersal
cannot “impose its purported exclusive narrative rights on third parties.” 	(Pl.’s Br.
Supp. Mot. Partial Summ. J. 38-39.)
85. 	But, citing various emails and Claggett’s testimony, Intersal disputes
Defendants’ implication that the filming and production of the series had been
completed prior to execution of the 2013 Agreement. 	(Pl.’s Br. Supp. Mot. Partial
Summ. J. 27, Ex. 54, ECF No. 154.54 (23 October 2014 e-mail from Think Out Loud
Productions to Claggett regarding status of web series); Pl.’s Br. Supp. Mot. Partial
Summ. J. 27, Ex. 55, ECF No. 154.55 (email chain between Claggett and Think Out
Loud Productions discussing status of project in November 2014); Claggett Dep.
63:10-64:5 	(conceding 	that 	Defendants 	were 	working 	with 	Think 	Out 	Loud
Productions on the web series project during November 2014).)
86. 	Intersal further argues that DNCR cannot avoid liability by hiding
behind FoQAR as the party that contracted with the film company when, almost
simultaneously, FoQAR assigned the rights to the documentary series to DNCR. 	It
contends that Claggett, head of the Office of State Archeology for DNCR admitted
that DNCR used FoQAR as nothing more than a “pass through.” (Pl.’s Br. Supp. Mot.
Partial Summ. J. 26; Claggett Dep. 49:11-14.)
87. 	Continuing the dispute, the parties disagree regarding whether the
documentary series should be analyzed as a “commercial narrative” under Paragraph
15. Intersal argues that it is, (Pl.’s Br. Supp. Mot. Partial Summ. J. 28), while DNCR

says that the project was educational in nature and, therefore, does not meet the
definition of 	“commercial narrative.” 	(Defs.’ Br. Resp. Pl.’s Mot. Partial Summ. J.
37.) 	DNCR 	points 	to 	the 	fact 	that 	it 	contracted 	for 	the 	development 	of 	an
accompanying “lesson plan” as evidence that the documentary series was not
intended to be a commercial narrative. 	However, Intersal argues that the evidence
proves that the lesson plans and videos were never actually used in schools. (Pl.’s Br.
Supp. Mot. Partial Summ. J. 28-29; Morris Dep. at 39:17-20.)
88. 	Under the circumstances presented here, the Court concludes that
summary judgment with respect to the Think Out Loud documentary series is not
appropriate. 	Other than listing as examples: “books and e-books, mini- and full-
length documentaries, and video games,” the term “commercial narrative” is not
defined either in Paragraph 15 or elsewhere in the 2013 Agreement. 	Whether the
parties 	intended 	for 	the 	term 	“commercial 	narrative” 	to 	cover 	a 	web-based
documentary series, whether the timing of this particular project causes it to fall
within 	the 	parameters 	of 	the 	2013 	Agreement, 	and 	whether 	Defendants 	are
responsible for FoQAR’s action in these circumstances are all matters for the jury to
decide.
2. 	Paragraph 15 (Collaboration on “Commercial Narratives”)
89. 	Paragraph 15 of the 2013 Agreement states:
DCR and Intersal agree to collaborate in making other commercial
narrative, such as, but not limited to, books and e-books, mini- and full-
length documentaries and video games. Any profit-sharing agreements
shall be based on the amount of work contributed by each entity. If DCR
and Intersal cannot reach an agreement on the sharing and production
of any such commercial ventures that they propose to undertake, DCR

and Intersal will refer the issues to a mutually selected, neutral
arbitrator for binding arbitration, with arbitration to be concluded
within three (3) months of selection of the neutral arbitrator.
(2013 Agreement ¶ 15.)17
Blackbeard’s Sunken Prize
90. 	Intersal seeks summary judgment on the grounds that Defendants
breached 	Paragraph 	15 	of 	the 	2013 	Agreement 	by 	collaborating 	on 	the 	book
Blackbeard’s Sunken Prize with Wilde-Ramsing and Carnes-McNaughton and not
including Intersal. 	They contend that DNCR steered the project, and they point to
the decision to recast the book as “educational” rather than “commercial,” as evidence
of an alleged attempt by Defendants to avoid Paragraph 15. 	They argue that
Defendants mandated that the authors use UNC Press as the publisher, resulting in
a monetary benefit for the State. Intersal further complains that DNCR collaborated
with 	the 	authors 	by 	advising 	them 	to 	submit 	public 	records 	requests 	for
unwatermarked images so that they could avoid including Intersal. (Pl.’s Br. Supp.
Mot. Partial Summ. J. 23-25.)18
17 The arbitration provision was not utilized by the parties. 	In response to the Court’s
questioning during the hearing, Defendants argue that it does not apply because they have
not failed to collaborate on any commercial narratives. (Tr. 27-31, ECF No. 194.) Plaintiff
argues that it was up to Defendants to demand arbitration, and they have not. (Tr. 37-38.)
Arbitration is a contractual right that may be waived. See, e.g., Cyclone Roofing Co., Inc. v.
David M. LaFave Co., Inc., 312 N.C. 224, 229 (1984).
18 The Court observes, as did Defendants, that these allegations do not appear in the Third
Amended Complaint; however, Intersal sufficiently alleges that Defendants breached
Paragraph 15 of the 2013 Agreement and that their action resulted in monetary damages to
Intersal. (Third Am. Compl. ¶¶ 64-66.) Intersal is not required to state a breach of contract
claim with particularity. See, e.g., Poor v. Hill, 138 N.C. App. 19, 26 (2000); Vanguard Pai
Lung, LLC v. Moody, 2019 NCBC LEXIS 30, at *10 (N.C. Super. Ct. June 19, 2019).

91. 	Defendants respond that their limited interaction with Wilde-Ramsing
and Carnes-McNaughton did not constitute the “making” of a commercial narrative;
consequently, they contend that they had no duty to collaborate with Intersal. They
argue that Paragraph 15 “confers no rights on Intersal to police the conduct of third
parties, or to extract a licensing fee whenever someone creates content—commercial
or otherwise—telling the story of the QAR discovery.” (Br. Supp. Defs.’ Mot. Summ.
J. 4.)
92. 	While there is evidence that DNCR discussed the book with its authors,
once again the facts are not sufficiently developed for the Court to determine whether
DNCR participated in “making” it. 	This is a question of fact yet to be resolved.
Accordingly, summary judgment is inappropriate.
Museum Exhibitions
93. 	Intersal alleges that Defendants have displayed a traveling exhibit of
QAR artifacts at state-owned venues without collaborating or sharing profits with
Intersal. (Third Am. Compl. ¶ 35J.) 	Defendants argue that they are entitled to
summary judgment on this claim because the exhibitions do not meet the definition
of “commercial narrative,” and, in any event, the State has not profited because no
additional admission fee has been charged to view the artifacts.19 	(Br. Supp. Defs.’
Mot. Summ. J. 6.)
19 Defendants also argue that the 2013 Agreement expressly allows DNCR to use QAR
artifacts and replicas in traveling exhibits and museums. (Defs.’ Reply Supp. Mot. Summ. J.
7, ECF No. 182.) But the 2013 Agreement says only that DNCR may “make, or have made,
molds or otherwise reproduce, or have reproduced, any QAR artifacts of its choosing for use
in museums or traveling exhibits, as educational props in its exhibits, museums, or
laboratories, as scientific tools, or for scientific study.” 	It does not speak to whether, with

94. 	But regardless of whether a surcharge was added to the admission fee
to view the traveling exhibit, there are other ways in which the State might have
profited from the exhibition. 	Whether it did, and whether the parties intended for
the term “commercial narrative” to apply to an exhibition of this nature are questions
for the jury to resolve.
Blockbuster Tour
95. 	Relatedly, 	Defendants 	argue 	that 	they 	are 	entitled 	to 	summary
judgment with respect to Intersal’s contention that Defendants violated Paragraph
15 by deciding not to participate in a “blockbuster” tour20 of the QAR artifacts. They
argue that the term “commercial narrative” was never intended to encompass a tour
like the one contemplated by Intersal. They further argue that the term “collaborate”
does not mean they are required to participate in every idea imagined by Intersal.
Therefore, they conclude, a decision not to engage with Intersal in the production of
a tour of this magnitude does not constitute a breach of Paragraph 15. 	(Defs.’ Br.
Supp. Mot. Summ. J. 7.)
96. 	Intersal 	responds 	that 	summary 	judgment 	for 	Defendants 	is
inappropriate because Defendants did not collaborate with it to produce, or even
seriously 	discuss, 	its 	idea 	for 	a 	tour. 	According 	to 	Intersal, 	Defendants 	are
respect to these exhibitions, DNCR must collaborate or share profits with Intersal. (2013
Agreement ¶ 9.)
20 According to Intersal’s expert with respect to exhibitions, Samuel S. Weiser, a “blockbuster”
exhibition is one that is generally 12,000 square feet but can be scaled up or down depending
on the exhibition space. (Weiser Report ¶ 36, ECF No. 159.2.)

“intentionally delay[ing]” and “slow-walk[ing] that concept until after this litigation
ends so that [they] can cut [Intersal] out of the tour.” (Pl.’s Br. Resp. Defs.’ Mot.
Summ. J. 9-10, 11.) 	Had they been able to “make” this “commercial narrative,”
Intersal argues, a tour of this nature would have resulted in Intersal realizing more
than $11.5 million in revenue, (Pl.’s Br. Resp. Defs.’ Mot. Summ. J., Ex. 25 ¶¶ 35, 40,
62 [“Weiser Expert Report”], ECF No. 173.25.)
97. 	Once again, a determination of this claim turns on an interpretation of
ambiguous language in the 2013 Agreement. 	Whether the parties intended for the
term “commercial narrative” to include a large-scale tour, and what they meant when
they agreed to “collaborate in making” commercial narratives, are matters for the
jury to decide.
98. 	Finally, Defendants contend that Intersal’s evidence that it has been
damaged as a result of Defendants’ alleged failure to collaborate on a “blockbuster”
QAR exhibition is too speculative to support its claim. Defendants argue that, even
if Intersal is successful in proving that the 2013 Agreement was breached, the Court
should enter summary judgment in their favor on damages and peremptorily instruct
the jury that no more than nominal damages may be awarded. 	(Br. Support Defs.’
Mot. Summ. J. 23-24.)
99. 	Specifically, Defendants assert that Intersal cannot prove that a tour of
this nature would have generated profits because of two “fundamental contingencies.”
(Br. Support Defs.’ Mot. Summ. J. 25.) First, Intersal and DNCR would have had to
reach a future agreement on the details and, according to Defendants, “Intersal has

no reasonable basis to predict that the parties would ever reach such an agreement.”
(Br. Support Defs.’ Mot. Summ. J. 25.) 	Second, Defendants contend that a tour of
this size would require a third-party tour promoter, and they argue that “Intersal has
no reasonable basis to predict that the parties would ultimately reach an agreement
with a third-party promoter.” (Br. Support Defs.’ Mot. Summ. J. 26.)
100. 	Intersal responds to the first argument by pointing to the arbitration
provision in Paragraph 15, which reads: 	“If [DNCR] and Intersal cannot reach an
agreement on the sharing and production of any such commercial ventures that they
propose to undertake, [DNCR] and Intersal will refer the issues to a mutually
selected, neutral arbitrator for binding arbitration, with arbitration to be concluded
within three (3) months of selection of the neutral arbitrator.” 	(2013 Agreement ¶
15.) 	Intersal concludes, therefore, that failure to agree in advance on these details
was a contingency adequately addressed by the language of the 2013 Agreement.
(Pl.’s Br. Resp. Defs.’ Mot. Summ. J. 15.)
101. 	As for whether the parties would have had to reach agreement with a
yet-unknown third-party tour promoter in order to produce profits, Intersal says the
2013 Agreement does not require one, and it would be up to a jury to decide both
whether a tour promoter would have been necessary and whether the parties would
have been able to reach agreement with one. 	(Pl.’s Br. Resp. Defs.’ Mot. Summ. J.
15.)21
21 Defendants point again to the report of 	Intersal’s exhibition expert, Weiser, who stated
that his analysis assumed that the cost of mounting and touring the exhibition would be
underwritten by a third-party partner with experience developing and touring blockbuster
exhibitions. 	See Weiser Expert Report ¶¶ 38, 49. 	But Weiser, who includes in his work

102. 	“In a suit for damages for breach of contract, proof of the breach would
entitle the plaintiff to nominal damages at least.” Delta Envtl. Consultants, Inc. v.
Wysong & Miles Co., 132 N.C. App. 160, 172 (1999) (citation and quotation marks
omitted). 	Beyond that, “[a] party claiming damages from a breach of contract must
prove its losses with ‘reasonable certainty.’ ” 	Plasma Ctrs. of Am., LLC v. Talecris
Plasma Res., Inc., 222 N.C. App. 83, 91 (2012). 	“While the reasonable certainty
standard requires something more than ‘hypothetical or speculative forecasts,’ it does
not require absolute certainty.” 	Id. (citation and quotation marks omitted); State
Props., LLC v. Ray, 155 N.C. App. 65, 76 (2002) (“absolute certainty” not required to
prove damages).
103. 	The law recognizes that certain agreements “[i]nvolve[] damages which
are difficult to calculate with absolute precision[,]” but the “indefiniteness . . . does
not, however, by itself preclude relief[.]” Keith v. Day, 81 N.C. App. 186, 196 (1986).
“What the law does require in cases of this character is that the evidence shall with
a fair degree of probability establish a basis for the assessment of damages[.]” 	Id.
Where evidence of damages “pushes . . . proof of damages beyond ‘hypothetical or
speculative forecasts of losses[,]’ ” there is a genuine issue to be decided at trial.
BOGNC, LLC v. Cornelius NC Self-Storage LLC, 2013 NCBC 26, at *87 (N.C. Super.
Ct. May 1, 2013).
experience that he was formerly an executive of a “market leader in the touring exhibition
business” and the company that toured Titanic exhibitions, among others, also stated that
“Businesses like Premier Exhibitions, where I was CEO, and other firms would have been
interested in working with the QAR parties . . . . These entities would have contributed to
the project, and possibly underwritten it in full, in exchange for a significant participation in
the revenues.” (Weiser Expert Report ¶ 38.)

104. 	The Court agrees with Intersal that the 2013 Agreement’s arbitration
provision gave the parties a surefire mechanism to avoid stalling over a dispute
regarding the production of a commercial narrative. 	However, whether the parties
would have required a third-party promoter and, if so, whether they would have been
able to agree on terms with one, remains to be determined. 	Weiser, who has
experience in the field, provides support for the Plaintiff’s position. A jury will have
to decide whether a blockbuster tour was among the “commercial narratives”
contemplated by the parties and, if so, whether the parties would have been
successful in producing a tour that would have generated a profit.
3. 	Paragraph 16(a) (Terms of Use Agreement to Access Artifacts
and Activities)
105. 	Intersal moves for entry of summary judgment on its claim that
Defendants breached Paragraph 16(a) of the 2013 Agreement by refusing to post an
Intersal terms of use agreement on a website DNCR 	agreed to establish to control
third party access to QAR Project-related artifacts and activities. (Pl.’s Br. Supp. Mot.
Partial Summ. J. 29-31.)
106. 	Paragraph 16(a)(3) states in relevant part:
a. Procedure.
3) 	The website shall be the primary means of access for requests, and
shall include, at a minimum:
(a) 	An 	Intersal 	terms 	of 	use 	agreement, 	to 	be 	electronically
submitted[.]
(2013 Agreement, § 16(a)(3).)

107. 	Intersal claims that DNCR refused to post or disseminate an Intersal
terms of use agreement as required by Paragraph 16(b), “destroying [Intersal’s]
ability to police unauthorized use of QAR digital media by third parties.” 	(Pl.’s Br.
Supp. Mot. Partial Summ. J. 30-31.) 	Intersal contends that this refusal occurred
despite Intersal’s electronic submission in June 2014 of a terms of use agreement that
parroted the terms used by Defendants’ Division of Tourism, Film, and Sports
Development website, “changing only the names.” 	(Pl.’s Br. Supp. Mot. Partial
Summ. J. 30.)22
108. 	On the other hand, Defendants contend that the 2013 Agreement did
not give Intersal a unilateral right to decide what the terms of use agreement would
contain, and they argue that Defendants had the right to weigh in, especially because
the terms were to be posted on a government website. 	Defendants assert that they
could not use Intersal’s language because it raised First Amendment concerns, and
they argue that the parties never agreed on the terms that would be posted or
otherwise disseminated to third parties. 	(Defs.’ Br. Response Pl.’s Mot. Partial
Summ. J. 25-27.) As for the language copied from the Division of Tourism, Film, and
Sports Development, Defendants contend that even those terms were problematic
because 	they 	“would 	apparently 	grant 	[Defendants] 	a 	copyright 	in 	the 	news
22 Intersal originally submitted its terms of use agreement in December 2013, but it was
never posted by DNCR. (Pl.’s Br. Supp. Mot. Partial Summ. J., Ex. 44, ECF No. 154.44 (email
from Cochran to Masters acknowledging receipt of terms)). Nevertheless, the Third Amended
Complaint does not allege that a breach occurred until June 2014, when Intersal’s revised
terms of use agreement (copying the language used by the Division of Tourism, Film, and
Sports Development) was also not posted. (Third Am. Compl. ¶ 35C.)

organization’s digital images of QAR activities and artifacts,” a result that is
constitutionally impermissible. (Br. Supp. Defs.’ Mot. Summ. J. 14.)
109. 	Again, the words of the 2013 Agreement fail to provide a clear answer
here. 	Paragraph 16(a) does not speak to the process by which the language of the
terms of use agreement would be decided. 	Indeed, even though it references the
writing as the Intersal terms of use agreement, use of the passive voice, “to be
electronically submitted,” does not permit the Court to identify Intersal as the sole
author. 	All that can be definitively discerned from the language of the 2013
Agreement is that the parties intended for access restrictions to appear on a website
to be established by DNCR, and that Intersal had responsibility for “managing and
enforcing” them. 	The contract is silent regarding whether the parties intended for
the language of the terms of use agreement to be mutually acceptable. Accordingly,
the question must be put to a jury. Summary judgment as to this issue is DENIED.
4. 	Paragraph 16(b) (Marking and Posting Non-Commercial Media)
110. 	Paragraph 16(b) of the 2013 Agreement states:
1) All non-commercial digital media, regardless of producing entity,
shall bear a time code stamp, and watermark (or bug) of Nautilus
and/or DCR, as well as a link to DCR, Intersal, and Nautilus
websites, to be clearly and visibly displayed at the bottom of any
web page on which the digital media is being displayed.
2) DCR agrees to display non-commercial digital media only on
DCR’s website.
(2013 Agreement ¶ 16(b)).
111. 	Intersal moves for affirmative summary judgment on the grounds that
Defendants breached Paragraph 16(b) by failing to include watermarks and time code

stamps on non-commercial digital media of the QAR Project that it produced to third
parties, whether in response to public records requests or otherwise. Intersal further
alleges that Defendants themselves posted—and by doing so enabled others to post—
hundreds of unmarked QAR images and videos. It alleges that some were posted to
websites other than the DNCR website, including Facebook, Instagram, Flickr, and
YouTube, all in violation of the 2013 Agreement. (Pl.’s Br. Supp. Mot. Partial Summ.
J. 18-23.)
112. 	Intersal argues that DNCR has conceded that the 2013 Agreement
required that it mark digital media and further that DNCR has admitted that it did
not begin marking digital media until late 2017. (Meyer Dep. at 56:2-57:18, 74:4-10,
110:12-18, 175:14-177:5; Cox Dep. 6:7-9:24, 32:15-33:21, 38:11-43:2.) 	It lists as
examples 	instances 	in 	which 	DNCR 	responded 	to 	public 	records 	requests 	by
producing unmarked images.23 Even after it began watermarking the digital media
in 2017, Intersal argues, Defendants continued to violate Paragraph 16(b)(2) by
leaving off time code stamps and required links to websites, and by posting digital
media to websites other than its own. (Pl’s Br. Supp. Mot. Partial Summ. J. 23.)
113. 	In addition, Intersal complains that DNCR provided unmarked
“non-commercial” digital media to other state offices to be posted on websites other
than DNCR’s own. 	For example, Intersal points to DNCR’s decision to send digital
images of the cannon raising event to the Governor’s office to be posted on Facebook.
(Pl.’s Br. Supp. Mot. Partial Summ. J., Exs. 22-23, Facebook postings of images on
23 It is not always clear from the record whether a particular image became a public record
before or after the effective date of the 2013 Agreement.

Governor’s webpage, ECF Nos. 154.22-154.23.) 	DNCR also sent a Flickr link of
images taken during the cannon raising to numerous media outlets. (Pl.’s Br. Supp.
Mot. Partial Summ. J., Ex. 14, email from Cox to media outlets forwarding Flickr link
of images, ECF No. 154.14.) 	In neither instance were the images marked in
accordance with Paragraph 16. 	In all, Intersal claims that Defendants posted
hundreds of QAR images and videos to websites such as Facebook, Instagram,
YouTube, Flickr, and Twitter, often without watermarks or time code stamps. (Pl.’s
Br. Supp. Mot. Partial Summ. J. 20-22.)
114. 	Defendants 	respond 	that 	the 	marking 	requirements 	of 	Paragraph
16(b)(1) apply only to non-commercial digital media produced and posted to the
internet by the parties (Intersal, DNCR, Rick Allen, and Nautilus Productions, LLC)
after the effective date of the 2013 Agreement. (Defs.’ Br. Response Pl.’s Mot. Partial
Summ. J. 29.) In addition, Defendants maintain that if Paragraph 16(b)(1) extended
to all digital media in their possession, Intersal’s interpretation would “require
Defendants to alter records provided in response to public records requests and
impose restrictions on a requestor’s use of public records,” a result that is contrary to
Paragraph 17 of the 2013 Agreement and State law. 	(Defs.’ Br. Response Pl.’s Mot.
Partial Summ. J. 31.)
115. 	Paragraph 17 of the 2013 Agreement provides:
Nothing in this Agreement shall prevent [DNCR] from making records
available to the public pursuant to North Carolina General Statutes
Chapters 121 and 132, or any other applicable State or federal law or
rule related to the inspection of public records.
(2013 Agreement ¶ 17.)

116. 	Chapter 121 establishes that DNCR is the “official archival agency of
the State of North Carolina.” 	N.C.G.S. § 121-5. 	Chapter 132 provides that public
records are “the property of the people.” 	N.C.G.S. § 132-1(b). 	Therefore, “it is the
policy of this State that the people may obtain copies of their public records and public
information free or at minimal cost[.]” N.C.G.S. § 132-1(b).
117. 	The definition of a public record is broad, covering any “documentary
material, regardless of physical form or characteristics, made or received pursuant to
law . . . in connection with the transaction of public business by any agency of North
Carolina[.] ” N.C.G.S. § 132-1(a). It specifically includes photographs and films and,
if there were any doubt that digital images of the QAR would be covered, Section
121-25(b) of the General Statutes removes it:
All photographs, video recordings, or other documentary materials of a
derelict vessel or shipwreck . . . in the custody of any agency of North
Carolina 	government 	or 	its 	subdivisions 	shall 	be 	a 	public 	record
pursuant to Chapter 132 of the General Statutes.
N.C.G.S. § 121-25(b).
118. 	Custodians of public records must allow the examination of public
records upon request and must furnish copies of public records to any person making
a request. The custodian of public records is prohibited from requiring a requestor to
“disclose the purpose or motive for the [public records] request.” N.C.G.S. § 132-6(b).
Moreover, “[p]ersons requesting copies of public records may elect to obtain them in
any and all media in which the public agency is capable of providing them.” N.C.G.S.
§ 132-6.2.

119. 	Notably, it is a Class 3 misdemeanor for any person to alter, deface,
mutilate or destroy a public record. N.C.G.S. § 132-3(a).
120. 	Defendants 	contend 	that, 	by 	its 	clear 	terms, 	Paragraph 	17 takes
precedence over any conflicting term in the Agreement, and that the referenced
statutes prohibit Defendants from altering public records or restricting their use.
(Defs.’ Br. Resp Pl.’s Mot. Partial Summ. J. 29-32.)
121. 	The Court agrees that Paragraph 17 trumps any interpretation of the
2013 Agreement that would require the State to alter public records or to limit the
public’s right to access or use them, both violations of state law. Therefore, Paragraph
16(b) cannot be read to mean that Defendants were required to add watermarks, time
code stamps and weblinks to public documents that pre-existed the 2013 Agreement.
To do so would be to alter those documents, which is both contrary to public records
obligations made paramount by Paragraph 17, as well as a criminal offense. See, e.g.,
Duke Power Co. v. Blue Ridge Electric Membership Corp., 253 N.C. 596, 602 (1961)
(“When called upon to interpret a contract, courts seek to ascertain and give effect to
the intent of the parties if that intent does not require the performance of an act
prohibited by law.”) (emphasis added); Security Life & Annuity Co. v. Costner, 149
N.C. 293, 297 (1908) (rejecting party’s interpretation of contract because it would
have required performance of an illegal act); Restatement 2d Contracts § 203 (“In the
absence of contrary indication, it is assumed that each term of an agreement has a
reasonable rather than an unreasonable meaning, and that the agreement is
intended to be lawful rather than unconscionable, fraudulent or otherwise illegal”);

Cf. Carolina Water Service, Inc. of North Carolina v. Town of Pine Knoll Shores, 145
N.C. App. 686, 689 (2001) (“An agreement which cannot be performed without
violation of a statute is illegal and void.”).24
122. 	In addition to when the digital media was produced, Defendants argue
that how it is being used is relevant when determining whether the 2013 Agreement
requires it to be marked. Defendants argue that Paragraph 16(b) stands only for the
proposition that if any of the parties to the 2013 Agreement desire to post non-
commercial digital media on the internet, that party is first required to add a time
code stamp and watermark of Nautilus and/or DCR, as well as a link to the DNCR,
Intersal and Nautilus websites, and that the markings must be “clearly and visibly”
displayed at the bottom of any web page on which the digital media appears. (Defs.’
Br. Resp. Pl.’s Mot. Partial Summ. J. 32.)
123. 	Intersal responds that Defendants’ interpretation of this provision
creates a hole in the bottom of the sea through which hundreds of images and other
digital media has escaped. 	It argues that the State committed to mark all non-
commercial digital media produced regardless of who produced it and how it is being
used. (Pl.’s Reply Supp. Mot. Partial Summ. J. 12.)
24 Likewise, Paragraph 16(b) cannot be read to mean that, when responding to public records
requests, Defendants are required to add watermarks, time code stamps and weblinks to
public records received from third parties, even if the records were received after the effective
date of the 2013 Agreement. Again, such an interpretation would mean that the State was
required to alter public records contrary to the prohibition in Chapter 132. The Court notes,
however, Defendants’ representation that “with only a handful of exceptions, the digital
images at issue were taken by and belong to DNCR[.]” (Br. Supp. Defs.’ Mot. Summ. J. 27,
ECF No. 161.)

124. 	The Court concludes that Paragraph 16(b) could be read to support
either argument. However, the difference in these two interpretations is significant.
If Intersal is correct, Paragraph 16(b) has implications for the manner in which
Defendants maintain the digital media pertaining to the QAR Project, even if they do
not post it. On the other hand, if Defendants are correct and marking is only required
for images Defendants post online, far fewer digital images would be subject to
marking requirements, and many public records requests would net unmarked
images.
125. 	The Court concludes that, as with other terms of the 2013 Agreement,
the parties’ intent with respect to marking requirements cannot be gleaned from the
plain language of Paragraph 16(b). 	Summary judgment in these circumstances is
inappropriate. However, under either reading of the provision, Intersal is entitled to
summary judgment to the extent DNCR posted on the internet non-commercial
digital media regarding the QAR Project that DNCR produced after the effective date
of the 2013 Agreement without including a time code stamp and watermark (or bug)
of Nautilus and/or DCR, as well as a link to the DNCR, Intersal and Nautilus
websites at the bottom of the web page on which that digital media was displayed. In
addition, Intersal is entitled to summary judgment for those occasions after the
effective date of the 2013 Agreement on which DNCR displayed non-commercial
digital media regarding the QAR Project (marked or unmarked) on websites other
than its own. As to these aspects of the first breach of contract claim (Media Rights),
Intersal’s Motion for Partial Summary Judgment is GRANTED.

126. 	On the other hand, Defendants are entitled to summary judgment to the
extent Intersal claims that a breach resulted from Defendants’ failure to alter public
records—regardless of their source—that predate the effective date of the 2013
Agreement prior to producing those records in response to a public records request.
As to this aspect of the first breach of contract claim (Media Rights), Defendants’
Motion for Summary Judgment is GRANTED.
127. 	Except as to these specific circumstances, the parties must await the
jury’s interpretation of the 2013 Agreement, and the cross-motions for summary
judgment as to the balance of the parties’ arguments with respect to the first breach
of contract claim (Media Rights) are DENIED.25
C. Alleged Breach for Failure to Renew the El Salvador Permit
128. 	Intersal claims that Defendants breached the 2013 Agreement by
refusing to 	renew the El Salvador Permit, but Defendants argue that Intersal is
25 Defendants argue that the “hypothetical licensing model” used by Intersal’s expert, Jeff
Sedlik, to calculate its damages is “untethered from both the facts of this case and from the
provisions of the 2013 Agreement.” Defendants contend that because Intersal did not produce
and does not own the images that it claims Defendants improperly handled, it would not be
entitled to a licensing fee for their use. 	(Defs.’ Br. Supp. 	Mot. Summ. J. 27-28.) 	Intersal
responds that Defendants misunderstand its theory of damages. 	According to Intersal,
Paragraph 16(b) of the 2013 Agreement required that DNCR mark QAR digital media, and
that its failure to do so damaged the value of QAR digital media for Intersal’s use either in
its exclusive documentary or for another commercial narrative.
The Court deems Defendants’ argument to be in the nature of a challenge to the admissibility
of Sedlik’s expert opinion, and it defers consideration of the argument pending a fully briefed
motion in limine pursuant to Rule 702 of the North Carolina Rules of Civil Procedure and
related law. 	See, e.g., State v. Abrams, 248 N.C. App. 639, 649 (2016) (Hunter, Jr., R.,
concurring) (“[B]est practice dictates parties should challenge an expert’s admissibility
through motions in limine.”).

barred by collateral estoppel from relitigating this issue because it has already been
decided. (Defs.’ Br. Supp. Mot. Summ. J. 30.)
129. 	Paragraph 3 of the 2013 Agreement provides that “[i]n consideration for
Intersal’s significant contributions toward the discovery of the QAR,” DNCR agrees
to continue to issue the El Salvador Permit to Intersal through the year in which the
QAR archaeology recovery phase is declared complete26 “so long as the requirements
contained in the permit are fulfilled.”27 (2013 Agreement ¶ 3.)
130. 	Additional requirements for the renewal of the El Salvador Permit are
as follows:
D. The period of this permit shall be one year. The permit may be
renewed yearly, subject to any changes in the terms [DNCR] deems
appropriate, providing the Permittee has satisfactorily met all the terms
and conditions of this permit.
G. Issuance or renewal of this permit shall not be construed to confer in
the Permittee any right, nor create in DCR or the State any duty or
obligation, to defend or in any way support the Permittee against claims
by third parties.
H. This Permit renewal in no way constitutes a guarantee by DCR, as
the 	permitting 	agency, 	that 	future 	Permits 	will 	be 	automatically
granted to the Permittee. Each proposed renewal of the Permit requires
a separate application which successfully meets all requirements of NC
General Statute 121, Article 3, and Title 7, subchapter .04R of the NC
Administrative Code.
(Defs.’ Mot. Summ. J. Ex. 26 [“El Salvador Permit”] at ¶¶ D, G, H (emphasis added).)
26 It is undisputed that the archaeology phase has yet to be declared complete.
27 DNCR specifically agreed that it would “recognize Intersal’s efforts and participation in
the QAR project as sufficient to satisfy any performance requirements associated with annual
renewal of Intersal’s permit for the El Salvador.” (2013 Agreement ¶3.)

131. 	Chapter 121, Article 3 of the North Carolina General Statutes pertains
to, among other things, the salvage of abandoned shipwrecks. Section 121-25 speaks
to the permitting process and provides, in relevant part:
If [DNCR] shall find that the granting of such permit or license is in the
best interest of the State, it may grant such applicant a permit or license
for such a period of time and under such conditions as the Department
may deem to be in the best interest of the State.
N.C.G.S. § 121-25 (emphasis added).
132. 	It is undisputed that DNCR refused to renew the El Salvador Permit in
2015. 	Intersal filed a Petition for Contested Case Hearing with the Office of
Administrative Hearings (“OAH”) and an administrative law judge dismissed the
matter on summary judgment. 	Intersal appealed to the Wake County Superior
Court, which also dismissed the case, albeit for a different reason.
133. 	Determining that the proper issue for review was whether DNCR erred
in concluding that the issuance of the permit was not “in the best interest of the
State,” the Honorable Paul C. Ridgeway observed that DNCR’s grant of authority and
discretion is broad and that it could be reversed, “only upon a showing that the
decision [was] arbitrary and capricious.” Intersal, Inc. v. NC Dept of Nat’l and Cult’l
Resources, 16 CVS 8149 (Wake County, Nov. 7, 2016) (unpublished) (citing Cates v.
North Carolina Dep’t of Justice, 121 N.C. App. 243 (1996)). 	Recognizing that “[t]he
trial court is not allowed to override a discretionary agency decision exercised in good
faith and in accordance with the law,” Judge Ridgeway concluded that there were no
genuine issues of material fact with respect to DNCR’s proper exercise of its
discretion, and he entered summary judgment for DNCR. The Court wrote:

In other words, taking all the pleadings, affidavits and submissions of
the Petitioner as true, the inescapable fact remains . . . that the Kingdom
of Spain has a sufficient likelihood of success in its claim of ownership
of the consigned cargo of the El Salvador, and that a reasonably cautious
and prudent steward of the State’s resources, in a good faith exercise of
discretion, could conclude that the issuance of the [El Salvador Permit]
to [Intersal] was no longer in the best interest of the State.
Intersal, Inc., 16 CVS 8149. 	Accordingly, the Superior Court dismissed Intersal’s
administrative action, and there was no appeal. The judgment is final.
134. 	In this case, Intersal argues that the Supreme Court has already
determined that “res judicata does not apply because [Intersal’s] El Salvador contract
claim is a separate cause of action from that decided in the administrative case on
the permit denial.” (Br. Supp. Defs.’ Mot. Summ. J. 31-32.) 	Intersal is correct. 	The
claim before this Court (breach of contract) differs from the administrative claim for
denial of a permit that was before Judge Ridgeway,28 and the breach of contract claim
has not been decided. 	However, Defendants do not argue claim preclusion. 	They
argue issue preclusion, also known as collateral estoppel. 	There is a difference
between these two legal concepts.29
28 As the Supreme Court observed, Intersal did not plead the elements of a breach of contract
action it its Petition for a Contested Case Hearing.
29 The Supreme Court recognized that although res judicata and collateral estoppel are
“historically recognized as species of a broader category of estoppel by judgment, [they] are
not interchangeable. Specifically, res judicata, or claim preclusion, functions to bar a
plaintiff's entire cause of action, whereas collateral estoppel, or issue preclusion, bars only
the subsequent adjudication of a previously determined issue, even if the subsequent action
is based on an entirely different claim. 	Therefore, although the two doctrines are
complimentary, they are not the same.” Intersal, 373 N.C. at 106 n.5 (cleaned up). However,
because the trial court’s analysis was limited to res judicata, so too was the Supreme Court’s
analysis.

135. 	Calling them “companion principles,” the North Carolina Supreme
Court has attempted to clear the fog surrounding res judicata and collateral estoppel
by using the words of the United States Supreme Court:
The language, therefore, which is so often used, that a judgment estops
not only as to every ground of recovery or defense actually presented in
the action, but also as to every ground which might have been presented,
is 	strictly 	accurate, 	when 	applied 	to 	the 	demand 	or 	claim 	in
controversy. Such 	demand 	or 	claim, 	having 	passed 	into 	judgment,
cannot 	again 	be 	brought 	into 	litigation 	between 	the 	parties 	in
proceedings at law upon any ground whatever.
But where the second action between the same parties is upon a
different claim or demand, the judgment in the prior action operates as
an estoppel only as to those matters in issue or points controverted, upon
the determination of which the finding or verdict was rendered.
King v. Grindstaff, 284 N.C. 348, 356 (1973) (quoting Cromwell v. County of Sac, 94
U.S. 351, 353 (1877)). 	And “[a]lthough the names used by courts when referring to
[these] two ‘effects’ have varied over time, the term ‘res judicata’ is frequently applied
to the former and the term ‘collateral estoppel,’ to the latter.” Thomas M. McInnis &
Assocs., Inc. v. Hall, 318 N.C. 421, 428 (1986).
136. 	Thus, res judicata bars relitigating the same cause of action following
the rendering of a final judgment; whereas collateral estoppel bars the retrying of an
issue that was necessary to, and has already been decided in, previous litigation, even
when the cause of action is different. 	See King, 284 N.C. at 355-357; McInnis, 318
N.C. at 427-28; Matthew Bender & Company, Inc., 2 North Carolina Civil Procedure
§§ 88-1, 88-4 (2023).

137. 	For collateral estoppel to apply, Defendants must show “that the earlier
suit resulted in a final judgment on the merits, that the issue in question was
identical to an issue actually litigated and necessary to the judgment, and that both
[defendant] and [plaintiffs] were either parties to the earlier suit or were in privity
with parties.” Turner v. Hammocks Beach Corp., 363 N.C. 555, 558-59 (2009) (quoting
McInnis, 318 N.C. at 429). But see Whitacre P’ship v. BioSignia, Inc., 358 N.C. 1, 15
(2004) (“we have followed the modern trend in abandoning the strict ‘mutuality of
estoppel’ requirement for defensive collateral estoppel.”).
138. 	Here, the issue is whether DNCR breached the 2013 Agreement when it
refused to renew the El Salvador Permit on the grounds that it was not in the best
interest of the State. 	Because the 2013 Agreement expressly incorporates the
permitting requirements of Chapter 121 which, in turn, condition permit renewal on
DNCR’s finding that reissuing the permit is in the best interest of the State, the issue
for collateral estoppel purposes is precisely the same in this Court as it was before
Judge Ridgeway. 	Therefore, if, as Judge Ridgeway has already determined, DNCR
properly exercised its authority when it concluded that it was not in the State’s best
interest to continue to renew the El Salvador Permit, then its decision does not
constitute a breach of the 2013 Agreement.
139. 	Because this issue has been finally decided, collateral estoppel applies
and requires this Court to conclude that DNCR’s decision not to renew the El
Salvador Permit because it was not in the best interest of the State was not a breach
of the 2013 Agreement. 	See Bradley v. Hidden Valley Transp., Inc., 148 N.C. App.

163, 166 (2001) (“[C]ollateral estoppel precludes the subsequent adjudication of a
previously determined issue even if the subsequent action is based on an entirely
different claim.”) (citation omitted).
140. 	Accordingly, Defendants’ Motion for Summary Judgment with respect
to Plaintiff’s second claim for breach of contract (Refusal to Renew the El Salvador
Permit) is GRANTED.30
D. Breach of the Implied Duty of Good Faith and Fair Dealing
141. 	Defendants argue that the Court should grant summary judgment in
their favor with respect to Intersal’s claim that Defendants not only breached the
express terms of the 2013 Agreement but also breached the implied duty of good faith
and fair dealing. 	Defendants contend that the implied duty claim is subject to
dismissal because Intersal has already conceded that it is not “making a claim for bad
faith,” and because it is duplicative of Intersal’s claims for breach of the express
provisions in the contract that Intersal is asserting. (Br. Supp. Defs.’ Mot. Summ. J.
41.)
142. 	The first argument is easily dispatched. 	Although it is true that this
Court previously dismissed with prejudice any attempted bad faith breach of contract
claim, (see Order ¶ 79, ECF No. 85), that dismissal does not preclude a claim for
breach of the implied covenant of good faith and fair dealing. 	See Southeast
30 Because the Court holds that DNCR’s decision not to renew the El Salvador Permit was
not a breach of the 2013 Agreement, it declines to address Defendants’ argument that
Intersal’s evidence of damages pertaining its loss of the El Salvador Permit is so speculative
that dismissal of the claim is required.

Anesthesiology Consultants, PLLC v. Rose, 2019 NCBC LEXIS 52, at *25-26 (N.C.
Super. Ct. Aug. 20, 2019) (distinguishing between a bad faith breach of contract claim
and one for breach of the implied covenant of good faith and fair dealing). Contrary
to Defendants’ argument, this claim has not been previously addressed.
143. 	As for the argument that the claim is subject to dismissal because it is
“duplicative” of Intersal’s claim for breach of the express provisions of the 2013
Agreement, the Court determines that the converse is true: 	to the extent Intersal’s
breach of contract claim survives, it includes within its ambit the implied covenant
of good faith and fair dealing.
144. 	“North Carolina law has long recognized that a covenant of good faith
and fair dealing is implied in every contract and requires the contracting parties not
to “do anything which injures the rights of the other to receive the benefits of the
agreement.” Bicycle Transit Auth. v. Bell, 314 N.C. 219, 228 (1985) (citation omitted).
This implied covenant is a “basic principle of contract law that a party who enters
into an enforceable contract is required to act in good faith and to make reasonable
efforts to perform his obligations under the agreement.” 	Maglione v. Aegis Family
Health Ctrs., 168 N.C. App. 49, 56 (2005) (quoting Weyerhaeuser Co. v. Godwin Bldg.
Supply Co., 40 N.C. App. 743, 746 (1979)). It requires parties to avoid “arbitrary or
unreasonable conduct which has the effect of preventing the other party to the
contract from receiving the [contract’s] fruits.” 	Wilgus v. Salt Pond Inv. Co., 498 A.2d
151, 159 (Del. Ch. 1985) (interpreting Restatement 2d of Contracts § 205 (1981))

145. 	The implied covenant of good faith and fair dealing has been called the
“spirit of the contract.” 	Bicycle Transit Authority, Inc., 314 N.C. at 230 (defendant
breached both the “letter and the spirit of the contract”); accord Allen v. Allen, 61
N.C. App. 716, 720 (1983) (party’s actions were “clear violations of both the letter and
spirit of the contract”). 	A material term, the implied covenant is the gap-filler that
guides the parties in the performance of the express terms of the contract. 	Howard
v. IOMAXIS, LLC, 2022 NCBC LEXIS 146, at **15 (N.C. Super. Ct. Dec. 5, 2022).
“Evasion of the spirit of the bargain, lack of diligence and slacking off, willful
rendering 	of 	imperfect 	performance, 	abuse 	of 	a 	power 	to 	specify 	terms, 	and
interference with or failure to cooperate in the other party’s performance” may
constitute breach of the implied covenant. Restatement 2d of Contracts § 205 cmt. d
(1981).
146. 	Here, Intersal did not set out a separate claim for breach of the implied
covenant of good faith and fair dealing in its Third Amended Complaint. 	Rather, it
alleged conduct that it argues constitutes breach of both the express and the implied
terms of the 2013 Agreement before pleading two breach of contract claims, one
pertaining to media rights and the other pertaining to the El Salvador Permit.
Defendants contend that Intersal’s failure to identify the implied covenant by name
in its pleading dooms its claim for breach of that term.
147. 	“Where a party’s claim for breach of the implied covenant of good faith
and fair dealing is based upon the same acts as its claim for breach of contract,” the
former claim is ‘part and parcel’ of the latter. Cordaro v. Harrington Bank, FSB, 260

N.C. App. 26, 38-39 (2018). 	This means that the fate of an implied covenant claim
rises and falls with the fate of the breach of contract claim if it is based on the same
underlying facts. In other words, if the breach of contract claim fails, there can be no
breach of the implied covenant. 	See, e.g., Suntrust Bank v. Bryant/Sutphin Props.,
LLC, 222 N.C. App. 821, 833 (2012) (“As the jury determined that plaintiff did not
breach any of its contracts with defendants, it would be illogical for this Court to
conclude that plaintiff somehow breached implied terms of the same contracts.”).
However, it also means that the converse is true. Where the breach of contract claim
survives, whether the implied covenant was one of the terms breached remains an
issue to be determined.
148. 	In this case Intersal has asserted a viable claim for breach of contract
and has not chosen to narrow its claim to breach of only the implied covenant of good
faith and fair dealing. 	Instead, pursuant to Rule 8 of the North Carolina Rules of
Civil Procedure, it has put Defendants on notice that it contends that Defendants
breached material terms in the 2013 Agreement pertaining to its media rights and
that they ignored their duty to act in good faith. 	(See, e.g., Third Am. Compl. ¶ 54:
“All actions taken by the State Defendants were taken with the clear intent to deprive
Intersal of its contractual, media, property and liberty rights [.]”)
149. 	Just as Intersal was not required to plead with particularity the express
terms that were breached, the implied covenant—the spirit of the agreement—is
included in its claim for breach of contract without the need to identify it specifically.
Indeed, “there are no magic words for pleading [a contract claim under North

Carolina law.]” 	Stellar Ins. Group, Inc. v. Cent. Cos., LLC, 2006 U.S. Dist. LEXIS
75801, at *23 (W.D.N.C. 2006). 	Plaintiff need only plead the “(1) existence of a valid
contract and (2) breach of the terms of that contract.” Poor, 138 N.C. App. at 26; see
Vanguard Pai Lung, LLC, 2019 NCBC LEXIS 39, at *11 (observing that “stating a
claim for breach of contract is a relatively low bar”).
150. 	Moreover, the fact that Intersal did not label its claim as one for breach
of the implied covenant is not dispositive. See, e.g., Gant v. NCNB Nat. Bank, 94 N.C.
App. 198, 199 (1989) (on a motion to dismiss “[t]he question before us is whether, as
a matter of law, the allegations of the complaint, treated as true, are sufficient to
state a claim upon which relief may be granted under some legal theory, whether
properly labeled or not.”).
151. 	Because the Court has determined that Intersal’s second breach of
contract claim is barred by collateral estoppel, a claim for breach of the implied duty
of good faith and fair dealing with respect to denial of the El Salvador Permit is also
barred. To that extent, Defendants’ Motion for Summary Judgment is GRANTED.
152. 	However, Intersal may pursue breach of the implied duty of good faith
and fair dealing in its claim for breach of certain of its media rights, as stated herein.
Accordingly, as to Intersal’s first claim for breach of contract, Defendants’ Motion for
Summary Judgment is DENIED.

VI. 	CONCLUSION
153. 	WHEREFORE, the Court hereby ORDERS as follows:
a. 	Intersal’s 	Motion 	for 	Partial 	Summary 	Judgment 	with 	respect 	to
Defendants’ Second and Ninth Affirmative Defenses is GRANTED, except
that nothing herein is intended to require terms of the 2013 Agreement to be
interpreted in a manner that is inconsistent with North Carolina law.
b. Intersal’s Motion for Partial Summary Judgment with respect to Intersal’s
First Claim for Relief (Breach of Contract with respect to Media Rights) is
GRANTED in part.
(i) The Court declares as a matter of law that, after the effective date of
the 2013 Agreement, DNCR’s posting on the internet of non-commercial
digital media of the QAR Project that DNCR produced without including
a time code stamp, watermark (or bug) of Nautilus and/or DNCR, as well
as a link to DNCR, Intersal, and Nautilus websites, clearly and visibly
displayed at the bottom of any web page on which the digital media was
or is being displayed, constitutes a breach of Paragraph 16(b)(1) of the
2013 Agreement.
(ii) The Court further declares as a matter of law that, after the effective
date of the 2013 Agreement, DNCR’s posting of non-commercial digital
media of the QAR Project on websites other than its own constitutes a
breach of Paragraph 16(b)(2) of the 2013 Agreement.

c. 	In all other respects, Intersal’s Motion for Partial Summary Judgment is
DENIED.
d. Defendants’ Motion for Summary Judgment with respect to Intersal’s First
Claim 	for 	Relief 	(Breach 	of 	Contract 	with 	respect 	to 	Media 	Rights) 	is
GRANTED to the extent that Intersal asserts that Defendants breached
Paragraph 16(b)(1) of the 2013 Agreement by failing to mark digital media of
the QAR Project that predates the effective date of the 2013 Agreement prior
to producing it in response to a public records request.
e. 	In all other respects, Defendants’ Motion for Summary Judgment 	with
respect to Intersal’s First Claim for Relief is DENIED.
f. 	Defendants’ Motion for Summary Judgment with respect to Intersal’s
Second Claim for Relief (Breach of Contract with respect to the El Salvador
Permit) is GRANTED, and Intersal’s Second Claim for Relief is dismissed with
prejudice.
IT IS SO ORDERED, this the 23rd day of February, 2023.
/s/ Julianna Theall Earp
Julianna Theall Earp
Special Superior Court Judge
for Complex Business Cases