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Widow Says Spacey Attorney|Took Her for $300,000

HOUSTON (CN) - An attorney defrauded a woman of $300,000 by claiming his company had a "special rocket engine" to "travel in space to a distant asteroid and mine precious metals," the woman claims in court.

Click here to read Courthouse News' Securities Law Review.

Donna Beck sued Houston patent attorney Arthur Dula, his companies Excalibur Exploration Limited, Excalibur Limited, Excalibur Almaz Limited and Excalibur Almaz USA Inc., and Excalibur directors J. Buckner Hightower and Christopher Stott, in Harris County Court.

"Dula defrauded Beck by inducing her and her husband (since deceased) to advance $300,000, and later purchase an investment in Excalibur Exploration Limited, one of the Excalibur entities, with the fundamental false representation that the company had the technical expertise and associations to develop a business to fly the first commercial prospecting space flight to an asteroid," the complaint states.

"Dula bolstered his lies by representing that his other companies had the spacecraft to accomplish the job, as well as associations with other necessary contractors.

"In fact, the entire operation was a sham and never accomplished anything of substance.

"Dula spent Beck's money even before Excalibur Exploration Limited was formed to pay for a project that Dula and his associates had previously earmarked as an expense for another related company, until they got lucky and got Beck's check and switched the obligation to her.

"Moreover, none of the promises made in Dula's solicitation letter were performed or even attempted: the initial stock share splits were never honors, no attempt to raise capital was ever undertaken, no business plans were ever developed, and the spacecraft that Dula said were available have not undergone any of the required modifications for flight. In fact, Dula even refused to provide the contracts to show his minority shareholder Beck that he or his companies owned the spacecraft that he had originally toured as an advantage to induce her investment."

Beck claims that she and her husband met Dula, Hightower and Stott in May 2006 during a commercial space flight convention on a cruise ship.

"Dula had given a talk at the event and was eager to meet prospective investors in his commercial space companies," the complaint states. "After the event, Dula kept in touch with Beck and her husband, and soon follow-on meetings were arranged, including some when Dula invited former NASA astronauts to attend to lend credibility to his effort.

"Beck and her husband were hooked by Dula's charm and the plan presented by all the defendants to mine asteroids for precious metals and the profits it would bring. Beck and her husband were open to making an investment."

Beck says Dula sent her a solicitation telling her to write him a $300,000 check for his company, and promising that with the investment she and her husband would be "founders" of his enterprise.

"Dula also represented to Beck that he had already raised '$50 million' for his Excalibur Almaz Limited operations, which included 'Almaz spacecraft' that would be used to test the operation of a special rocket engine needed to travel to asteroids," the complaint states.

"Dula also represented that this special rocket engine - VASMIR - was developed by a company with which he had close ties, and that they would sell Excalibur Mines 'the 'right of first refusal' to use the VASMIR rocket engine for commercial asteroid prospecting and mining.'"

Beck says though they were interested, she and her husband did not immediately give Dula any money. But she claims Dula persuaded them to invest by falsely claiming he had financed acquisition of the VASMIR engine.

Beck says Dula, Hightower and Stott won them over by hosting them at a dinner honoring science fiction writer Robert Heinlein, which many former NASA astronauts and officials attended.

"The dinner included Dula awarding the First Heinlein Prize of a $500,000 check to Peter Diamandis for his work in advancing commercial space opportunities," the complaint states. "Beck and her husband were impressed with the contacts in the aerospace industry the defendants appeared to have, as well as their apparent success to substantial amounts of money."

Beck claims that after she and her husband forked over the $300,000 in 2006, Dula never formed Excalibur Mines, the company in which she thought she would be shareholder.

Instead, Beck says, Dula issued her and her husband 3,000 shares of Excalibur Exploration Limited, a company he formed in 2007 in the Isle of Man, an offshore tax haven.

"In June 2011, before which no meetings, or board minutes, or status reports, or progress had been reported for many months, Beck tendered her resignation from the Board and told Dula she wanted to sell her Excalibur Exploration Limited shares back to the company," the complaint states.

Beck says that when she could not get any answers from Dula about what happened to her money, she had her lawyer remove her from the Excalibur Exploration Limited Board of Directors.

"To this day, no explanation has been provided as to the use of Beck's initial funds advanced to EA USA," Beck claims.

Beck says that Dula and his colleagues have a habit of "preying on wealthy people by promising that they would be part of a grand new adventure in order to get their money."

In reality, Beck says, Dula and company spend investors' money to fund their own international travel to aerospace conferences, and perpetuate their schemes.

Beck seeks damages for negligence, fraud, breach of fiduciary duty, Texas Securities Act violations and breach of contract.

She is represented by Scott Clearman with ClearmanPrebeg in Houston.

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