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IN THE UNITED STATES BANKRUPTCY COURT
                                     FOR THE DISTRICT OF DELAWARE

        In re                                                            Chapter 11

        CORDILLERA GOLF CLUB, LLC 1 dba The                              Case No. 12-11893 (CSS)
        Club at Cordillera,
                                                                         Hearing Date: July 16, 2012 at 10:00 a.m.
                                  Debtor.
       _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___]Ref. Docket Nos. 69, 77, 78 & 95

         THE DEBTOR'S OMNIBUS OBJECTION TO THE MOTIONS TO TRANSFER VENUE
            AND/OR RELATED JOINDERS FILED BY (I) CHERYL M. FOLEY, THOMAS
          WILNER, JANE WILNER, CHARLES JACKSON, MARY JACKSON AND KEVIN B.
         ALLEN, INDIVIDUALLY AND AS REPRESENTATIVES OF A CERTIFIED CLASS OF
             MEMBERS, (II) ALPINE BANK, (III) CORDILLERA PROPERTY OWNERS
              ASSOCIATION, INC. AND CORDILLERA METROPOLITAN DISTRICT


                 Cordillera Golf Club, LLC dba The Club at Cordillera, the debtor and debtor in

         possession in the above-captioned case (the "Debtor"), by and through its undersigned attorneys,

         hereby submits this omnibus objection (the "Objection") to (i) the motion (the "Class Member

         Motion") of Cheryl M. Foley, Thomas Wilner, Jane Wilner, Charles Jackson, Mary Jackson And

         Kevin B. Allen, Individually And As Representatives Of A Certified Class Of Members

         (collectively, the "Class Members") to transfer venue of this case, (ii) the motion (the

         "CPOA/CMD Motion," and together with the Class Member Motion, the "Motions") of

         Cordillera Property Owners Association, Inc. ("the "CPOA") and Cordillera Metropolitan

         District ("CMD" or the "District"), to transfer venue of this case, and (iii) the joinders to the

         Motions (the "Joinders," and collectively with the Motions, the "Venue Motions") filed by

         Alpine Bank ("Alpine," and together with the Class Members, CPOA and CMD, the

         "Movants"). In support of its Objection, the Debtor respectfully states as follows:
         1
          The Debtor in this chapter 11 case, and the last four digits of its employer tax identification number, is XX-
         XXX1317. The corporate headquarters address for the Debtor is 97 Main Street, Suite E202, Edwards, Colorado
         81632.


01:12275800.2
PRELIMINARY STATEMENT

                1.      This case is not a liquidation case, but is instead a chapter 11 reorganization. The

         Debtor's economic rehabilitation turns on the valuation of its real estate, its going concern

         business, and its personal property and other assets. The Debtor alleges that the alleged first-

         priority secured lender has a defective security interest in the Debtor's non-real estate personal

         property assets. The fundamental issues to be resolved in this case are valuation, post-petition

         financing, and going-forward capitalization. The issues currently pending in Colorado and the

         focus of the Class Member's Motion and the Joinders, are at best peripheral to the central issues

         in the bankruptcy case, and are matters which can be resolved in Colorado without threatening

         the economic rehabilitation of the Debtor. Whether the Debtor wins its Colorado lawsuit as

         plaintiff, and how much money that may bring into the estate, is peripheral to the Debtor's

         capital restructure and financing plans, which are grounded in the financial markets of New York

         and the Northeast U.S. Whether the class action case results in a defense verdict in favor of

         Debtor (which Debtor anticipates), or a judgment for the class members (which, in any event, is

         an insured claim and therefore not a serious threat to the Debtor's restructuring) is likewise

         peripheral to the Debtor's capital restructure and financing plans, which are grounded in the

         financial markets ofNew York and the Northeast U.S. A transfer of venue away from the

         financial markets ofNew York and the Northeast U.S. makes the chapter 11 rehabilitation ofthis

         Debtor significantly more expensive, significantly less efficient, and prejudices all creditors of

         this estate that would expect a higher recovery on their claims with a recapitalization of the

         Debtor that can and will be accomplished in this case.

                 2.     On July 3, 2012, the Class Members filed the Class Member Motion on shortened

         notice seeking to change the venue of this chapter 11 case to the United States Bankruptcy Court

         for the District of Colorado.
01:12275800.2
                                                           2
3.      On July 5, 2012, Alpine filed its joinder to the Class Member Motion. Alpine is

         Debtor's secured lender, whose security interest is at issue in an adversary proceeding pending

         before this Court. Alpine now complains about Delaware as a forum; yet, the Debtor's chapter

         11 filing was precipitated by Alpine's unwillingness to extend the due date on its loan.

         Declaration of Daniel Fitchett ("Fitchett Decl."). The Debtor was unable to find alternative

         financing in Colorado and thus has been forced to look outside the local Colorado market.

                4.      To that end, the Debtor has engaged a national-based real estate advisor (GA

         Keen Realty Advisors, based in NY) and a nationally-prominent Chief Restructuring Officer,

         Alfred H. Siegel (the "CRO"), who is not domiciled in Colorado. At least in part because of the

         stigma associated with the class action dispute, the Debtor's professionals have determined that

         the Debtor's financial future is not grounded in the Midwest, but rather the financial markets of

         New York and the east coast. See Declaration ofHarold Bordwin filed in support hereof

         ("Bordwin Decl.").

                5.      On July 5, 2012, CPOA and the District filed the CPOA/CMD Motion. The

         Debtor believes these parties are not motivated to promote the best interests of the estate.

         Rather, they seek to move this case to Colorado where the Debtor will be hampered by negative

         public opinion fueled by unsubstantiated claims espoused by these parties. In contrast, the

         Delaware forum provides a level playing field and affords the Debtor and all parties in interest a

         proper forum to prosecute this chapter 11 case to a successful reorganization. Movants' cries of

         inconvenience are simply not supported by compelling evidence. In fact, Movants have had no

         difficulty voicing their views in this Court and not a single Movant has stated that they are

         unable to attend hearings in Delaware.




01:12275800.2
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6.        Aside from the Movants, who represent only a fraction of the creditor body as a

        whole, none of the other creditors in this case have lodged a complaint over the Debtor's choice

        of venue. Indeed, it is anticipated that independent homeowners and Club members will join in

        the within opposition to the Venue Motions.

                 7.        No one disputes that venue of the Debtor's case is both proper and permissible in

        Delaware under 28 U.S.C. § 1408; instead, Movants proceed under 28 U.S.C. § 1412. The

        Venue Motions are focused on the fact that (a) the Debtor's headquarters and assets are in

         Colorado and (b) the Debtor has many Colorado creditors, some with a pending action litigation

         in Colorado. 2

                  8.       As discussed in detail below, these facts and what follows from them fall far short

         of satisfying the Movants' heavy burden of showing that the interests of justice or the

         convenience of parties in interest will be served by transferring this Chapter 11 reorganization

         case to Colorado.

                  9.       Contrary to the suggestions in the Venue Motions, the Debtor's selection of

         Delaware for the venue of this case was and remains in the best interests of the estate because the

         economic administration of the case and the rehabilitation of the Debtor hinges on contacts with

         the financial markets in New York and on the East Coast, not locally in Colorado. While the

         Debtor may be characterized as a regional operation insofar as the location of its real estate and

         related amenities are concerned, its broad appeal on the national level is borne out by the fact

         that nearly two-thirds of its members reside outside of Colorado. See Debtor's Schedules and


         2
            The Colorado litigation between the Movants and the Debtor is not the focus of the bankruptcy case. While the
         Debtor expects to prevail in its case as plaintiff (and the recovery will be an asset of the estate), and expects to be
         exonerated in the class action case (and even if not, the recovery is covered by insurance, so the outcome will have
         little impact on the estate), the overall outcome of that litigation is not central to the economic reorganization of this
         Debtor.


01:12275800.2
                                                                     4
Statement of Financial Affairs, which will be on file herein. Moreover, the reality is that the

         success of this chapter 11 proceeding will hinge on the participation of those located on the East

         Coast, including the proposed DIP Lender. See Bordwin Decl. at 1 16.

                 10.      As would be expected of a company that owns and operates high-end recreational

         amenities in a residential community where many of the homes are second homes or vacation

         homes, the vast majority of the Debtor's creditors are actually located outside of Colorado. 3 The

         statements by Movants that most creditors are in Colorado are simply not accurate; in fact, of the

         six individuals that filed the Member Motion, only Ms. Foley lists her address in Edwards,

         Colorado, and Mr. Allen lists his address in Cherry Hills Village, Colorado -the other four

         Movants reside in Washington, DC or Illinois. See Exhibit B to the Foley Decl. And, as to Ms.

         Foley and Mr. Allen, they have affirmatively sought and obtained a position on the Official

         Committee of Unsecured Creditors ("Committee") in this case, thus consenting to their

         availability to participate in this case no matter where it is pending. 4 See Notice of Appointment

         of Committee of Unsecured Creditors, Docket No.86. In fact, the Debtor expects that the major

         issues in this case will tum on the involvement of parties located on the East Coast.

                 11.      The ultimate question for the Court is whether the Movants have shouldered their

         heavy burden and proved that administration of this chapter 11 case - and not the peripheral

         3
           In fact, Movants Thomas and Jane Wilner are located in Washington, DC (about 110 miles to the Delaware Court
         as opposed to 1657 miles to the Colorado Court) and Charles and Mary Jackson are located in Illinois (781 miles to
         Delaware Court and 1012 miles to Colorado). Additionally, the general creditor breakdown is as follows:
         Members: 34% are in Colorado, 66% are outside of Colorado; Vendors Owed Money (excluding employees): 46%
         are in Colorado, 54% are outside of Colorado; All vendors (excluding employees): 55% are in Colorado, 45% are
         outside of Colorado. See Schedules and Statement of Financial Affairs.
         4
           On or about July 6, 2012, the U.S. Trustee appointed the seven-member Committee [Docket No. 86]. Of the
         seven Committee members, four of them are Class Members, two of whom are named class representatives and
         Movants herein. The Debtor understands that the Committee is likely to support the Venue Motion. However,
         while the Debtor recognizes that the bankruptcy courts often give some deference to official committees on matters
         such as the one at bar, the weight of any support of the Venue Motion by the Committee in this case should be
         appropriately discounted given that the majority composition of the Committee are actual Movants herein.


01:12275800.2
                                                                  5
litigation already pending in Colorado- will be improved if the case is transferred to Colorado.

         The Debtor submits that Movants have not done so and will not be able to do so.

                12.     By the time this Court considers the Venue Motions, it will have held three

         separate hearings, including one status conference, in this case involving 8 motions and

         applications, 7 of which were approved, and one of which was denied after an appearance by

         some of the Movants. Additionally, the Debtor has filed its application to employ professionals.

         Moreover, the vocal creditors, including the Movants, have already engaged local Delaware

         counsel to represent their interests. Movants simply have not met their burden of showing they

         cannot appear in Delaware. They, in fact, already have. And Ms. Foley and Mr. Allen have

         volunteered to participate in the case no matter where it is venued by volunteering for the

         Committee.

                13.     After a diligent interview process and search, the Debtor has retained Delaware

         counsel, as well as non-Colorado based financial advisor, each of which is skilled and

         experienced in chapter 11 reorganizations. Other parties have already retained Delaware

         counsel, including the DIP lender. The Debtor's real estate advisor, who is involved in the East

         Coast financial markets, is located in New York. All of the Debtor's professionals as well as the

         proposed DIP lender believe that Delaware is the best venue for this case. These are the

         constituents who are critical to the success of this Case and the financial rehabilitation and

         reorganization of the Debtor, not the Movants.




01:12275800.2
                                                           6
14.    Transferring this case to Colorado will create far more harm than it could ever

         alleviate; it would necessitate a new judge; it would require new co-counsel for the Debtor (and

         the Debtor anticipates difficulty and attendant delay with the retention of Colorado counsel based

         upon possible conflicts of interest, see Fitchett Decl.   at~   10); transfer may affect (and will

         certainly increase the costs associated with) the potential debtor in possession financing, which is

         poised to provide sufficient funds for the Debtor to operate for the next year while it finalizes its

         capital restructuring and confirms a plan ofreorganization. Moreover, it would inconvenience

         the Debtor's real estate advisor, DIP lender, CRO, and financial advisors- the parties whose

         testimony is most likely if the Debtor's plan is contested.

                 15.    The Movants have not and will not be able to satisfy their heavy burden of

         showing that a change in venue is necessary for the convenience of the parties or for the interests

         of justice, and this Court should therefore deny the Motion.

                                                  BACKGROUND


         A.      The Debtor

                 16.    The Debtor is a limited liability company incorporated under the laws of the state

         of Delaware.


         B.      Company Background

                 17.     The Debtor owns and operates the "Club Facilities" as defined in the Venue

         Motion which are located in Vail Valley in Eagle County, Colorado.

                 18.     The details of the Debtor's operations, current management and equity interests in

         the Debtor, are set forth in the First Day Motion affidavit of the Debtor's CEO, DanielL.

         Fitchett, Jr. filed herein on June 26, 2012 (Docket No.2) and are incorporated herein by

         reference.
01:12275800.2
                                                            7
19.     Prior to filing its bankruptcy in Delaware, the Debtor worked with local lenders in

         Colorado, including Alpine Bank, but was not successful in generating any interest from the

         local Colorado community to assist with financing for the business. Fitchett Decl. Indeed, the

         Debtor attempted to negotiate a work-out with Alpine Bank for many months prior to the filing

         of the bankruptcy petition herein without success. Fitchett DecI. Therefore, Debtor was forced

         to look outside Colorado- with the assistance of its New York-based real estate advisor, among

         several alternatives, the Debtor identified Northlight Financial, LLC a New York based lender

         and negotiated the terms of a DIP loan with its affiliate, Southlight Trust I, a Delaware statutory

         trust (collectively "DIP Lender"), which is the subject ofthe July 19,2012 hearing scheduled to

         proceed before this Court. [Docket Entry No. 59].

                20.     The main issues in this case, namely Alpine Bank's alleged perfection of a

         security interest in personal property of the Debtor and the reorganization of the Debtor's capital

         structure, are governed by Delaware law.

                21.     On June 26, 2012 (the "Petition Date"), the Debtor filed a voluntary petition for

         relief under chapter 11 of the Bankruptcy Code.


         C.      Activity in the Bankruptcy Case

                 22.    The Debtor continues to operate its business and manage its property as debtor in

         possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. On June 27, 2012,

         the Court presided over, and granted, the Debtor's seven (7) First Day Motions, and each of the

         Movants participated through counsel in those proceedings.




01:12275800.2
                                                           8
23.     On July 3, 2012, this Court denied Debtor's emergency motion for co-debtor stay,

         after vociferous and competent participation and opposition by these very Movants, through the

         representation of Delaware counsel, who had little inconvenience appearing before this Court on

         24-hours' notice.

                 24.    The Debtor's motion for approval of debtor in possession financing, filed on

         July 1, 2012, is set to be heard on July 19, 2012, and Alpine and the Debtor have worked

         together, through local counsel, relative to streamline discovery and trial of that matter.

                 25.    On June 29, 2012, Debtor filed an adversary complaint against Alpine Bank,

         challenging the alleged security interest in certain of Debtor's assets, commencing adversary

         case number 12-50785 (the "Adversary") [Docket Entry No. 60].

                 26.     On July 3, 2012, the Member's Motion was filed to transfer venue, after they had

         already appeared through same Delaware counsel in the First Day Motions and the co-debtor

         stay hearings on June 27 and July 3, respectively. On July 5, 2012, Alpine Bank filed its joinder

         in the Class Member Motion.

                 27.     On July 5, 2012, the CPOA and the District- through counsel who represented

         them at the First Day Motions -    filed their motion to transfer venue.

                 28.     On July 6, 2012, the United States Trustee presided over a formation meeting and

         appointed the Committee, which includes as volunteers who have submitted to the jurisdiction

         and venue of the Delaware court, the only Colorado residents that participated in the filing of the

         Member's Motion.

                 29.     On July 10, 2012, Debtor filed various professional retention applications and

         related motions.

                 30.     The Debtor anticipates filing its Schedules and Statements in short order.


01:12275800.2
                                                           9
31.     To suggest that Movants are unable to avail themselves of competent Delaware

         representation, or that somehow the Colorado-based members will be inconvenienced by their

         own voluntary participation as members ofthe Debtor's Creditors Committee if this matter

         proceeds in Delaware, is belied by facts; rarely do clients need to attend every hearing (indeed,

         maybe not even most hearings) and Movants have made no effort to explain how often or why

         they would need to personally appear, particularly given the ease of telephonic appearance.


         D.     The Movants

                32.     Some of the Movants allege to be court-approved representatives of a certified

         class of club members in Case Number 11CV552 pending in the District Court of Eagle County,

         Colorado. Only two of these named members live in Colorado (and both of the Colorado

         residents have decided to forego any claims of inconvenience by traveling to Delaware on July 6,

         2012 to be appointed as members ofthe Committee), the other four live in Illinois and

         Washington, DC- both forums more convenient to Delaware than Colorado.

                33.     All Movants have engaged Delaware counsel to assist with their Member's

         Motion (and to appear at the First Day Motions and the Stay Motion). See Court Docket Entry

         No. 58, 61, 82, and 83.

                34.     Movants that are participants in the class action litigation have not provided any

         evidence to this Court that they are authorized to speak for the alleged 609 other members of the

         class they purport to represent, or whether this is simply rogue conduct on the part of the six

         members.




01:12275800.2
                                                          10
35.     Alpine clearly has shown no inconvenience as is evidenced by their active

         participation in this case to date- it is uncertain whether the bank will challenge Debtor's claim

        that Delaware law applies to the issue of perfection of its security interest in Debtor's personal

         property assets.

                36.     Finally, CPOA and the District have also engaged Delaware counsel (who

         appeared at the First Day hearings) and have shown no hardship in having the case proceed in

         Delaware, including that they have shown no need to appear in person given the ease of

         telephonic appearances. Moreover, Ms. VanDeusen, although she claims that Delaware is

         inconvenient, actually has strong ties to the East Coast, is on the board of organizations in New

         Jersey and works for a New Jersey based firm. See http://www.njisj.org/test site/about/boardll.php.


         E.      The Debtor's Assets

                 37.    When the Debtor commenced this case, it operated four golf courses, a state-of-

         the-art athletic club, the Trailhead Facilities, and owned restaurant facilities at the Mountain,

         Summit and Valley Course facilities, swimming pools, tennis courts, and a family lodge, among

         other amenities. The Debtor also owns significant accounts receivable owing from members

         spread across the Country.


         F.      The Debtor's Secured Creditors

                 38.    On the Petition Date, the Debtor's alleged secured lender, Alpine, had opposed

         the Debtor's motion to use cash collateral and is the defendant in Debtor's Adversary

         challenging the bank's perfected secured status in certain collateral. Alpine has also expressed

         opposition to the Debtor's motion for approval of DIP financing from the DIP Lender, currently

         scheduled for hearing on July 19, 2012.



01:12275800.2
                                                           11
39.        David Wilhelm is also an alleged secured creditor of the Debtor, although Debtor

        understands that Wilhelm consents to Delaware's choice of venue in Delaware and consents to

        the terms of the Debtor's DIP financing.


         G.     The Debtor's Other Creditors

                40.        The Debtor's Schedules and Statements which will be on file herein by the

         hearing date ofthe Venue Motions, as well as Exhibit A to the CPOA/District Motion,

         demonstrate that there are potential creditors located in every state in the United States and

         abroad. Of the vendors who have outstanding claims against the Debtor, over 50% are not

         located in Colorado. Ofthe Debtor's club members, some of whom claim to be creditors ofthe

         Debtor (these claims are disputed by the Debtor), approximately 66% reside outside Colorado.

         In short, Colorado is not the most convenient forum for the vast majority of the pre-petition

         participants in the Debtor's business.

                                                     ARGUMENT


                                                            I.
                              TRANSFER OF THE DEBTOR'S CHAPTER 11 CASE
                               IS NOT IN THE INTEREST OF JUSTICE OR FOR
                                   THE CONVENIENCE OF THE PARTIES

                 41.       "Change of Venue" pursuant to 28 USC 1412 provides: "A district court may

         transfer a case or proceeding under title 11 to a district court for another district, in the interest of

         justice or for the convenience of the parties." Section 1412 of title 28 applies to changes of venue

         both of (a) cases under title 11 and (b) civil proceedings arising under title 11, or arising in or

         related to cases under title 11. Section 1412 speaks ofthe interest of justice "or" the convenience

         of the parties.




01:12275800.2
                                                            12
INTERESTS OF JUSTICE WEIGH IN FAVOR OF DELAWARE

                42.     A Debtor's choice of venue should only be disturbed when the balance weighs

         heavily in favor of a defendant's motion for transfer. Oglebay Norton Co. v. Port (In re ONCO

         Inv. Co.), 320 B.R. 577, 579 (Bank:r. D. Del. 2005). Movants bear the burden of demonstrating,

         by a preponderance of the evidence, that a transfer of venue is warranted. HLI Creditor Trust v.

         Keller Rigging Constr., Inc. (In re Hayes Lemmerz Int'l Inc.), 312 B.R. 44, 45 (Bank:r. D. Del.

         2004) (citing Hechinger Liquidation Trust v. Fox (In re Hechinger Inv. Co. ofDel., Inc.), 296

         B.R. 323, 325 (Bank:r. D. Del. 2003). The decision of whether venue should be transferred lies

         within the sound discretion of the Court, though the moving party must demonstrate by a

         preponderance of the evidence that such change is warranted. Lamari Ltd. v. Yes! Entm't Corp.,

         244 B.R. 56, 61 (D.N.J. 2000).

                43.     In cases such as this one where the existing venue is entirely appropriate, the

         Court must exercise its power to transfer cases cautiously. In re Enron Corp., 274 B.R. 327, 342

         (Bankr. S.D.N.Y. 2002); In re Campbell, 242 B.R. at 746; A.R.E. Mfg. Co., Inc. v. D & M

         Nameplate, Inc. (In re A.R.E. Mfg. Co., Inc.), 124 B.R. 912, 914 (Bankr. M.D. Fla. 1991); In re

         Walter, 47 B.R. 240, 241 (Bank:r. M.D. Fla. 1985).


         A.     The Case will Turn on Involvement of the East Coast Based Lenders/
                Investors/Buyers

                44.     The most important consideration in deciding whether to transfer venue of this

         case is where economic administration of a chapter 11 case can best be accomplished. See In re

         Enron Corp., 274 B.R. at 348; In re Commonwealth Oil Ref. Co., 596 F.2d at 1247; In re Int'l

         Filter Corp., 33 B.R. 952, 956 (Bank:r. S.D.N.Y. 1983). The economic administration of a

         bankruptcy estate involves the need to obtain post-petition financing, the need to obtain

         financing to fund reorganization, and the location of the sources of such financing and the
01:12275800.2
                                                         13
management personnel in charge of obtaining it. Huntington Nat'l Bank v. Indus. Pollution

         Control, Inc. (In re Indus. Pollution Control, Inc.), 137 B.R. 176, 182 (Bankr. W.D. Pa. 1992);

         see also In re Int'l Filter Corp., 33 B.R. at 956; In re Enron Corp., 274 B.R. at 348; In re Garden

         Manor Assocs., L.P., 99 B.R. 551, 554-55 (Bankr. S.D.N.Y. 1988) (court denied motion to

         transfer even when sole asset was located in another jurisdiction because ability to raise capital,

         renegotiate loan terms and likely sources of capital were located in current venue.)

                  45.      The Movants' arguments focus largely on peripheral litigation in Colorado and

         the situs of the Debtor's primary assets rather than on the true driver of this restructuring, which

         will be financing from sources outside Colorado, such as the proposed DIP Lender. The post-

         petition economic administration of this case is East Coast centric as there is little or no

         economic market in Colorado or the Midwest for the sources of post-petition capital for the

         Debtor as are available to it on the East Coast. See Bordwin Decl.    at~   13. See also Fitchett

         Decl.   at~   4-6 and 8.


         B.       Disruption To Debtor, Their Estates and Their Creditors

                  46.       The Debtor's goal of maximizing the recovery for creditors can best be achieved

         through a speedy and efficient chapter 11 process. Transfer of venue of this case would thwart,

         or at least hamper, that goal. There is no question that a transfer of venue of this case at this time

         would delay, disrupt, and add unnecessary expenses (especially to the DIP financing) to the

         administration of the cases, and take the Debtor back to a financial market that has already

         turned its back on the Debtor.

                  4 7.      If this Court were to grant the Venue Motion and transfer venue, the Colorado

         court would need to expend time and effort to become familiar with the cases, the relief granted

         to date, and the pending matters. The professionals would need to retain a new set of local

01:12275800.2
                                                            14
counsel (with attendant problems being anticipated by the Debtor) and may need to file

         duplicative motions. All with additional expense to the Debtor.

                 48.     Moreover, as to the adversary proceeding contesting Alpine's security interest, the

         inevitable delays in resolving that issue would unquestionably result in additional expense for the

         estate and would not be in the best interests of creditors. Thus, it is in the best interests of the

         Debtor, their estates and their creditors for the venue of this case to remain in Delaware.

                                                         II.

          THE CONVENIENCE OF THE PARTIES IS AT BEST NEUTRAL, AND LIKELY IN
         DEBTOR'S FAVOR, IN LIGHT OF THE REALITY THAT THE MAJOR CREDITORS,
         THE DEBTOR, AND DEBTOR'S PROFESSIONALS (INCLUDING ITS REAL ESTATE
         ADVISOR), AND PROPOSED DIP LENDER ALL HAVE AVAILED THEMSELVES OF
            THIS COURT AND HAVE ENGAGED COMPETENT DELAWARE COUNSEL

                 49.     The criteria that many courts employ in determining whether to transfer a title 11

         case for convenience of the parties is: (1) the proximity of creditors of every kind to the court;

         (2) the proximity of the bankrupt (debtor) to the court; (3) the proximity of the witnesses

         necessary to the administration of the estate; (4) the location of the assets; (5) the economic

         administration of the estate; and (6) the necessity for ancillary administration ifliquidation

         should result. See, Commonwealth of Puerto Rico v. Commonwealth Oil Refining Co., Inc. (In

         re Commonwealth Oil Refining Co., Inc.), 596 F.2d 1239, 1241 (5th Cir. 1979), cert. denied, 444

         U.S. 1045, 100 S. Ct. 732, 62 L. Ed. 2d 731 (1980). Accord In re Enron Corp., 274 B.R. at 343

         (using CORCO factors but also relying upon Gulf States Exploration Co. v. Manville Forest

         Prods. Corp. (In re Manville Forest Prods. Corp.), 896 F.2d 1384 (2d Cir. 1990), even though

         that case involved a motion to transfer an adversary proceeding); In re Land Stewards, L.C., 293

         B.R. 364 (Bankr. E.D. Va. 2002); In re Campbell, 242 B.R. 740 (Bankr. M.D. Fla. 1999); In re

         Pope Vineyards, 90 B.R. 252 (Bankr. S.D. Tex. 1988); In re Walter, 47 B.R. 240 (Bankr. N.D.

         Fla. 1985).
01:12275800.2
                                                               15
50.      Third Circuit case law requires the Court to apply a twelve-factor test in

         determining whether to grant a motion to transfer venue. 5 See Hayes, 312 B.R. at 46 (citing

         Jumara v. State Farm Ins. Co., 55 F.3d 873, 879-80 (3d Cir. 1995)). The twelve factors are:

         (1) Plaintiffs choice of forum, (2) defendant's forum preference, (3) whether the claim arose

         elsewhere, (4) the location ofthe books and records and/or the possibility of viewing premises if

         applicable, (5) the convenience of the parties as indicated by their relative physical and financial

         condition, (6) the convenience of the witnesses, but only to the extent that the witnesses may

         actually be unavailable for trial in one of the fora, (7) the enforceability of the judgment,

         (8) practical considerations that would make the trial easy, expeditious, or inexpensive, (9) the

         relative administrative difficulty in the two fora resulting from congestion of the court's dockets

         (1 0) the public policies of the fora, (11) the familiarity of the judge with the applicable state law,

         and (12) the local interest in deciding local controversies at home.

         Movants argue that the Chapter 11 case should be transferred to the District of Colorado for

         several asserted reasons- none ofwhich ultimately weigh in favor of transferring venue -- as

         follows: (1) there is pending litigation in Colorado, involving some of the members (Debtor's

         response: these members do not explain why this should prevent the bankruptcy case from

         proceeding in Delaware); (2) the majority of creditors are in Colorado (Debtor's response: as

         noted above, this is not accurate. The majority of both creditors and members are located outside

         of Colorado, and the majority of members filing the Member Motion do not reside in Colorado.

         Moreover, the two who do reside in Colorado having volunteered to accept the convenience of

         the Delaware forum by joining the UCC); (3) little has happened in the case (Debtor's response:

         this is incorrect, the Debtor has filed and this Court ruled on 7 first day motions, the financial

         5
             These 12 factors include the six (6) factors related to the convenience ofthe parties discussed above.


01:12275800.2
                                                                    16
support for the Debtor is located in the East Coast, Debtor's CRO, financial advisor and real

         estate advisor are not in Colorado, the Debtor's counsel is in Delaware and San Diego, not

         Colorado; a committee has been formed, and the major creditors have all engaged Delaware

         counsel. All is in place in Delaware to move the case expeditiously forward); (4) the assets are

         in Colorado (Debtor's response: the location of the assets is not a critical issue in a motion to

         transfer venue in a Chapter 11 proceeding, but may be relevant in a liquidation. See Garden

         Manor Assoc., supra. But, in any event, a significant asset of the Debtor,- accounts receivable

         owing from members- are owed by members located throughout the Country); (5) Colorado

         law applies to some agreements (Debtor's response: this Court is well positioned to address the

         potential issues in this case, even if it must interpret contracts governed by laws of other

         jurisdictions- although, it is unclear, at best, whether even the membership agreements are all

         governed by Colorado law (see below), and even then, while Colorado law may be relevant to

         the litigation matters pending there, it has little relevance to the financial restructuring that is the

         central issue in this case. See In re Visteon Corporation v. Governor Business Solutions, Inc.,

         2011 Bankr. LEXIS 4008 (this court held that "where issues will be resolved through basic

         contractual interpretation, and the location of the underlying events is not germane, this factor is

         neutral.")).

                 51.     As discussed more fully below, Movants simply have not met their heavy burden

         to justifY such a drastic remedy of transferring this case to Colorado. In re Delaware and Hudson

         Railway Co., 96 B.R. 467, 468 (D. Del. 1988), affd, 884 F.2d 1383 (3d Cir. 1989); see also In re




01:12275800.2
                                                            17
Commonwealth Oil Refining Co., Inc., 596 F.2d at 1241; In re Fairfield Puerto Rico, Inc., 333 F.

         Supp. 1187, 1189 (D. Del. 1971). 6

                 52.       The burden of proof in connection with the Venue Motions is on the Movants, not

         the Debtor. Nevertheless, the Debtor will demonstrate that, utilizing the twelve-factor test

         relating to venue transfer, Movants have not and cannot meet their burden.

                                                                  III.

                           TWELVE FACTOR TEST WEIGHS IN DEBTOR'S FAVOR
                                 IN RETAINING VENUE IN DELAWARE

                  53.      The first factor, Debtor's forum preference, weighs in Debtor's favor. "Transfer

         is a cumbersome disruption of the Chapter 11 process." In re Pavilion Place Associates, 88 B.R.

         32, 35 (Bankr. S.D.N.Y. 1988). Consequently, when venue is proper, a debtor's choice of forum

         is to be accorded substantial weight and deference. See In re Delaware and Hudson Railway

         Co., 96 B.R. at 469; In re Visteon Corp., 2011 Bankr. LEXIS 4008. A movant must demonstrate

         that a transfer of venue is necessary to achieve the statutory purposes by a preponderance of the

         evidence. In re Commonwealth Oil Refining Co., 596 F.2d at 1241 (citing, In re Fairfield Puerto

         Rico, Inc., 333 F. Supp. 1187, 1189 (D. Del. 1971)).




         6
           In considering these factors, courts also rely on decisions construing 28 U.S.C. § 1404, which is the federal statute
         governing transfer of venue of civil actions. Jumara v. State Farms Ins. Co., 55 F.3d 873, 879 (3d Cir. 1995); In re
         Spillane, 884 F.2d 642, 645 (1st Cir. 1989); Pursuit Athletic Footwear, Inc. v. Save Power Ltd., C.A. No. 96-40-
         MMS, 1996 WL 328596, at *5 (D. Del. June 7, 1996) ("The decision to transfer venue under either section 1404 and
         1412 has been determined to tum on the same issues."). Courts considering venue transfer motions in
         nonbankruptcy cases recognize that "a plaintiffs choice of forum is a paramount consideration in any determination
         of a transfer request, and the court should not disturb the plaintiffs choice lightly." Shutte v. Armco Steel Corp.,
         431 F.2d 22, 25 (3d Cir. 1970).


01:12275800.2
                                                                   18
54.      Some courts suggest that something more than a preponderance of the evidence

         must weigh in favor of transfer:

                [W]here after balancing all factors, the equities lean but slightly in favor of the
                movant, the plaintiffs choice of forum should not be disturbed.

         49 B.R. 935, 938 (Bankr. E.D.N.Y. 1985); see also In re Garden Manor Assoc., L.P., 99 B.R. at

         553 ("where a transfer would merely shift the inconvenience from one party to the other, or

         where after balancing all the factors, the equities leaned but slightly in favor of the movant, the

         [debtor's] choice of forum should not be disturbed.").

                55.      In Matsushita Battery Indus. Co. v. Energy Conversion Devices, Inc., the

         Delaware District Court described the movant's burden of proof on a venue transfer motion as

         follows:

                As a general rule, "[b ]ecause plaintiffs choice of forum is accorded substantial
                weight, the burden is on the defendants to establish that the balance of
                convenience of the parties and witnesses strongly favors the defendants."

         C.A. No. 96-101-SLR, 1996 WL 328594, at *4 (D. Del. April23, 1996) (quoting, Bergman v.

         Brainin, 512 F. Supp. 972, 973 (D. Del. 1981)).

                 56.     A Delaware entity's election to commence a chapter 11 case in the District of

         Delaware is not to be disregarded or downplayed in the context of a venue transfer motion.

         Indeed, it is the well-settled law of this District that, even if Delaware is not a plaintiff's "home

         turf," deference should be accorded to the Delaware entity's choice of venue. See Waste

         Distillation Technology, Inc. v. Pan American Resources, 775 F. Supp. 759, 766 (D. Del. 1991)

         ("[T]his Court rejects the assertion that 'lack of doing business' here makes it unfair to try the

         case here.").




01:12275800.2
                                                           19
57.    Wilmington, Delaware is a ninety-minute train ride from both New York City and

         Washington D.C. It is a thirty minute drive from the Philadelphia International Airport.

         Conversely, Cordillera is over a hundred miles from Denver, through at least three mountain

         passes. For the vast majority of the parties in interest that will be attending hearings in this case

         on a regular basis, Wilmington is at least if not a far more convenient venue than Colorado,

         including for some of the Movants, contrary to their self-serving and unsupported claims of
         .      .
         mconvemence.

                 58.     Consider the parties in interest that are certain to attend every hearing in this case,

         the Debtor, their proposed DIP lender, the Committee and the U.S. Trustee. Their respective

         counsel are each located in San Diego, Detroit and Delaware. Should contested hearings be

         necessary, the likely witnesses will be the Debtor's financial advisors who are based in the East

         Coast. And the only Colorado-based Class Members among the Movants have voluntarily

         elected to join the Committee and should be viewed as consents to the convenience of these

         cases no matter where they are venued.

                 59.     All of the major parties in this case have already retained Delaware bankruptcy

         counsel. Of the numerous professionals who have appeared in this case, only Alpine's counsel

         has offices in both Colorado and Delaware.

                 60.     In addition, the Debtor's Delaware counsel has extensive understanding of

         numerous aspects of the Debtor's business, as they took the lead in assisting the Debtor in the

         preparation of its first day motions. Transferring this case to Colorado would require the Debtor

         to engage and educate local counsel in Colorado (with an anticipated delay and potential conflict

         issue) and would saddle the estate with additional expenses arising from the time and expense for

         travel to and from Colorado. These expenses could be substantial in light of the fact that the


01:12275800.2
                                                           20
Debtor's counsel are located in San Diego, California, and Delaware, and the financial advisors

        are located on the East Coast (Detroit and New York). Moreover, at least in part because of the

        action of Movants, there is no market for financing to the Debtor in Colorado, and the financial

        markets in New York and the East Coast are the most likely source of the Debtor's post-petition

         financing. See Bordwin Decl.    at~   16.

                61.     Notably, the DIP Lender, located in New York, also supports venue in Delaware

         (the DIP Lender has advised the Debtor that it intends to file a joinder in the Debtor's opposition

         to the transfer of venue). And several of the dues paying members support venue in Delaware.

                62.     Accordingly, the Debtor's decision to commence this case in the District of

         Delaware is entitled to substantial weight and deference and should not be disturbed unless the

         equities strongly favor the Movants, which it does not. This factor weighs in favor of a

         Delaware forum.

                63.     As to the second factor, Defendant's Forum Preference, Movants obviously

         prefer the District of Colorado. Thus, the second factor superficially appears to weigh in favor of

         transferring venue. Upon more careful scrutiny, Movants have not presented evidence to show

         that they are unable to participate in Delaware, nor can they because they have already been very

         active in the case and the only Colorado-based initial Movants have essentially waived their

         preference for the Colorado forum, having subsequently consented to the Delaware forum by

         agreeing to serve on the Creditor's Committee, a decision undertaken after the filing of the

         Members Motion. Moreover, the Movants don't speak for all creditors, and as noted, dues

         paying members and homeowners support Debtor's decision to file in Delaware.




01:12275800.2
                                                          21
64.     Additionally, the majority of the Debtor's other creditors and members are located

         outside of Colorado and thus, under Movants' logic, could face substantial travel burdens if the

         Debtor had filed their cases in Colorado. Even Colorado creditors would face long trips by car

         or plane, as the Colorado Bankruptcy Court, which is a greater than a two-hour car ride from

         Cordillera, is far from being centrally-located. For example, a creditor in Washington, DC

         (which include Movants Thomas and Jane Wilner) would be forced to traverse a greater distance

         to Colorado than they would to attend a hearing in Wilmington.

                65.     Finally, Debtor believes that other Club members favor a speedy resolution of the

         Debtor's economic rehabilitation in the Delaware venue, and Debtor expects those members to

         file Joinders in the Debtor's Opposition to the Venue Motion.

                66.     The Debtor's alleged secured creditor- whose businesses are national in scope

         and thus render them generally agnostic on matters of geography- not surprisingly has already

         engaged Delaware counsel and from the Court docket has had no difficulty in making its position

         known to the Court. Moreover, it is now a defendant in the adversary proceeding before this

         Court (Adversary Number 12-50785) and has filed a joinder in the Member's Motion.

                67.     This factor is at best neutral or weighs in favor of the Debtor given that Debtor's

         preference for a forum takes precedence. See Garden Manor, supra.

                68.     As to the third factor, whether The Claim Arose Elsewhere, Movant contends

         that the claims relate to issues in Colorado. The Debtor does not dispute that the majority of the

         assets are located in Colorado. The Debtor contends that the relevant law for the fmancial

         restructuring, the post-petition finance, and the corporate restructuring is Delaware. The Debtor

         filed in Delaware for the convenience of the parties that the Debtor expects will be instrumental

         in the Debtor's reorganization, namely the DIP financing lender, the financial advisor, the


01:12275800.2
                                                         22
bankruptcy counsel, the real estate advisor, and expected "exit financing" lenders. Here,

         Debtor's goal is to submit a plan that will allow the Debtor to proceed with a recapitalization and

         new investment that will allow the Debtor to profitably manage its operation and satisfy claims

         of creditors. It is well-settled that "where the issue will be resolved through basic contractual

         interpretation and the location of the underlying events is not germane, this factor is neutral."
                                                                            7
         Visteon, supra, citing DHP Holdings II, 435 B.R. at 273.

                 69.      This factor is in favor of the Debtor.

                 70.      As to the fourth factor, Location Of Books And Records, this is also a neutral

         factor. Debtor concedes that the computers on which it's electronic "books and records" are

         maintained are located in Colorado - but these electronic books and records can be easily

         accessed without regard to the location of the computer on which they are maintained. However,

         given the goal, and likelihood, of rehabilitation, this is not an important factor here and should
         7
            It is uncertain to what extent Colorado law does apply to the interpretation of the member documents. In
         essence, there are four (4) documents or instruments that govern memberships and membership rights and
         obligations in the Club at Cordillera, namely: (1) The Club at Cordillera Membership Plan; (2) The Club at
         Cordillera Rules and Regulations; (3) The Club at Cordillera Application for Membership Privileges; and (4) the
         Addendum to Application for Membership Privileges (Premier Memberships) or Addendum to Application for
         Membership Privileges (Charter Memberships).

         All members of the Club at Cordillera (Signature Golf, National, Gold Medallion, Corporate, Social, Resident
         Owner and Honorary), were required to execute and deliver to Debtor an Application for Membership Privileges.
         Similarly, pursuant thereto, all members of the Club at Cordillera are bound by the Membership Plan and the Rules
         and Regulations, as those are from time to time amended. The Membership Plan, the Rules and Regulations and the
         Application for Membership Privileges are all silent as to governing law. In other words, neither the Membership
         Plan, the Rules and Regulations nor the Application for Membership Privileges specify any governing law. Debtor
         asserts that all members of the Club at Cordillera are bound by these documents, as they are amended from time to
         time.

         Certain Signature Golf Members of the Club at Cordillera elected to convert their Signature Golf Membership to
         either a Premier Membership or a Charter Membership. In order to make this election, these members executed and
         delivered to the Debtor an Addendum to Application for Membership Privileges (Premier Memberships) or an
         Addendum to Application for Membership Privileges (Charter Memberships). In these Addendums, the governing
         law is specified as Colorado. These documents only apply to a limited number of Signature Golf Members. These
         are the only documents that specify the governing law. Given that nearly two-thirds of the members are not
         Colorado residents, there is at least a question of whether Colorado law governs the claims grounded in these
         documents.




01:12275800.2
                                                                 23
not be the basis for the transfer of venue of this chapter 11 case. See In re Commonwealth Oil

         Ref. Co., 596 F.2d 1239, 1248 (5th Cir. 1979) (holding that "the location of the assets is not as

         important where the ultimate goal is rehabilitation rather than liquidation). See also In re Land

         Stewards, L.C., 293 B.R. 364, 371 (Bankr. E.D. Va. 2002) .");In re Marina Enterprises, 14 B.R.

         327 (Bankr. S.D. Fla. 1981) (venue proper in Florida although debtor's sole asset, undeveloped

         land for hotel/casino, was located in New Jersey). Venue should be retained in the location

         where the debtor can most successfully reorganize, even if the sole asset is located in another

         jurisdiction. See In re Emon, 274 B.R. at 328 (citing In re Garden Manor Assocs., L.P., 99 B.R.

         551, 554-55 (Bankr. S.D.N.Y. 1988)).

                71.     Movants and Alpine place great emphasis on the fact that the Debtor's

         headquarters (and thus, their pre-petition executives) are located in Colorado. But, physical

         location of a debtor's headquarters (or the computers on which the electronic books and records

         are maintained) does not dictate the venue of a chapter 11 reorganization case, especially in light

         of the geographic diversity of the majority of Debtor's current creditors and members, the

         universe of Debtor's prospective investors, financial partners, and Chief Reorganization Officer.

         As recognized by the Court in In reUnited Button Co., 137 F. 668, 672, 673-74 (D. Del. 1904):

                Proximity of place ofbusiness of the bankrupt to the court entertaining
                proceedings in bankruptcy, though a circumstance sometimes entitled to weight,
                is by no means conclusive.

                Much stress was laid by counsel for the petitioning creditors upon the fact that the
                principal place ofbusiness ofthe bankrupt was located in New York City.
                Assuming this to be the case ... I am unable to perceive that the fact has much
                materiality or relevancy, as orders and directions may be sent to the
                manufacturing plants in Massachusetts from the receiver in Wilmington, as well
                as from one in New York or Chicago.




01:12275800.2
                                                          24
See also Fairfield Puerto Rico, 333 F. Supp. at 1190 ("[T]he location of principal assets and ...

         principal place of business or residence does not necessarily control whether transfer should be

         ordered."); In re Int'l Filter Corp., 33 B.R. 952, 956 (Bankr. S.D.N.Y. 1983) ("the location of the

         [debtor's] assets ... [has] greater weight ifthe proceeding is brought in Chapter 7.").

                 72.     As a matter of geography, Delaware is the convenient forum for east coast

         investors, and the available financing for the success of the Debtor's Chapter 11 case. See

         Bordwin Decl. at ,-r 16.

                 73.     Moreover, it is well recognized that "Because of the "ease of transporting [paper

         and electronic] documents" when discovery is "largely limited to 'paper exchanges"' the physical

         location of books and records is frequently considered a "neutral" factor. See In re Viteon, supra,

         citing DHP Holdings II, 435 B.R. at 273-274. Movants have not asserted that this matter

         "involves excessive or significant paperwork or that that there will be a copious amount of

         document production, which, in tum, would make it difficult to produce evidence to this court."

         ONCO, 320 B.R. at 580. Movant also has not distinguished the amount of non-electronic books

         and records in this case from the amounts considered non-problematic in comparable cases in

         this Circuit.

                 74.     This factor is in favor of the Debtor.

                 75.     As to the fifth factor, Convenience Of The Parties, Movants argue that the

         majority of creditors, including Debtor's secured creditor Alpine, are located in Colorado. As

         stated above, the facts are otherwise: a majority of Debtor's creditors, and a super-majority of

         Debtor's "members" are located outside of Colorado.

                 76.     Movants claim Delaware would be inconvenient, ignoring the reality that

         Movants and joinder parties have already engaged competent Delaware counsel and have


01:12275800.2
                                                           25
appeared before this Court with little inconvenience. Moreover, Movants ignore the reality that

         the existing secured creditor, Alpine, to date has been unwilling to work with the Debtor and thus

         the Debtor was forced to seek out alternative financing. The only Colorado-based Movants have

         availed themselves of a seat on the Creditor's Committee, consenting to the convenience of

         forum no matter where this case is pending. The Debtor was unable to find any lenders in

         Colorado willing to work with the Debtor. See Bordwin Decl. at 1 10-11. Thus the Debtor has

         had to seek out and has found, the DIP Lender, who is located on the east coast, convenient to

         the Delaware court. 8

                 77.      A motion is before this Court for approval of the DIP financing which motion is

         to be heard on July 19, 2012. The importance of expedited treatment for approval of financing

         bodes against transferring venue. Moreover, the Debtor has already retained Delaware counsel

         familiar with the case and without an office in Colorado. The Debtor has engaged a real estate

         advisor who advises the debtor that the best chance for locating additional investors/buyers - not

         just the DIP lender- are on the east coast, not Colorado. See Bordwin Decl. at 1 13. Thus,

         Delaware is optimally located to assist in the reorganization. As noted in ONCO, 320 B.R. at

         580 and cited by this Court in its In re Visteon decision: "transferring the dispute to another

         forum may actually increase the administrative expenses of the estate, lower the amounts

         available for distribution ... and sap the temporal and financial resources of the Plaintiff."

         Movants have failed to show any concrete evidence that it would be less expensive overall to

         handle the reorganization matters of this case anywhere but Delaware. As a result, the

         convenience factor is neutral at best for Movants and likely weighs in favor of denial of the

         motion.
         8
           Indeed, all of Debtor's received DIP proposals and interest in take-out finance are with non-Colorado based
         entities.


01:12275800.2
                                                                 26
78.     Debtor concedes that many- but not the majority- of the creditors are located in

         Colorado, a fact not determinative that the cases should be transferred to Colorado. See In re

         Indus. Pollution Control Inc., 137 B.R. at 181. The majority of creditors who are owed money,

         and the super-majority of members, are located outside Colorado. Based on their moving papers,

         four of the six Movants are not residents of Colorado: two are from Illinois, two from

         Washington, DC. And both Colorado-based Movants can hardly be heard to complain given that

         they volunteered to sit on the creditors committee no matter where this case is venued.

                79.     No creditor other than Movants have expressed a concern over the Delaware

         venue. Other creditors and members support venue in Delaware. In fact the Debtor's key

         constituents to its reorganization, including the DIP lender, oppose transfer of venue to Colorado.

                80.     Attendance at meetings of the Committee and with the Debtor's professionals will

         occur irrespective of the venue of the Chapter 11 cases. In many instances, these meetings will

         be conducted by conference call. In fact, not one of the Movants stated that they, individually,

         intended to appear at hearings. Given that the Colorado bankruptcy court is at least a two-hour

         drive for most of the Committee Members, for example, it is unlikely they will attend any routine

         hearings. Thus, their claims of inconvenience should not sway this Court as there is simply no

         substance behind those claims. This is likely to be particularly true in cases, such as these, where

         the Committee members are located in states across the country.

                81.     Movants profess concern for Colorado creditors, arguing that the Delaware

         hinders their participation in this case. While this may be true in a few limited instances, the

         venue of this case likely has very little to do with why these creditors are not likely to take an

         active participation in this case. Their lack of participation likely stems from the fact that the

         size of their claim, if any, is too small to justify the expenditure of time necessary to effectively


01:12275800.2
                                                           27
participate in a chapter 11 case. Congress's solution to this problem of collective action was to

         provide for the formation of an official committee of unsecured creditors. This Committee has

         been formed in this case and the members have not presented any reason why they will need to

         personally appear at any of the hearings- indeed, the only two Colorado-based Movants have

         joined that committee.

                82.     It is also unlikely that there will be a need for ancillary administration if

         liquidation should result. This factor has little bearing on the case proceeding in Delaware. This

         Court is more than capable of conducting sale motions of assets located outside its borders - but,

         as set forth herein, and evidenced by the speed and efficiency with which this Debtor acquired a

         post-petition DIP commitment, this case demonstrates a strong likelihood of reorganization.

                83.     As described above, the Debtor maintains that Delaware is more convenient than

         Colorado for parties that are most likely to routinely participate in court hearings and that

         Colorado would present a substantial travel burden even for Colorado creditors. Thus, this factor

         weighs in favor of the Debtor.

                84.     As to the sixth factor, Convenience Of The Witnesses, this factor is only relevant

         to the extent that Movants show that witnesses are "actually unavailable for trial in Delaware."

         In re Visteon, 2011 Bankr. LEXIS 4008 (citing Hayes, 312 B.R. at 4 7. ). "Without such a

         showing, 'witnesses are presumed to be willing to testify in either forum, despite the

         inconvenience that one of the forums would entail."' Id.

                85.     Movants have not suggested that any relevant witnesses would be unavailable for

         trial in Delaware- this can hardly be the case for the two Colorado-based Movants, who have

         arguably waived the inconvenience argument by volunteering to participate as members of the

         statutory committee, and one of whom is a declarant who is expected to be in Court for the


01:12275800.2
                                                          28
hearing on the Motion. Moreover, Movants have not established that they will hereafter be

         witnesses in these bankruptcy proceedings. They may or may not. However, "a mere shift of

         inconvenience from one party to another will not suffice for a change of venue pursuant to 28

         U.S.C. § 1412. Russell, Bankruptcy Evidence Manual, 2002 Ed.,§ 301.33. See In re Campbell,

         242 B.R. 740, 747 (Bankr. M.D. Fla. 1999) ("While the Court is concerned for the convenience

         of witnesses in every case, this factor concerns the proximity of those witnesses necessary for

         administration of this estate.") The "Court needs more than mere allegations ... that witnesses

         will be needed and why their inconvenience in traveling to this district outweighs the Debtor's

         choice to file its petition here." In re Stony Brook Dev., LLC, No. 06-13781-WIL, 2006 Bankr.

         LEXIS 4246, 2006 WL 4547184, at 2 (Bankr. D. Md. Sept. 8, 2006). Other than the alleged

         facts asserted in the Class Action case, of which they may testify in the already pending cases in

         Colorado (and as to which the Debtor maintains insurance coverage), there is not likely an issue

         that arises in the reorganization for which their testimony is even relevant, much less likely.

         Therefore, this factor favors keeping the action in Delaware.

                86.     As to the seventh factor, Enforceability Of The Judgment, Movants have not

         even mentioned this factor, have not objected to personal jurisdiction, and have not provided any

         reason why a judgment from this Court would not be given full faith and credit in the State of

         Colorado, if ever relevant. Therefore, this factor favors keeping the action in Delaware. See

         Hechinger, 296 B.R. at 326.

                87.     As to the eighth factor- Practical Considerations that Would Make the Trial

         Easy, Expeditious, or Inexpensive- the Movants have introduced no evidence. Practically, this

         Chapter 11 case is about value, enterprise value, and an East Coast based market valuation and

         refinance. This factor weighs greatly in favor of venue in Delaware.


01:12275800.2
                                                          29
88.     As to the ninth factor- the Relative Administrative Difficulty in the Two Fora

         Resulting from Congestion of the Court's Dockets- is likely a neutral or weighs in Debtor's

         favor as this Court has already demonstrated the alacrity in which it moves matters along.

                  89.      As to the tenth factor- the Public Policies of the Fora- weigh in Favor of this

         Court where the emotional, charged dynamic that obviously exists in Colorado can be defused in

         a fresh location free oflocal acrimony. See Bordwin Decl.               at~   7-8; Fitchett Decl.   at~   3.

                  90.      As to the eleventh factor- the Familiarity of the Judge with the Applicable State

         Law- is likely a neutral issue. Little need be said in response to Movants' assertion that

         Colorado is a more "convenient and logical forum" because issues in the Debtor's case will

         require application of Colorado law. First, if that is true about the pending litigation brought by

         the Members and the Debtor's likely counter-claims, there is no truth to the fact that the

         reorganization issues central to the Chapter 11 have anything to do with Colorado law.

         Moreover, as to such peripheral issues even if they are relevant, bankruptcy courts regularly deal

         with state law issues without any difficulty, and the geographic scope of the Debtor's operations

         makes it highly unlikely that Colorado law will be the only state law at issue. Moreover, the

         perfection, or lack thereof, of the alleged Alpine security interest in certain personal property will

         tum on Delaware law, not Colorado law. Thus, Delaware, is likely better situated to deal with

         laws of different states given the more diverse types of creditor bodies in cases filed in

         Delaware. 9




         9
           Movants claim that Colorado law governs the rights of members under the membership documents. This is a red
         herring. First, it may not be true- see footnote 7, supra. Second, this is not the issue in the reorganization, where
         the relevant law is Delaware or possibly New York law (because the DIP and prospective fmancing partners are
         New York based, and it is common to expect New York law to govern post-petition fmancing arrangements in a
         reorganization).


01:12275800.2
                                                                   30
91.   As to the twelfth and final factor -the Local Interest in Deciding Local

         Controversies at Home -- Movants have not shown any prejudice to a Delaware forum. In fact,

         for reasons discussed, the financial market in Colorado is foreclosed to the Debtor, forcing the

         Debtor to look outside the local environment and to East Coast participants. The local

         community has turned its back on this Debtor and thus this factor weighs in favor of a Delaware

         forum.

                                                    CONCLUSION

                  92.   Under the facts of this case, neither the "convenience of the parties" nor the

         "interest of justice" either necessitate or justify the transfer of this chapter 11 reorganization case

         to Colorado. In fact, the opposite is true. The Movants have not, and will not, sustain their

         burden of showing, by a preponderance of the evidence, that the interests of justice or

         convenience of parties are better served ifthis case were transferred to Colorado. Indeed, it is

         clear that such a transfer, at this juncture, will negatively affect the Debtor's rehabilitation, will

         increase the Debtor's expenses relative to its DIP loan and future refinance, and will be of utmost

         inconvenience to the Debtor's professionals and likely post-petition financing sources.




01:12275800.2
                                                            31
93.     Delaware is well-suited to the convenience of the parties in interest that are most

        likely to play an active role in this case: the Debtor and its professionals, the Committee (with

        both of its 2 Colorado-based Movants having consented to participating in the Committee) and

         its professionals, the DIP lender, and other creditors that have retained local Delaware counsel.

         And, far from serving the interests of justice, transferring this case would work an injustice on

         this estate because it would be costly and disruptive to the Debtor's efforts to reorganize.

         Accordingly, the Debtor respectfully requests that this Court deny the Venue Motion, allow the

         Debtor to proceed with its efficient rehabilitation in this Court, and grant the Debtor such other

         and further relief as is necessary and appropriate under the circumstances

         Dated: July Jj_, 2012                     FOLEY & LARDNER LLP
                                                   Christopher Celentino (CA No. 131688)
                                                   Mikel Bistrow (CA No. 102978)
                                                   402 West Broadway, Suite 2100
                                                   San Diego, California 921 01
                                                   Telephone: (619) 234--6655
                                                   Facsimile: (619) 234-3510

                                                           -and-

                                                   YOUNG CONAWAY STARGATT & TAYLOR, LLP


                                              (72 R. Nof(N0:3526) ~
                                                Michael ~
                                                    Joseph M. Barry (No. 4221)
                                                    Donald J. Bowman, Jr. (No. 4383)
                                                    Kenneth J. Enos (No. 4544)
                                                    Rodney Square
                                                    1000 N. King Street
                                                    Wilmington, Delaware 19801
                                                    Telephone: (302) 571-6600
                                                    Facsimile: (302) 571-1253

                                                    Proposed Counsel for Debtor and Debtor in Possession




01:12275800.2
                                                          32

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10000001216

  • 1. IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re Chapter 11 CORDILLERA GOLF CLUB, LLC 1 dba The Case No. 12-11893 (CSS) Club at Cordillera, Hearing Date: July 16, 2012 at 10:00 a.m. Debtor. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___]Ref. Docket Nos. 69, 77, 78 & 95 THE DEBTOR'S OMNIBUS OBJECTION TO THE MOTIONS TO TRANSFER VENUE AND/OR RELATED JOINDERS FILED BY (I) CHERYL M. FOLEY, THOMAS WILNER, JANE WILNER, CHARLES JACKSON, MARY JACKSON AND KEVIN B. ALLEN, INDIVIDUALLY AND AS REPRESENTATIVES OF A CERTIFIED CLASS OF MEMBERS, (II) ALPINE BANK, (III) CORDILLERA PROPERTY OWNERS ASSOCIATION, INC. AND CORDILLERA METROPOLITAN DISTRICT Cordillera Golf Club, LLC dba The Club at Cordillera, the debtor and debtor in possession in the above-captioned case (the "Debtor"), by and through its undersigned attorneys, hereby submits this omnibus objection (the "Objection") to (i) the motion (the "Class Member Motion") of Cheryl M. Foley, Thomas Wilner, Jane Wilner, Charles Jackson, Mary Jackson And Kevin B. Allen, Individually And As Representatives Of A Certified Class Of Members (collectively, the "Class Members") to transfer venue of this case, (ii) the motion (the "CPOA/CMD Motion," and together with the Class Member Motion, the "Motions") of Cordillera Property Owners Association, Inc. ("the "CPOA") and Cordillera Metropolitan District ("CMD" or the "District"), to transfer venue of this case, and (iii) the joinders to the Motions (the "Joinders," and collectively with the Motions, the "Venue Motions") filed by Alpine Bank ("Alpine," and together with the Class Members, CPOA and CMD, the "Movants"). In support of its Objection, the Debtor respectfully states as follows: 1 The Debtor in this chapter 11 case, and the last four digits of its employer tax identification number, is XX- XXX1317. The corporate headquarters address for the Debtor is 97 Main Street, Suite E202, Edwards, Colorado 81632. 01:12275800.2
  • 2. PRELIMINARY STATEMENT 1. This case is not a liquidation case, but is instead a chapter 11 reorganization. The Debtor's economic rehabilitation turns on the valuation of its real estate, its going concern business, and its personal property and other assets. The Debtor alleges that the alleged first- priority secured lender has a defective security interest in the Debtor's non-real estate personal property assets. The fundamental issues to be resolved in this case are valuation, post-petition financing, and going-forward capitalization. The issues currently pending in Colorado and the focus of the Class Member's Motion and the Joinders, are at best peripheral to the central issues in the bankruptcy case, and are matters which can be resolved in Colorado without threatening the economic rehabilitation of the Debtor. Whether the Debtor wins its Colorado lawsuit as plaintiff, and how much money that may bring into the estate, is peripheral to the Debtor's capital restructure and financing plans, which are grounded in the financial markets of New York and the Northeast U.S. Whether the class action case results in a defense verdict in favor of Debtor (which Debtor anticipates), or a judgment for the class members (which, in any event, is an insured claim and therefore not a serious threat to the Debtor's restructuring) is likewise peripheral to the Debtor's capital restructure and financing plans, which are grounded in the financial markets ofNew York and the Northeast U.S. A transfer of venue away from the financial markets ofNew York and the Northeast U.S. makes the chapter 11 rehabilitation ofthis Debtor significantly more expensive, significantly less efficient, and prejudices all creditors of this estate that would expect a higher recovery on their claims with a recapitalization of the Debtor that can and will be accomplished in this case. 2. On July 3, 2012, the Class Members filed the Class Member Motion on shortened notice seeking to change the venue of this chapter 11 case to the United States Bankruptcy Court for the District of Colorado. 01:12275800.2 2
  • 3. 3. On July 5, 2012, Alpine filed its joinder to the Class Member Motion. Alpine is Debtor's secured lender, whose security interest is at issue in an adversary proceeding pending before this Court. Alpine now complains about Delaware as a forum; yet, the Debtor's chapter 11 filing was precipitated by Alpine's unwillingness to extend the due date on its loan. Declaration of Daniel Fitchett ("Fitchett Decl."). The Debtor was unable to find alternative financing in Colorado and thus has been forced to look outside the local Colorado market. 4. To that end, the Debtor has engaged a national-based real estate advisor (GA Keen Realty Advisors, based in NY) and a nationally-prominent Chief Restructuring Officer, Alfred H. Siegel (the "CRO"), who is not domiciled in Colorado. At least in part because of the stigma associated with the class action dispute, the Debtor's professionals have determined that the Debtor's financial future is not grounded in the Midwest, but rather the financial markets of New York and the east coast. See Declaration ofHarold Bordwin filed in support hereof ("Bordwin Decl."). 5. On July 5, 2012, CPOA and the District filed the CPOA/CMD Motion. The Debtor believes these parties are not motivated to promote the best interests of the estate. Rather, they seek to move this case to Colorado where the Debtor will be hampered by negative public opinion fueled by unsubstantiated claims espoused by these parties. In contrast, the Delaware forum provides a level playing field and affords the Debtor and all parties in interest a proper forum to prosecute this chapter 11 case to a successful reorganization. Movants' cries of inconvenience are simply not supported by compelling evidence. In fact, Movants have had no difficulty voicing their views in this Court and not a single Movant has stated that they are unable to attend hearings in Delaware. 01:12275800.2 3
  • 4. 6. Aside from the Movants, who represent only a fraction of the creditor body as a whole, none of the other creditors in this case have lodged a complaint over the Debtor's choice of venue. Indeed, it is anticipated that independent homeowners and Club members will join in the within opposition to the Venue Motions. 7. No one disputes that venue of the Debtor's case is both proper and permissible in Delaware under 28 U.S.C. § 1408; instead, Movants proceed under 28 U.S.C. § 1412. The Venue Motions are focused on the fact that (a) the Debtor's headquarters and assets are in Colorado and (b) the Debtor has many Colorado creditors, some with a pending action litigation in Colorado. 2 8. As discussed in detail below, these facts and what follows from them fall far short of satisfying the Movants' heavy burden of showing that the interests of justice or the convenience of parties in interest will be served by transferring this Chapter 11 reorganization case to Colorado. 9. Contrary to the suggestions in the Venue Motions, the Debtor's selection of Delaware for the venue of this case was and remains in the best interests of the estate because the economic administration of the case and the rehabilitation of the Debtor hinges on contacts with the financial markets in New York and on the East Coast, not locally in Colorado. While the Debtor may be characterized as a regional operation insofar as the location of its real estate and related amenities are concerned, its broad appeal on the national level is borne out by the fact that nearly two-thirds of its members reside outside of Colorado. See Debtor's Schedules and 2 The Colorado litigation between the Movants and the Debtor is not the focus of the bankruptcy case. While the Debtor expects to prevail in its case as plaintiff (and the recovery will be an asset of the estate), and expects to be exonerated in the class action case (and even if not, the recovery is covered by insurance, so the outcome will have little impact on the estate), the overall outcome of that litigation is not central to the economic reorganization of this Debtor. 01:12275800.2 4
  • 5. Statement of Financial Affairs, which will be on file herein. Moreover, the reality is that the success of this chapter 11 proceeding will hinge on the participation of those located on the East Coast, including the proposed DIP Lender. See Bordwin Decl. at 1 16. 10. As would be expected of a company that owns and operates high-end recreational amenities in a residential community where many of the homes are second homes or vacation homes, the vast majority of the Debtor's creditors are actually located outside of Colorado. 3 The statements by Movants that most creditors are in Colorado are simply not accurate; in fact, of the six individuals that filed the Member Motion, only Ms. Foley lists her address in Edwards, Colorado, and Mr. Allen lists his address in Cherry Hills Village, Colorado -the other four Movants reside in Washington, DC or Illinois. See Exhibit B to the Foley Decl. And, as to Ms. Foley and Mr. Allen, they have affirmatively sought and obtained a position on the Official Committee of Unsecured Creditors ("Committee") in this case, thus consenting to their availability to participate in this case no matter where it is pending. 4 See Notice of Appointment of Committee of Unsecured Creditors, Docket No.86. In fact, the Debtor expects that the major issues in this case will tum on the involvement of parties located on the East Coast. 11. The ultimate question for the Court is whether the Movants have shouldered their heavy burden and proved that administration of this chapter 11 case - and not the peripheral 3 In fact, Movants Thomas and Jane Wilner are located in Washington, DC (about 110 miles to the Delaware Court as opposed to 1657 miles to the Colorado Court) and Charles and Mary Jackson are located in Illinois (781 miles to Delaware Court and 1012 miles to Colorado). Additionally, the general creditor breakdown is as follows: Members: 34% are in Colorado, 66% are outside of Colorado; Vendors Owed Money (excluding employees): 46% are in Colorado, 54% are outside of Colorado; All vendors (excluding employees): 55% are in Colorado, 45% are outside of Colorado. See Schedules and Statement of Financial Affairs. 4 On or about July 6, 2012, the U.S. Trustee appointed the seven-member Committee [Docket No. 86]. Of the seven Committee members, four of them are Class Members, two of whom are named class representatives and Movants herein. The Debtor understands that the Committee is likely to support the Venue Motion. However, while the Debtor recognizes that the bankruptcy courts often give some deference to official committees on matters such as the one at bar, the weight of any support of the Venue Motion by the Committee in this case should be appropriately discounted given that the majority composition of the Committee are actual Movants herein. 01:12275800.2 5
  • 6. litigation already pending in Colorado- will be improved if the case is transferred to Colorado. The Debtor submits that Movants have not done so and will not be able to do so. 12. By the time this Court considers the Venue Motions, it will have held three separate hearings, including one status conference, in this case involving 8 motions and applications, 7 of which were approved, and one of which was denied after an appearance by some of the Movants. Additionally, the Debtor has filed its application to employ professionals. Moreover, the vocal creditors, including the Movants, have already engaged local Delaware counsel to represent their interests. Movants simply have not met their burden of showing they cannot appear in Delaware. They, in fact, already have. And Ms. Foley and Mr. Allen have volunteered to participate in the case no matter where it is venued by volunteering for the Committee. 13. After a diligent interview process and search, the Debtor has retained Delaware counsel, as well as non-Colorado based financial advisor, each of which is skilled and experienced in chapter 11 reorganizations. Other parties have already retained Delaware counsel, including the DIP lender. The Debtor's real estate advisor, who is involved in the East Coast financial markets, is located in New York. All of the Debtor's professionals as well as the proposed DIP lender believe that Delaware is the best venue for this case. These are the constituents who are critical to the success of this Case and the financial rehabilitation and reorganization of the Debtor, not the Movants. 01:12275800.2 6
  • 7. 14. Transferring this case to Colorado will create far more harm than it could ever alleviate; it would necessitate a new judge; it would require new co-counsel for the Debtor (and the Debtor anticipates difficulty and attendant delay with the retention of Colorado counsel based upon possible conflicts of interest, see Fitchett Decl. at~ 10); transfer may affect (and will certainly increase the costs associated with) the potential debtor in possession financing, which is poised to provide sufficient funds for the Debtor to operate for the next year while it finalizes its capital restructuring and confirms a plan ofreorganization. Moreover, it would inconvenience the Debtor's real estate advisor, DIP lender, CRO, and financial advisors- the parties whose testimony is most likely if the Debtor's plan is contested. 15. The Movants have not and will not be able to satisfy their heavy burden of showing that a change in venue is necessary for the convenience of the parties or for the interests of justice, and this Court should therefore deny the Motion. BACKGROUND A. The Debtor 16. The Debtor is a limited liability company incorporated under the laws of the state of Delaware. B. Company Background 17. The Debtor owns and operates the "Club Facilities" as defined in the Venue Motion which are located in Vail Valley in Eagle County, Colorado. 18. The details of the Debtor's operations, current management and equity interests in the Debtor, are set forth in the First Day Motion affidavit of the Debtor's CEO, DanielL. Fitchett, Jr. filed herein on June 26, 2012 (Docket No.2) and are incorporated herein by reference. 01:12275800.2 7
  • 8. 19. Prior to filing its bankruptcy in Delaware, the Debtor worked with local lenders in Colorado, including Alpine Bank, but was not successful in generating any interest from the local Colorado community to assist with financing for the business. Fitchett Decl. Indeed, the Debtor attempted to negotiate a work-out with Alpine Bank for many months prior to the filing of the bankruptcy petition herein without success. Fitchett DecI. Therefore, Debtor was forced to look outside Colorado- with the assistance of its New York-based real estate advisor, among several alternatives, the Debtor identified Northlight Financial, LLC a New York based lender and negotiated the terms of a DIP loan with its affiliate, Southlight Trust I, a Delaware statutory trust (collectively "DIP Lender"), which is the subject ofthe July 19,2012 hearing scheduled to proceed before this Court. [Docket Entry No. 59]. 20. The main issues in this case, namely Alpine Bank's alleged perfection of a security interest in personal property of the Debtor and the reorganization of the Debtor's capital structure, are governed by Delaware law. 21. On June 26, 2012 (the "Petition Date"), the Debtor filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code. C. Activity in the Bankruptcy Case 22. The Debtor continues to operate its business and manage its property as debtor in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. On June 27, 2012, the Court presided over, and granted, the Debtor's seven (7) First Day Motions, and each of the Movants participated through counsel in those proceedings. 01:12275800.2 8
  • 9. 23. On July 3, 2012, this Court denied Debtor's emergency motion for co-debtor stay, after vociferous and competent participation and opposition by these very Movants, through the representation of Delaware counsel, who had little inconvenience appearing before this Court on 24-hours' notice. 24. The Debtor's motion for approval of debtor in possession financing, filed on July 1, 2012, is set to be heard on July 19, 2012, and Alpine and the Debtor have worked together, through local counsel, relative to streamline discovery and trial of that matter. 25. On June 29, 2012, Debtor filed an adversary complaint against Alpine Bank, challenging the alleged security interest in certain of Debtor's assets, commencing adversary case number 12-50785 (the "Adversary") [Docket Entry No. 60]. 26. On July 3, 2012, the Member's Motion was filed to transfer venue, after they had already appeared through same Delaware counsel in the First Day Motions and the co-debtor stay hearings on June 27 and July 3, respectively. On July 5, 2012, Alpine Bank filed its joinder in the Class Member Motion. 27. On July 5, 2012, the CPOA and the District- through counsel who represented them at the First Day Motions - filed their motion to transfer venue. 28. On July 6, 2012, the United States Trustee presided over a formation meeting and appointed the Committee, which includes as volunteers who have submitted to the jurisdiction and venue of the Delaware court, the only Colorado residents that participated in the filing of the Member's Motion. 29. On July 10, 2012, Debtor filed various professional retention applications and related motions. 30. The Debtor anticipates filing its Schedules and Statements in short order. 01:12275800.2 9
  • 10. 31. To suggest that Movants are unable to avail themselves of competent Delaware representation, or that somehow the Colorado-based members will be inconvenienced by their own voluntary participation as members ofthe Debtor's Creditors Committee if this matter proceeds in Delaware, is belied by facts; rarely do clients need to attend every hearing (indeed, maybe not even most hearings) and Movants have made no effort to explain how often or why they would need to personally appear, particularly given the ease of telephonic appearance. D. The Movants 32. Some of the Movants allege to be court-approved representatives of a certified class of club members in Case Number 11CV552 pending in the District Court of Eagle County, Colorado. Only two of these named members live in Colorado (and both of the Colorado residents have decided to forego any claims of inconvenience by traveling to Delaware on July 6, 2012 to be appointed as members ofthe Committee), the other four live in Illinois and Washington, DC- both forums more convenient to Delaware than Colorado. 33. All Movants have engaged Delaware counsel to assist with their Member's Motion (and to appear at the First Day Motions and the Stay Motion). See Court Docket Entry No. 58, 61, 82, and 83. 34. Movants that are participants in the class action litigation have not provided any evidence to this Court that they are authorized to speak for the alleged 609 other members of the class they purport to represent, or whether this is simply rogue conduct on the part of the six members. 01:12275800.2 10
  • 11. 35. Alpine clearly has shown no inconvenience as is evidenced by their active participation in this case to date- it is uncertain whether the bank will challenge Debtor's claim that Delaware law applies to the issue of perfection of its security interest in Debtor's personal property assets. 36. Finally, CPOA and the District have also engaged Delaware counsel (who appeared at the First Day hearings) and have shown no hardship in having the case proceed in Delaware, including that they have shown no need to appear in person given the ease of telephonic appearances. Moreover, Ms. VanDeusen, although she claims that Delaware is inconvenient, actually has strong ties to the East Coast, is on the board of organizations in New Jersey and works for a New Jersey based firm. See http://www.njisj.org/test site/about/boardll.php. E. The Debtor's Assets 37. When the Debtor commenced this case, it operated four golf courses, a state-of- the-art athletic club, the Trailhead Facilities, and owned restaurant facilities at the Mountain, Summit and Valley Course facilities, swimming pools, tennis courts, and a family lodge, among other amenities. The Debtor also owns significant accounts receivable owing from members spread across the Country. F. The Debtor's Secured Creditors 38. On the Petition Date, the Debtor's alleged secured lender, Alpine, had opposed the Debtor's motion to use cash collateral and is the defendant in Debtor's Adversary challenging the bank's perfected secured status in certain collateral. Alpine has also expressed opposition to the Debtor's motion for approval of DIP financing from the DIP Lender, currently scheduled for hearing on July 19, 2012. 01:12275800.2 11
  • 12. 39. David Wilhelm is also an alleged secured creditor of the Debtor, although Debtor understands that Wilhelm consents to Delaware's choice of venue in Delaware and consents to the terms of the Debtor's DIP financing. G. The Debtor's Other Creditors 40. The Debtor's Schedules and Statements which will be on file herein by the hearing date ofthe Venue Motions, as well as Exhibit A to the CPOA/District Motion, demonstrate that there are potential creditors located in every state in the United States and abroad. Of the vendors who have outstanding claims against the Debtor, over 50% are not located in Colorado. Ofthe Debtor's club members, some of whom claim to be creditors ofthe Debtor (these claims are disputed by the Debtor), approximately 66% reside outside Colorado. In short, Colorado is not the most convenient forum for the vast majority of the pre-petition participants in the Debtor's business. ARGUMENT I. TRANSFER OF THE DEBTOR'S CHAPTER 11 CASE IS NOT IN THE INTEREST OF JUSTICE OR FOR THE CONVENIENCE OF THE PARTIES 41. "Change of Venue" pursuant to 28 USC 1412 provides: "A district court may transfer a case or proceeding under title 11 to a district court for another district, in the interest of justice or for the convenience of the parties." Section 1412 of title 28 applies to changes of venue both of (a) cases under title 11 and (b) civil proceedings arising under title 11, or arising in or related to cases under title 11. Section 1412 speaks ofthe interest of justice "or" the convenience of the parties. 01:12275800.2 12
  • 13. INTERESTS OF JUSTICE WEIGH IN FAVOR OF DELAWARE 42. A Debtor's choice of venue should only be disturbed when the balance weighs heavily in favor of a defendant's motion for transfer. Oglebay Norton Co. v. Port (In re ONCO Inv. Co.), 320 B.R. 577, 579 (Bank:r. D. Del. 2005). Movants bear the burden of demonstrating, by a preponderance of the evidence, that a transfer of venue is warranted. HLI Creditor Trust v. Keller Rigging Constr., Inc. (In re Hayes Lemmerz Int'l Inc.), 312 B.R. 44, 45 (Bank:r. D. Del. 2004) (citing Hechinger Liquidation Trust v. Fox (In re Hechinger Inv. Co. ofDel., Inc.), 296 B.R. 323, 325 (Bank:r. D. Del. 2003). The decision of whether venue should be transferred lies within the sound discretion of the Court, though the moving party must demonstrate by a preponderance of the evidence that such change is warranted. Lamari Ltd. v. Yes! Entm't Corp., 244 B.R. 56, 61 (D.N.J. 2000). 43. In cases such as this one where the existing venue is entirely appropriate, the Court must exercise its power to transfer cases cautiously. In re Enron Corp., 274 B.R. 327, 342 (Bankr. S.D.N.Y. 2002); In re Campbell, 242 B.R. at 746; A.R.E. Mfg. Co., Inc. v. D & M Nameplate, Inc. (In re A.R.E. Mfg. Co., Inc.), 124 B.R. 912, 914 (Bankr. M.D. Fla. 1991); In re Walter, 47 B.R. 240, 241 (Bank:r. M.D. Fla. 1985). A. The Case will Turn on Involvement of the East Coast Based Lenders/ Investors/Buyers 44. The most important consideration in deciding whether to transfer venue of this case is where economic administration of a chapter 11 case can best be accomplished. See In re Enron Corp., 274 B.R. at 348; In re Commonwealth Oil Ref. Co., 596 F.2d at 1247; In re Int'l Filter Corp., 33 B.R. 952, 956 (Bank:r. S.D.N.Y. 1983). The economic administration of a bankruptcy estate involves the need to obtain post-petition financing, the need to obtain financing to fund reorganization, and the location of the sources of such financing and the 01:12275800.2 13
  • 14. management personnel in charge of obtaining it. Huntington Nat'l Bank v. Indus. Pollution Control, Inc. (In re Indus. Pollution Control, Inc.), 137 B.R. 176, 182 (Bankr. W.D. Pa. 1992); see also In re Int'l Filter Corp., 33 B.R. at 956; In re Enron Corp., 274 B.R. at 348; In re Garden Manor Assocs., L.P., 99 B.R. 551, 554-55 (Bankr. S.D.N.Y. 1988) (court denied motion to transfer even when sole asset was located in another jurisdiction because ability to raise capital, renegotiate loan terms and likely sources of capital were located in current venue.) 45. The Movants' arguments focus largely on peripheral litigation in Colorado and the situs of the Debtor's primary assets rather than on the true driver of this restructuring, which will be financing from sources outside Colorado, such as the proposed DIP Lender. The post- petition economic administration of this case is East Coast centric as there is little or no economic market in Colorado or the Midwest for the sources of post-petition capital for the Debtor as are available to it on the East Coast. See Bordwin Decl. at~ 13. See also Fitchett Decl. at~ 4-6 and 8. B. Disruption To Debtor, Their Estates and Their Creditors 46. The Debtor's goal of maximizing the recovery for creditors can best be achieved through a speedy and efficient chapter 11 process. Transfer of venue of this case would thwart, or at least hamper, that goal. There is no question that a transfer of venue of this case at this time would delay, disrupt, and add unnecessary expenses (especially to the DIP financing) to the administration of the cases, and take the Debtor back to a financial market that has already turned its back on the Debtor. 4 7. If this Court were to grant the Venue Motion and transfer venue, the Colorado court would need to expend time and effort to become familiar with the cases, the relief granted to date, and the pending matters. The professionals would need to retain a new set of local 01:12275800.2 14
  • 15. counsel (with attendant problems being anticipated by the Debtor) and may need to file duplicative motions. All with additional expense to the Debtor. 48. Moreover, as to the adversary proceeding contesting Alpine's security interest, the inevitable delays in resolving that issue would unquestionably result in additional expense for the estate and would not be in the best interests of creditors. Thus, it is in the best interests of the Debtor, their estates and their creditors for the venue of this case to remain in Delaware. II. THE CONVENIENCE OF THE PARTIES IS AT BEST NEUTRAL, AND LIKELY IN DEBTOR'S FAVOR, IN LIGHT OF THE REALITY THAT THE MAJOR CREDITORS, THE DEBTOR, AND DEBTOR'S PROFESSIONALS (INCLUDING ITS REAL ESTATE ADVISOR), AND PROPOSED DIP LENDER ALL HAVE AVAILED THEMSELVES OF THIS COURT AND HAVE ENGAGED COMPETENT DELAWARE COUNSEL 49. The criteria that many courts employ in determining whether to transfer a title 11 case for convenience of the parties is: (1) the proximity of creditors of every kind to the court; (2) the proximity of the bankrupt (debtor) to the court; (3) the proximity of the witnesses necessary to the administration of the estate; (4) the location of the assets; (5) the economic administration of the estate; and (6) the necessity for ancillary administration ifliquidation should result. See, Commonwealth of Puerto Rico v. Commonwealth Oil Refining Co., Inc. (In re Commonwealth Oil Refining Co., Inc.), 596 F.2d 1239, 1241 (5th Cir. 1979), cert. denied, 444 U.S. 1045, 100 S. Ct. 732, 62 L. Ed. 2d 731 (1980). Accord In re Enron Corp., 274 B.R. at 343 (using CORCO factors but also relying upon Gulf States Exploration Co. v. Manville Forest Prods. Corp. (In re Manville Forest Prods. Corp.), 896 F.2d 1384 (2d Cir. 1990), even though that case involved a motion to transfer an adversary proceeding); In re Land Stewards, L.C., 293 B.R. 364 (Bankr. E.D. Va. 2002); In re Campbell, 242 B.R. 740 (Bankr. M.D. Fla. 1999); In re Pope Vineyards, 90 B.R. 252 (Bankr. S.D. Tex. 1988); In re Walter, 47 B.R. 240 (Bankr. N.D. Fla. 1985). 01:12275800.2 15
  • 16. 50. Third Circuit case law requires the Court to apply a twelve-factor test in determining whether to grant a motion to transfer venue. 5 See Hayes, 312 B.R. at 46 (citing Jumara v. State Farm Ins. Co., 55 F.3d 873, 879-80 (3d Cir. 1995)). The twelve factors are: (1) Plaintiffs choice of forum, (2) defendant's forum preference, (3) whether the claim arose elsewhere, (4) the location ofthe books and records and/or the possibility of viewing premises if applicable, (5) the convenience of the parties as indicated by their relative physical and financial condition, (6) the convenience of the witnesses, but only to the extent that the witnesses may actually be unavailable for trial in one of the fora, (7) the enforceability of the judgment, (8) practical considerations that would make the trial easy, expeditious, or inexpensive, (9) the relative administrative difficulty in the two fora resulting from congestion of the court's dockets (1 0) the public policies of the fora, (11) the familiarity of the judge with the applicable state law, and (12) the local interest in deciding local controversies at home. Movants argue that the Chapter 11 case should be transferred to the District of Colorado for several asserted reasons- none ofwhich ultimately weigh in favor of transferring venue -- as follows: (1) there is pending litigation in Colorado, involving some of the members (Debtor's response: these members do not explain why this should prevent the bankruptcy case from proceeding in Delaware); (2) the majority of creditors are in Colorado (Debtor's response: as noted above, this is not accurate. The majority of both creditors and members are located outside of Colorado, and the majority of members filing the Member Motion do not reside in Colorado. Moreover, the two who do reside in Colorado having volunteered to accept the convenience of the Delaware forum by joining the UCC); (3) little has happened in the case (Debtor's response: this is incorrect, the Debtor has filed and this Court ruled on 7 first day motions, the financial 5 These 12 factors include the six (6) factors related to the convenience ofthe parties discussed above. 01:12275800.2 16
  • 17. support for the Debtor is located in the East Coast, Debtor's CRO, financial advisor and real estate advisor are not in Colorado, the Debtor's counsel is in Delaware and San Diego, not Colorado; a committee has been formed, and the major creditors have all engaged Delaware counsel. All is in place in Delaware to move the case expeditiously forward); (4) the assets are in Colorado (Debtor's response: the location of the assets is not a critical issue in a motion to transfer venue in a Chapter 11 proceeding, but may be relevant in a liquidation. See Garden Manor Assoc., supra. But, in any event, a significant asset of the Debtor,- accounts receivable owing from members- are owed by members located throughout the Country); (5) Colorado law applies to some agreements (Debtor's response: this Court is well positioned to address the potential issues in this case, even if it must interpret contracts governed by laws of other jurisdictions- although, it is unclear, at best, whether even the membership agreements are all governed by Colorado law (see below), and even then, while Colorado law may be relevant to the litigation matters pending there, it has little relevance to the financial restructuring that is the central issue in this case. See In re Visteon Corporation v. Governor Business Solutions, Inc., 2011 Bankr. LEXIS 4008 (this court held that "where issues will be resolved through basic contractual interpretation, and the location of the underlying events is not germane, this factor is neutral.")). 51. As discussed more fully below, Movants simply have not met their heavy burden to justifY such a drastic remedy of transferring this case to Colorado. In re Delaware and Hudson Railway Co., 96 B.R. 467, 468 (D. Del. 1988), affd, 884 F.2d 1383 (3d Cir. 1989); see also In re 01:12275800.2 17
  • 18. Commonwealth Oil Refining Co., Inc., 596 F.2d at 1241; In re Fairfield Puerto Rico, Inc., 333 F. Supp. 1187, 1189 (D. Del. 1971). 6 52. The burden of proof in connection with the Venue Motions is on the Movants, not the Debtor. Nevertheless, the Debtor will demonstrate that, utilizing the twelve-factor test relating to venue transfer, Movants have not and cannot meet their burden. III. TWELVE FACTOR TEST WEIGHS IN DEBTOR'S FAVOR IN RETAINING VENUE IN DELAWARE 53. The first factor, Debtor's forum preference, weighs in Debtor's favor. "Transfer is a cumbersome disruption of the Chapter 11 process." In re Pavilion Place Associates, 88 B.R. 32, 35 (Bankr. S.D.N.Y. 1988). Consequently, when venue is proper, a debtor's choice of forum is to be accorded substantial weight and deference. See In re Delaware and Hudson Railway Co., 96 B.R. at 469; In re Visteon Corp., 2011 Bankr. LEXIS 4008. A movant must demonstrate that a transfer of venue is necessary to achieve the statutory purposes by a preponderance of the evidence. In re Commonwealth Oil Refining Co., 596 F.2d at 1241 (citing, In re Fairfield Puerto Rico, Inc., 333 F. Supp. 1187, 1189 (D. Del. 1971)). 6 In considering these factors, courts also rely on decisions construing 28 U.S.C. § 1404, which is the federal statute governing transfer of venue of civil actions. Jumara v. State Farms Ins. Co., 55 F.3d 873, 879 (3d Cir. 1995); In re Spillane, 884 F.2d 642, 645 (1st Cir. 1989); Pursuit Athletic Footwear, Inc. v. Save Power Ltd., C.A. No. 96-40- MMS, 1996 WL 328596, at *5 (D. Del. June 7, 1996) ("The decision to transfer venue under either section 1404 and 1412 has been determined to tum on the same issues."). Courts considering venue transfer motions in nonbankruptcy cases recognize that "a plaintiffs choice of forum is a paramount consideration in any determination of a transfer request, and the court should not disturb the plaintiffs choice lightly." Shutte v. Armco Steel Corp., 431 F.2d 22, 25 (3d Cir. 1970). 01:12275800.2 18
  • 19. 54. Some courts suggest that something more than a preponderance of the evidence must weigh in favor of transfer: [W]here after balancing all factors, the equities lean but slightly in favor of the movant, the plaintiffs choice of forum should not be disturbed. 49 B.R. 935, 938 (Bankr. E.D.N.Y. 1985); see also In re Garden Manor Assoc., L.P., 99 B.R. at 553 ("where a transfer would merely shift the inconvenience from one party to the other, or where after balancing all the factors, the equities leaned but slightly in favor of the movant, the [debtor's] choice of forum should not be disturbed."). 55. In Matsushita Battery Indus. Co. v. Energy Conversion Devices, Inc., the Delaware District Court described the movant's burden of proof on a venue transfer motion as follows: As a general rule, "[b ]ecause plaintiffs choice of forum is accorded substantial weight, the burden is on the defendants to establish that the balance of convenience of the parties and witnesses strongly favors the defendants." C.A. No. 96-101-SLR, 1996 WL 328594, at *4 (D. Del. April23, 1996) (quoting, Bergman v. Brainin, 512 F. Supp. 972, 973 (D. Del. 1981)). 56. A Delaware entity's election to commence a chapter 11 case in the District of Delaware is not to be disregarded or downplayed in the context of a venue transfer motion. Indeed, it is the well-settled law of this District that, even if Delaware is not a plaintiff's "home turf," deference should be accorded to the Delaware entity's choice of venue. See Waste Distillation Technology, Inc. v. Pan American Resources, 775 F. Supp. 759, 766 (D. Del. 1991) ("[T]his Court rejects the assertion that 'lack of doing business' here makes it unfair to try the case here."). 01:12275800.2 19
  • 20. 57. Wilmington, Delaware is a ninety-minute train ride from both New York City and Washington D.C. It is a thirty minute drive from the Philadelphia International Airport. Conversely, Cordillera is over a hundred miles from Denver, through at least three mountain passes. For the vast majority of the parties in interest that will be attending hearings in this case on a regular basis, Wilmington is at least if not a far more convenient venue than Colorado, including for some of the Movants, contrary to their self-serving and unsupported claims of . . mconvemence. 58. Consider the parties in interest that are certain to attend every hearing in this case, the Debtor, their proposed DIP lender, the Committee and the U.S. Trustee. Their respective counsel are each located in San Diego, Detroit and Delaware. Should contested hearings be necessary, the likely witnesses will be the Debtor's financial advisors who are based in the East Coast. And the only Colorado-based Class Members among the Movants have voluntarily elected to join the Committee and should be viewed as consents to the convenience of these cases no matter where they are venued. 59. All of the major parties in this case have already retained Delaware bankruptcy counsel. Of the numerous professionals who have appeared in this case, only Alpine's counsel has offices in both Colorado and Delaware. 60. In addition, the Debtor's Delaware counsel has extensive understanding of numerous aspects of the Debtor's business, as they took the lead in assisting the Debtor in the preparation of its first day motions. Transferring this case to Colorado would require the Debtor to engage and educate local counsel in Colorado (with an anticipated delay and potential conflict issue) and would saddle the estate with additional expenses arising from the time and expense for travel to and from Colorado. These expenses could be substantial in light of the fact that the 01:12275800.2 20
  • 21. Debtor's counsel are located in San Diego, California, and Delaware, and the financial advisors are located on the East Coast (Detroit and New York). Moreover, at least in part because of the action of Movants, there is no market for financing to the Debtor in Colorado, and the financial markets in New York and the East Coast are the most likely source of the Debtor's post-petition financing. See Bordwin Decl. at~ 16. 61. Notably, the DIP Lender, located in New York, also supports venue in Delaware (the DIP Lender has advised the Debtor that it intends to file a joinder in the Debtor's opposition to the transfer of venue). And several of the dues paying members support venue in Delaware. 62. Accordingly, the Debtor's decision to commence this case in the District of Delaware is entitled to substantial weight and deference and should not be disturbed unless the equities strongly favor the Movants, which it does not. This factor weighs in favor of a Delaware forum. 63. As to the second factor, Defendant's Forum Preference, Movants obviously prefer the District of Colorado. Thus, the second factor superficially appears to weigh in favor of transferring venue. Upon more careful scrutiny, Movants have not presented evidence to show that they are unable to participate in Delaware, nor can they because they have already been very active in the case and the only Colorado-based initial Movants have essentially waived their preference for the Colorado forum, having subsequently consented to the Delaware forum by agreeing to serve on the Creditor's Committee, a decision undertaken after the filing of the Members Motion. Moreover, the Movants don't speak for all creditors, and as noted, dues paying members and homeowners support Debtor's decision to file in Delaware. 01:12275800.2 21
  • 22. 64. Additionally, the majority of the Debtor's other creditors and members are located outside of Colorado and thus, under Movants' logic, could face substantial travel burdens if the Debtor had filed their cases in Colorado. Even Colorado creditors would face long trips by car or plane, as the Colorado Bankruptcy Court, which is a greater than a two-hour car ride from Cordillera, is far from being centrally-located. For example, a creditor in Washington, DC (which include Movants Thomas and Jane Wilner) would be forced to traverse a greater distance to Colorado than they would to attend a hearing in Wilmington. 65. Finally, Debtor believes that other Club members favor a speedy resolution of the Debtor's economic rehabilitation in the Delaware venue, and Debtor expects those members to file Joinders in the Debtor's Opposition to the Venue Motion. 66. The Debtor's alleged secured creditor- whose businesses are national in scope and thus render them generally agnostic on matters of geography- not surprisingly has already engaged Delaware counsel and from the Court docket has had no difficulty in making its position known to the Court. Moreover, it is now a defendant in the adversary proceeding before this Court (Adversary Number 12-50785) and has filed a joinder in the Member's Motion. 67. This factor is at best neutral or weighs in favor of the Debtor given that Debtor's preference for a forum takes precedence. See Garden Manor, supra. 68. As to the third factor, whether The Claim Arose Elsewhere, Movant contends that the claims relate to issues in Colorado. The Debtor does not dispute that the majority of the assets are located in Colorado. The Debtor contends that the relevant law for the fmancial restructuring, the post-petition finance, and the corporate restructuring is Delaware. The Debtor filed in Delaware for the convenience of the parties that the Debtor expects will be instrumental in the Debtor's reorganization, namely the DIP financing lender, the financial advisor, the 01:12275800.2 22
  • 23. bankruptcy counsel, the real estate advisor, and expected "exit financing" lenders. Here, Debtor's goal is to submit a plan that will allow the Debtor to proceed with a recapitalization and new investment that will allow the Debtor to profitably manage its operation and satisfy claims of creditors. It is well-settled that "where the issue will be resolved through basic contractual interpretation and the location of the underlying events is not germane, this factor is neutral." 7 Visteon, supra, citing DHP Holdings II, 435 B.R. at 273. 69. This factor is in favor of the Debtor. 70. As to the fourth factor, Location Of Books And Records, this is also a neutral factor. Debtor concedes that the computers on which it's electronic "books and records" are maintained are located in Colorado - but these electronic books and records can be easily accessed without regard to the location of the computer on which they are maintained. However, given the goal, and likelihood, of rehabilitation, this is not an important factor here and should 7 It is uncertain to what extent Colorado law does apply to the interpretation of the member documents. In essence, there are four (4) documents or instruments that govern memberships and membership rights and obligations in the Club at Cordillera, namely: (1) The Club at Cordillera Membership Plan; (2) The Club at Cordillera Rules and Regulations; (3) The Club at Cordillera Application for Membership Privileges; and (4) the Addendum to Application for Membership Privileges (Premier Memberships) or Addendum to Application for Membership Privileges (Charter Memberships). All members of the Club at Cordillera (Signature Golf, National, Gold Medallion, Corporate, Social, Resident Owner and Honorary), were required to execute and deliver to Debtor an Application for Membership Privileges. Similarly, pursuant thereto, all members of the Club at Cordillera are bound by the Membership Plan and the Rules and Regulations, as those are from time to time amended. The Membership Plan, the Rules and Regulations and the Application for Membership Privileges are all silent as to governing law. In other words, neither the Membership Plan, the Rules and Regulations nor the Application for Membership Privileges specify any governing law. Debtor asserts that all members of the Club at Cordillera are bound by these documents, as they are amended from time to time. Certain Signature Golf Members of the Club at Cordillera elected to convert their Signature Golf Membership to either a Premier Membership or a Charter Membership. In order to make this election, these members executed and delivered to the Debtor an Addendum to Application for Membership Privileges (Premier Memberships) or an Addendum to Application for Membership Privileges (Charter Memberships). In these Addendums, the governing law is specified as Colorado. These documents only apply to a limited number of Signature Golf Members. These are the only documents that specify the governing law. Given that nearly two-thirds of the members are not Colorado residents, there is at least a question of whether Colorado law governs the claims grounded in these documents. 01:12275800.2 23
  • 24. not be the basis for the transfer of venue of this chapter 11 case. See In re Commonwealth Oil Ref. Co., 596 F.2d 1239, 1248 (5th Cir. 1979) (holding that "the location of the assets is not as important where the ultimate goal is rehabilitation rather than liquidation). See also In re Land Stewards, L.C., 293 B.R. 364, 371 (Bankr. E.D. Va. 2002) .");In re Marina Enterprises, 14 B.R. 327 (Bankr. S.D. Fla. 1981) (venue proper in Florida although debtor's sole asset, undeveloped land for hotel/casino, was located in New Jersey). Venue should be retained in the location where the debtor can most successfully reorganize, even if the sole asset is located in another jurisdiction. See In re Emon, 274 B.R. at 328 (citing In re Garden Manor Assocs., L.P., 99 B.R. 551, 554-55 (Bankr. S.D.N.Y. 1988)). 71. Movants and Alpine place great emphasis on the fact that the Debtor's headquarters (and thus, their pre-petition executives) are located in Colorado. But, physical location of a debtor's headquarters (or the computers on which the electronic books and records are maintained) does not dictate the venue of a chapter 11 reorganization case, especially in light of the geographic diversity of the majority of Debtor's current creditors and members, the universe of Debtor's prospective investors, financial partners, and Chief Reorganization Officer. As recognized by the Court in In reUnited Button Co., 137 F. 668, 672, 673-74 (D. Del. 1904): Proximity of place ofbusiness of the bankrupt to the court entertaining proceedings in bankruptcy, though a circumstance sometimes entitled to weight, is by no means conclusive. Much stress was laid by counsel for the petitioning creditors upon the fact that the principal place ofbusiness ofthe bankrupt was located in New York City. Assuming this to be the case ... I am unable to perceive that the fact has much materiality or relevancy, as orders and directions may be sent to the manufacturing plants in Massachusetts from the receiver in Wilmington, as well as from one in New York or Chicago. 01:12275800.2 24
  • 25. See also Fairfield Puerto Rico, 333 F. Supp. at 1190 ("[T]he location of principal assets and ... principal place of business or residence does not necessarily control whether transfer should be ordered."); In re Int'l Filter Corp., 33 B.R. 952, 956 (Bankr. S.D.N.Y. 1983) ("the location of the [debtor's] assets ... [has] greater weight ifthe proceeding is brought in Chapter 7."). 72. As a matter of geography, Delaware is the convenient forum for east coast investors, and the available financing for the success of the Debtor's Chapter 11 case. See Bordwin Decl. at ,-r 16. 73. Moreover, it is well recognized that "Because of the "ease of transporting [paper and electronic] documents" when discovery is "largely limited to 'paper exchanges"' the physical location of books and records is frequently considered a "neutral" factor. See In re Viteon, supra, citing DHP Holdings II, 435 B.R. at 273-274. Movants have not asserted that this matter "involves excessive or significant paperwork or that that there will be a copious amount of document production, which, in tum, would make it difficult to produce evidence to this court." ONCO, 320 B.R. at 580. Movant also has not distinguished the amount of non-electronic books and records in this case from the amounts considered non-problematic in comparable cases in this Circuit. 74. This factor is in favor of the Debtor. 75. As to the fifth factor, Convenience Of The Parties, Movants argue that the majority of creditors, including Debtor's secured creditor Alpine, are located in Colorado. As stated above, the facts are otherwise: a majority of Debtor's creditors, and a super-majority of Debtor's "members" are located outside of Colorado. 76. Movants claim Delaware would be inconvenient, ignoring the reality that Movants and joinder parties have already engaged competent Delaware counsel and have 01:12275800.2 25
  • 26. appeared before this Court with little inconvenience. Moreover, Movants ignore the reality that the existing secured creditor, Alpine, to date has been unwilling to work with the Debtor and thus the Debtor was forced to seek out alternative financing. The only Colorado-based Movants have availed themselves of a seat on the Creditor's Committee, consenting to the convenience of forum no matter where this case is pending. The Debtor was unable to find any lenders in Colorado willing to work with the Debtor. See Bordwin Decl. at 1 10-11. Thus the Debtor has had to seek out and has found, the DIP Lender, who is located on the east coast, convenient to the Delaware court. 8 77. A motion is before this Court for approval of the DIP financing which motion is to be heard on July 19, 2012. The importance of expedited treatment for approval of financing bodes against transferring venue. Moreover, the Debtor has already retained Delaware counsel familiar with the case and without an office in Colorado. The Debtor has engaged a real estate advisor who advises the debtor that the best chance for locating additional investors/buyers - not just the DIP lender- are on the east coast, not Colorado. See Bordwin Decl. at 1 13. Thus, Delaware is optimally located to assist in the reorganization. As noted in ONCO, 320 B.R. at 580 and cited by this Court in its In re Visteon decision: "transferring the dispute to another forum may actually increase the administrative expenses of the estate, lower the amounts available for distribution ... and sap the temporal and financial resources of the Plaintiff." Movants have failed to show any concrete evidence that it would be less expensive overall to handle the reorganization matters of this case anywhere but Delaware. As a result, the convenience factor is neutral at best for Movants and likely weighs in favor of denial of the motion. 8 Indeed, all of Debtor's received DIP proposals and interest in take-out finance are with non-Colorado based entities. 01:12275800.2 26
  • 27. 78. Debtor concedes that many- but not the majority- of the creditors are located in Colorado, a fact not determinative that the cases should be transferred to Colorado. See In re Indus. Pollution Control Inc., 137 B.R. at 181. The majority of creditors who are owed money, and the super-majority of members, are located outside Colorado. Based on their moving papers, four of the six Movants are not residents of Colorado: two are from Illinois, two from Washington, DC. And both Colorado-based Movants can hardly be heard to complain given that they volunteered to sit on the creditors committee no matter where this case is venued. 79. No creditor other than Movants have expressed a concern over the Delaware venue. Other creditors and members support venue in Delaware. In fact the Debtor's key constituents to its reorganization, including the DIP lender, oppose transfer of venue to Colorado. 80. Attendance at meetings of the Committee and with the Debtor's professionals will occur irrespective of the venue of the Chapter 11 cases. In many instances, these meetings will be conducted by conference call. In fact, not one of the Movants stated that they, individually, intended to appear at hearings. Given that the Colorado bankruptcy court is at least a two-hour drive for most of the Committee Members, for example, it is unlikely they will attend any routine hearings. Thus, their claims of inconvenience should not sway this Court as there is simply no substance behind those claims. This is likely to be particularly true in cases, such as these, where the Committee members are located in states across the country. 81. Movants profess concern for Colorado creditors, arguing that the Delaware hinders their participation in this case. While this may be true in a few limited instances, the venue of this case likely has very little to do with why these creditors are not likely to take an active participation in this case. Their lack of participation likely stems from the fact that the size of their claim, if any, is too small to justify the expenditure of time necessary to effectively 01:12275800.2 27
  • 28. participate in a chapter 11 case. Congress's solution to this problem of collective action was to provide for the formation of an official committee of unsecured creditors. This Committee has been formed in this case and the members have not presented any reason why they will need to personally appear at any of the hearings- indeed, the only two Colorado-based Movants have joined that committee. 82. It is also unlikely that there will be a need for ancillary administration if liquidation should result. This factor has little bearing on the case proceeding in Delaware. This Court is more than capable of conducting sale motions of assets located outside its borders - but, as set forth herein, and evidenced by the speed and efficiency with which this Debtor acquired a post-petition DIP commitment, this case demonstrates a strong likelihood of reorganization. 83. As described above, the Debtor maintains that Delaware is more convenient than Colorado for parties that are most likely to routinely participate in court hearings and that Colorado would present a substantial travel burden even for Colorado creditors. Thus, this factor weighs in favor of the Debtor. 84. As to the sixth factor, Convenience Of The Witnesses, this factor is only relevant to the extent that Movants show that witnesses are "actually unavailable for trial in Delaware." In re Visteon, 2011 Bankr. LEXIS 4008 (citing Hayes, 312 B.R. at 4 7. ). "Without such a showing, 'witnesses are presumed to be willing to testify in either forum, despite the inconvenience that one of the forums would entail."' Id. 85. Movants have not suggested that any relevant witnesses would be unavailable for trial in Delaware- this can hardly be the case for the two Colorado-based Movants, who have arguably waived the inconvenience argument by volunteering to participate as members of the statutory committee, and one of whom is a declarant who is expected to be in Court for the 01:12275800.2 28
  • 29. hearing on the Motion. Moreover, Movants have not established that they will hereafter be witnesses in these bankruptcy proceedings. They may or may not. However, "a mere shift of inconvenience from one party to another will not suffice for a change of venue pursuant to 28 U.S.C. § 1412. Russell, Bankruptcy Evidence Manual, 2002 Ed.,§ 301.33. See In re Campbell, 242 B.R. 740, 747 (Bankr. M.D. Fla. 1999) ("While the Court is concerned for the convenience of witnesses in every case, this factor concerns the proximity of those witnesses necessary for administration of this estate.") The "Court needs more than mere allegations ... that witnesses will be needed and why their inconvenience in traveling to this district outweighs the Debtor's choice to file its petition here." In re Stony Brook Dev., LLC, No. 06-13781-WIL, 2006 Bankr. LEXIS 4246, 2006 WL 4547184, at 2 (Bankr. D. Md. Sept. 8, 2006). Other than the alleged facts asserted in the Class Action case, of which they may testify in the already pending cases in Colorado (and as to which the Debtor maintains insurance coverage), there is not likely an issue that arises in the reorganization for which their testimony is even relevant, much less likely. Therefore, this factor favors keeping the action in Delaware. 86. As to the seventh factor, Enforceability Of The Judgment, Movants have not even mentioned this factor, have not objected to personal jurisdiction, and have not provided any reason why a judgment from this Court would not be given full faith and credit in the State of Colorado, if ever relevant. Therefore, this factor favors keeping the action in Delaware. See Hechinger, 296 B.R. at 326. 87. As to the eighth factor- Practical Considerations that Would Make the Trial Easy, Expeditious, or Inexpensive- the Movants have introduced no evidence. Practically, this Chapter 11 case is about value, enterprise value, and an East Coast based market valuation and refinance. This factor weighs greatly in favor of venue in Delaware. 01:12275800.2 29
  • 30. 88. As to the ninth factor- the Relative Administrative Difficulty in the Two Fora Resulting from Congestion of the Court's Dockets- is likely a neutral or weighs in Debtor's favor as this Court has already demonstrated the alacrity in which it moves matters along. 89. As to the tenth factor- the Public Policies of the Fora- weigh in Favor of this Court where the emotional, charged dynamic that obviously exists in Colorado can be defused in a fresh location free oflocal acrimony. See Bordwin Decl. at~ 7-8; Fitchett Decl. at~ 3. 90. As to the eleventh factor- the Familiarity of the Judge with the Applicable State Law- is likely a neutral issue. Little need be said in response to Movants' assertion that Colorado is a more "convenient and logical forum" because issues in the Debtor's case will require application of Colorado law. First, if that is true about the pending litigation brought by the Members and the Debtor's likely counter-claims, there is no truth to the fact that the reorganization issues central to the Chapter 11 have anything to do with Colorado law. Moreover, as to such peripheral issues even if they are relevant, bankruptcy courts regularly deal with state law issues without any difficulty, and the geographic scope of the Debtor's operations makes it highly unlikely that Colorado law will be the only state law at issue. Moreover, the perfection, or lack thereof, of the alleged Alpine security interest in certain personal property will tum on Delaware law, not Colorado law. Thus, Delaware, is likely better situated to deal with laws of different states given the more diverse types of creditor bodies in cases filed in Delaware. 9 9 Movants claim that Colorado law governs the rights of members under the membership documents. This is a red herring. First, it may not be true- see footnote 7, supra. Second, this is not the issue in the reorganization, where the relevant law is Delaware or possibly New York law (because the DIP and prospective fmancing partners are New York based, and it is common to expect New York law to govern post-petition fmancing arrangements in a reorganization). 01:12275800.2 30
  • 31. 91. As to the twelfth and final factor -the Local Interest in Deciding Local Controversies at Home -- Movants have not shown any prejudice to a Delaware forum. In fact, for reasons discussed, the financial market in Colorado is foreclosed to the Debtor, forcing the Debtor to look outside the local environment and to East Coast participants. The local community has turned its back on this Debtor and thus this factor weighs in favor of a Delaware forum. CONCLUSION 92. Under the facts of this case, neither the "convenience of the parties" nor the "interest of justice" either necessitate or justify the transfer of this chapter 11 reorganization case to Colorado. In fact, the opposite is true. The Movants have not, and will not, sustain their burden of showing, by a preponderance of the evidence, that the interests of justice or convenience of parties are better served ifthis case were transferred to Colorado. Indeed, it is clear that such a transfer, at this juncture, will negatively affect the Debtor's rehabilitation, will increase the Debtor's expenses relative to its DIP loan and future refinance, and will be of utmost inconvenience to the Debtor's professionals and likely post-petition financing sources. 01:12275800.2 31
  • 32. 93. Delaware is well-suited to the convenience of the parties in interest that are most likely to play an active role in this case: the Debtor and its professionals, the Committee (with both of its 2 Colorado-based Movants having consented to participating in the Committee) and its professionals, the DIP lender, and other creditors that have retained local Delaware counsel. And, far from serving the interests of justice, transferring this case would work an injustice on this estate because it would be costly and disruptive to the Debtor's efforts to reorganize. Accordingly, the Debtor respectfully requests that this Court deny the Venue Motion, allow the Debtor to proceed with its efficient rehabilitation in this Court, and grant the Debtor such other and further relief as is necessary and appropriate under the circumstances Dated: July Jj_, 2012 FOLEY & LARDNER LLP Christopher Celentino (CA No. 131688) Mikel Bistrow (CA No. 102978) 402 West Broadway, Suite 2100 San Diego, California 921 01 Telephone: (619) 234--6655 Facsimile: (619) 234-3510 -and- YOUNG CONAWAY STARGATT & TAYLOR, LLP (72 R. Nof(N0:3526) ~ Michael ~ Joseph M. Barry (No. 4221) Donald J. Bowman, Jr. (No. 4383) Kenneth J. Enos (No. 4544) Rodney Square 1000 N. King Street Wilmington, Delaware 19801 Telephone: (302) 571-6600 Facsimile: (302) 571-1253 Proposed Counsel for Debtor and Debtor in Possession 01:12275800.2 32