In re:

UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE
Chapter 11
CORDILLERA GOLF CLUB, LLC/ Case No. 12-11893 (CSS)
Debtor. Re: Docket Nos. 1, 69, 71, 78, 79,
92,93
Hearing Date: 7/16/12@ 10:00 a.m.
JOINDER OF THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS
IN: (I) 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, TO
TRANSFER VENUE; AND (II) MOTION OF CORDILLERA PROPERTY
OWNERS ASSOCIATION, INC. AND CORDILLERA METROPOLITAN
DISTRICT TO TRANSFER VENUE TO COLORADO
The Official Committee of Unsecured Creditors ("Committee") appointed in the above
captioned, Chapter 11 bankruptcy case of Cordillera Golf Club, LLC ("Debtor"), by and through
its (proposed) undersigned counsel, respectfully files this Joinder (this "Joinder") in: (i) the
Motion filed by 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, to
Transfer Venue [Docket No. 69] (the "First Venue Motion'); and (ii) the Motion filed by
Cordillera Property Owners Association, Inc. ("CPOA") and Cordillera Metropolitan District
(the "District") to Transfer Venue to Colorado [Docket No. 79] ("Second Venue Motion"), and
in support, would respectfully show this Court as follows:
I. BACKGROUND
1. On June 26, 2012 ("Petition Date"), the Debtor filed its voluntary for relief under
Chapter 11 of the United States Bankruptcy Code, 11 U.S.C. 101, et seq. (the "Bankruptcy
The Debtor in this chapter II case, and the last four digits of its employer tax identification number, is:
XX-XXX\317. The corporate headquarters address for the Debtor is 97 Main Street, Suite E202, Edwards,
co 81632.
615266.17/11112
Code"), thereby initiating the above-captioned case with this Court (the "Bankruptcy Case").
The Debtor remains in control of its business and affairs as a debtor-in-possession pursuant to
sections 1107 and 1108 of the Bankruptcy Code.
2. On July 6, 2012, the United States Trustee filed its Notice of Appointment of
Committee of Unsecured Creditors [Docket No. 86], thereby forming the Comrnittee.
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3. The Debtor is the owner and operator of "The Club at Cordillera" (the "Club"),
located in Edwards Colorado in Eagle County. The Club includes three 18-hole golf courses, a
short course, three tennis centers, fitness facilities, five indoor and outdoor pools, a sununer
camp and clubhouse for children, and riding, hiking and cross-country ski trails. See Declaration
of Daniel L. Fitchett, Jr. in Support of Chapter 11 Petitions and First Day Relief ("Fitchett
Declaration"), 7. The Club is the Debtor's sole asset and only business.
4. The Club is located within the Cordillera residential community in Edwards,
Colorado, and derives revenues through fees and dues related to Club memberships and
marketed to community residents and others. Fitchett Declaration, 5, 6, 8-12. Upon
information and belief, the sole, ultimate equity interest holder in the Club is Mr. David
Wilhelm, a resident of Colorado. Fitchett Declaration, 20; Consolidated Creditor Matrix
[Docket No. 10], at p. 22. Mr. Wilhelm is also alleged to be a secured creditor of the Debtor,
who, as of the Petition Date, is purportedly owed in excess of $7 million from the Debtor.
Fitchett 53, 54.
5. On or about June 26, 2009, the Debtor entered into a loan agreement with Alpine
Bank, under which the Debtor owes Alpine in excess of $12.7 million, which debt is alleged to
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The Committee's current membership is comprised of the following various homeowners and trade
creditors of the Debtor: (i) John D. O'Brien; (ii) Cheryl M. Foley; (iii) Ken Ulickey; (iv) Kevin B. Allen;
(v) Dennis S. Meir; (vi) John S. Lemak; and (vii) Ceres Design & Arborscape, LLC. All of the
Committee's members have Colorado addresses.
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be secured by substantially all of the Debtor's real and personal property. Fitchett Declaration,
~ ~ 50-52, 54. Alpine Bank is located in Colorado. Upon information and belief, Alpine Bank
supports the transfer of venue of this Bankruptcy Case to the District of Colorado.
B. The First Venue Motion
6. Over the past several years, the Debtor's relationship with its members,
comprising its largest creditor constituency, has become strained, resulting in ongoing litigation
in Colorado state courts that is a central feature in the Debtor's financial difficulties. First Venue
Motion, at p. 2.
7. On July 3, 2012, Cheryl M. Foley, Thomas Wilner, Jane Wilner, Charles Jackson,
Mary Jackson and Kevin B. Allen filed the First Venue Motion, as individual homeowners in the
Cordillera community, members of the Debtor, and as representatives of a class of homeowner
members (collectively, the "Class Movants") certified in connection with litigation pending in
Colorado state court (the "Class Action"). First Venue Motion, at pp. 3-4.
8. Each of these class member Plaintiffs asserts a noncontingent, unsecured claim
against the Debtor for the return of the member's deposits with the Club, ranging in amount from
$7,500 to $205,000, with an average of approximately $103,000, and for an aggregate total of
approximately $62 million in pre-petition claims. See First Venue Motion, at Exh. A.
Accordingly, this Plaintiff class by far comprises the largest claim constituency in this estate. As
these creditors are comprised of Club members who are, in turn, largely comprised of Cordillera
residents, these Plaintiffs, and their underlying interests, are essentially all located in Colorado.
9. Despite these facts, or perhaps concerned over the implications that would result
from this disclosure, the Debtor failed to include any of these creditors in its List of Creditors
Holding Twenty Largest Unsecured Claims filed with the Court [Docket No. 1] ("List of Twentv
Largest"). According to the Plaintiffs, their members hold individual claims that exceed all but
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one of the unsecured creditors that the Debtor included in its List of Twenty Largest. First
Venue Motion, at p. 5. Notwithstanding, half of the creditors that the Debtor did list are also
located in Colorado.
10. The Class Action involves the Plaintiff members' claims for, inter alia, breach of
contract, inducement, securities violations, and related causes of action against the Debtor and
related parties, and seeks the return of deposits and membership dues and fees paid to the Debtor.
First Venue Motion, at Exh. B. These monies were paid to the Debtor in reliance on certain
express promises, commitments and representations to provide access to Club facilities and other
membership benefits and privileges. First Venue Motion, at Exh. B.
II. On July 5, 2012, this Court entered its Order shortening the requisite notice period
for the First Venue Motion [Docket No. 71], and setting an expedited hearing to consider the
motion for July 16,2012, at 10:00 a.m.
C. The Second Venue Motion
12. On July 5, 2012, the CPOA and the District filed their Second Venue Motion,
through which these movants also joined in the First Venue Motion. The CPOA is one of two
homeowner associations governing the Cordillera community. Its membership is comprised of
private, individual homeowner consumers who also share similar claims and interests as the
Class Movants. Related to this fact, the CPOA is the Defendant in separate litigation
commenced by the Debtor and pending in Colorado state court, apparently contending that the
CPOA is somehow responsible for the determination of numerous of the Debtor's members to
seek to cancel their membership interests. Fitchett Declaration, ~ 6; Second Venue Motion, at
~ ~ 25-29.
13. In addition to generally acting as a property owners association, the CPOA is
involved in the provision of numerous community operations and public safety and welfare
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services, including, without limitation, the management, maintenance and operation of public
facilities, programs and initiatives. Second Venue Motion, at ~ 26. The CPOA provides for its
operating expenses through assessments charged on the sale of homes in Cordillera.
14. The District is a quasi-municipal "special" district created under the laws of
Colorado as a political subdivision of the state, and constructs and manages all public facilities
and infrastructure in the district. Second Venue Motion, at ~ ~ 20-21. The District includes
Cordillera, under which the Debtor is one of the District's two largest taxpayers. The District is
thereby a secured creditor of the Debtor pursuant to various ad valorem tax obligations, and is
owed approximately $205,311.31 corresponding to the Debtor's 2011 assessments.
15. On July 9, 2012, this Court entered its Order shortening the requisite notice period
for the Second Venue Motion [Docket No. 92], and setting an expedited hearing to consider that
motion at the same time as the First Venue Motion (July 16,2012, at 10:00 a.m.).
II. JOINDER IN REQUESTED RELIEF
16. The Committee hereby joins in the relief sought in both the First Venue Motion
and the Second Venue Motion, and respectfully prays that this Court enter its order immediately
transferring this Bankruptcy Case, and all related proceedings, to the District of Colorado for
continued administration.
B. Applicable Standards
17. Even where venue is proper, a court may nevertheless transfer a case, "in the
interest of justice or for convenience of the parties." 28 U.S.C. 1412; Fed. R. Bankr.P.
1014(a)(1). Specifically, 28 U.S.C. 1412 provides in relevant part that this 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." 28 U.S.C. 1412.
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18. First, the '"interest of justice' component of 1412 is a broad and flexible
standard which must be applied on a case-by-case basis. It contemplates a consideration of
whether transferring venue would promote the efficient administration of the bankruptcy estate,
judicial economy, timeliness, and fairness ... " In re Manville Forest Products Corp., 896 F.2d
1384, 1391 (2d Cir.l990). Secondly, in consideration of the second clause of this statute- the
convenience ofthe parties- courts typically engage in a factor based analysis that contemplates:
(i) The proximity of creditors of every kind to the Court;
(ii) The proximity ofthe bankrupt (debtor) to the Court;
(iii) The proximity of the witnesses and proof necessary to the administration
of the estate and availability of subpoena power for unwilling witnesses;
(iv) The location of the assets;
(v) The enforceability of judgments and economic administration of the
estate;
(vi) The ability to receive a fair trial;
(vii) The state's interest in having local controversies decided within its
borders, by those familiar with its law; and
(vii) The necessity for ancillary administration if bankruptcy [liquidation]
should result.
See In re LaGuardia Associates, L.P., 316 B.R. 832, 837 (Bankr. E.D. Pa. 2004) (citations
omitted); Matter of Continental Airlines, Inc., 133 B.R. 585, 587-88 (Bankr. D. Del. 1991)
(simultaneously addressing interests of justice and convenience of the parties as related
considerations).
C. All Factors Weigh In Support of Transferring This Bankruptcy Case to the District
of Colorado
19. Here, it is beyond dispute that the Debtor, and the vast majority of its creditors,
including the Debtors' most significant secured and unsecured creditors - the Class Action
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Plaintiffs, the CPOA, the District, Mr. Wilhelm, Alpine Bank, and the members of the
Committee- are all located in Colorado. There can be no dispute that venue for this Bankruptcy
Case is proper in Colorado.
20. Of course, the Debtor's assets are also uniquely situated in Colorado. This is not
a mere case of a debtor who operates in national or international markets irrespective of its
primary location or place of business. The Debtor has no product to offer other than the real
property and related services and facilities in Colorado. Trade vendors providing services to the
Debtor and those seeking to become customers I members of the Debtor must, with negligible
exceptions, necessarily do so in Colorado. Day to day business operations of the Club occur
only in Colorado.
21. Because this case involves a significant real property development and a
residential community located in Colorado, the State of Colorado has a particularized interest in
the resolution of the disputes implicated in this Bankruptcy Case, which no other state can
approximate. In re Buffets Holdings, Inc., 397 B.R. 725, 730 (Bankr. D. Del. 2008); In re
Portjef!Development Corp., 118 B.R. 184, 193-94 (Bankr. E.D.N.Y. 1990) (even where no other
factor supports transfer, the presence of the debtor's principal, if not sole, asset in the destination
district "overwhelmingly militates in favor oftransfer ... ").
22. As cited in the First Venue Motion, this consideration is paramount where, as
here, the sole or central asset of the estate is comprised of real property. Courts recognize the
unique relationship and interest that a state has in matters affecting its local real estate. See First
Venue Motion, at p. 9. See also In re Enron Corp., 284 B.R. 376, 392 (Bankr. S.D.N.Y. 2002)
("[m]atters concerning real property have always been of local concern and traditionally are
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decided at the situs of the property." Citing and quoting In re Baltimore Food Systems, Inc., 71
B.R. 795, 803 (Bankr. D.S.C. 1986)).
23. As to the remaining relevant factors, the major related litigation involving the
Debtor is currently pending in Colorado state courts, and upon information and belief, the
Debtor's managers, principal offices, and books and records are all located in Colorado.
Moreover, this case remains in its infancy, with only two hearings conducted, and primarily to
consider first day requests on an interim basis. Therefore, transferring venue to Colorado can
only maximize judicial economy and the availability of proof, while minimizing the burden on
litigants and parties in interest. This is particularly true in the event that this case becomes an
orderly sale or liquidation as apparently contemplated.
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See also In re Abacus Broadcasting
Corp., 154 B.R. 682, 684 (Bankr. W.D. Tex. 1993) (where liquidation is contemplated, the court
should consider the added burden that would result in requiring a trustee to administer assets in a
distant location). Furthermore, the agreements between the Debtor and its creditors are primarily
governed under Colorado law.
24. The totality of the circumstances applied here constitute a compelling case to
transfer venue, not only for the convenience of the parties but also in the interests of justice. The
sole factor weighing in favor of the Debtor's choice of forum is simply deference to the Debtor's
choice of forum. However, here, there exists some indication that the Debtor has sought to
actually discourage creditor participation through its choice of forum. In light of the
overwhelming nexus that Colorado has with the Debtor, its assets, creditors, and major disputes,
and the corresponding lack of any meaningful nexus between the Debtor and Delaware, the
The fact that the Debtor has proposed to sell one of its major golf course assets underscores this fact.
Fitchett Declaration, 1111 41-42. Potential purchasers wishing to conduct due diligence in connection with
this potential acquisition of a golf course facility must necessarily do so in Colorado and any sale would be
subject to applicable Colorado law.
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Debtor's choice of forum appears to have no other basis. Critically, the vast majority of the
Debtor's creditors are comprised of individual, consumer homeowners and members located in
Colorado. Many of these parties are in active litigation with the Debtor and its affiliates in
Colorado. The adverse impact that these parties will suffer in having to participate in this case in
Delaware are greater than might be expected of a business that is accustomed to operating in
different markets, and would be particularly acute. The fact that the Debtor failed to disclose the
locations of its true major unsecured creditors -these same individual homeowner members -is
troubling and evidence of its attempt to disenfranchise unsecured creditors in this case. See also
In re Pine haven Associates, 132 B.R. 982, 990 (Bankr. E.D.N.Y. 1991) (debtor's choice of
forum is not entitled to deference where it appears motivated not by the convenience of the
parties, but "to make this Chapter 11 case more burdensome to creditors and other interested
. ")
partres... .
D. Conclusion
25. In sunrmary, the estate's property is comprised of real estate and related
operations uniquely located in residential communities in Colorado. The Debtor's assets,
offices, operations, records, managers, and secured creditors are all located in Colorado. Many
of the Debtor's creditors are private citizens whose participation in this Bankruptcy Case would
be strained and discouraged by the need to litigate in a distant forum. Therefore, as the Debtor
has no connection to Delaware other than its state of incorporation, this Court should exercise its
discretion to transfer this case to the District of Colorado.
615266.1 7/ll/12
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WHEREFORE, PREMISES CONSIDERED, the Official Committee of Unsecured
Creditors respectfully joins in the requests of the Class Movants, CPO A, and District for this
Court's entry of its Order immediately transferring this case to the District of Colorado, and
granting such other and further relief to the Committee as to which it has shown itself to be justly
entitled.
Dated: July 11, 2012
615266.1 7111112
SAUL EWING LLP
By:-'----:------,--:-::-----:.,--------
Mark Minuti (No. 2659)
222 Delaware Avenue, Suite 1200
P.O. Box 1266
Wilmington, DE 19899
Telephone: (302) 421-6840
Facsimile: (302) 421-5873
E-mail: mminuti@saul.com
-and-
MUNSCH HARDT KOPF & HARR, P.C.
Russell L. Munsch
Texas Bar No. 14671500
Joseph J. Wielebinski
Texas Bar No. 21432400
Jay H. Ong
Texas Bar No. 24028756
3 800 Lincoln Plaza
500 N. Akard Street
Dallas, TX 75201-6659
Telephone: (214) 855-7500
Facsimile: (214) 978-4335
E-mail: rmunsch@munsch.com
E-mail: jwielebinski@munsch.com
E-mail: jong@munsch.com
Proposed Counsel for the Official Committee of
Unsecured Creditors
10
In re:
UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
Chapter 11
CORDILLERA GOLF CLUB, LLC, Case No. 12-11893 (CSS)
Debtor.
CERTIFICATE OF SERVICE
I, Mark Min uti, hereby certify that on July 11, 2012, I caused a copy of the foregoing
Joinder of the Official Committee of Unsecured Creditors in: (I) 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, to Transfer Venue;
and (II) Motion of Cordillera Property Owners Association, Inc. and Cordillera
Metropolitan District to Transfer Venue to Colorado to be served on the parties on the
attached service list in the manner indicated therein.
615266.1 7/11112
SAUL EWING LLP
B y : . ~ - - ~ ~ ~ - - ~ ~ - - - - - - -
Mark Minuti (No. 2659)
222 Delaware Avenue, Suite 1200
P. 0. Box 1266
Wilmington, DE 19801-1266
(302) 421-6840
I
I
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CORDILLERA GOLF CLUB, LLC
Service List
Via Hand Delivery:
Michael R. Nestor, Esquire
Joseph M. Barry, Esquire
Donald J. Bowman, Esquire
Young Conaway Stargatt & Taylor LLP
Rodney Square
1000 North King Street
Wilmington, DE 19801
Mark Kenney, Esquire
Office of the United States Trustee
J. Caleb Boggs Federal Building
844 King Street, Suite 2207
Wilmington, DE 19801
Mark D. Collins, Esquire
Zachary I. Shapiro, Esquire
Richards, Layton & Finger, P.A.
One Rodney Square
920 N. King Street
Wilmington, DE 19801
Tobey M. Daluz, Esquire
Joshua E. Zugarman, Esquire
Ballard Spahr LLP
919 N. Market Street, I Ith Floor
Wilmington, DE 19801
Damien Tancredi, Esquire
Cozen O'Connor, PC
1201 N. Market Street, Suite 1400
Wilmington, DE 19801
William P. Bowden, Esquire
Ricardo Palacio, Esquire
Ashby & Geddes, P.A.
500 Delaware avenue, 8th Floor
P.O. Box 1150
Wilmington, DE 19899
615266.1 7/ll/12
Matthew P. Ward, Esquire
Ericka F. Johnson, Esquire
Womble Carlyle Sandridge & Rice, LLP
222 Delaware Avenue, Suite 1501
Wilmington, DE 19801
Ellen W. Slights, Esquire
United States Attorney's Office
District of Delaware
1 007 N. Orange Street, Suite 700
P.O. Box 2046
Wilmington, DE 19899-2046
Via Electronic Mail and First Class Mail:
Erika L. Morabito, Esquire
Brittney J. Nelson, Esquire
Foley Lardner LLP
3000 K Street, N.W., Suite 600
Washington, DC 20007
Christopher Celentino, Esquire
Mikel Bistrow, Esquire
Dawn Messick, Esquire
Foley Lardner LLP
402 W. Broadway, Suite 2100
San Diego, CA 92101
Carl A. Eklund, Esquire
Ballard Spahr, LLP
1225 I 7th Street, Suite 2300
Denver, CO 80202
Vincent J. Marriott, III, Esquire
Sara Schindler-Williams, Esquire
Ballard Spahr, LLP
1735 Market Street, 51st Floor
Philadelphia, P A I 9 I 03
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James J. Holman, Esquire
Duane Morris LLP
30 South 17th Street
Philadelphia, PA 19103
Arthur J. Abramowitz, Esquire
Cozen O'Connor, PC
Libertyview, Suite 300
457 Haddonfield Road
Cherry Hill, NJ 08002
Brad W. Breslau, Esquire
Cozen O'Connor, PC
707 17th Street, Suite 3100
Denver, CO 80202
Melissa Maxman, Esquire
Ronald Wick, Esquire
Cozen O'Connor, PC
1627 I Street, NW, Suite 1100
Washington, DC 20006
Harland W. Robins, Esquire
Dickinson Wright PLLC
15 N. 4th Street
Columbus, OH 43215
Kristi A. Katsma, Esquire
Dickinson Wright PLLC
500 Woodward Avenue, Suite 4000
Detroit, MI 48226
Garry R. Appel, Esquire
Appel & Lucas, P.C.
1660 17th Street, Suite 200
Denver, CO 80202
Peter A. Cal, Esquire
Mark L. Fulford, Esquire
Sherman & Howard L.L.C.
633 17th Street, Suite 3000
Denver, CO 80202
615266.1 7/11/12
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Via First Class Mail:
Dan White
Cordillera Golf Club, LLC
97 Main Street, Suite E202
Edwards, CO 81632
Securities & Exchange Commission
Central Regional Office
Attn: Office of General Counsel
(Bankruptcy)
1801 California Street, Suite 1500
Denver, CO 80202
Colorado Department of Revenue
Attn: Bankruptcy Unit
1375 Sherman Street, Room 1375
Denver, CO 80261
Secretary of State
Division of Corporations
Franchise Tax
John G. Townsend Building
401 Federal Street- Suite 4
P.O. Box 898
Dover, DE 19903
Secretary of Treasury
820 Silver Lake Boulevard, Suite 100
P.O. Box 7040
Dover, DE 19903
George S. Canellos, Regional Director
Securities & Exchange Commission
New York Office
3 World Financial Center, Suite 400
New York, NY 10281-1022
Internal Revenue Service
Department of Treasury
Ogden, UT 84201-0030
Internal Revenue Service
Centralized Insolvency Section
2970 Market Street
Philadelphia, P A 19104
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Internal Revenue Service
Centralized Insolvency Section
P.O. Box 7346
Philadelphia, PA 19101-7346
615266.1 7111112
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