IN THE UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION In re: ) ) COLLINS & AIKMAN CORPORATION,

et al.1 ) ) Debtors. ) ) ) ) ) ) _________________________________________) Chapter 11 Case No. 05-55927 (SWR) (Jointly Administered) (Tax Identification #13-3489233) Honorable Steven W. Rhodes

COLLINS & AIKMAN LITIGATION TRUSTS RESPONSE IN OPPOSITION TO MARTIN STAMMS AMENDED MOTION FOR TRANSFER OF VENUE The Collins & Aikman Litigation Trust (the Trust), as successor to the above-captioned Debtors (collectively, the Debtors) pursuant to the First Amended Joint Plan of Reorganization of Collins & Aikman Corporation and its Debtor Subsidiaries, as confirmed by order of the Bankruptcy Court, files this Response in Opposition to Martin Stamms (Stamm) Amended Motion for Transfer of Venue [Dckt. # 9136]. In support of this Response, the Trust respectfully represents as follows:

The Debtors in the jointly administered cases include: Collins & Aikman Corporation; Amco Convertible Fabrics, Inc., Case No. 05-55949; Becker Group, LLC (d/b/a/ Collins & Aikman Premier Mold), Case No. 05-55977; Brut Plastics, Inc., Case No. 05-55957; Collins & Aikman (Gibraltar) Limited, Case No. 05-55989; Collins & Aikman Accessory Mats, Inc. (f/k/a the Akro Corporation), Case No. 05-55952; Collins & Aikman Asset Services, Inc., Case No. 05-55959; Collins & Aikman Automotive (Argentina), Inc. (f/k/a Textron Automotive (Argentina), Inc.), Case No. 05-55965; Collins & Aikman Automotive (Asia), Inc. (f/k/a Textron Automotive (Asia), Inc.), Case No. 0555991; Collins & Aikman Automotive Exteriors, Inc. (f/k/a Textron Automotive Exteriors, Inc.), Case No. 05-55958; Collins & Aikman Automotive Interiors, Inc. (f/k/a Textron Automotive Interiors, Inc.), Case No. 05-55956; Collins & Aikman Automotive International, Inc., Case No. 05-55980; Collins & Aikman Automotive International Services, Inc. (f/k/a Textron Automotive International Services, Inc.), Case No. 05-55985; Collins & Aikman Automotive Mats, LLC, Case No. 05-55969; Collins & Aikman Automotive Overseas Investment, Inc. (f/k/a Textron Automotive Overseas Investment, Inc.), Case No. 05-55978; Collins & Aikman Automotive Services, LLC, Case No. 05-55981; Collins & Aikman Canada Domestic Holding Company, Case No. 05-55930; Collins & Aikman Carpet & Acoustics (MI), Inc., Case No. 05-55982; Collins & Aikman Carpet & Acoustics (TN), Inc., Case No. 05-55984; Collins & Aikman Development Company, Case No. 05-55943; Collins & Aikman Europe, Inc., Case No. 05-55971; Collins & Aikman Fabrics, Inc. (d/b/a Joan Automotive Industries, Inc.), Case No. 05-55963; Collins & Aikman Intellimold, Inc. (d/b/a M&C Advanced Processes, Inc.), Case No. 05-55976; Collins & Aikman Interiors, Inc., Case No. 05-55970; Collins & Aikman International Corporation, Case No. 05-55951; Collins & Aikman Plastics, Inc., Case No. 05-55960; Collins & Aikman Products Co., Case No. 05-55932; Collins & Aikman Properties, Inc., Case No. 0555964; Comet Acoustics, Inc., Case No. 05-55972; CW Management Corporation, Case No. 05-55979; Dura Convertible Systems, Inc., Case No. 05-55942; Gamble Development Company, Case No. 05-55974; JPS Automotive, Inc. (d/b/a PACJ, Inc.), Case No. 05-55935; New Baltimore Holdings, LLC, Case No. 05-55992; Owosso Thermal Forming, LLC, Case No. 05-55946; Southwest Laminates, Inc. (d/b/a Southwest Fabric Laminators Inc.), Case No. 05-55948; Wickes Asset Management, Inc., Case No. 05-55962; and Wickes Manufacturing Company, Case No. 05-55968.

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PRELIMINARY STATEMENT 1. On April 13, 2004, Stamm filed a Complaint and Demand for Jury Trial (the

Complaint) against Collins & Aikman Products Co., Inc., f/k/a Rantoul Textron Products Co. (the Defendant) in the United States District Court for the Central District of Illinois (Illinois Court) alleging, inter alia, discrimination by the Defendant in failing to promote the Plaintiff to positions involving the driving of a forklift. (Compl. at 1.) 2. On June 14, 2004, the Defendant filed an Answer and Affirmative Defenses.

Thereafter, the above-captioned Debtors commenced these chapter 11 cases by the filing with this Court of their respective chapter 11 petitions on May 17, 2005. 3. On January 11, 2006, Stamm filed a general unsecured claim against the Debtors

based upon an alleged violation Americans with Disabilities Act. The Claim asserted damages in the amount of $500,000 and attached a copy of the Complaint filed in the Illinois Court. 4. On January 30, 2008, Stamm filed his initial Motion for Transfer of Venue with

this Court [Dckt #8834]. That Motion neglected to identify any specific legal or factual basis that would justify transferring this action. On February 11, 2008, the Trust filed its Response in Opposition [Dckt. #8854]. 5. Now, months after the initial, flawed Motion was filed, Stamm has presented an

Amended Motion for Transfer of Venue. While purporting to present additional facts regarding prospective witnesses to Stamms action in Illinois, there is no basis for burdening the Trust with a trial in an out-of-state jurisdiction for what would amount to a relatively small amount of money. Moreover, because Stamm filed a claim that is disputed and this involves a contested

matter not an adversary proceeding, the matter cannot be transferred on the grounds of forum non conveniens. I. 6. STAMMS CLAIM SHOULD NOT BE TRANSFERRED BECAUSE STAMMS CLAIM IS NOT A CASE OR PROCEEDING AS REQUIRED BY 28 U.S.C. 1412 The statute cited by Stamm does not provide a discretionary basis for a court to

transfer a case or proceeding either in the interest of justice or for the convenience of the parties. 28 U.S.C. 1412. Stamms claim is neither a case nor a proceeding required by the statute. 7. Federal Rule of Bankruptcy Procedure 1014(a) deals with the dismissal and

transfer of cases. FED. R. BANKR. P. 1014(a). Commentary on that rule suggests that a case is a reference to the proceedings initiated by the filing of a chapter petition filed by or against a debtor. See 1 COLLIER
ON

BANKRUPTCY 4.04[4][a] (15th Ed.)

Similarly, reference to a

proceeding relates to an adversary proceeding, not a contested matter. Id. 8. The resolution of disputed claim, on the other hand, is a contested matter as

distinguished from a case and a proceeding under the Bankruptcy Rules. Compare FED. R. BANKR. P. 3007, 9014. 9. No case applying 28 U.S.C. 1412 to a contested matter involving resolution of a

disputed claim has been or could be cited by Stamm, a claimant, who invoked the jurisdiction of this Court by filing a claim. All of the cases cited by Stamm involve the transfer of adversary proceedings. To be sure, the primary case relied upon by Stamm involves the transfer of an adversary proceeding from Philadelphia to Alabama. See In re Leedy Mortgage Co, 62 B.R. 303 (Bankr. E.D. Pa. 1986). That case involved the debtor initiating an adversary proceeding in Philadelphia where the chapter 11 case was filed, and the defendants sought the transfer back to

Alabama where the debtors business was located. In Leedy, as in other cases, the transfer sought was of an adversary proceeding and not a contested matter in the form of a claim dispute. 10. Since the Claim issue here involves neither a case nor an adversary proceeding,

28 U.S.C. 1412 is inapplicable to this dispute, and Stamm is subject to this Courts jurisdiction for the resolution of the dispute over his Claim. II.
EVEN IF THE DISPUTE OVER STAMMS CLAIM WERE SUBJECT TO TRANSFER ON THE GROUNDS OF FORUM NON CONVENIENS, IT SHOULD NOT BE

TRANSFERRED BECAUSE A TRANSFER WOULD NOT PROMOTE THE ECONOMIC OR EFFICIENT ADMINISTRATION OF THE BANKRUPTCY ESTATE 11. Transfer pursuant to 28 U.S.C. 1412 should be exercised cautiously. In re

Enron Corp., 317 B.R. 629, 638 (Bankr. S.D.N.Y. 2004). Transfer is a cumbersome disruption of the Chapter 11 process. In re Pavilion Place Assocs., 88 B.R. 32, 35 (Bankr. S.D.N.Y. 1988). Given this, the burden is on the movant to show by a preponderance of the evidence that transfer of venue is warranted. In re Enron Corp., 317 B.R. at 639. Primary among the factors to be evaluated when considering a transfer include whether the transfer would promote the economic and efficient administration of the bankruptcy estate. Id. (emphasis supplied). 12. A case cited by Stamm confirms that [t]here is a strong presumption in favor of

maintaining venue where the bankruptcy case is pending. In re Hechinger Investment Co of Del, Inc., 288 B.R. 398, (Bankr. D. Del. 2003) (denying a motion to transfer case from Delaware).2 13. Although the Claim asserted damages in the amount of $500,000, Stamms

damages are a small fraction of the claimed amount. Stamm asserts that he was relieved of his
2 Stamms other cases are equally unpersuasive. One case was based on a contractual forum selection clause that considered transfer under 28 U.S.C 1404, 1406. See In re The Bennett Funding Group, Inc., 259 B.R. 243 (Bankr. N.D.N.Y. 2001). Another case involved the transfer of an adversary proceeding filed by a trustee back to the principal place of business of the Debtor because the bankruptcy action was filed in Philadelphia when the company was headquartered in Birmingham, Alabama. In re Leedy Mortgage Co, 62 B.R. 303 (Bankr. E.D. Pa. 1986).

temporary position as a fork-lift driver purportedly losing a $.40 per hour raise he received for only a little more than one month (Compl. at 7.) Given the benefit of every reasonable doubt, even if Stamm had worked as the fork-lift driver between July 2001 and the present, he would have received a maximum salary differential of approximately $5,200. ($.40 per hour x 40 hours per week x 50 weeks per year x 6.5 years.) There would be no future lost wages because the company is no longer in existence. Therefore, his Claim of $500,000 is grossly inflated.3 14. Stamm asserts that his damages will be far higher because he is entitled to

punitive damages and attorneys fees. Stamm relies on the case of Szmaj v. AT&T, No. 99-1353, to support his claim that punitive damages are awarded for these sorts of cases. Although the jury rendered a verdict in excess of $1,000,000, Stamm fails to advise the Court that the verdict was completely vacated by the District Court, and that the Seventh Circuit affirmed the District Courts vacation of the jury verdict. See Szmaj v. AT&T, 291 F.3d 955 (7th Cir. 2002). 15. Here, transfer would not promote the economic and efficient administration of the

bankruptcy estate. Stamm has not provided a basis for anything other than extremely limited damages, assuming only for the purposes of this Motion that Stamms claims have any merit whatsoever. Stamm proposes that the Trust should use its limited resources resources that are being used to respond to and process the thousands of claims for hundreds of millions of dollars that remain pending to retain Illinois counsel and have a trial for extremely limited damages, relying for support on one case where the jury verdict was vacated by the appellate court. Id.4 16. Stamm, admittedly, identifies a number of witnesses who appear to live in close

proximity to the Central District of Illinois. The Trust is in an identical position with the only

Neither the Trust nor the Debtors concede that Stamms claims have any merit whatsoever. The evaluation of damages is only for example purposes and should not be considered an admission that Stamm is entitled to an award (which he is not). Stamm also claims that he is entitled to a trial by jury. If Stamms claims somehow survived an objection, Stamm could have his jury trial in the United States District Court for the Eastern District of Michigan.

personnel available to the Trust at this time, and where all of the Debtors records are located in Detroit. Stamm suggests that this reason alone should be sufficient to warrant transfer. Of course, Stamm ignores that there are simple ways to obtain testimony of witnesses in distant jurisdictions. Affidavits or de benne esse depositions would enable Stamm to present the

proposed testimony of the witnesses without having to bring those witnesses to court. Much of the evaluation of Stamms claim, therefore, can take place on paper so that this Court can still evaluate and estimate Stamms claim. 17. Contrasting the limited returns that could be available to Stamm with the cost and

expense of litigating this matter in Illinois, it is neither economic nor efficient for the Court to transfer this action. Valuable resources that could be used to pay the general unsecured creditors of the Debtors would be squandered in trying the matter in Illinois when there are means to evaluate and assess Stamms claims in this Court. See 11 U.S.C. 502(c)(1). WHEREFORE, the Trust respectfully requests that this Court deny Stamms Motion to Transfer. Respectfully submitted, BOYLE BURDETT By: s/H. William Burdett, Jr. Eugene H. Boyle, Jr. H. William Burdett, Jr. 14950 East Jefferson, Suite 200 Grosse Pointe Park, Michigan 48230 (313) 344-4000 (313) 344-4001 (facsimile) burdett@boyleburdett.com Attorneys for the Collins & Aikman Litigation Trust

Dated: April 18, 2008