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Case 1:09-cv-02170-CMA Document 2 Filed 09/11/2009 USDC Colorado Page 1 of 13

IN THE UNITED STATES DISTRICT COURT


FOR THE DISTRICT OF COLORADO

Civil Action No. 09-CV-2170-CMA-KMT

ANTHONY SNYDER, CATHERINE SNYDER, CASEY SNYDER, on behalf of himself and


OLYVIA SNYDER and ELLA SNYDER, BRETT SNYDER, CLAIRE BASSLER, JOCELYN
DOERFER WHITNEY, ALEXIS HAWKINS, MITZE HAWKINS, SCOTT HAWKINS,
SONJA E. RODLI, on behalf of SALLY E. RODLI and ANNA E. RODLI, LESLIE
STERNLICHT, THOMAS O’BRIEN, ELLEN O’BRIEN NEILEY, COLIN O’BRIEN, JUSTIN
O’BRIEN, ELIOTT ROBERTSON, ROBERT ST. JOHN, BARBARA SCHNEEMAN,
ELIZABETH WALTER as Counterclaim Defendant, and KOERT VOORHEES

Plaintiffs
v.

VAIL RESORTS, INC., THE VAIL CORPORATION, and VAIL SUMMIT RESORTS, INC.,

Defendants.

PLAINTIFFS’ FORTHWITH MOTION FOR REMAND


AND MOTION FOR SANCTIONS

REQUEST FOR EMERGENCY HEARING

Plaintiffs, by and through their attorneys, Jacobs Chase Frick Kleinkopf & Kelley, LLC,

respectfully submit this Forthwith Motion for Remand and Motion for Sanctions and Request for

Emergency Hearing.

To save a two-week trial set to begin on September 21, 2009 in Summit County,

Colorado, a trial Plaintiffs have been looking forward to for nearly three years, Plaintiffs ask for

an emergency forthwith hearing and immediate remand of this case to the District Court for

Summit County, Colorado. Plaintiffs also seek sanctions against both Counsel and the Vail

Defendants (“Vail”) for pulling a stunt that has to qualify as among the most cynical and tactical

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misuses of the rules of procedure that can be contemplated—the filing of an utterly frivolous

removal notice on the eve of a multi-million dollar trial. Plaintiffs have notified the state court

judge of their intent to file this emergency motion, so as to not lose a trial date that the State

Court had declared to be “firm.”

Introduction

This case is literally on the eve of a two-week trial scheduled to begin on September 21,

2009. The matter has been pending for nearly three years (originally filed in November of

2006). A number of the Plaintiffs are older than 80 years old. Witnesses are being prepared,

cross-examinations outlined, pretrial orders have been issued, plane tickets for out of state

witnesses have been purchased, orders of proof have been filed, exhibits exchanged. The trial

court held its pretrial conference on August 24, 2009, where all parties indicated preparedness

for trial. The parties have filed dozens and dozens of pretrial motions, including summary

judgment motions and motions in limine, which the District Judge is dutifully plowing through

as trial approaches. As recently as Wednesday, September 9, 2009, the District Judge held a

status conference on pretrial publicity, confirmed she was still working on outstanding motions,

and explained she had ordered the Summit County clerk to increase the size of the panel to be

called for jury service.1 And now, without warning, Vail removes the case to federal court

asserting as a basis for removal a justification that is beyond frivolous. The costs to the Plaintiffs

in terms of time and money are significant, but the loss of trial preparation time (in order to

1
Vail’s counsel was specifically asked by the Summit County Court whether they intended to
submit any additional substantive filings. Vail mentioned only a motion relating to late disclosed
expert evidence.

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respond to a frivolous removal notice) and the possible loss of a trial date are potentially

catastrophic.

The removal notice completely misrepresents Plaintiffs’ claims and is fabricated nearly

out of whole cloth by selectively editing and ignoring entire portions of the relevant filing. The

removal notice focuses on the last line of an objection to a proposed Vail jury instruction—

ignoring the majority of the objection, which emphasizes again and again the fact that Plaintiffs’

claims sound in state contract law. The removal notice should be seen for what it is—a

transparent and misleading tactic to disrupt the judicial process and the orderly administration of

justice. A remand order should issue forthwith, and Vail and its counsel should be ordered either

to pay Plaintiffs’ fees or some other more appropriate sanction should be imposed. See Smith v.

Student Non-Violent Coordinating Committee, 421 F.2d 522 (5th Cir. 1969) (ordering sanctions

where removal was not an action taken by the Defendants in good faith, but was, on the contrary,

an action taken in bad faith with the obvious purpose and intent of simply frustrating the trial of

the issues in the state court).

Case History and Plaintiffs’ Claims

Believe it or not, for a matter that has been pending for nearly three years, this case is

fairly simple. Plaintiffs are owners of lifetime transferable ski passes issued by Keystone Resort

when it was founded. Because the passes were transferable on a daily basis from the owner to

anyone the owner wanted, and imposed no limitations on to whom or for what purpose they

could be transferred, pass owners have for years been transferring the passes to others on a daily

basis for money—effectively renting out the transferable ski passes. See Fourth Amended

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Complaint and Jury Demand, attached as Exhibit A, ¶¶ 19-26. The practice was common

knowledge in Summit County and to representatives of Keystone. Id.

In 2005, Vail (which had acquired Keystone Resort in 1996) announced that it would no

longer honor transferable passes that had been exchanged for anything of value, barring so-called

“commercial use” of the lifetime transferable passes. Fourth Amended Complaint and Jury

Demand, ¶¶ 27-35. Vail’s action dramatically reduced the value of the lifetime transferable

passes. Id. Plaintiffs accordingly filed a breach of contract claim, basing their claim on the

original contract between the corporate organizers which granted what came to be the

transferable lifetime passes. Plaintiffs have never wavered from their position that this is

fundamentally a state law breach of contract case (with some state law tortious interference

claims thrown in), and that they and their transferees have the state law-based contractual right to

ride up the lifts at Keystone until the end of the relevant measuring life. See Fourth Amended

Complaint and Jury Demand, ¶¶ 36-57. Vail, for its part, has always asserted defenses related to

federal law including laws and regulations relating to the Forest Service Permit pursuant to

which Keystone operates, and has also asserted that the ski passes were nothing more than

revocable licenses. See, e.g., Defendants' Answer, Affirmative Defenses, Counterclaims, and

Jury Demand, dated January 8, 2007, attached as Exhibit B, at p. 6; Defendants' Answer,

Defenses and Affirmative Defenses, Counterclaims, and Jury Demand to Plaintiffs' Fourth

Amended Complaint and Jury Demand, dated May 4, 2009, attached as Exhibit C, at p. 8.

In response to these federal law issues raised by Vail, the District Judge specifically

requested that the parties submit additional briefing regarding federal regulations and any other

federal law that might be relevant to this case. Order re Sur-Response and Sur-Reply for Motion

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Pursuant to Rule 56(h) for Determination of Law on Vail’s Position That It Has No Obligation to

Honor the Lifetime Transferable Ski Passes, dated August 4, 2009, attached as Exhibit D. After

reviewing the briefing submitted by the parties, the District Judge concluded that the Forest

Service regulations relied on by Vail "as well as the other federal authority cited by

Defendants ... are not relevant to the claims and defenses of the various parties in this action."

Order Denying Plaintiffs' Motion for Determination of Law on VSRI's Position That It Has No

Obligation to Honor Passes, dated August 26, 2009, the relevant excerpt of which is attached as

Exhibit E. Given the lack of probative value and risk of confusing or misleading the jury, the

court further concluded "as a matter of law that evidence regarding the [Forest Service] Manual

or other federal legal authority shall not be admissible at the jury trial in this action." Id.

Because nothing on the face of the complaint raises questions of federal law, there is no

federal jurisdiction here.

Standards for Removal and Remand

A party may remove a case from state court if the case originally could have been

brought in federal court. See 28 U.S.C. § 1441(a). Federal removal jurisdiction is statutory in

nature and is to be strictly construed. Archuleta v. Lacuesta, 131 F.3d 1359, 1370 (10th Cir.

1997) (citing Shamrock Oil & Gas v. Sheets, 313 U.S. 100, 108-09, 61 S.Ct. 868, 85 L.Ed. 1214

(1941). The party seeking removal bears the burden to prove the existence of federal subject

matter jurisdiction. Pritchett v. Office Depot, Inc., 420 F.3d 1090, 1094-95 (10th

Cir.2005) (applying burden of proof in diversity jurisdiction case); Meinders v. Refco Securities,

Inc., 865 F. Supp. 721, 723 (D. Colo. 1994) (a party seeking removal based on federal question

jurisdiction bears the burden of proof as to federal jurisdiction). Because of the strict

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construction of statutory removal jurisdiction, any doubts as to whether a case is removable

should be resolved in favor of a remand to state court. Laughlin v. Kmart Corp., 50 F.3d 871,

873 (10th Cir.1995); Meinders, 865 F. Supp. at 723 ("Section 1331 should be construed strictly

and all doubts should be resolved in favor of state court jurisdiction.")

Argument

A. The “Well-Pleaded Complaint” Rule Should End This Inquiry.

Federal district courts have original jurisdiction over actions “arising under” the laws of

the United States. 28 U.S.C. § 1331. Whether a case arises under the laws of the United States

is determined from the plaintiff's complaint, unaided by statements alleged in anticipation of

defenses that the defendant may raise. Franchise Tax Board v. Construction Laborers Vacation

Trust, 463 U.S. 1, 10, 103 S.Ct. 2841, 2847, 77 L.Ed.2d 420 (1983) (emphasis added). The well-

pleaded complaint rule is satisfied when the complaint reveals that “a right or immunity created

by the Constitution or laws of the United States [is] an element, and an essential one, of the

plaintiff's cause of action.” Gully v. First Nat'l Bank, 299 U.S. 109, 112, 57 S.Ct. 96, 97, 81

L.Ed. 70 (1936) (emphasis added). Plaintiff is the “master of the claim” and “may avoid federal

jurisdiction by exclusive reliance on state law.” Id.; see Garley v. Sandia Corp., 236 F.3d 1200,

1207 (10th Cir.2001). As summarized in Wright and Miller’s Federal Practice and Procedure:

The federal claim or right that provides the predicate for removal to
federal court must not be asserted as part of an issue that is merely
collateral or incidental to a claim that is primarily based in state law, nor
can the federal question appear for the first time in the defendant's answer
by way of defense, nor is it sufficient for the federal question to enter the
case as a counterclaim asserted by the defendant.

14B Federal Practice and Procedure §3722 (footnotes omitted).

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Thus, a defense which implicates a federal question is not considered part of plaintiff's

properly pleaded complaint. See Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 63, 107 S.Ct. 1542,

95 L.Ed.2d 55 (1987); Warner Bros. Records, Inc. v. R.A. Ridges Distrib. Co. Inc., 475 F.2d 262,

262 (10th Cir.1973). Accordingly, “a case may not be removed to federal court on the basis of a

federal defense, ... even if the defense is anticipated in the plaintiff's complaint, and even if both

parties admit that the defense is the only question truly at issue in the case.” Franchise Tax

Board, 463 U.S. at 14, 103 S.Ct. at 2847; see also Garley, 236 F.3d at 1207. Where a claim is

amenable to establishment without reference to questions of federal law, no federal jurisdiction

exists. Nielsen v. Archdiocese of Denver, 413 F.Supp.2d 1181, 1184 (D. Colo. 2006). Put very

simply, a state law claim that implicates no federal issues on its face, does not create federal

jurisdiction. Id. at 1187.

As explained below, nothing in Plaintiffs’ Complaint or the claims articulated therein

implicates federal law. To whatever extent Plaintiffs’ objection to Vail’s “License” jury

instruction could even remotely be deemed to raise a question of federal law, it was an issue

raised in response to, and as a defense to, Vail’s own defense. If mere anticipation of a defense

is not enough to satisfy the well-pleaded complaint rule, then surely a raising defense to a

defense suffers from the same defect, and cannot satisfy the criteria for removal jurisdiction.

B. Vail’s “Federal Question” Removal Argument Is Frivolous.

The very document and page on which Vail bases its removal argument (Plaintiffs’

objections to Vail’s jury instructions) goes out of its way to reemphasize that Plaintiffs’ claims

are state law breach of contract claims—not some claim of ownership to federal land. Plaintiffs

have never asserted an ownership interest in federal land; what they have asserted, and continue

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to assert, is that Keystone has a contractual obligation to allow holders of the passes (or their

transferees) to ride up Keystone’s ski lifts (and ski down the trails maintained by Keystone)

without payment. Yet, Vail in the removal notice blatantly misquotes the document on which it

relies:

The Plaintiffs at first called the privileges created by the Agreement 'Transferable
Ski Passes,' without specifying the nature of the alleged right created, but a recent
paper filed in the course of settling jury instructions shows the Plaintiffs are
actually claiming an interest in federal land. When the Defendants' proposed
instructions stated that the jury should be instructed the 'privileges' were licenses
to use the lifts and trails, the Plaintiffs responded—for the first time—that in
addition to an undefined contract right, the jury should be told 'the interest created
was an irrevocable transferable interest akin to an easement or a lease.'

Notice of Removal at p. 2. This selective quotation is a fantasy. Plaintiffs made clear in the

objection to Vail’s jury instruction (consistent with every version of the Complaint that has ever

been filed) that Plaintiffs are making a claim of breach of contract. The objection was made in

response to Vail’s assertion (strongly disputed) that the Ski Passes are revocable licenses, and the

jury should be so instructed. The full text of Plaintiffs’ objection to Vail’s proposed license-

related jury instructions bears repeating:

Plaintiffs object to this proposed instruction [on revocable licenses] because it is


misleading and contrary to the facts and legal claims in this case. First, Plaintiffs
believe that the Court needs to decide whether the rights associated with the
transferable ski passes at issue in this case are nothing more than a revocable
license. If the transferable ski passes are merely revocable licenses, no different
than movie tickets, then the Court should so find, and send us all home.

If, on the other hand, the Court determines that Plaintiffs received contractual rights,
different from a revocable license, then none of these “license-related” instructions
should go to the jury —because in that instance the case would be what Plaintiffs claim it
is — a breach of contract case.

The simple fact that the interest for which two parties negotiate involves the use of one
party’s property does not necessarily create a “license.” Even when dealing with a ticket
to a sporting event or concert, typically understood to be the epitome of a “revocable

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license,” courts will look to the interest intended to be created by the parties before
concluding that the interest was necessarily a “license.” See, e.g. Brotherson v.
Professional Basketball Club, LLC, 604 F.Supp.2d 1276, 1285-89 (W.D.Wash.
2009)(permitting suit for breach of contract rather than license revocation where
plaintiffs were buyers of season passes for an athletic team’s home games); Kilgallon v.
Clear Channel Communications, inc., 2007 WL 2840381 (Mass. Super. 2005)(permitting
suit under a contract theory where plaintiff was a holder of one ticket to a concert event);
but see, Sweeney v. United Artists Theater Circuit, Inc., 119 P.3d 538, 540 (Colo. App.
2005)(“It is generally recognized that an admission ticket is a revocable license to
witness a performance or attraction.”).

Similarly, in particular with respect to agreements to use property for a set duration—
such as a lifetime, courts have recognized contractual rather than license rights. For
example, courts have recognized “lifetime passes” in exchange for valid consideration to
use another’s property as contractual obligations rather than the mere revocable licenses.
Mottley v. Louisville & N.R. Co., 150 F. 406, 409 (W.D. Ky. 1907)(recognizing lifetime
passes issued as part of settlement agreement as a “valuable right” and a contractual
obligation), rev’d on other grounds, 211 U.S. 149 (1908) (federal courts lacked
jurisdiction).

In the event this Court considers the Plaintiffs’ interest in the lifetime transferable ski
passes to be a “license,” Plaintiffs object to this proposed instruction on the basis that the
interest created was an irrevocable transferable interest akin to an easement or a lease.

Plaintiffs Objections to Defendants’ Jury Instructions, the relevant excerpt of which is attached

as Exhibit F (emphasis added). It is on this thin reed that Vail bases its claim that Plaintiffs have

asserted an ownership interest in federal land, allegedly morphing the case into a federal

question. On its face, the argument is absurd. As the objection says repeatedly, Plaintiffs have

always asserted this is a breach of contract case. Plaintiffs have never alleged any ownership

right in federal land. The only point being made is that the right claimed—a contract right—

cannot be terminated without the payment of money damages, and is therefore irrevocable,

regardless of what the right is called, contract or license. Contrary to Vail’s assertion, Plaintiffs

never stated “that in addition to an undefined contract right, the jury should be told ‘the interest

created was an irrevocable transferable interest akin to an easement or a lease.’” Removal

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Notice at 2. Plaintiffs have always asserted, exclusively, that they have a contract right created

under state law. Only if the Court deemed the right to be a license was the irrevocability element

raised. This is hardly an aspect of federal law that is apparent from the face of the Complaint.

For Vail to turn this one line, which was conditional in any event, into a supposed

asserted claim to a property interest in federal land is absurd. Using a pointillist technique

worthy of Seurat, Vail jumps back and forth from the factual statement that the U.S. government

owns the land on which the Resort is located, to the dictionary definition of “akin,” to the

conclusion that a lifetime lift ticket is necessarily a claim of an interest in federal land. Notice at

4. The false picture is masterfully painted, but it bears no resemblance to reality. Watching Vail

strain for a federal question by linking words here and there brings to mind Justice Cardozo’s

admonition from Gully about the well-pleaded complaint rule being is required to ensure that

“collateral” matters do not create federal jurisdiction unnecessarily:

What is needed is something of that common-sense accommodation of


judgment to kaleidoscopic situations which characterizes the law in the
treatment of problems of causation.… If we follow the ascent far enough,
countless claims of right can be discovered to have their source or their
operative limits in the provisions of a federal statute or in the Constitution
itself with its circumambient restrictions upon legislative power. To set
bounds to the pursuit, the courts have formulated the distinction between
controversies that are basic and those that are collateral, between disputes
that are necessary and those that are merely possible. We shall be lost in a
maze if we put that compass by.

Gully, 299 U.S. at 117-18.

Vail is lost in a maze or a least wants us all to take the path, and this Court need not

follow. Plaintiffs statement on which Vail relies was conditional; it was a defense to Vail’s own

defense that the ski passes are nothing more than revocable licenses, important only in the event

the Court did not find the passes to have created a state law contractual right. Nowhere in the

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well-pleaded complaint is a federal question raised. See Neilson, 413 F.Supp.2d at 1187 (where

labyrinthine pursuit of a substantial federal question leads inexorably back to the beginning, and

no federal question appears on the complaint, remand is required).

C. Vail and Its Counsel Should Be Sanctioned for this Baseless Removal

Title 28 U.S.C. § 1447(c) provides that "[a]n order remanding the case may require

payment of just costs and any actual expenses, including attorneys fees, incurred as a result of

the removal." Sanctions are appropriate “where the removing party lacked an objectively

reasonable basis for seeking removal." Martin v. Franklin Capital Corp., 546 U.S. 132, 141

(2005). In addition, "a district court abuses its discretion by refusing to award fees where the

defendant's argument for removal was devoid of even fair support." Nat'l City Bank v. Aronson,

474 F. Supp. 2d 925, 933 (S.D. Ohio 2007).

Sanctions have been deemed particularly appropriate in situations where baseless

removal motions are filed with the specific intent to interfere with impending trial dates. See

LaGrotte v. Simmons Airlines, Inc., No. Civ. A3:99-CV-2652-G, 1999 WL 1063420 (N.D. Tex.

Nov. 23, 1999); 250 F.3d 739 (5th Cir. 2001) (emergency remand and sanctions granted where

removal lacking any reasonable basis was made eleven days before trial date); Ins. Co. of State of

Pa. v. Waterfield, 371 F. Supp. 2d 146, 151 (D. Conn. 2005) (sanctions imposed on a defendant

who "improperly engaged in a tactic of stalling and delay," had no "reasonable basis" for seeking

removal, and whose notice of removal "complicated and delayed what is otherwise a simple state

law breach of contract case, to the prejudice of the Plaintiff").

In this instance, Plaintiffs propose a more creative sanction than a mere monetary award.

Plaintiffs have lost a significant amount of trial preparation time having to respond to this

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frivolous and disruptive removal attempt. The Court could order the case immediately remanded

and also order Vail’s counsel to stop working on or preparing for the case for a full 24 hour

period, and also order that Vail’s counsel file a certification to that effect. Vail is a multi-billion

dollar corporation with apparently bottomless legal and monetary resources. A $2,000 attorneys

fee award will have no deterrent effect. Ordering Vail’s lawyers to stop work for a day would

fairly compensate for the unfair advantage gained.

An alternative sanction, in conjunction with the immediate remand, would be a

recommendation to the State trial court that the jury be instructed that Vail had attempted to

avoid the trial via a last minute bad faith tactic. Not unlike an “evidence spoilage” adverse

inference instruction, the jury could be allowed to consider this fact when assessing Vail’s

credibility.

Something concrete must be done to prevent Vail and its well-paid legal minions from

continuing their effort at turning what should have been a relatively straightforward effort by

residents of Summit County, Colorado to obtain justice, into an extraordinarily expensive

process without any end in sight.

Conclusion

This Court should immediately remand this case to the District Court for Summit County,

Colorado for trial. Vail and its counsel should be sanctioned for this last-minute attempt to avoid

trial.

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Dated: September 11, 2009

Respectfully submitted,

s/ Reid Neureiter
N. Reid Neureiter
Kathryn A. Reilly
JACOBS CHASE FRICK KLEINKOPF & KELLEY, LLC
1050 17th St., Suite 1500
Denver, Colorado 80265
Telephone: 303.685.4800
Fax: 303.685.4869
Email: rneureiter@jacobschase.com
kreilly@jacobschase.com

ATTORNEYS FOR PLAINTIFFS

CERTIFICATE OF SERVICE

I hereby certify that on September 11, 2009, I electronically filed the foregoing with the
Clerk of Court using the CM/ECF system which will send notification of such filing to the
following e-mail addresses:

Bobbee J. Musgrave bobbee.musgrave@hro.com


Michael J. Hofmann michael.hofmann@hro.com
HOLME ROBERTS & OWEN LLP
1700 Lincoln St., Suite 4100
Denver, CO 80203

s/ Claudia Jones
Legal Assistant

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