DISTRICT COURT, PITKIN COUNTY, COLORADO I 506 East Main Street Dietris? 925; ii? wi i2 Q: 12; Aspen' CO 81611 Risner BRUCE L. SMITH, et al. A A FOR COURT USE ONLY A THE RELATED COMPANIES, LP, et al. Defelidants. I Jon Bernhardt, #20227 Patrick H. Pugh, #36774 Ballard Spahr LLP Case No. 2011ev168 1225 17th Street, Suite 2300 D. - Denver, Co 80202 Phone: 303-292-2400 Facsimile: 303-296-3956 _Qughp @bal1ards_Qahr.eom MEMORANDUM IN SUPPORT OF MOTION OF DEFENDANTS I 9- BASE VILLAGE OWNER LLC AND RELATED WESTPAC REAL ESTATE LLC TO DISMISS FIRST AMENDED COMPLAINT PURSUANT TO C.R.C.P. 12 DMWEST #8547445 TABLE OF CONTENTS I. SUMMARY OF THE SUCCESSOR SPONSOR DEFENDANT POSITION II. FACTUAL BACKGROUND 5 A. Execution of PSAs by Plaintiffs 5 B. PSA Disclosures Regarding Square Footage 5 C. PSA Disclosures Regarding Mill Levies 5 D. Publicly Available Information About Expected Mill Levies 7 E. Recording of Condominium Documents for the Project. 8 F. Plaintiffs Closed on the Units . ARGUMENT 9 A. Legal Standard 9 B. Plaintiffs Lack Standing to Bring the Claims Asserted in the Complaint. 9 I. To Have Standing, Plaintiffs Must Be the Real Parties In Interest I0 2. Plaintiffs Granted the Association the Exclusive Right to Pursue Any Claim Regarding More Than One Unit I0 3. All Claims in the Complaint Regard More Than One Unit and Therefore Are Included Within the Grant to the Association. 12 C. The Square Footage Fraud Claims And The Metro District Fraud Claims Should Be Dismissed For Failure To Adequately Plead Fraud And For Failure To State A Claim For Which Relief May Be Granted. I3 l. Plaintiffs' Square Footage Fraud Claims Fail To Adequately Plead Fraud And Are Contradicted By The Express Terms Of The PSAs 13 2. Plaintiffs' Metro District Fraud Claims Fail to Adequately Plead Fraud And Are Contradicted By The PSAs And Public Records I3 D. Plaintiffs' Metro District Fraud Claims Are Barred By The Applicable Statutes Of Limitations I4 l. All of Plaintiffs' Claims Are Subject to a Three-Year Limitations Period. I 4 2. Plaintiffs Knew or Should Have Known All Facts With Respect to the Metro Districts Before Signing the PSAs And No Later Than the Date the TOSV Approved the Amended Service Plan. I5 E. Plaintiffs' Sixth Claim Fails Because The Complaint Fails To Adequately Plead A Violation of the CCPA and Because It Is Expressly Contradicted By The PSAs. 17 DMWEST #ss-41445 i F. G. H. I. Plaintiffs' Eighth Claim, For Breach Of Contract, Fails Because It Is Expressly Contradicted By The PSAs And Because It Is Based On Alleged Promises That Did Not Survive The Delivery Of Deeds To Plaintiffs. Plaintiffs' Claim For Rescission (Seventh Claim) And For Breach of Contract (Eighth Claim) Should Be Dismissed As Against WestPac Real Estate Because WestPac Real Estate Was Not A Party To Any Contract.. The Claims of 19 Plaintiffs Are Barred Because Those Plaintiffs Had Actual or Constructive Notice of the Pertinent Facts More Than Three Years Before They Brought Suit If The Court Does Not Disrniss The Complaint In Its Entirety, Plaintiffs' Demand for a Jury Trial and Request for Consequential and Punitive Damages Should Be Stricken. l. Plaintiffs Waived Their Right to a Jury Trial. . 2. The Successor Sponsor Defendants Cannot Be Liable For Consequential or Treble Damages. . IV. CONCLUSION DMWEST #8547445 ii TABLE OF AUTHORITIES CASES Ainscoitgk v. Owens, 90 P.3d 851 (Colo. 2004) Bolinger v. Neal, No. 09CA1314, 2010 WT. 4054510 (Colo. App. Oct. 14, Bowman v. May, 80 P.2d 327 (Colo. 1938) City of Westminster v. Skyline Vista Dev. Co., 431 P.2d 26 (Colo. 1967) Colorado Bean, LLC v. Peaberry Cojfee Inc., Page(s) 21 251 P.3d 9 (Colo. App. 2010) 2 2 23 Coors Brewing Co. v. Floyd, 978 P.2d 663 (Colo. 1999) Duran v. Clover Club Foods Co., 616 F. Supp. 790 (D. Colo. 1985) First Interstate Bank v. Berenlaaitnt, 872 P. 2d 1297 (Colo. App. 1993) Fox v. I-10, Ltd., 957 P.2d 1018 (CO10. 1999) Hoeppner Const. Co. v. U.S. for Use of Mangitrn, 287 F. 2d 108 (10th Cir. 1960) Imperial Merchant Services, Inc. v. Hunt, 212 P.3d 736 (Cal. 2009) Keefe, et al. v. Base Village Owner, LLC, et al., No. 2009 CV 273 (Dist. Ct. Pitkin Co.) Lexton-Ancira Real Estate and, 1972 v. Heller, 826 P.2d 819 (Colo. 1992) Medina v. State, 35 P.3d 443 (Colo. 2001) DMWEST #8547445 .. 10 National Propane Corp. v. Miller, 18 P.3d 782, 785-86 (Colo. App. 2000) Ogitnwo v. American Nat. Ins. Co., 936 P.2d 606 (Colo. App. 1997) Parahoo v. Mancini, No. 97APE08-1071, 1998 WL 180539 (Ohio App. 1998) People v. Adarns, 243 P.3d 256 (Colo. 2010) Perez v. Frank Oldsmobile, Inc., 223 F.3d 617 (7th Cir. 2000) Prestige Homes, Inc. v. Legonjie, 658 P.2d 850 (Colo. App. 1983) Radiology Professional Corp. v. Trinidad Area Health Ass 577 P.2d 748 (Colo. 1978) Rhino Linings USA, Inc. v. Rocky Mountain Rhino Lining, Inc., 62 P.3d 142 (Colo. 2003) SMLL, LL. C. v. Peak Nat. Bank, 111 P.3d 563 (Colo. App. 2005) Talbot v. Seabert, 484 P.2d 1242 (Colo. App. 1971) Town of Snowmass Village Home Rule Charter 4.13 U.S. Fax Law Center, Inc. v. iHire, Inc., 373 F. Supp. 2d 1208 (D. Colo. 2005) U.S. Fax Law Center, Inc. v. T2 Tech., Inc., 183 P34 642 (C010. App. 2007) Vermont Agency of Natural Resources v. United States ex rel. Stevens, 120 1858 (2000) Walker v. Van Laningham, 148 P.3d 391 (Colo. App. 2006) Western Innovations, Inc. v. Sonitrol Corp., 187 P.3d 1155 (Colo. App. 2008) DMWEST #8547445 iv Yacht Club Homeowners Assoc., Inc. v. A. C. Excavating, 94 P.3d 1177 (Cao. App. 2004) Yadon v. Lowry, 126 P.3d 332 (Colo. App. 2005) STATUTES 15 1711(a)(2) 15 1703 C.R.s. 6-1-115 c_R.s_ (C) 13-30-10813) 32-1-205 .. 32-1-306 c.R.s_ 3863.3-201 c.R_s. 30-33.3-205 C.R.S. C.R.S. 3865.7-101 Rules C.R.C.P. 9(b) 12(b)(5) C.R.C.P. 12(1) C.R.E. 201(f) DMWEST #8547-445 Base Village Owner, LLC and Related WestPac Real Estate, LLC ("WestPac Real Estate" and, together with BVO, the "Successor Sponsor Defendants") submit this Memorandum in support of their Omnibus Motion to Dismiss the First Amended Complaint (the "Complaint") under C.R.C.P. l2(b)(5) and 9(b) (the "Motion).1 The Motion is further supported by the accompanying Appendix of Exhibits (the "Appendix") and by the Memorandum of Law filed by the Non-Sponsor Defendants (the "Non-Sponsor Defendants' Memo") in support of- their separate motion to dismiss the Complaint, which are incorporated by reference. I. SUMMARY OF THE SUCCESSOR SPONSOR POSITION This case arises from the purchase and sale of condominium units in a project known as Capitol Peak Lodge Condominium (the "Project") in the Town of Snowmass Village, Colorado The Project is part of the Base Village Planned Unit Development ("Base Village In 2006 - before any involvement in the Project by the Successor Sponsor Defendants - each Plaintiff entered into a Purchase and Sale Agreement (the for the purchase of a condominium unit (the "Unit") in the Project. BVO later acquired the Project and received an assignment of the PSAs on or about March 2, 2007. Thereafter, in 2008, each Plaintiff closed on, took title to, and received a deed for the contracted-for Unit. Years later, Plaintiffs bring this action in an attempt to profit from the nationwide lawsuits filed under the Interstate Land Sals Full Disclosure Act including one (entitled Keefe, et al. v. Base Village Owner, LLC, et al., No. 2009 CV 273, (the "Viceroy Litigation)) filed in Pitkin County District Court involving another project in the Base Village The Complaint groups the Successor Sponsor Defendants with Defendants The Related Companies, L.P., Related WestPac, LLC, Base Village Mezzanine, LLC, Base Village Snowmass Center Association, LLC, and Related Snowmass, LLC (the "Non-Sponsor Defendants"). The Non-Sponsor Defendants are represented separatelyand are filing a separate motion to dismiss, in which the Successor Sponsor Defendants partially join as ftuther detailed below. I #8547445 PUD. But, as further detailed in the Non-Sponsor Defendants' Memo (at pp. 2-3), Plaintiffs' case is fundamentally different from the Viceroy Litigation because the Viceroy plaintiffs rejected the allegedly non-conforming condominium units proffered to them and suedifor a refund of their deposits. In sharp contrast, Plaintiffs here accepted their Units, took title to them, and remained in possession for 2 to 3 years before suddenly purporting to notice that the Units varied "substantially" from what had been promised to them. As a threshold matter, no Plaintiff has standing to bring these claims because each claim involves more than one Unit in the Project. Under the PSAs and the Declaration of Covenants, Conditions, and Restrictions for the Project (the "Declaration"), Plaintiffs granted the Capitol Peak Lodge Condominium Association (the "Association") the exclusive right to pursue any such claim, and expressly gave up the right to assert such claims individually. As a result, the Complaint should be dismissed in its entirety. (Section IILB.) If the Court agrees that Plaintiffs lack standing, it need not consider the Complaint's many other deficiencies. If the Court determines that Plaintiffs do have standing despite their assignment of all of their rights, each claim should nevertheless be dismissed as legally deficient for several reasons. Plaintiffs' eight claims flow from two groups of allegations. First, Plaintiffs 'allege that the Units they received were smaller than what was promised to them. Based on this contention, Plaintiffs assert claims for _breach of contract (Eighth Claim) and for various species of fraud (First and Third Claims and portions of Fourth, Fifth, Sixth, and Seventh Claims; collectively the "Square Footage Fraud Claims"). Second, Plaintiffs allege that they were misled regarding the property taxes and related mill levies for which property owners in the Project would be responsible in connection with the Metropolitan District and General Improvement District DMWEST #ss-47445 2 Bonds issued to finance various infrastructure construction (Second Claim and portions of Fourth, Fifth, Sixth, and Seventh Claims; collectively the "Metro District Fraud Claims"). None of those eight claims is adequately pled, and each of them is contradicted by the PSAS and by the relevant public-record documents. As set forth in Sections II and of the Non-Sponsor Defendants' Memo, both the Square Footage Fraud Claims and the Metro District Fraud Claims should be dismissed for failure to comply with C.R.C.P. 9(b) because they improperly treat all seventeen defendants together as a single undefined "Defendant" and fail to specify what any Plaintiff was told by any defendant or how such information differed from the truth. Moreover, Plaintiffs cannot solve this problem by re-pleading because the Square Footage Fraud Claims and the Metro District Fraud Claims are contradicted by Plaintiffs' own allegations (particularly the allegation that the relevant representations were made to them at the time they signed their PSAs - before the Successor Sponsor Defendants had any involvement in the Project), by the PSAS, and by the public record. (Section In any event, the Metro District Fraud Claims are time-barred because all of the facts Plaintiffs claim were concealed were matters of public record more than three years before Plaintiffs filed suit. (Section For any or all of these reasons, all of Plaintiffs' fraud-based claims (the First through Seventh Claims) should be dismissed. For the same reasons, Plaintiffs have not alleged and cannot allege a false or deceptive trade practice under the Colorado Consumer Protection Act and cannot sustain a claim for violation of the CCPA (Sixth Claim). (Section Plaintiffs' breach of contract claim (Eighth Claim) should also be dismissed. That claim is based on an allegation that each Plaintiff received a Unit smaller than promised in the PSA. But no PSA promised that any Unit would be a specific size. Rather, each one expressly states DMWEST #8547445 3 that all measurements are "approximate" and that "[f]inal dimensions, square footage, and floorplans mayvary." The PSAS further provide that "so long as the Condo Unit[s are] constructed substantially in accordance with the Condo Unit Plan reviewed by [each Plaintiffj, [Plaintiff] shall neither have any right to rescind this agreement nor to claim any breach hereof on account of alleged discrepancies in the square footage." The promise Plaintiffs claim was breached was simply not made. (Section Moreover, even if such a promise had been made it could not form the basis for a breach of contract claim because each Plaintiff accepted a deed to the Unit years ago. That acceptance extinguished any promise or representation in the PSAs concerning the size of the Units. (Section ILLF). Wholly apart from these flaws, that claim - together with the Seventh Claim for fraudulent inducement - should at the very least be dismissed as against WestPac Real Estate because that entity has never been a party to any agreement with any Plaintiff. (Section IILG). To the extent any claim survives despite these defects, all claims should be dismissed as to Plaintiffs who closed on their Units more than three years before the Complaint was filed. No later than the date of each such closing, each Plaintiff had actual or constructive knowledge - by virtue of possession of the Unit and by virtue of information contained in documents recorded in their chains of title - of all the alleged facts underlying each claim. Because each claim is subject to a three-year statute of limitations, for those Plaintiffs who closed more than three years before the Complaint was filed, the time bar ran before they brought suit. The Complaint should be dismissed in its entirety as to those Plaintiffs. (Section IILH). Finally, to the extent any claim survives this Motion, the Court should strike Plaintiffs' demand for a jury trial and Plaintiffs' requests for consequential and treble damages because, in the PSAS and in the Declaration, Plaintiffs waived any right to those items. (Section ULD. DMWEST #8547445 4 II. FACTUAL BACKGROUND2 A. Execution of PSAs by Plaintiffs Between April 14 and June 6, 2006, each Plaintiff entered into a PSA with Defendant Base Village lA Development Compan (not Defendant BVO or any affiliate of BVO) for the purchase of one or more condominium units in_ the Project. (Compl, 'Il 73.) A sample PSA is attached to the Appendix as Exhibit A. To assist the Court, a summary of the dates Plaintiffs entered into their respective PSAs is attached to the Appendix as Exhibit B.3 B. PSA Disclosures Regarding Sguare Footage Each PSA stated an approximate square footage for the Unit, and advised: "These are preliminary suite layouts only. . Final dimensions, square footage, and floorplans may vary.' 3 (Ex. A (PSA) at Ex. The PSAS also provided that "[r]epresentations as to square footages contained within the Unit . are approximate numbers only," that each "[b]uyer acknowledges and agrees that square footage calculations may be made in a variety of manners," -and that "so long as the Unit is constructed substantially in accordance with the Unit Plan reviewed by Buyer, Buyer shall neither have any right to rescind this Agreement nor to claim any breach hereof on account of alleged discrepancies in square footage calculations." (Id. at Add. No. l, C. PSA Disclosures Regarding Mill Levies The PSAS disclosed to Plaintiffs that the Units were included in special taxing districts, including the Base Village Metropolitan District No. 2 and the Snowmass Village General 2 This Factual Background is taken from the Complaint, documents referred to in or incorporated by the Complaint, and the public record, all of which is properly before the Court on a motion to dismiss pursuant to C.R.C.P. 12. 3 This information is taken from documents referred to in the Complaint, and is properly before the Court on a motion to dismiss. Yadon v. Lowry, 126 P.3d 332 (Colo. App. 2005). DMWEST #8547445 5 Improvement District (collectively, the "Metro Districts"). They further disclosed that Unit owners would be responsible for paying property taxes to cover the costs of constructing or purchasing the improvements for which the Metro Districts were responsible. Plaintiffs were warned that they could face increased mill levies to service the related debt. Plaintiffs were also advised to investigate this matter, including the "existing mill levies of such districts" and the "potential for increase in such mill levies." Specifically, Plaintiffs were told: Taxing Districts IT IS ANTICIPATED THAT THE UNIT MAY BE INCLUDED ON ONE OR MORE SPECIAL TAXING DISTRICTS. SPECIAL TAXING DISTRICTS MAY BE SUBJECT TO GENERAL OBLIGATION INDEBTEDNESS THAT IS PAID BY REVENUES PRODUCED FROM ANNUAL TAX LEVIES ON THE TAXABLE PROPERTY WITH SUCH DISTRICTS. PROPERTY OWNERS IN SUCH DISTRICTS MAY BE PLACED AT RISK FOR INCREASED MILL LEVIES IN EXCESS OF TAX BURDENS TO SUPPORT THE SERVICE OF SUCH DEBT WHERE CIRCUMSTANCES ARISE RESULTING IN THE INABILITY OF SUCH A DISTRICT TO DISCHARGE SUCH INDEBTEDNESS WITHOUT SUCH AN INCREASE IN MILL LEVIES. BUYER SHOULD INVESTIGATE THE DEBT FINANCING REQUIREMENTS OF THE AUTHORIZED GENERAL OBLIGATION AND INDEBTEDNESS OF SUCH DISTRICTS, EXISTING MILL LEVIES OF SUCH DISTRICTS SERVICING SUCH INDEBTEDNESS AND THE POTENTIAL FOR AN INCREASE IN SUCH MILL LEVIES. Base Village Metropolitan District No. 2 and Snowmass Village General Improvement District. In addition to the foregoing, the Project is located within the boundaries of the Base Village Metropolitan District No. 2 and the Snowmass General Improvement District (the "Snowmass Eligible electors and property owners within the boundaries of the Snowmass Districts previously authorized the Snowmass Districts to impose property tax levies and facilities fees and to issue bonds in amounts sufficient to construct or purchase certain improvements within the Town of Snowmass Village. No additional eligible elector or property owner approvals are required prior to such imposition of property tax levies or the issuance of debt within previously approved amounts within the Project. Regardless of whether such person was a property owner as of the date initial DMWEST #8547445 6 I authorization was given to impose property tax levies or issue the bonds, or became an owner thereafter, such property owner will be responsible for the payment of taxes and repayment of any such bonds issued by the Snowmass Districts. (EX. A, at Add. No. 1, (emphasis in original).) D. Publicly Available Information About Expected Mill Levies On December 7 and 10, 2004, the Pitkin County District Court entered Orders approving Base Village Metropolitan Districts No. 2 and No.l, respectively. (Compl., 'll 64; Ex. (Orders).) Those Orders - recorded with the Pitkin County Clerk and Recorder - refer to the Consolidated Service Plan for the Metro Districts (the "Service Plan") approved by the TOSV on September 20, 2004. (Ex. at 6; Ex. at 6; see Compl. 'Il 64). The Service Plan, in turn, included a $38 million limit on the debt the Metro Districts may incur, a 49.5 mill maximum aggregate mill levy that may be imposed on properties in the Metro Districts (the "Mill Levy Cap"), and a samplecomputation of taxes a property owner could pay on a $1 million property, assuming the maximum 49.5 mill levy. (EX. (Service Plan) at (C) EX. thereto.) The Service Plan became a matter of public record on its approval, and was thereafter available "for public inspection" in the office of the Town Clerk of the TOSV. See C.R.S. 32-1-306. On October 23, 2006, the TOSV approved an Amended and Restated Consolidated Service Plan for the Metro Districts (the "Amended Service Plan"). (Compl., HI 75; Ex. (Amended Service Plan).) The Amended Service Plan (which is similarly part of the public record) includes the same 49.5 Mill Levy Cap, and increased the debt limit to $48.7 million. (Ex. at 'Il V.C Ex. thereto.) The current mill levy imposed on real property located within the boundaries of the Metro Districts, including the Units owned by Plaintiffs, is 49.5 mills. #8547445 7 E. Recording of Condominium Documents for the Project. On March 31, 2008, the Declaration and the condominium map for the Project were recorded with the Pitkin County Clerk and Recorder. The Declaration formally created the condominium known as Capitol Peak Lodge Condominium and formed the Association. (Ex. (Declaration) at Att. Art. IV.) The condominium map sets forth the dimensions of the units located in the tirst phase of the Project. See C.R.S. 38-33.3-201, 205. On July 28, 2008, recorded supplements to the Declaration and condominium map, which incorporated the second and third phases of the Proj ect. By accepting a deed to a Unit, each Plaintiff expressly agreed to the terms of the Declaration, as supplemented. (See Ex. at 19.03.) F. Plaintiffs Closed on the Units Between April 10, 2008, and December 2, 2008, each Plaintiff closed on their Unit. (Compl. at 'll 76; see also Ex. B.) The closing dates are set forth in Exhibit B.4 As that Exhibit indicates, for nine of the Units -those contracted for or purchased by Plaintiffs Jeffrey Ganeles Lori Berman and/or GBL, Silverman Family Trust; Helena Willner and Robert K. Vahradian; Jerome P. White; Aspen Valley Real Estate, Pharris Family Trust, Gerald Nelson Pharris Trust, and Terese Koleto Pharris Trust; Vincent A. Dartnali and Patti M. Darmali Trust; Marc A. Asselmeier Michael W. Mitchell and/or Snowmass Capitol Peak Investment, and Bruce Smith, Kathleen Smith and/or The Smith Trust DTD 1-15-04 - the closings occurred more than three years before this action was filed. (See EX. The closing dates for each Plaintiff were taken from the deeds filed with the Pitkin County Clerk and Recorder and from the Pitkin County Assessor. This information is properly before the Court on a motion to dismiss. See Walker v. Van Laningham, 148 P.3d 391, 397 (Colo. App. 2006). 4 5 The Complaint identities nineteen plaintiffs for the nine Units that closed more than three years before this lawsuit was filed. Although only the person who took title to the Unit may be a proper party to this action, the Complaint pleads these persons in the alternative. DMWEST #8547445 ARGUMENT A. Legal Standard A complaint should be dismissed if the plaintiff cannot prove facts that would entitle it to relief. Coors Brewing Co. v. Floyd, 978 P.2d 663, 665 (Colo. 1999). On a motion to dismiss, the well-pleaded facts in the complaint are taken as true. Medina v. Stare, 35 P.3d 443, 452 (Colo. 2001). "However, the court is not required to accept as true legal conclusions couched as factual allegations." Western Innovations, Inc. v. Sonirrol Corp., 187 P.3d 1155, 1158 (Colo. App. 2008). The Court may consider facts alleged in the complaint, documents attached to or referenced in the complaint, and matters of which the court may take judicial notice. Walker v. Van Laninghcirn, 148 P.3d 391, 397 (Colo. App. 2006) (iudicial notice); Yadon v. Lowry, 126 P.3d 332, 335-36 (Colo. App. 2005) (documents attached to or referred to in complaint). The Court may take judicial notice of matters of publicly recorded documents and the court's own records. C.R.E. 201(f); Prestige Homes, Inc. v. Legoujfe, 658 P.2d 850, 853 (Colo. App. 1983); Walker v. Van Laningharn, 148 P.3d 391, 397 (Colo. App. 2006). B. Plaintiffs Lack Standing to Bring the Claims Asserted in the Complaint. As a threshold matter, the Complaint should be dismissed in its entirety because none of the Plaintiffs has standing to assert any of the claims. To have standing to assert the claims in the Complaint, Plaintiffs must be the real parties in interest. However, Plaintiffs granted to the Association the exclusive right to pursue any claim against BVO or any of its affiliates (including WestPac Real Estate) that regards more than one unit. That grant is consistent with Colorado law and is binding on Plaintiffs. Because all the claims in the Complaint regard more than one unit, they are included in the grant from Plaintiffs to the Association. Therefore, DMWEST #8547445 9 Plaintiffs are not the real parties in interest and do not have standing to assert these claims against the Successor Sponsor Defendants. 1. To Have Standing, Plaintiffs Must Be the Real Parties In Interest. An action may be brought only in the name of the real party in interest. C.R.C.P. 17(a). "The real party in interest is the party who, by virtue of the substantive law, has the right to invoke the aid of the court to vindicate the legal interest in question." National Propane Corp. v. Miller, 18 P.3d 782, 785 (Colo. App. 2000).6 "In order for a court to have jurisdiction over a dispute, the plaintiff must have standing to bring the case. Standing is a threshold issue that must be satisfied in order to decide a case on the merits." Ainscoagh v. Owens, 90 P.3d 851, 855 (Colo. 2004). A party may contractually transfer its right to pursue a claim. People v. Adams, 243 P.3d 256, 261-62 (Colo. 2010). Upon transferring the right to pursue a claim, a person no longer has standing to maintain an action on that claim. Hoeppner Const. Co. v. U.S. for Use of Mangian, 287 F. 2d 108, 111 (10th Cir. 1960) (recipient of right to pursue an action is real party in interest); Oganwo v. American Nat. Ins. Co., 936 P.2d 606, 610-11 (Colo. App. 1997). 2. Plaintiffs Granted the Association the Exclusive Right to Pursue Any Claim Regarding More Than One Un_it. Plaintiffs expressly granted the Association the exclusive right to pursue any claim involving more than one unit against BVO and its affiliates, and expressly agreed that they would not individually pursue such claims. Article of the Declaration, to which Plaintiffs agreed' by accepting a deed to a unit in the Project, provides, in relevant part: 6 The case-law often uses real-party-in-interest and standing interchangeably. The analysis and result would be same under either. See US. Fax Law Center, Inc. v. T2 Tech., Inc., 183 P.3d 642, 644~45 (Colo. App. 2007); Nat'l Propane Corp. v. Miller, 18 P.3d 782, 785-86 (Colo. App. 2000); US. Fax Law Center, Inc. v. iHire, Inc., 373 F. Supp. 2d 1208, 1210 (D. Colo. 2005). DMWEST #3547445 10 Other than with respect to claims relating to enforcement of this Declaration under Article XVII above, any and all claims by an Owner or the Association against or any Affiliate thereof (ii) a Contractor, or a Design Consultant (individually, an "Applicable Party"); and disputes between or among an Owner or the Association and one or more Applicable Parties, including any such claims or disputes arising out of or relating to the design or construction of any portion of the Condominium (collectively, "Disputes") shall be resolved in accordance with the procedures set forth in this Article XIX. By accepting a deed to a Unit, each Owner agrees that the procedures for resolving Disputes set forth in this Article XIX shall be the exclusive procedures and shall provide the exclusive remedy for resolving Disputes and specifically waives any and all other rights or remedies such Owner may have against any Applicable Party at law, in equity or otherwise with respect to all Disputes. (Ex at l9.0l(emphasis added).) For any Dispute regarding more than one Unit or any Common Element, the Association shall have the exclusive right to pursue such Dispute on behah" of the Owners and to seek redress against the appropriate Applicable Parties; and (ii) individual Owners shall not be permitted to pursue such Dispute or seek redress against the appropriate Applicable Party on their own behalf or on the behalf of any other Person. By accepting a deed to a Unit, each Owner hereby irrevocably grants to the Association a power of attorney to pursue a Dispute in the manner set forth in this Article XIX and to settle such Dispute on the Owner's behalf without further consent or action by such owner. (EX at 19.03 (emphasis added).) The terms of the PSAS mirror the language in the Declaration. The PSAS provide [A]s more particularly described in Section 19.03 of the Condominium Declaration [quoted above], in the event the facts, circumstances or allegations of Buyer against an Applicable Party relating to any dispute are common to any other dispute that may be asserted by any other owners in the Project or the Condominium Association, the Association shall have the exclusive right to pursue such dispute on behalf of Buyer and all other affected owners in the Project and to seek redress against the appropriate Applicable Parties; and Buyer shall not [be] permitted [to] pursue such dispute or seek redress against the Diviwitsr #8547445 appropriate Applicable Party on its own behalf or on the behalf of any other person. (Ex. A at Add. No. l, 'll 8(b)(iv) (emphasis added).) Granting the Association the exclusive right to pursue certain claims comports with Colorado law. Under the Colorado Common Interest Ownership Act, C.R.S. 38-3.3.3-101, et seq. an association is empowered, "subject to the provisions of [its] declaration," to "[i]nstitnte, defend, or intervene in litigation or administrative proceedings in its name on behalf of itself or two or more unit owners on matters affecting the common interest community." C.R.S. Colorado courts have held that "[u]nder CCIOA, individual units are a part of the 'common interest community" and associations have standing to assert claims on behalf of the individual unit owners. Yacht lub Homeowners Assoc., Inc. v. A. C. Excavating, 94 P.3d 1177, 1180 (Colo. App. 2004). 3. All Claims in the Complaint Regard More Than One Unit and Therefore Are Included Within the Grant to the Association. The Complaint does not contain any claim that involves only a single Unit. Rather, it collectively asserts claims with identical factual allegations and legal theories involving all the Plaintiffs' Units. By pleading their claims collectively, Plaintiffs concede that these allegations affect more than one Unit. Therefore, their claims all fall within the scope of the grant to the Association in the Declaration _and the PSAS, together with a power-of-attorney, of the exclusive right to pursue any claim affecting more than one Unit. Because Plaintiffs gave the Association this exclusive right (and, further agreed that they would not individually pursue those claims), they do not have standing to bring any of the claims asserted in the Complaint. As a result, the Complaint should be dismissed in its entirety. #s541>>'445 12 C. The Square Footage Fraud Claims And The Metro District Fraud Claims Should Be Dismissed For Failure To Adequately Plead Fraud And For Failure To State A Claim For VVhich Relief May Be Granted. If the Court agrees that Plaintiffs lack standing to pursue their claims, it need go no further. But if the Court declines to dismiss the Complaint for lack of standing, it should nevertheless dismiss the Square Footage Fraud Claims and the Metro District Fraud Claims for failure to adequately plead fraud under C.R.C.P. or because such claims are directly contradicted by the PSAS and public records. 1. Plaintiffs' Square Footage Fraud Claims Fail To Adequately Plead Fraud And Are Contradicted By The Express Terms Of The PSAS. For the reasons set forth in Section ILA (want of particularity), Section 2 (allegations and referenced documents negate any claim of fraud), Section H.B.3 (merger doctrine precludes finding of fraud) and Section ILB.-4 (economic loss rule) of the Non-Sponsor Defendants' Memo, Plaintiffs' Square Footage Fraud Claims (First and Third Claims and portions of Fourth, Fifth, Sixth, and Seventh Claims) should be dismissed as to the Successor Sponsor Defendants. 2. Plaintiffs' Metro District Fraud Claims Fail to Adequately Plead Fraud And Are Contradicted By The PSAS And Public Records. For the reasons set forth in Section HLA (want of particularity) and Section (PSAS and public records contradict claims; all information Plaintiffs' complain was concealed was, in fact, disclosed to Plaintiffs) of the Non-Sponsor Defendants' Memo, Plaintiffs' Metro District Fraud Claims (Second Claim and the remainder of Fourth, Fifth, Sixth, and Seventh Claims) should be dismissed as to the Successor Sponsor Defendants. DMWEST #s54a445' 13 D. Plaintiffs' Metro District Fraud Claims Are Barred By The Applicable Statutes Of Limitations To the extent Plaintiffs' Metro District Fraud Claims survive despite the defects set forth above and in the Non-Sponsor Defendants' Memo, those claims should be dismissed because they are barred by the applicable statutes of limitations. statute of limitations defense may be considered on a motion to dismiss where the bare allegations of the complaint reveal that the action was not brought within the required statutory period." SMLL, L.L. C. v. Peak Nat. Bank, 111 P.3d 563, 564-65 (Colo. App. 2005). 1. All of Plaintiffs' Claims Are Subject to a hree-Year Limitations Period. The statutes of limitations for all of Plaintiffs' claims provide for a 3-year period after the date the alleged fraud, violation, or breach was discovered or should have been discovered with the exercise of reasonable diligence. 15 U.S.C. 1711(a)(2) (actions for violation of 15 U.S.C. 1703 C.R.S. 13-80-l08(3) (actions for breach of contract, fraud, misrepresentation, or concealment); C.R.S. 6-1-115 (CCPA actions). "The limitations period commences when the [allegedly] defrauded person has knowledge of facts which, in the exercise of proper prudence and diligence, would enable the person to discover the [alleged] fraud perpetrated against that person." First Interstate Bank v. Berenbattm, 872 P. 2d 1297, 1301 (Colo. App. 1993). "[F]ull possession of the means of detecting a fraud is equivalent to l