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

et al., Debtors. Chapter 11 Case No. 05-55927 (SWR) (Jointly Administered) Tax ID # 13-3489233 Hon. Steven W. Rhodes

LIMITED OBJECTION TO MEDIATORS MOTION TO MODIFY MEDIATION ORDER NOW COMES Howard & Howard Attorneys, P.C., counsel for several preference defendants and, for this Limited Objection to the Mediators Motion (Motion) to Modify the Courts October 19, 2007 Mediation Order (Mediation Order) states: 1. The Motion proposes a daily flat fee for the mediators, but this creates the risk

of an uneven mediation fee rate paid among similarly-situated defendants because a defendant whose case is scheduled for mediation on a busy mediation day will pay a smaller mediation fee than the defendant whose mediation is scheduled on a slow mediation day. Thus, the Motion proposes a procedure that has the potential for unequal treatment among similarly situated defendants, whereas the Mediation Order did not create that problem. 2. The Motions suggested revisions to paragraph 16 of the Mediation Order are

unduly harsh for the smaller adversary proceedings, because a defendant with $50,000 at issue should not have run the risk that it might have to pay $3,000 to have the case mediated in Detroit (or $3,750 to have the case mediated in New York). Those mediation fees are disproportionately large.

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Moreover, the Motion proposes a mediation fee structure that punishes the last

defendant left standing among other defendants whose mediations are scheduled for a particular day, and this can result in mediation being used as a club against preference defendants in smaller cases who have been unable to settle. In the experience of the undersigned, the

preference defendants in the smaller cases are often the most anxious to settle in order to avoid disproportionately high legal feeshowever, in this bankruptcy, they have often been unable to settle due to Plaintiffs alleged interpretations of the law (such as the flawed notion that a preference defendant can only use one of the defenses embodied in 547(c), or that 547(c)(4) must be applied only to the last payments, and cannot be applied up the chain). 4. The Motion ignores the fundamental reality that the smaller cases are easier to

analyze because they generally involve fewer transactions to consider. Indeed, thats why they are smaller casesbecause there were fewer transactions between the Debtors and the defendant during the preference period. 5. The undersigned disagrees with the suggestion (on page 3 of the Motion) that the

mediators will not spend more time on a larger case than on a smaller one. In the smaller cases, it should be easier to reach a settlement because there are fewer dollars at issue. The larger cases, however, are generally more difficult to settle because the larger dollar amounts at issue make them far more painful for the preference defendants. 6. Paragraph 6(b) of the Motion alleges that once a mediators hours are scheduled,

they might not be completely recoverable, but this is inaccurate--especially if the mediation is held in Detroit. If a Detroit-based mediation is cancelled, the mediator could go back to his work as an attorney, or could prepare other cases for facilitation.

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The undersigned agrees with the parenthetical at the end of paragraph 6(a) of the

Motion, and suggests that (in order to avoid future confusion or controversy) this Court should clarify whether the intent of the Mediation Order is to apportion the mediation fees on a per side basis or a per party basis. WHEREFORE the undersigned prays that the Motion be denied with respect to its suggested revisions to paragraph 16 f the Mediation Order, except for clarifying whether the mediation fees in paragraph 16 are to be apportioned on a per side or per party basis. The undersigned takes no position with respect to the Motions suggested revisions to other paragraphs of the Mediation Order. HOWARD & HOWARD ATTORNEYS, P.C. By: /s/ Lisa S. Gretchko Lisa S. Gretchko (P29881) 39400 Woodward Avenue, Suite 101 Bloomfield Hills, MI 48304-5151 (248) 723-0396 (248) 645-1568 (facsimile) lgretchko@howardandhoward.com

Dated: November 20, 2007