Contract analysis

I. Executive Summary Calderwood & Harkness LLP has been asked by Metropolitan Transit Development Corp. ("MTDC"), a unit of local government and special-purpose transit authority organized under the Illinois Local Mass Transit District Act (70 ILCS 3610/1 et seq.), headquartered at 550 West Harrison Street, Suite 1400, Chicago, IL 60607, to undertake representation in connection with five related and interrelated mat

II. Background A. The Prospective Client — Metropolitan Transit Development Corp. Metropolitan Transit Development Corp. ("MTDC") is a unit of local government and special-purpose transit authority established under the Illinois Local Mass Transit District Act, 70 ILCS 3610/1 et seq. MTDC is headquartered at 550 West Harrison Street, Suite 1400, Chicago, IL 60607. As a governmental body, MTDC is organized pursuant to

III. Conflicts Analysis A. Applicable Ethical Framework The Illinois Rules of Professional Conduct govern this analysis. Illinois is the controlling jurisdiction because: (i) the proposed engagement would be handled principally from the firm's Chicago office (One North Wacker Drive, Suite 4200, Chicago, IL 60606); (ii) MTDC is an Illinois governmental entity established under Illinois law; (iii) the underlying procee

IV. Financial Considerations The following financial information is documented for the Conflicts Committee's complete understanding of the matter's dimensions. Financial considerations do not alter the ethical analysis. The Rules of Professional Conduct do not permit a law firm to accept or decline an engagement based on revenue considerations where doing so would result in a violation of the concurrent-conflict rule

V. Recommendation Based on the analysis set forth in this memorandum, the General Counsel respectfully recommends that the Conflicts Committee take the following actions:

1. Determine that the conflict is unwaivable. The Committee should formally determine that the concurrent representation of MTDC and Pinnacle presents an unwaivable conflict of interest under Illinois Rules of Professional Conduct 1.7(a)(1) (direct adversity) and 1.7(a)(2) (material limitation), and that informed consent under Rule 1.7(b) cannot cure the conflict for the reasons set forth in Section III.D of this mem

2. Direct that the proposed MTDC engagement be declined. The Committee should direct that the proposed MTDC engagement (Matter No. 1031-00001) be declined and that no attorney-client relationship be formed between Calderwood & Harkness LLP and Metropolitan Transit Development Corp. in connection with this matter or any matter substantially related to the BIPA proceedings involving TruScan 360.

3. Direct Rachel Bernstein to notify MTDC of the declination. The Committee should direct Rachel Bernstein, as the partner who initiated the intake process, to promptly notify MTDC's General Counsel, Terrence Whitfield, of the declination. The notification should be made in appropriately general terms, consistent with the firm's obligations under Rule 1.6 (Confidentiality of Information). Specifically, Bernstein shou

4. Direct Rachel Bernstein to facilitate a referral to qualified alternative counsel. The Committee should direct Rachel Bernstein to offer MTDC a referral to qualified alternative counsel with substantial BIPA expertise and government-entity defense experience. The General Counsel has identified two firms that meet these criteria and are not conflicted: (a) Aldridge, Paulson & Cho LLP, 150 North Michigan Avenue, Sui

5. Direct Colleen Farrow to update the firm's conflicts database. The Committee should direct Colleen Farrow, Director of Conflicts & New Business, to update the firm's IntegrityCheck conflicts-management system to reflect MTDC as a declined prospective client, with a permanent cross-reference to Pinnacle Matter No. 1031-00001. The entry should include a notation of the basis for the declination (unwaivable concurren

6. Confirm that no Pinnacle confidential information was disclosed to the proposed MTDC engagement team. The Committee should confirm, through appropriate inquiry, that no Pinnacle confidential information was disclosed to Rachel Bernstein, Miriam Calloway, Devon Archer, or Nadia Petrov at any point during the intake process. Based on the General Counsel's preliminary review, no such disclosure occurred — the intake

7. Direct that Matter No. 1031-00001 be formally closed. The Committee should direct that Matter No. 1031-00001 be formally closed in all firm systems — including IntegrityCheck, the firm's document-management system, and the firm's time-and-billing system — with zero billings, zero disbursements, and a permanent notation that the matter was declined due to an unwaivable conflict of interest. No client file was creat

VI. Conclusion The concurrent representation of Metropolitan Transit Development Corp. and Pinnacle Workforce Analytics, Inc. presents an unwaivable conflict of interest under the Illinois Rules of Professional Conduct. The conflict is grounded in direct adversity under Rule 1.7(a)(1), arising from Pinnacle's status as a named responsible party in the Attorney General's investigation, MTDC's contemplated cross-claims