Contract analysis

I. Purpose and Executive Summary The purpose of this memorandum is to provide Nexford Industrial Holdings Inc. ("Nexford" or the "Company") with a comprehensive update on the current status of the above-captioned litigation matter following the status conference held on January 12, 2023 before the Honorable Judge Helena R. Vasquez-Torres in the Circuit Court of Cook County, Illinois, County Department, Law Division.

II. Background and Case Posture For context and to ensure a complete record in this status memorandum, we provide below a summary of the background of this litigation and the current posture of the case. A. The Complaint and Plaintiff's Allegations Darren K. Maciejewski ("Maciejewski" or "Plaintiff"), a former Senior Quality Assurance Supervisor at Nexford's manufacturing facility located at 2700 Industrial Parkway,

1. Legitimate Non-Retaliatory Business Reason. Nexford's termination of Maciejewski was motivated by a legitimate, non-retaliatory business reason — namely, Maciejewski's repeated violations of the Company's attendance and tardiness policy — and was not in any way motivated by, or causally connected to, any protected activity.

2. Failure to Exhaust Administrative Remedies (Count II). With respect to Count II of the Complaint (Section 11(c) of the OSH Act), Maciejewski failed to file a complaint with the Secretary of Labor within the thirty-day period prescribed by 29 U.S.C. § 660(c)(2), and the claim is therefore procedurally barred. Section 11(c) provides that an employee who believes he has been discharged in violation of the provision m

3. After-Acquired Evidence. In the course of preparing its defense, Nexford has identified evidence of Maciejewski's misconduct during his employment that would have independently justified termination, and which limits or eliminates Plaintiff's entitlement to certain categories of damages under the after-acquired evidence doctrine. The specific nature of this evidence has been preserved for further development throu

III. Summary of discovery Activity and Opposing Counsel's Inactivity A recurring and central theme of this memorandum is the stark asymmetry between the parties' respective levels of engagement in this litigation. Nexford has diligently participated in discovery, while Plaintiff's counsel has effectively abandoned the case. The following summary details the discovery activity to date. A. Discovery Completed by Nexfor

IV. January 12, 2023 Status Conference The scheduled status conference in this matter was held on January 12, 2023 before Judge Helena R. Vasquez-Torres. Nadia Petrov of Calderwood & Harkness appeared on behalf of Defendant Nexford Industrial Holdings Inc. I was prepared to address the Court regarding the status of discovery, the outstanding discovery defaults by Plaintiff, and the communications breakdown with Plain

1. The Court entered an order noting Plaintiff's counsel's non-appearance at the January 12, 2023 status conference.

2. The Court set a further status date of March 16, 2023.

3. The Court directed that Plaintiff's counsel, Gerald P. Hess, appear at the March 16, 2023 status date or show cause for his failure to prosecute the case and for his non-appearance at the January 12, 2023 hearing. The Court's order was entered on the record and will be reflected on the Cook County docket. A copy of the January 12, 2023 order will be forwarded to Nexford upon receipt from the Clerk's office. The sh

V. Assessment and Outlook A. Potential for Dismissal for Want of Prosecution Based on the current trajectory of this matter, we believe there is a meaningful probability that this case will be dismissed for want of prosecution ("DWP") if Plaintiff's counsel continues his pattern of non-appearance and inactivity. If Mr. Hess fails to appear at the March 16, 2023 status conference, the Court may enter a formal Rule to

VI. Fees and Budget Status As discussed with Tara Svendsen at the outset of this engagement, Calderwood & Harkness and Nexford agreed to a pre-trial litigation budget cap of $175,000 for the defense of this matter through the completion of pretrial proceedings, exclusive of any trial preparation or trial costs, which would be budgeted separately if the case were to proceed to that stage. The following is a summary of

VII. Recommended Next Steps Based on the foregoing analysis, Calderwood & Harkness recommends the following course of action:

1. Maintain Litigation Hold. Nexford should continue to preserve all documents and electronically stored information ("ESI") identified in the litigation hold notice dated April 1, 2022 related to Maciejewski's employment, the OSHA complaint and inspection, Building C safety conditions and the EHS Department's internal investigation, and all communications among the key custodians identified in the hold notice, inclu

2. Calderwood & Harkness to Attend March 16, 2023 Status Conference. Nadia Petrov will appear on behalf of Nexford at the next scheduled status conference on March 16, 2023 before Judge Vasquez-Torres. I will be prepared to address the Court regarding the full record of Plaintiff's counsel's non-appearances, discovery defaults, and failure to prosecute the case. If the Court entertains a motion for dismissal or enter

3. Continue Monitoring Docket. Calderwood & Harkness will continue to monitor the Cook County Circuit Court docket for any filings by Hess, any substitution of counsel on behalf of Plaintiff, or any other activity in the case. We will promptly notify Nexford of any developments.

4. No Affirmative Motions at This Time. After careful consideration, Calderwood & Harkness does not recommend filing a motion to dismiss for want of prosecution or a motion for sanctions at this juncture. The Court's show-cause mechanism is already in motion and is likely to achieve the same result — dismissal — without the cost and potential complications of affirmative motion practice. Filing an affirmative motion

5. Periodic Reporting. Calderwood & Harkness will continue to provide periodic status updates to Nexford. In addition, we will continue to coordinate with Verdant Mutual Insurance Company through its designated claims adjuster, Brianna Choi, regarding insurer reporting obligations. We will also coordinate with Tara Svendsen on the preparation of the quarterly litigation exposure report to Harborview Partners, through

6. Contact Information for Questions. Tara Svendsen and Cat Donnelly should not hesitate to contact us with any questions or concerns regarding this matter or any developments that may come to their attention. We can be reached as follows: Nadia Petrov, Lead Associate Calderwood & Harkness LLP 227 West Monroe Street, Suite 3600 Chicago, Illinois 60606 Direct: (312) 555-1847 Email: npetrov@calderwoodharkness.com Berna

VIII. Closing Calderwood & Harkness appreciates Nexford's continued confidence in the firm's handling of this matter. We remain committed to achieving the most favorable resolution possible for the Company, and we believe the current trajectory of this case is a positive one from Nexford's perspective. We will continue to monitor the case closely and will keep you informed of all significant developments. Please be r