CALDERWOOD & HARKNESS LLP Attorneys at Law 2200 Ross Avenue, Suite 3600 Dallas, Texas 75201 Telephone: (214) 555-7200 Facsimile: (214) 555-7201 www.calderwoodharkness.com
May 5, 2025
Via Certified Mail, Return Receipt Requested, and Email
Claims Department Broadleaf Insurance Company 100 Constitution Plaza Hartford, CT 06103
Attention: Director of Claims — Employment Practices Liability
Re: Formal Notice of Claim Under Employment Practices Liability Insurance Policy No. BIC-EPL-2024-07831
Policyholder / Named Insured: Stonefield Logistics Group Inc.
Claim: Delano v. Stonefield Logistics Group Inc., Case No. 3:25-cv-01847-RBC, United States District Court for the Northern District of Texas, Dallas Division
Dear Sir or Madam:
1. Purpose of Letter and Representation
Calderwood & Harkness LLP represents Stonefield Logistics Group Inc. ("Stonefield" or "SLG") in connection with the above-referenced litigation, Delano v. Stonefield Logistics Group Inc., Case No. 3:25-cv-01847-RBC, currently pending before the United States District Court for the Northern District of Texas, Dallas Division. This letter serves as formal notice of a claim under Broadleaf Insurance Company's ("Broadleaf") Employment Practices Liability Insurance Policy No. BIC-EPL-2024-07831 (the "Policy").
Stonefield Logistics Group Inc. is a corporation incorporated under the laws of the State of Delaware and headquartered in the State of Texas. SLG's principal place of business is located at 4200 Commerce Gateway Blvd., Suite 800, Irving, Texas 75039. SLG's Employer Identification Number is 82-4731956. Stonefield is a transportation and logistics company that specializes in last-mile delivery, regional freight, and white-glove delivery services across the South Central United States. SLG currently operates distribution hubs across four states and maintains a substantial workforce of drivers, warehouse personnel, logistics coordinators, and administrative staff in support of its operations.
Calderwood & Harkness LLP has been engaged by Stonefield to defend against the claims asserted in the above-captioned matter. The engagement is being overseen and managed by Bernard Crawford, a partner in the firm's Labor & Employment practice group, who serves as the responsible partner on this matter. Margaret Hollis, General Counsel of Stonefield Logistics Group Inc., has authorized this firm to submit this notification on behalf of the company and to serve as the primary point of contact with Broadleaf for all communications relating to this claim.
We are transmitting this notice as promptly as practicable following Stonefield's receipt of the underlying Complaint to ensure full compliance with the Policy's notice provisions and to preserve all of SLG's rights under the Policy. We respectfully request Broadleaf's prompt attention to this matter given the nature and potential magnitude of the claims asserted, as more fully described below.
2. Policy Identification
The following information identifies the relevant Policy under which coverage is being sought:
The above-captioned litigation involves claims arising from alleged employment practices that fall squarely within the scope of the Policy's insuring agreement, as described in greater detail below. The underlying Complaint was filed on April 30, 2025, which is within the current Policy Period. Stonefield hereby provides notice pursuant to the terms and conditions of the Policy requiring prompt notification of claims or potential claims that may give rise to coverage under the Policy. This notice is provided in accordance with, and without limitation of, all applicable notice provisions contained in the Policy, including any provisions relating to notice of a "claim," "potential claim," "occurrence," "suit," or "wrongful act" as those terms may be defined therein.
3. Description of the Underlying Litigation
3.1 Case Caption and Court Information
The following sets forth the identifying information for the underlying litigation:
A complete copy of the Complaint, as filed, is enclosed with this letter for Broadleaf's review and records.
3.2 Parties.  Plaintiff. The Plaintiff in this action is Marcus Delano, an individual residing in Fort Worth, Tarrant County, Texas. Mr. Delano is a former delivery driver who performed last-mile residential delivery services for Stonefield from approximately March 2021 through September 2024. According to the Complaint, Mr. Delano was assigned to and operated out of SLG's Fort Worth distribution hub, designated internally as HUB-01, which is located at 1015 Railhead Parkway, Fort Worth, Texas 76106. Mr. Delano's engagement with Stonefield was governed by an Independent Contractor Operating Agreement ("ICOA"), the terms and conditions of which are central to the claims at issue.
Defendant. The sole named Defendant in this action is Stonefield Logistics Group Inc., the Named Insured under the Policy.
Plaintiff's Counsel. Plaintiff is represented by Claudia Hartwell of the law firm Hartwell & Brashear PLLC, located at 500 N. Akard Street, Suite 1750, Dallas, Texas 75201. Ms. Hartwell is known to specialize in wage-and-hour collective and class action litigation, and her firm has litigated several similar misclassification cases in this District.
3.3 Nature of Claims
The Complaint sets forth claims arising under both federal and state wage-and-hour laws. Specifically, Plaintiff has filed this action as a collective action under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq., and additionally asserts claims under the Texas Payday Law, Texas Labor Code Chapter 61.
The gravamen of Plaintiff's claims is that Stonefield systematically misclassified Mr. Delano and approximately 1,200 similarly situated delivery drivers as independent contractors, rather than as employees, pursuant to the terms of Independent Contractor Operating Agreements entered into between Stonefield and each driver. Plaintiff alleges that this classification was erroneous as a matter of law and that the drivers were, in fact, employees of Stonefield for purposes of the FLSA and applicable state law.
According to the Complaint, this alleged misclassification deprived the named Plaintiff and the putative collective members of overtime pay and other wage protections to which they would have been entitled had they been properly classified as employees. Plaintiff specifically alleges that he regularly worked approximately 55 to 65 hours per week performing delivery services for Stonefield but was compensated solely on a per-delivery basis, without overtime compensation for hours worked in excess of 40 per workweek, in violation of the FLSA's overtime provisions, 29 U.S.C. § 207(a).
In support of his theory that an employment relationship existed, Plaintiff contends that Stonefield exercised a degree of control over its drivers' work that is inconsistent with independent contractor status under the FLSA's economic reality test. The Complaint identifies the following indicia of control, among others:
(a) Stonefield required all drivers to wear mandatory company-branded uniforms while performing delivery services, including logoed shirts, jackets, and hats bearing the Stonefield name and branding;
(b) Stonefield equipped all delivery vehicles with GPS tracking devices and monitored drivers' locations, routes, and delivery times in real time through a centralized dispatch and logistics platform;
(c) Stonefield imposed mandatory delivery windows on drivers, requiring deliveries to be completed within specified time frames communicated through the company's proprietary routing software;
(d) Stonefield prohibited drivers from subcontracting or delegating their delivery obligations to third parties without prior written consent, which was routinely withheld; and
(e) Stonefield retained the right to terminate drivers' ICOA agreements at will, with or without cause, upon minimal notice.
Plaintiff further alleges that Stonefield's violations of the FLSA were willful within the meaning of 29 U.S.C. § 255(a), thereby invoking the three-year statute of limitations period rather than the default two-year period. Plaintiff contends that Stonefield was aware of, or acted with reckless disregard for, its obligations under federal wage-and-hour law when it classified the drivers as independent contractors.
3.4 Proposed Collective
Plaintiff seeks conditional certification of an FLSA collective action under 29 U.S.C. § 216(b). The proposed collective is defined in the Complaint as:
All individuals who performed delivery driving services for Stonefield Logistics Group Inc. pursuant to an Independent Contractor Operating Agreement at any of SLG's distribution hubs at any time from April 30, 2022 through the date of final judgment in this action.
Based on Stonefield's internal records, which SLG has begun reviewing in connection with its preliminary assessment of this matter, the company's human resources and operations databases reflect that 1,187 unique drivers executed ICOAs and performed delivery services during the period encompassed by the proposed collective definition. These drivers were deployed across SLG's network of 14 distribution hubs located throughout the states of Texas, Oklahoma, Louisiana, and Arkansas. The geographic scope and numerical size of the proposed collective are significant and contribute materially to the potential financial exposure presented by this matter, as discussed in Section 4 below.
3.5 Relief Sought
The Complaint seeks the following relief on behalf of the named Plaintiff and all members of the proposed collective:
(a) Unpaid overtime compensation for all hours worked by collective members in excess of 40 hours per workweek during the relevant period;
(b) Liquidated damages in an amount equal to the unpaid overtime compensation, pursuant to 29 U.S.C. § 216(b), based on Plaintiff's allegation that Stonefield's violations were willful;
(c) An award of reasonable attorneys' fees, costs, and expenses of litigation;
(d) Declaratory relief establishing that Stonefield's classification of the delivery drivers as independent contractors violated the FLSA; and
(e) Injunctive relief enjoining Stonefield from continuing the alleged unlawful classification practices and requiring reclassification of the affected drivers as employees.
4. Potential Exposure
While Stonefield believes that meritorious defenses exist and intends to vigorously contest the claims asserted in the Complaint, we set forth below a summary of the potential financial exposure presented by this matter based on Plaintiff's damages theory as articulated in the Complaint. This summary is provided for Broadleaf's information in connection with its coverage evaluation and reserving analysis.
Plaintiff's damages model is predicated on the following assumptions and calculations:
•  Plaintiff alleges that collective members worked, on average, approximately 18 overtime hours per week (i.e., hours in excess of 40 per workweek);
•  Plaintiff contends that the effective hourly rate for collective members, calculated by dividing per-delivery compensation by total hours worked, was approximately $21.50 per hour;
•  At an overtime rate of one and one-half times the effective hourly rate ($21.50 × 1.5 = $32.25), less the per-delivery compensation already received, Plaintiff calculates unpaid overtime of $10.75 per hour (representing the additional 0.5× premium owed);
•  Correcting for Plaintiff's methodology as set forth in the Complaint, the alleged weekly unpaid overtime per driver is approximately $193.50 per driver (18 hours × $10.75);
•  The relevant limitations period, as alleged by Plaintiff under the three-year willful violation standard, encompasses approximately 161 weeks (from April 30, 2022 through the present date); and
•  The estimated per-driver damages for the full limitations period are therefore approximately $31,153.50 ($193.50 per week × 161 weeks).
Applied to the full proposed collective of 1,187 drivers, Plaintiff's damages theory yields the following aggregate exposure estimate:
Stonefield acknowledges that the foregoing figures represent Plaintiff's maximum damages theory and that numerous factual and legal issues will affect the ultimate calculation of damages, if any, including but not limited to: (i) whether collective certification is granted; (ii) the number of individuals who ultimately opt in to the collective; (iii) whether individual drivers can establish they worked overtime hours; (iv) the proper calculation of the effective hourly rate; and (v) whether Stonefield's conduct was willful, which would affect both the limitations period and the availability of liquidated damages.
Nevertheless, given the magnitude of the potential exposure — which substantially exceeds the Policy's $10,000,000 aggregate limit — Stonefield believes it is imperative that Broadleaf be apprised of this matter immediately and that coverage be confirmed as promptly as possible.
Stonefield intends to vigorously defend against these claims and believes that strong defenses exist, including that the delivery drivers at issue are bona fide independent contractors under both the FLSA economic reality test and applicable state law standards. Stonefield has historically relied on the advice of outside counsel and industry consultants in structuring its ICOA program and believes that its classification practices are consistent with applicable legal standards. However, neither the existence of these defenses nor anything stated in this letter should be construed as an admission or concession regarding any fact, legal issue, or claim asserted in the underlying litigation.
5. Procedural Status
As of the date of this letter, the procedural status of the litigation is as follows:
•  Complaint Filed: The Complaint was filed on April 30, 2025 and served upon Stonefield on May 1, 2025.
•  Answer: Stonefield's Answer and Affirmative Defenses are currently being prepared by this firm and will be filed in accordance with all applicable deadlines under the Federal Rules of Civil Procedure and the Local Rules of the Northern District of Texas. The responsive pleading is due on or before June 2, 2025.
•  Motion for Conditional Certification: As of the date of this letter, Plaintiff has not yet filed a motion for conditional certification of the FLSA collective. We anticipate that such a motion may be filed in due course, potentially following the completion of limited discovery related to the certification question.
•  discovery: No discovery has been propounded by either party as of the date of this letter, and no discovery orders have been entered by the Court.
•  Scheduling Conference: The initial Rule 16 Scheduling Conference has not yet been set by the Court as of the date of this letter. We will notify Broadleaf promptly when a scheduling order is entered and provide any material case management deadlines.
We will continue to keep Broadleaf apprised of all significant procedural and substantive developments in this litigation as they occur. We will promptly forward copies of all material pleadings, motions, orders, and other filings as they become available.
6. Request for Coverage Confirmation
Stonefield Logistics Group Inc. respectfully requests that Broadleaf Insurance Company acknowledge and confirm coverage under Policy No. BIC-EPL-2024-07831 for the defense and indemnification of the claims asserted in Delano v. Stonefield Logistics Group Inc., Case No. 3:25-cv-01847-RBC.
The claims asserted against Stonefield in the Complaint constitute a "claim" as that term is defined in the Policy, arising from alleged "wrongful acts" in the nature of employment practices — specifically, alleged misclassification of workers and resulting wage-and-hour violations — that are covered under the Policy's insuring agreement. The claims were first made during the Policy Period, and Stonefield is providing notice as promptly as practicable following receipt of the Complaint.
Stonefield acknowledges the existence of the $2,000,000 self-insured retention applicable to this claim under the terms of the Policy and understands that Broadleaf's coverage obligations are subject to the satisfaction of the SIR and the $10,000,000 aggregate policy limit. Stonefield will satisfy its obligations under the SIR as required by the Policy and will keep Broadleaf informed of defense costs and expenditures as they accrue toward the SIR threshold.
Stonefield requests that Broadleaf provide a written confirmation of coverage at the earliest practicable date, or, in the alternative, a detailed written statement of Broadleaf's coverage position, including any reservation of rights that Broadleaf believes are applicable to this claim. In the event Broadleaf intends to issue a reservation of rights letter, Stonefield requests that such letter specifically identify each Policy provision, exclusion, condition, or other basis upon which Broadleaf relies in reserving its rights, so that Stonefield may meaningfully evaluate Broadleaf's coverage position.
Stonefield expressly reserves all of its rights under the Policy and applicable law. Nothing in this letter, nor any actions taken by Stonefield in connection with the defense of the underlying litigation, shall be construed as a waiver, modification, or limitation of any of Stonefield's rights, claims, or remedies under the Policy, at law, or in equity.
7. Defense Counsel Information
Calderwood & Harkness LLP has been retained by Stonefield Logistics Group Inc. as defense counsel in this matter. The key personnel and contact information for the defense team are as follows:
Calderwood & Harkness LLP has extensive experience in employment litigation and wage-and-hour defense, including FLSA collective actions and independent contractor misclassification disputes. The firm was retained by Stonefield in connection with this matter prior to the filing of the Complaint, based on a long-standing advisory relationship regarding SLG's employment practices and contractor classification programs.
Stonefield respectfully requests that Broadleaf confirm whether it consents to Calderwood & Harkness LLP's continued representation of Stonefield as panel counsel, approved defense counsel, or otherwise authorized counsel under the terms of the Policy. In the alternative, if Broadleaf intends to appoint separate counsel to defend this matter, Stonefield requests that Broadleaf promptly advise of such intention, identify proposed counsel, and confirm Broadleaf's position regarding the insured's right to select defense counsel under the applicable terms of the Policy and Texas law.
For Broadleaf's reference, the current billing arrangement with Calderwood & Harkness LLP is pursuant to a pre-existing panel agreement between the firm and Ridgepoint Capital Partners Fund III, LP, which is SLG's majority equity holder. Under that agreement, the blended billing rates are as follows:
•  Partners: $875.00 per hour
•  Associates: $525.00 per hour
•  Paralegals: $275.00 per hour
Stonefield requests that Broadleaf confirm whether these rates are acceptable under the Policy's provisions regarding defense counsel compensation, or whether Broadleaf proposes alternative rate guidelines. Stonefield is prepared to discuss billing arrangements and litigation management guidelines as may be required by the Policy or otherwise requested by Broadleaf.
8. Document Enclosures
The following documents are enclosed with this letter for Broadleaf's review and records in connection with its coverage evaluation:
1.  Complaint — Copy of the Complaint filed April 30, 2025, in Delano v. Stonefield Logistics Group Inc., Case No. 3:25-cv-01847-RBC, United States District Court for the Northern District of Texas, Dallas Division (with exhibits thereto);
2.  EPLI Policy — Copy of the Employment Practices Liability Insurance Policy No. BIC-EPL-2024-07831, including all endorsements, amendments, and schedules thereto;
3.  ICOA Templates — Copies of the Independent Contractor Operating Agreement templates utilized by Stonefield during the relevant period, in three versions:
(a) ICOA Version 1.0 (original template, effective 2018);
(b) ICOA Version 2.0 (revised template, effective August 2020); and
(c) ICOA Version 3.0 (revised template, effective January 2023).
These ICOA templates are provided for reference purposes to assist Broadleaf in understanding the contractual framework governing Stonefield's engagement of its delivery drivers during the period at issue in the litigation.
Additional documents, pleadings, discovery materials, and other relevant information will be provided to Broadleaf as they become available in the course of the litigation. Stonefield will promptly forward copies of all material filings, including Stonefield's Answer and Affirmative Defenses, any motions for conditional certification and responsive briefing, scheduling orders, and any dispositive motions.
9. Request for Prompt Response and Point of Contact
Given the significance and potential magnitude of this matter, Stonefield respectfully requests that Broadleaf take the following actions as promptly as practicable:
(a) Designate a Claims Adjuster or Coverage Counsel. Stonefield requests that Broadleaf designate a specific claims adjuster or coverage counsel as the primary point of contact for all ongoing communications regarding this claim. Having a dedicated point of contact will facilitate efficient and timely communication between the parties as this matter progresses through litigation.
(b) Provide Written Acknowledgment. Stonefield requests that Broadleaf provide a written response acknowledging receipt of this formal notice of claim and confirming Broadleaf's coverage position within the time period required by the terms and conditions of the Policy and applicable law, including the Texas Insurance Code and any regulations promulgated by the Texas Department of Insurance.
(c) Direct All Communications to Defense Counsel. All communications from Broadleaf regarding this claim should be directed to:
Bernard Crawford, Partner Calderwood & Harkness LLP 2200 Ross Avenue, Suite 3600 Dallas, Texas 75201 Telephone: (214) 555-7200
Email: bcrawford@calderwoodharkness.com
with copies to:
Margaret Hollis, General Counsel Stonefield Logistics Group Inc. 4200 Commerce Gateway Blvd., Suite 800 Irving, Texas 75039
Email: mhollis@stonefieldlogistics.com
10. Reservation of Rights
This notification is provided pursuant to, and in accordance with, the terms and conditions of the Policy, including all provisions requiring prompt notice of claims, suits, or potential claims. This letter is not intended to, and shall not be construed to, limit, waive, modify, or otherwise affect any of Stonefield Logistics Group Inc.'s rights or any of Broadleaf Insurance Company's obligations under the Policy, at law, or in equity.
Stonefield Logistics Group Inc. expressly reserves all rights, claims, demands, and remedies available to it under the Policy, under applicable state and federal law (including the Texas Insurance Code, the Texas Deceptive Trade Practices Act, and the common law of the State of Texas), and in equity, including but not limited to any and all rights to:
(a) seek full defense and indemnification under the Policy;
(b) challenge any denial of coverage, reservation of rights, or limitation of coverage asserted by Broadleaf;
(c) recover consequential damages, statutory penalties, and attorneys' fees resulting from any improper denial or delay of coverage; and
(d) pursue any and all other remedies that may be available.
Nothing in this letter, nor any conduct by Stonefield or its counsel in connection with the defense of the underlying litigation, shall operate as a waiver, estoppel, or modification of any rights or defenses available to Stonefield under the Policy or applicable law.
We appreciate Broadleaf's prompt attention to this matter. Please do not hesitate to contact the undersigned should you require any additional information or wish to discuss any aspect of this claim.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Bernard Crawford Partner, Labor & Employment Practice Group Telephone: (214) 555-7214
Email: bcrawford@calderwoodharkness.com
cc:
Margaret Hollis, General Counsel, Stonefield Logistics Group Inc.
Aaron Turcotte, Chief People Officer, Stonefield Logistics Group Inc.
Nathan Okonkwo, Managing Director, Ridgepoint Capital Management LLC
Renata Vasquez, Partner, Calderwood & Harkness LLP
Enclosures:
1.  Complaint, Delano v. Stonefield Logistics Group Inc., Case No. 3:25-cv-01847-RBC (filed Apr. 30, 2025)
2.  Employment Practices Liability Insurance Policy No. BIC-EPL-2024-07831
3.  Independent Contractor Operating Agreement Templates (v1.0, 2018; v2.0, Aug. 2020; v3.0, Jan. 2023)
Policy Detail | Information
Policy Number | BIC-EPL-2024-07831
Named Insured | Stonefield Logistics Group Inc.
Policy Period | January 1, 2025 – January 1, 2026
Self-Insured Retention (SIR) | $2,000,000
Policy Limit | $10,000,000 (aggregate)
Type of Coverage | Employment Practices Liability Insurance
Case Detail | Information
Case Caption | Marcus Delano v. Stonefield Logistics Group Inc.
Case Number | 3:25-cv-01847-RBC
Court | United States District Court for the Northern District of Texas, Dallas Division
Assigned Judge | Honorable Rebecca Chen, United States District Judge
Assigned Magistrate Judge | Honorable Timothy Farrell, United States Magistrate Judge
Date Complaint Filed | April 30, 2025
Damages Component | Estimated Amount
Single damages (unpaid overtime) | $36,979,204.50
Liquidated damages (equal amount, willful violation) | $36,979,204.50
Subtotal (damages only) | $73,958,409.00
Attorneys' fees and costs | To be determined
Total potential exposure | $73,958,409.00+
Role | Name | Contact
Responsible Partner | Bernard Crawford, Labor & Employment | bcrawford@calderwoodharkness.com
Billing Partner | Renata Vasquez | rvasquez@calderwoodharkness.com
Firm Address | Calderwood & Harkness LLP | 2200 Ross Avenue, Suite 3600, Dallas, TX 75201
Firm Telephone | — | (214) 555-7200
Firm Facsimile | — | (214) 555-7201