PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT PRIVILEGE / ATTORNEY WORK PRODUCT DOCTRINE — DO NOT DISTRIBUTE WITHOUT PRIOR APPROVAL OF OUTSIDE COUNSEL
CALDERWOOD & HARKNESS LLP 200 Park Avenue, 38th Floor New York, New York 10166 Telephone: (212) 554-8000 Facsimile: (212) 554-8001 www.calderwoodharkness.com
Matter No. 1012-00005 September 20, 2023
MEMORANDUM
TO:
Tobias Wren, Esq., General Counsel, Stonefield Logistics Group Inc. Marcus Denton, Chief Executive Officer, Stonefield Logistics Group Inc. Priya Ramachandran, Chief Financial Officer, Stonefield Logistics Group Inc. Alison Trang, Partner, Ridgeline Capital Partners, LP; Board Member, Stonefield Logistics Group Inc. Douglas Whitmore, Managing Partner, Ridgeline Capital Partners, LP
FROM:
Samuel Eklund, Responsible Partner — Litigation (General), Calderwood & Harkness LLP
RE:
Semi-Annual Litigation Status and Risk Assessment — Vantor Holdings Corp. v. Stonefield Logistics Group Inc., Case No. 22-cv-07841 (S.D.N.Y.)
COPIES:
Patrick Gallagher, Lead Associate, Calderwood & Harkness LLP — for internal file Linda Osei, Billing Partner, Calderwood & Harkness LLP — for internal file
NOTICE: This memorandum constitutes a privileged and confidential attorney-client communication and attorney work product prepared in anticipation of litigation. It is intended solely for the use of the addressees identified above. This memorandum contains legal analysis, mental impressions, strategies, opinions, and recommendations of counsel. Do not forward, copy, discuss, or otherwise disseminate this memorandum or its contents to any person or entity without the express prior written approval of Calderwood & Harkness LLP. Unauthorized disclosure may result in waiver of applicable privileges.
I. EXECUTIVE SUMMARY
The purpose of this memorandum is to provide our client, Stonefield Logistics Group Inc. ("Stonefield" or "SLG"), and its board representative and majority equity sponsor, Ridgeline Capital Partners, LP ("Ridgeline"), with a comprehensive semi-annual assessment of the litigation posture, risks, forward strategy, and budget in the above-referenced matter as of September 20, 2023 — approximately one year after Calderwood & Harkness LLP ("C&H") was engaged to defend Stonefield on September 1, 2022.
The Case. Vantor Holdings Corp. ("Vantor") filed suit against Stonefield in the United States District Court for the Southern District of New York, Case No. 22-cv-07841, currently pending before the Honorable Margaret T. Calloway, United States District Judge. The case arises from Stonefield's termination of the five-year Transportation Services Agreement dated March 15, 2019 (the "TSA," Ref. No. SLG-VTS-2019-0315) between Stonefield and Vantor Transport Services LLC ("VTS"), a wholly owned operating subsidiary of Vantor. Vantor alleges that Stonefield wrongfully terminated the TSA and claims approximately $95.4 million in damages, comprising liquidated damages, lost profits, stranded asset costs, workforce reduction costs, and mitigation expenses.
Stonefield's Position. Stonefield maintains — and the evidence developed in discovery strongly supports — that the termination was valid for Cause under Section 13.1(a) of the TSA, based on VTS's sustained and uncured service failures across all five Service Level Obligations ("SLOs") during the fourth quarter of 2021. Stonefield has also asserted a counterclaim for declaratory judgment confirming the validity of the termination.
Overall Assessment. Stonefield's litigation posture is strong and has improved materially since the initial case assessment delivered in September 2022. The intervening twelve months of discovery have produced significant evidence corroborating Stonefield's Cause defense. Most notably, the discovery process yielded what we regard as a "smoking gun" document — an internal email from Sandra Milescu, Chief Operating Officer of Vantor and VTS, to Nikolai Vantorovich, Vantor's CEO and majority owner (Bates No. VHC-008417, dated November 12, 2021), in which Milescu confirmed that VTS had intentionally pulled 85 tractors from SLG-dedicated lanes without notice to cover commitments to another shipper. This document directly establishes that VTS itself caused the very performance failures it now attributes to Stonefield's alleged volume shortfalls. Deposition testimony from VTS witnesses — particularly Milescu's own testimony on August 4, 2023 — has been highly favorable to Stonefield's position. Additionally, the rebuttal expert report from Dr. Evelyn Rosser of Kensington Analytics Group LLC caps Stonefield's worst-case damages exposure at $8.2 million under an alternative lost-profits theory, compared to Vantor's claimed $95.4 million.
Principal Risks. While the overall posture is favorable, we have identified two principal risk factors that warrant continued monitoring and strategic attention:
1.  The Kirkwood Email (September 22, 2021), in which Janet Kirkwood, Stonefield's VP of Carrier Relations, expressed frustration with VTS and referenced the possibility of terminating the TSA. Vantor will use this email to argue pretext and premeditated termination. While the email is contextually defensible for the reasons discussed in detail below, it is the single most significant document risk in the case.
2.  The enforceability of the liquidated damages clause under New York law, which remains genuinely uncertain. The $67.23 million liquidated damages claim is Vantor's largest single damages component, and while strong arguments exist for unenforceability, New York courts' treatment of such clauses between sophisticated commercial parties is not uniformly favorable to the challenging party.
Strategic Recommendation. We recommend that Stonefield proceed toward summary judgment on the current timeline, targeting the four-pillar framework described in Section X of this memorandum. Simultaneously, we recommend continued monitoring of the emerging development regarding plaintiff's counsel's motion to withdraw, which may create either a settlement opportunity or a path to dismissal for failure to prosecute. Settlement authority should remain at the current level of $0 to $4.5 million, which reflects a nuisance and litigation-cost-avoidance range appropriate to Stonefield's strengthened posture.
Updated Fee Estimate. Total legal spend through disposition is now estimated at $5.5 million to $7.2 million, inclusive of the approximately $4.42 million already incurred through October 2023. The updated estimate reflects higher-than-initially-projected discovery costs as well as a contingency for trial costs that were not included in the original September 2022 preliminary budget.
The sections that follow provide detailed analysis supporting each of the foregoing assessments.
II. CASE BACKGROUND AND PROCEDURAL HISTORY
A. The Parties
Stonefield Logistics Group Inc. (Defendant / Our Client). Stonefield is a Delaware corporation headquartered at 4200 Commerce Parkway, Suite 800, Fort Worth, Texas 76102. It is a mid-market freight brokerage and managed transportation company, generating approximately $1.28 billion in revenue for fiscal year 2022, with approximately $118 million in FY 2022 EBITDA. Stonefield employs approximately 2,800 people and manages an extensive carrier network of approximately 12,000 approved carriers that collectively handle roughly 850,000 annual shipments across the continental United States.
Stonefield is majority-owned (approximately 72%) by Ridgeline Capital Partners, LP, through its investment vehicle Ridgeline Fund III, LP, following an October 2017 leveraged buyout at an enterprise value of approximately $680 million. The remaining equity is held by management and certain co-investors. Ridgeline is represented on the Stonefield Board of Directors by Alison Trang, a Partner at Ridgeline, who serves as a board observer with full board-level information rights under the terms of the Stockholders' Agreement.
Vantor Holdings Corp. (Plaintiff). Vantor is a New York corporation headquartered at 580 Eighth Avenue, 14th Floor, New York, New York 10018. It is a holding company whose principal operating subsidiary, Vantor Transport Services LLC, was the counterparty to the TSA at issue in this litigation. Vantor's CEO and majority owner (holding approximately 58% of the equity) is Nikolai Vantorovich. At the time of contract execution, Vantor was a substantial regional carrier operating approximately 650 owned tractors and 2,100 trailers, with approximately 1,900 employees. Vantor's FY 2022 revenue was approximately $310 million, a decline from approximately $385 million in FY 2021, reflecting in substantial part the loss of the Stonefield contract.
Vantor Transport Services LLC (VTS). VTS is a New York limited liability company, wholly owned by Vantor Holdings Corp. VTS was the signatory to the TSA, identified therein as the "Carrier-Provider." As a practical matter, Vantor and VTS operate as a single economic unit, with Vantor serving as the holding company and VTS conducting the actual transportation operations. This structural distinction gives rise to a standing question discussed briefly in Section V.H below.
Plaintiff's Counsel. Vantor is represented (subject to the withdrawal motion discussed in Section IX below) by Caldwell Royce & Shapiro LLP ("CRS"), 1 Liberty Plaza, 22nd Floor, New York, New York 10006. The lead partner on the matter is Harrison Caldwell, a founding partner of the firm with a practice focused on commercial litigation and transportation industry disputes. The senior associate is Jason Whitford. As discussed in Section IX, CRS filed a motion to withdraw as counsel of record on October 3, 2023, reportedly due to a fee dispute with Vantor, which adds a significant new dimension to the case.
B. The Transportation Services Agreement (TSA)
The Transportation Services Agreement was executed on March 15, 2019, with an effective date of April 1, 2019, and a term expiring March 31, 2024 — a five-year initial term. The TSA was drafted by Ashford Meridian LLP (Lorraine Beckwith, Partner) on behalf of Stonefield. This fact is noteworthy because it means that certain provisions that Stonefield now seeks to challenge — most notably the liquidated damages clause — were proposed or accepted by Stonefield's own outside counsel during the drafting process. The TSA is governed by New York law, with a forum selection clause designating the United States District Court for the Southern District of New York or the Supreme Court of the State of New York, New York County, as the exclusive forums for any disputes arising under or relating to the agreement.
The key provisions of the TSA relevant to this litigation are as follows:
Annual Committed Volume (ACV). Under the TSA, Stonefield committed to tender a minimum annual volume of freight to VTS generating revenues of $43.2 million per contract year, for a total committed value of $216 million over the five-year term. This commitment was subject to the force majeure provisions of Section 12.1 and the rate adjustment mechanism of Section 5.3.
Service Level Obligations (SLOs). The TSA imposed five Service Level Obligations on VTS, each measured on a quarterly basis:
•  On-Time Pickup: ≥ 95% of all tendered loads must be picked up within the designated pickup window.
•  On-Time Delivery: ≥ 93% of all tendered loads must be delivered within the designated delivery window.
•  Cargo Claims Ratio: ≤ 0.5% of total shipments may result in cargo damage, loss, or shortage claims.
•  Tender Acceptance: ≥ 90% of all load tenders must be accepted by VTS.
•  Equipment Availability: ≥ 85% of the committed fleet capacity — defined as 400 tractors and 1,200 trailers — must be available and operational for SLG-dedicated freight at all times during the measurement period.
These SLOs were central to the TSA's structure. Stonefield committed to substantial annual volumes and, in return, VTS committed to maintaining dedicated capacity and meeting rigorous performance standards. The failure to meet any SLO, if uncured following proper notice, constituted a material breach under the termination provisions.
Termination for Cause (Section 13.1). Section 13.1 provided that either party could terminate the TSA upon the occurrence of a material breach by the other party that remained uncured for thirty (30) calendar days after written notice of such breach was delivered in accordance with Section 13.2. Among other triggering events, the failure to meet any SLO for a full calendar quarter constituted a material breach subject to this cure-and-terminate mechanism.
Cure Notice Requirements (Section 13.2). Section 13.2 specified that a Cure Notice must identify the alleged breach with "reasonable particularity," including the specific contractual provision breached, the factual basis for the alleged breach, and the applicable cure period. This provision has been a subject of dispute in the litigation, as Vantor initially contended — though it has largely abandoned this argument — that the January 18, 2022 Cure Notice was insufficiently particularized.
Liquidated Damages (Section 14.2). If the TSA were terminated other than "for Cause" (as defined in Section 13.1), Stonefield was required to pay VTS liquidated damages equal to seventy-five percent (75%) of the Annual Committed Volume multiplied by the number of remaining full and partial contract years in the term. As applied to the facts here, this formula yields a liquidated damages figure of $67.23 million — a sum that is a central focus of the litigation and a principal risk factor, as discussed in detail in Section VII.B below.
Consequential Damages Waiver (Section 15.1). Section 15.1 contains a mutual waiver of consequential, incidental, punitive, and special damages, whether arising from breach of contract, tort, strict liability, or any other legal theory. This provision is significant because several categories of Vantor's claimed damages — including stranded asset costs, workforce reduction costs, and certain mitigation expenses — are consequential in nature and should be barred by this waiver.
Rate Adjustment Mechanism (Section 5.3). The TSA provided for annual rate adjustments effective each April 1, calculated using a blended index comprising 70% diesel fuel index and 30% CPI-U (Consumer Price Index for All Urban Consumers). As discussed in Section III.D below, an internal memorandum from Ashford Meridian dated February 2022 projected that the April 2022 rate adjustment would increase the weighted average per-mile rate from $2.87 to $3.28 — a 14.3% increase adding approximately $6.2 million in annual costs. This projected increase is relevant as potential motive evidence that Vantor may rely upon to argue that Stonefield sought to exit the contract for economic reasons.
Force Majeure (Section 12.1). Section 12.1 excused performance obligations during qualifying force majeure events, including government orders, pandemics, and other events beyond the parties' reasonable control. Stonefield invoked this provision in connection with COVID-19 impacts on freight demand during the period from April 2020 through September 2020.
Exclusivity (Schedule C). Schedule C to the TSA established an exclusivity arrangement pursuant to which Stonefield agreed to tender freight on fourteen (14) designated "Primary Lanes" exclusively to VTS. Importantly, the exclusivity obligation applied only to these fourteen Primary Lanes. Section 2(b) of Schedule C separately identified additional lanes as "Secondary Lanes," which were not subject to the exclusivity requirement. This distinction is critical to Stonefield's defense against the exclusivity violation claim.
Dispute Resolution (Section 16). Section 16 required the parties to engage in a mandatory thirty (30)-day executive negotiation period before initiating litigation. Both parties complied with this requirement through meetings on May 16 and June 3, 2022, neither of which produced a resolution.
C. The Termination and Pre-Litigation Events
The sequence of events leading to the termination of the TSA and the commencement of this litigation is as follows.
Q4 2021: Performance Deterioration. During the fourth quarter of 2021 (October through December), VTS's performance deteriorated sharply across all five Service Level Obligations. The actual metrics for Q4 2021, as confirmed by VTS's own internal systems and subsequently admitted in Vantor's responses to Stonefield's Requests for Admission, were as follows:
These failures were not marginal. Every metric missed its threshold by a substantial margin, with equipment availability — the metric most directly tied to VTS's secret redeployment of 85 tractors — falling 23 percentage points below the contractual minimum.
January 18, 2022: Cure Notice. Raymond Hess, Director of Contract Compliance at Stonefield, sent a formal Cure Notice to Sandra Milescu, COO of Vantor and VTS, identifying each of the five metric failures with specificity, including the relevant SLO threshold, the actual Q4 2021 performance figure, and the contractual basis for the notice under Section 13.2. The Cure Notice stated that VTS had thirty (30) calendar days from receipt to cure the identified breaches in accordance with Section 13.1(a).
February 14, 2022: VTS Response. VTS responded to the Cure Notice through Derek Pruitt, Vice President of Business Development. The response acknowledged "operational challenges" during Q4 2021 but attributed VTS's performance failures to three purported causes: (i) the nationwide driver shortage affecting the trucking industry generally; (ii) Stonefield's alleged failure to tender committed volumes; and (iii) Stonefield's purported diversion of freight to spot market carriers in violation of the exclusivity provisions. The response asserted that VTS had achieved "substantial cure" and disputed the accuracy of Stonefield's cargo claims data. Notably, the response did not deny the Q4 2021 performance metrics themselves, nor did it disclose VTS's decision to reassign 85 tractors from SLG-dedicated service to the Northwind Distribution Co. account.
February 17, 2022: Cure Period Expiration. The thirty-day cure period expired without VTS having demonstrated actual remediation of the identified breaches. As noted above, post-cure-period performance data extracted from Stonefield's internal systems for the month of March 2022 continued to show failures across multiple SLO metrics.
March 4, 2022: Termination. Tobias Wren, General Counsel of Stonefield, sent a formal termination letter to Vantor and VTS, citing the failure to cure the material breaches identified in the January 18, 2022 Cure Notice. The letter stated that the TSA was terminated effective immediately pursuant to Section 13.1(a). At the time of termination, approximately two years and twenty-seven days remained in the five-year term.
Post-Termination Events. On April 8, 2022, Vantor, through CRS, sent a demand letter to Stonefield claiming $95.4 million in damages resulting from the allegedly wrongful termination. Stonefield responded on April 29, 2022, rejecting the demand and invoking the mandatory executive negotiation period under Section 16 of the TSA. Two executive negotiation sessions were held — the first on May 16, 2022, attended in person by Marcus Denton (CEO, SLG) and Nikolai Vantorovich (CEO, Vantor), and the second on June 3, 2022, conducted by telephone. Neither session resulted in a resolution or meaningful progress toward settlement.
D. Procedural History
The procedural history of the litigation to date is summarized as follows:
August 12, 2022: Vantor files original Complaint in the U.S. District Court for the Southern District of New York. The case is assigned to the Honorable Margaret T. Calloway, U.S.D.J., who has handled all proceedings to date. Judge Calloway is a thoughtful and experienced commercial litigator-turned-jurist, appointed to the bench in 2016. Her judicial philosophy favors active case management, and she has been receptive to discovery enforcement and demonstrated a willingness to address disputes promptly.
September 1, 2022: Calderwood & Harkness is engaged by Stonefield to serve as lead outside litigation counsel. The matter is opened under Matter No. 1012-00005.
September 8, 2022: C&H files Notice of Appearance for Stonefield.
October 14, 2022: Stonefield, through C&H, files a Motion to Dismiss under Federal Rule of Civil Procedure 12(b)(6), arguing that (i) the liquidated damages clause is unenforceable as a penalty under New York law and (ii) Vantor's lost profits allegations are insufficiently pled to state a claim for relief.
November 18, 2022: Vantor files opposition to the Motion to Dismiss.
December 2, 2022: Before the Court rules on the Motion to Dismiss, Vantor files an Amended Complaint as of right under Federal Rule of Civil Procedure 15(a)(1)(B). The Amended Complaint adds new counterclaims alleging that Stonefield itself breached the TSA through (i) volume shortfalls below the Annual Committed Volume, (ii) violations of the Schedule C exclusivity provisions, and (iii) pretextual termination — the theory being that Stonefield manufactured grounds for termination to avoid the financial consequences of the upcoming rate adjustment and escalating contract costs.
December 16, 2022: Judge Calloway denies the Motion to Dismiss as moot in light of the filing of the Amended Complaint, without prejudice to Stonefield raising the arguments in a renewed motion or at summary judgment.
January 13, 2023: Stonefield files its Answer to the Amended Complaint, asserting fourteen Affirmative Defenses and a Counterclaim for Declaratory Judgment seeking a judicial determination that the TSA was validly terminated for Cause and that Stonefield has no liability to Vantor under the TSA.
January 27, 2023: Vantor files its Answer to Stonefield's Counterclaim, denying the material allegations and asserting various affirmative defenses.
February 10, 2023: The Court holds the Initial Pretrial Conference. Judge Calloway establishes an aggressive but manageable discovery schedule, emphasizing her expectation that the parties cooperate in discovery and resolve disputes through meet-and-confer before seeking judicial intervention.
February 17, 2023: The Case Management Order ("CMO") is entered, establishing the following key deadlines:
•  Fact discovery Deadline: September 29, 2023
•  Expert discovery Deadline: January 12, 2024
•  Dispositive Motions Deadline: March 1, 2024
March through September 2023: Active discovery phase, including document productions, written discovery, discovery disputes, and depositions. The discovery phase is summarized in detail in Section III below.
III. DISCOVERY SUMMARY
The discovery phase of this litigation has been extensive and, from Stonefield's perspective, highly productive. The evidence developed through document production, written discovery, and depositions has materially strengthened Stonefield's defense and revealed critical weaknesses in Vantor's case. The following sections provide an overview of the principal discovery events and key findings.
A. Document discovery
Stonefield's Production. Stonefield completed its initial document production on April 14, 2023. The production comprised 42,387 documents totaling approximately 186,000 pages, bearing Bates numbers SLG-000001 through SLG-042387. The documents were collected from the custodial files of eleven key custodians, including Tobias Wren, Janet Kirkwood, Raymond Hess, Carlos Medina, and seven additional individuals involved in the VTS relationship, contract management, and carrier procurement functions. The documents were processed, hosted, and reviewed using the Pinnacle Forensics LLC platform (Project ID: PF-SLG-2022-0914), and the review employed a Technology-Assisted Review ("TAR") 2.0 workflow using continuous active learning, achieving a validated recall rate of 91.3%. The production encompassed the full range of responsive materials, including internal correspondence, operational reports, carrier performance data, financial analyses, board presentations, and contract administration records.
Privilege Log. Stonefield's initial privilege log identified 1,247 documents withheld on the basis of attorney-client privilege and/or the attorney work product doctrine. A supplemental privilege log adding 218 additional documents was served on June 30, 2023, following the identification of additional responsive materials during the expanded review prompted by the discovery dispute discussed below. Vantor's counsel informally challenged privilege log entries 312 through 318, which relate to communications between Raymond Hess and Lorraine Beckwith of Ashford Meridian during the cure notice period, but CRS did not file a formal motion to compel and the challenge has not been pursued further.
Vantor's Production. Vantor's initial document production was served on April 28, 2023, comprising 28,914 documents totaling approximately 112,000 pages. The production was notably narrower than Stonefield's, and we identified significant gaps — particularly regarding VTS's fleet redeployment decisions and post-termination mitigation efforts — that became the subject of the discovery dispute described in Section III.C below.
Vantor's Supplemental Production. Following Judge Calloway's June 9, 2023 order compelling production of fleet redeployment records, Vantor served a supplemental production on June 22, 2023, consisting of 4,218 documents bearing Bates numbers VHC-029001 through VHC-033218. This supplemental production was critically important: it included the documents confirming that VTS redirected the 85 tractors referenced in the Milescu email to the Northwind Distribution Co. account, a competing shipper, beginning in October 2021.
Third-Party Subpoenas. On June 28, 2023, C&H served subpoenas duces tecum pursuant to Federal Rule of Civil Procedure 45 on two third-party carriers: Cascade Freight Systems Inc., located in Columbus, Ohio, and Briarwood Trucking Co., located in Arlington, Virginia. Both carriers had been engaged by Stonefield to handle freight on certain lanes during the period relevant to Vantor's exclusivity violation claims. The responses received from both Cascade and Briarwood confirmed that Stonefield's use of these carriers was limited to Lanes 8 through 14, which are classified as "Secondary Lanes" under Section 2(b) of Schedule C to the TSA and are not subject to the exclusivity provisions. This third-party evidence is dispositive of the exclusivity claim.
B. Written discovery
Stonefield served comprehensive written discovery, including a First Set of Interrogatories (25 interrogatories), a First Request for Production of Documents (38 requests), a First Set of Requests for Admission (30 requests), and a Second Request for Production of Documents (12 targeted requests directed specifically at VTS's fleet redeployment decisions and post-termination mitigation efforts).
Vantor served a First Set of Interrogatories (25 interrogatories) and a First Request for Production of Documents (38 requests). Vantor did not serve Requests for Admission.
The written discovery yielded several important findings. Most significantly, Vantor's responses to Stonefield's Requests for Admission included an unequivocal admission that VTS's on-time pickup rate was 78.2% in Q4 2021 — well below the 95% SLO threshold. While Vantor attempted to qualify this admission by attributing the shortfall to Stonefield's alleged volume irregularities, the admission itself is highly valuable as an undisputed fact for summary judgment purposes. Additionally, Vantor's responses to interrogatories regarding post-termination mitigation efforts were notably evasive, providing generalized statements about "exploring alternative business opportunities" without identifying any specific contracts pursued, carriers contacted, or revenue replacement efforts undertaken. This evasiveness was confirmed and amplified by the deposition testimony discussed below.
C. Discovery Dispute
On May 30, 2023, C&H sent a detailed meet-and-confer letter to CRS identifying specific deficiencies in Vantor's interrogatory responses and document production. The letter focused primarily on Vantor's refusal to produce internal fleet redeployment records — documents showing how VTS allocated its tractor and trailer fleet among its various customer accounts during the Q4 2021 period and thereafter. These records were directly relevant to Stonefield's defense that VTS caused its own performance failures by secretly diverting capacity to other accounts. Vantor's counsel resisted production on relevance and burden grounds.
Following an unsuccessful telephonic meet-and-confer on June 2, 2023, C&H filed a letter brief to Judge Calloway on June 5, 2023, requesting a discovery conference and an order compelling production. The Court held a discovery conference on the record on June 9, 2023, during which Judge Calloway ordered Vantor to produce all fleet redeployment records for the period from July 2021 through June 2022. In her oral ruling, the Court used language that we view as highly favorable to Stonefield's position, stating from the bench that "the relevance of VTS's unilateral capacity reduction decisions is self-evident" and that "a party that claims its performance failures were caused by the other side's conduct cannot refuse to produce documents showing its own fleet management choices during the same period." This language may be cited in our summary judgment briefing as judicial recognition of the centrality of VTS's fleet redeployment to the case.
D. Key Documents Identified in discovery
The discovery process has produced several documents of particular significance to the case. We describe the most important ones below, ranked in order of their impact on the litigation posture.
1. The Milescu Email (VHC-008417) — November 12, 2021. This email, from Sandra Milescu (COO, Vantor/VTS) to Nikolai Vantorovich (CEO, Vantor), is the single most important document in the case. The email reads:
"We've pulled 85 tractors off the SLG dedicated lanes to cover [redacted] commitments. SLG won't notice until January."
The significance of this email cannot be overstated. It demonstrates three critical facts: First, VTS intentionally and unilaterally reduced the fleet capacity dedicated to Stonefield from the committed level of 400 tractors to approximately 315 tractors — a 21.25% reduction that directly caused the equipment availability metric to fall to 62% (approximately 248 available tractors of the reduced fleet, accounting for normal operational availability), far below the 85% SLO threshold. Second, the reassignment was conducted secretly, with Milescu's own words acknowledging that VTS did not notify Stonefield of the capacity reduction. Third, the email's casual tone — "SLG won't notice until January" — suggests a deliberate decision to conceal the reassignment from Stonefield rather than an inadvertent oversight.
The Milescu email also fundamentally undermines Vantor's core liability theory. Vantor's Amended Complaint alleges that VTS's Q4 2021 performance failures were caused by Stonefield's volume shortfalls and freight diversion. The Milescu email demonstrates that VTS itself caused the performance failures by diverting its own capacity to another customer, and that it did so in October 2021 — before the alleged Q4 2021 volume shortfalls occurred.
2. Supplemental Fleet Records (Vantor Supplemental Production). The fleet redeployment records produced pursuant to Judge Calloway's June 9, 2023 order corroborate and expand upon the Milescu email. These documents show that VTS redirected the 85 tractors to the Northwind Distribution Co. account — a competing shipper — beginning in October 2021. The records include fleet allocation schedules, driver assignment logs, and internal operational reports confirming the redeployment. These documents further establish that VTS's capacity reduction was not "temporary" as Milescu characterized it at her deposition, but rather was a sustained reallocation that continued through the end of the TSA.
3. The Kirkwood Email (SLG Production) — September 22, 2021. This email, from Janet Kirkwood (VP, Carrier Relations, SLG) to Carlos Medina (VP, Operations, SLG), is the most significant document risk in Stonefield's production. The email reads:
"VTS is a mess. We're already moving volume to Cascade and Briarwood on Lanes 8–14. If VTS doesn't get its act together by Q1 I think we pull the plug on the whole contract."
This email is discussed at length in Section VII.A below as a principal litigation risk. In summary, Vantor will argue that the email demonstrates a premeditated plan to terminate the TSA and that the for-Cause termination was pretextual. While the email is defensible in context — it references only Secondary Lanes and predates the identified SLO failures by a full quarter — it will require careful handling in summary judgment briefing and at trial.
4. Rate Adjustment Memorandum (Ashford Meridian, February 2022). An internal analysis prepared by Ashford Meridian LLP in February 2022 concluded that the annual rate adjustment scheduled for April 1, 2022, under Section 5.3 of the TSA, would increase the weighted average per-mile rate from $2.87 to $3.28. This represents a 14.3% increase (($3.28 − $2.87) ÷ $2.87 = 14.29%), which would have added approximately $6.2 million in annual costs to Stonefield's transportation spend under the TSA. Vantor will argue that this impending cost increase provided Stonefield with a financial motive to terminate the contract. This document is a secondary risk factor and reinforces the pretext argument associated with the Kirkwood email.
5. VTS Q4 2021 Performance Report. An internal VTS document summarizing VTS's own performance metrics for Q4 2021 confirms that all five SLO metrics fell materially below the contractual thresholds. The report's figures closely align with those cited in Raymond Hess's Cure Notice, corroborating the accuracy of Stonefield's cure notice data and further undermining any challenge to the factual basis for termination.
E. Depositions
C&H conducted four depositions of Vantor-side witnesses and defended one deposition of a Stonefield witness during the July–August 2023 period. The testimony obtained was, on the whole, highly favorable to Stonefield. Key highlights are as follows:
1. Derek Pruitt (VP, Business Development, Vantor) — July 10, 2023 (7 hours). Pruitt was Vantor's primary commercial contact with Stonefield and authored the February 14, 2022 cure response. At deposition, Pruitt acknowledged that VTS "struggled" to maintain committed fleet capacity during Q4 2021, and could not identify any specific steps that VTS or Vantor took to mitigate damages after the termination — a critical evidentiary gap for Vantor's failure-to-mitigate defense. Pruitt was generally evasive on the topic of mitigation, repeatedly stating that he was "not directly involved" in post-termination operational decisions and deferring to others who have not been designated as witnesses. His inability to articulate concrete mitigation efforts, despite his senior role in the Stonefield relationship, significantly strengthens Stonefield's failure-to-mitigate defense.
2. Janet Kirkwood (VP, Carrier Relations, SLG) — July 14, 2023 (6.5 hours). Kirkwood was deposed by CRS and was the subject of extensive questioning regarding her September 22, 2021 email and the rate adjustment motive theory. CRS's lead partner, Harrison Caldwell, conducted this deposition personally and focused heavily on the timeline of Stonefield's engagement of Cascade and Briarwood, Kirkwood's awareness of the upcoming rate adjustment, and her stated desire to "pull the plug" on the VTS contract. Kirkwood performed well under cross-examination. She maintained that the volume diversion to Cascade and Briarwood was limited to Secondary Lanes only and was operationally necessary due to VTS's increasing rate of tender rejections on those lanes. She acknowledged awareness of the upcoming rate adjustment but denied that it influenced the termination decision, testifying that the termination was driven solely by VTS's failure to cure the Q4 2021 SLO breaches. Her testimony was consistent, measured, and credible.
3. Raymond Hess (Director, Contract Compliance, SLG) — July 27, 2023 (5 hours). Hess was the author of the January 18, 2022 Cure Notice and the principal Stonefield employee responsible for monitoring VTS's contractual performance. His deposition testimony was solid and consistent. He confirmed that the Q4 2021 performance metrics cited in the Cure Notice were independently derived from VTS's own Carrier Performance Portal — a shared data platform accessible to both parties. He testified that VTS did not dispute the accuracy of the metrics in its February 14, 2022 response, and that post-cure-period data continued to show non-compliance. Hess also described the cure notice process in detail, explaining the specificity of the notice and the adequacy of the thirty-day cure period. CRS was unable to undermine his testimony on any material point.
4. Sandra Milescu (COO, Vantor/VTS) — August 4, 2023 (7 hours). Milescu's deposition was arguably the most important of the fact discovery phase. As the author of the November 12, 2021 email (VHC-008417), Milescu was questioned extensively about VTS's decision to reassign 85 tractors from SLG-dedicated lanes. She confirmed that the reassignment occurred in October 2021 and that the tractors were redirected to the Northwind Distribution Co. account. She characterized the reassignment as "temporary" and driven by "commercial necessity" in light of what she described as Stonefield's volume shortfalls. However, when pressed on why VTS did not notify Stonefield of the reassignment — particularly given that the TSA committed VTS to maintaining 85% fleet availability — Milescu was unable to provide a coherent explanation. She alternated between claiming that the reassignment was "too operational" to warrant customer notification and asserting that she "intended to address it with SLG in the regular quarterly business review." This testimony is extremely favorable for Stonefield because it establishes not only the fact of the intentional reassignment but also VTS's deliberate concealment of it.
5. Nikolai Vantorovich (CEO, Vantor) — August 18, 2023 (4.5 hours, partial). Vantorovich's deposition was cut short after approximately 4.5 hours when the witness claimed illness. During the completed portion, Vantorovich testified that he was "not involved in day-to-day fleet decisions" and deferred to Milescu on operational matters. He expressed frustration with what he characterized as Stonefield's declining volumes but could not provide specific figures or dates to support his assertions. When shown the Milescu email (VHC-008417), he stated that he did not recall the specifics of the communication and could not explain why VTS management chose to reassign tractors from a dedicated customer account without notification. Judge Calloway, by order dated September 22, 2023, directed that the deposition be completed by October 20, 2023. As of the date of this memorandum, the continuation has not yet occurred. We anticipate that CRS's withdrawal motion may further delay completion, and we will seek to ensure the deposition is completed regardless of counsel changes.
IV. EXPERT DISCOVERY
A. Plaintiff's Expert: Dr. Philip Trask (Trask Greystone & Associates)
Vantor designated Dr. Philip Trask of Trask Greystone & Associates as its damages expert. Dr. Trask's report was served on May 15, 2023, and opines that Vantor sustained total damages of $95.4 million as a result of Stonefield's allegedly wrongful termination of the TSA. Dr. Trask's damages breakdown is as follows:
We have identified the following weaknesses in Dr. Trask's analysis, each of which will be challenged in our summary judgment briefing and, if the motion is denied, at trial:
(i) Assumes enforceability of liquidated damages. Dr. Trask's report treats the enforceability of the liquidated damages clause as a given, without conducting any legal analysis of whether the clause is enforceable under New York law. While an economics expert is not expected to opine on legal questions, the fact that $67.23 million of the $95.4 million total rests entirely on this assumption means that the report's headline number is misleading.
(ii) Inflated operating margin assumptions. Dr. Trask uses a 12% operating margin to calculate lost profits, asserting that VTS would have earned $18.7 million in profits on the remaining committed volume. However, our expert, Dr. Rosser, has calculated VTS's historical operating margins on the SLG account at 6% to 8%, based on VTS's own financial records. The 12% figure appears to be based on a cherry-picked single-quarter peak rather than a sustained historical average.
(iii) Fails to account for VTS's own breaches. The Trask report does not adjust its damages calculations for VTS's own concurrent breaches, including the secret fleet redeployment that caused the Q4 2021 SLO failures. Under New York law, a breaching party's damages recovery must be offset by the economic impact of its own non-performance.
(iv) No meaningful analysis of mitigation. The report acknowledges the duty to mitigate in a single paragraph but does not conduct any analysis of whether VTS took reasonable steps to mitigate its losses. Given the robust Q1–Q2 2022 freight market and VTS's substantial fleet capacity, the absence of mitigation analysis is a glaring omission.
(v) Seeks both liquidated damages and lost profits. Dr. Trask's report claims $67.23 million in liquidated damages and $18.7 million in lost profits — but both categories compensate for the same underlying harm: the value of the contract VTS lost. Under New York law, double recovery is prohibited, and a plaintiff cannot recover both liquidated damages (which substitute for actual damages) and lost profits (which are the actual damages). At minimum, one of these two categories must be eliminated.
B. Defendant's Expert: Dr. Evelyn Rosser (Kensington Analytics Group LLC)
Stonefield designated Dr. Evelyn Rosser of Kensington Analytics Group LLC as its rebuttal damages expert. Dr. Rosser's rebuttal report was served on August 25, 2023. The report spans 48 pages and includes detailed quantitative analysis supported by extensive appendices.
Dr. Rosser's key opinions are as follows:
Primary Opinion: If the termination was valid for Cause under Section 13.1(a), Vantor is entitled to $0 in damages under the TSA. The liquidated damages provision applies only to terminations "other than for Cause," and no other damages theory survives valid Cause termination in the context of this agreement.
Alternative Opinion (assuming arguendo wrongful termination): Even if the Court were to find that the termination was not for valid Cause, Vantor's maximum recoverable damages are $8.2 million — not $95.4 million. Dr. Rosser reaches this figure through the following adjustments:
•  Reduction of operating margin from Dr. Trask's 12% to a market-based and historically supported range of 6% to 8%, based on VTS's own financial statements and industry benchmarks for dedicated carrier operations.
•  Application of appropriate offsets for VTS's own concurrent breaches, including the economic impact of the secret fleet redeployment and VTS's failure to maintain committed capacity.
•  Credit for VTS's failure to mitigate losses in the Q1–Q2 2022 freight market, during which spot rates were elevated approximately 35% above historical averages — meaning that VTS could have redeployed its 650 tractors and 2,100 trailers at premium rates but failed to do so.
•  Elimination of volume shortfall-related lost profits to the extent Stonefield's volume shortfalls were excused by the force majeure provision or justified by VTS's own tender rejections.
Liquidated Damages Opinion: Dr. Rosser opines that the $67.23 million liquidated damages formula produces a result that is grossly disproportionate to the actual harm suffered by VTS, which she caps at $8.2 million under the most plaintiff-favorable assumptions. This disproportionality — a ratio of more than 8:1 — supports the legal argument that the clause is an unenforceable penalty.
Expert depositions have not yet been taken. The expert discovery deadline is January 12, 2024, per the Case Management Order. We anticipate that both Dr. Trask and Dr. Rosser will be deposed in November or December 2023, subject to scheduling and any impacts from the CRS withdrawal.
C. Daubert Considerations
We have identified viable grounds for a challenge to Dr. Trask's expert testimony under Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993), and Federal Rule of Evidence 702. The challenge would focus on the unreliability of Dr. Trask's lost profits opinion (specifically, the unsupported 12% margin assumption and the failure to account for mitigation) and the methodological deficiency of claiming both liquidated and actual damages.
After careful consideration, our strategic recommendation is to defer filing a standalone Daubert motion and instead incorporate the Daubert arguments into our summary judgment briefing. This approach offers several advantages: it avoids the risk of an unfavorable pretrial ruling that could limit our arguments at summary judgment; it presents the Court with a unified and comprehensive challenge to both liability and damages in a single submission; and it conserves resources by avoiding duplicative briefing. This approach is consistent with the practice of many judges in the Southern District, including Judge Calloway, who have expressed a preference for resolving expert challenges in the context of dispositive motions where possible.
V. ASSESSMENT OF STONEFIELD'S DEFENSES
The following section provides a detailed assessment of each of Stonefield's principal defenses and affirmative arguments. For each defense, we provide a strength rating, a summary of the supporting evidence, and an assessment of the vulnerabilities, if any.
A. Valid Termination for Cause (Primary Defense)
Assessment: STRONG
This is Stonefield's primary defense and the linchpin of our summary judgment strategy. If the Court finds that Stonefield validly terminated the TSA for Cause under Section 13.1(a), Vantor's claims fail in their entirety — including the liquidated damages claim, which applies only to terminations "other than for Cause."
The evidence supporting valid Cause termination is compelling and largely undisputed:
Undisputed SLO Failures. VTS's Q4 2021 performance failures are documented across all five Service Level Obligations and confirmed by multiple independent sources: Stonefield's internal systems, VTS's own Carrier Performance Portal, VTS's internal Q4 2021 Performance Report, and Vantor's admission in its RFA responses. The margins of failure are not marginal — they are substantial, with every metric missing its threshold by double digits (in percentage point terms) except the cargo claims ratio.
Compliant Cure Notice. The January 18, 2022 Cure Notice satisfied every requirement of Section 13.2. It specified each metric failure, the relevant SLO threshold, the actual performance figure, and the contractual basis for the notice. Vantor initially suggested in its Amended Complaint that the Cure Notice lacked sufficient specificity, but this argument has been effectively abandoned — Vantor's own cure response addressed each metric individually, demonstrating that VTS understood the identified breaches with precision.
Failure to Cure. VTS's February 14, 2022 response acknowledged "operational challenges" but did not demonstrate that any of the five SLO failures had been cured during the thirty-day cure period. Post-cure-period data from Stonefield's systems confirmed continued non-compliance in March 2022.
The Milescu Email. The November 12, 2021 email (VHC-008417) establishes that VTS intentionally reduced fleet capacity dedicated to Stonefield by reassigning 85 tractors to a competing shipper without notice. This evidence directly refutes Vantor's core causation theory (that Stonefield's volume shortfalls caused the SLO failures) and establishes that VTS itself caused the very breaches that triggered the for-Cause termination.
Milescu Deposition Testimony. Milescu confirmed the secret reassignment at deposition, characterized it as driven by "commercial necessity," and was unable to explain why Stonefield was not notified — testimony that reinforces the documentary evidence.
First-to-Breach Doctrine. Under New York law, when one party to a bilateral contract commits the first material breach, the other party is excused from further performance and is entitled to treat the contract as terminated. Here, VTS committed the first material breach by unilaterally reducing fleet capacity in October 2021 — before any of the alleged Q4 2021 volume shortfalls by Stonefield. This doctrine provides an independent basis for upholding the termination even if the Court credits some of Vantor's arguments regarding Stonefield's own performance.
B. Force Majeure Defense (ACV Shortfall)
Assessment: STRONG
Stonefield properly invoked the force majeure provision of Section 12.1 in connection with the COVID-19 pandemic's impact on freight demand during the period from April 2020 through September 2020 — a six-month period during which freight volumes across the industry declined sharply due to government lockdowns, supply chain disruptions, and demand contraction.
The invocation of force majeure has the effect of excusing Stonefield's volume commitment during the affected period. Applying this adjustment to Contract Year 2 (April 2020 through March 2021), the calculation is as follows: the Annual Committed Volume of $43.2 million, prorated for the six months outside the force majeure period, yields an adjusted ACV of $21.6 million ($43.2M × 6/12). Stonefield's actual tenders during CY2 totaled $31.8 million — exceeding the adjusted minimum by $10.2 million. Accordingly, there was no volume shortfall in CY2 after accounting for force majeure.
For Contract Year 3 (April 2021 through January 2022, which is only ten of twelve months due to the March 2022 termination), Stonefield's actual tenders totaled $36.5 million. Vantor contends that, on a prorated basis, Stonefield fell $6.7 million short of the annualized ACV. The calculation methodology is disputed, and even under Vantor's most favorable assumptions, the shortfall is modest in comparison to VTS's own concurrent breaches — a fact that weighs heavily in the materiality analysis.
C. No Exclusivity Violation
Assessment: STRONG
Vantor alleges that Stonefield violated the exclusivity provisions of Schedule C by diverting freight to Cascade Freight Systems Inc. and Briarwood Trucking Co. during Q3 and Q4 2021. The evidence conclusively refutes this claim.
Schedule C to the TSA designates fourteen (14) lanes as "Primary Lanes" subject to the exclusivity requirement. Section 2(b) of Schedule C separately identifies additional lanes as "Secondary Lanes," which are expressly excluded from the exclusivity obligation. Cascade and Briarwood were used by Stonefield exclusively on Lanes 8 through 14, all of which are classified as Secondary Lanes under Section 2(b). This fact is confirmed not only by Stonefield's own records but also by the third-party subpoena responses from both Cascade and Briarwood, which identify the specific lanes serviced and confirm that none fall within the Primary Lane designation.
This defense is dispositive of the exclusivity claim and should be resolvable on summary judgment.
D. Liquidated Damages Unenforceable as Penalty
Assessment: MODERATE (Key Risk — See Section VII.B)
Under New York law, a liquidated damages clause is unenforceable as a penalty where (i) the stipulated amount is grossly disproportionate to the probable loss anticipated at the time of contracting, and (ii) actual damages were readily ascertainable at the time of contracting. See Northpoint Holdings v. Purdy Corp., 41 N.Y.2d 354, 365 (1977); Kestrel Corporation, 4 N.Y.3d 373, 380 (2005).
Several factors weigh in favor of a finding of unenforceability. The $67.23 million liquidated damages figure is more than eight times Dr. Rosser's maximum alternative damages calculation of $8.2 million — a degree of disproportionality that many courts would find excessive. Actual damages were readily calculable using standard lost-profits methodology (lost contract revenue minus saved costs), which cuts against the argument that liquidated damages were necessary because actual damages were difficult to ascertain. The 75% multiplier built into the formula appears arbitrarily high and bears no reasonable relationship to anticipated harm, particularly in a scenario (such as this one) where the termination occurs relatively late in the contract term and the carrier-provider has substantial capacity to redeploy to other customers.
However, significant countervailing factors exist. New York courts are generally reluctant to override freely negotiated terms between sophisticated commercial parties, particularly where both parties were represented by experienced counsel. The TSA contains express recitals that the parties "acknowledge and agree" that the liquidated damages formula is a "reasonable estimate of the actual loss and damage" that would result from early termination and is "not a penalty." Such recitals are given weight by New York courts, though they are not dispositive. Additionally, Ashford Meridian drafted the TSA on Stonefield's behalf, which means Stonefield's own counsel proposed or accepted this provision — a fact that Vantor will undoubtedly emphasize.
On balance, we assess the enforceability question as genuinely uncertain — approximately a 50/50 proposition under current New York law. However, as discussed in Section VII.B, the strongest path to eliminating the liquidated damages exposure is not to attack the clause directly but rather to prevail on the Cause defense, which renders the liquidated damages provision inapplicable by its own terms.
E. Consequential Damages Barred (Section 15.1)
Assessment: STRONG
Section 15.1 of the TSA contains a mutual waiver of consequential, incidental, punitive, and special damages. This waiver is broad, unambiguous, and applies regardless of the legal theory under which damages are sought.
Several categories of Vantor's claimed damages are consequential in nature and should be barred by this waiver:
This argument, if successful, eliminates $9.47 million of Vantor's claimed damages regardless of the outcome on the wrongful termination claim. New York courts consistently enforce consequential damages waivers between sophisticated commercial parties, and there is no basis in the record to challenge the enforceability of Section 15.1. This defense should be resolvable on summary judgment.
F. Failure to Mitigate
Assessment: STRONG
Under New York law, a plaintiff has a duty to take reasonable steps to mitigate its damages following a breach of contract. The burden of proving mitigation falls on the plaintiff, meaning Vantor must demonstrate that it took reasonable steps to replace the revenue lost from the SLG contract.
The evidence strongly supports a finding that Vantor failed to mitigate. The Q1–Q2 2022 freight market was historically robust, with spot rates elevated approximately 35% above historical averages. VTS had a substantial fleet — 650 owned tractors and 2,100 trailers — that could readily have been deployed to carry freight for other shippers at premium rates. Despite these favorable market conditions, the evidence shows that VTS made no meaningful efforts to replace the SLG volume. Derek Pruitt was unable at deposition to identify any specific mitigation steps taken after the termination. Vantor's discovery responses on the topic of mitigation were evasive and non-specific. And the document production — including the supplemental production — contains no evidence of new customer solicitations, bid responses, or other efforts to redeploy capacity during the relevant period.
Vantor's failure to mitigate should substantially reduce any damages awarded in the event of an adverse liability finding. Under Dr. Rosser's analysis, the failure to mitigate is one of the principal factors reducing the maximum damages exposure from Dr. Trask's $95.4 million to $8.2 million.
G. Duplicative Damages
Assessment: STRONG
Vantor's damages model claims both liquidated damages ($67.23 million) and lost profits ($18.7 million), but these two categories compensate for the same underlying harm — the economic value of the contract that VTS lost as a result of the termination. Liquidated damages, by definition, are a pre-agreed substitute for actual damages. Lost profits are the actual damages. A plaintiff cannot recover both, because to do so would constitute impermissible double recovery under New York law. See, e.g., U.S. Fid. & Guar. Co. v. Braspetro Oil Servs. Co., 369 F.3d 34, 74 (2d Cir. 2004).
This argument eliminates at least one of the two largest categories of Vantor's claimed damages. If the liquidated damages clause is enforceable, lost profits are subsumed within it. If the clause is unenforceable, liquidated damages are eliminated and only actual lost profits — significantly reduced by Dr. Rosser's analysis — survive.
H. Standing Issue (Parent vs. Subsidiary)
We note as a reserved defense that Vantor Holdings Corp. — the plaintiff in this action — is not a signatory to the TSA. The TSA was signed by Vantor Transport Services LLC, a wholly owned subsidiary. There is a threshold question as to whether Vantor Holdings has standing to assert breach of contract claims under an agreement to which it is not a party.
We have not asserted this defense as a leading argument because Vantor would likely respond with alter-ego or single-economic-unit arguments, or seek leave to add VTS as a party-plaintiff, which Judge Calloway would likely grant. Additionally, the practical distinction between Vantor and VTS is minimal given VTS's status as a wholly owned operating subsidiary. We hold this defense in reserve as a potential procedural tool if circumstances warrant.
VI. ASSESSMENT OF VANTOR'S CLAIMS — LIKELIHOOD OF ADVERSE OUTCOME
A. Wrongful Termination Claim
To prevail on its wrongful termination claim, Vantor must prove that Stonefield's March 4, 2022 termination of the TSA was not for valid Cause under Section 13.1(a). In light of the undisputed SLO failures, the Milescu email, and Milescu's own deposition testimony, Vantor faces a formidable burden.
Vantor's principal liability theory is that VTS's Q4 2021 performance deficiencies were caused by Stonefield's own conduct — specifically, Stonefield's alleged failure to tender committed volumes and its diversion of freight to third-party carriers — making the termination pretextual. Under this theory, Stonefield engineered the conditions that caused VTS to fail, then used those failures as a pretext to exit a contract that was becoming economically unfavorable due to the impending rate adjustment.
While this is a compelling narrative theory that could resonate with a jury, it is contradicted by the factual record in several critical respects:
(i) VTS secretly reassigned 85 tractors from SLG-dedicated lanes to the Northwind account in October 2021 — a decision made unilaterally by VTS management and concealed from Stonefield. This reassignment directly caused the equipment availability failure and likely contributed to the on-time pickup, on-time delivery, and tender acceptance failures. Vantor cannot credibly argue that Stonefield caused the SLO failures when VTS itself pulled nearly a qua