1012-00005 · Stonefield Logistics Group · Discovery/Propounded

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UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

DEFENDANT STONEFIELD LOGISTICS GROUP INC.'S FIRST SET OF REQUESTS FOR ADMISSION TO PLAINTIFF VANTOR HOLDINGS CORP.

Served: March 6, 2023 Calderwood & Harkness LLP Matter No.: 1012-00005

Propounded by:

Patrick Gallagher, Lead Associate Calderwood & Harkness LLP 200 Park Avenue, 38th Floor New York, New York 10166

Directed to:

Vantor Holdings Corp., by and through its counsel of record, Caldwell Royce & Shapiro LLP, 1 Liberty Plaza, 22nd Floor, New York, New York 10006 (Attention: Harrison Caldwell, Esq. / Jason Whitford, Esq.)

INTRODUCTORY STATEMENT AND PRELIMINARY MATTERS

I. Preamble. Defendant Stonefield Logistics Group Inc. ("Stonefield" or "Defendant"), by and through its undersigned attorneys, Calderwood & Harkness LLP, hereby requests that Plaintiff Vantor Holdings Corp. ("Vantor" or "Plaintiff"), pursuant to Rules 26 and 36 of the Federal Rules of Civil Procedure and the Local Civil Rules of the United States District Court for the Southern District of New York, admit or deny the truth of each of the following statements within thirty (30) days of service of these Requests.

These Requests for Admission are directed to Vantor Holdings Corp. and, to the extent applicable, its wholly owned subsidiary Vantor Transport Services LLC ("VTS"), the signatory counterparty to the Transportation Services Agreement dated March 15, 2019 (the "TSA," Contract Reference No. SLG-VTS-2019-0315). Where a Request refers to "Vantor" or "Plaintiff," it shall be understood to encompass both Vantor Holdings Corp. and VTS, unless the context specifically requires otherwise or a particular entity is expressly identified.

II. Definitions. As used in these Requests for Admission, the following terms shall have the meanings set forth below:

1. "TSA" means the Transportation Services Agreement dated March 15, 2019, by and between Stonefield Logistics Group Inc. (in its capacity as "Shipper-Broker") and Vantor Transport Services LLC (in its capacity as "Carrier-Provider"), including all Schedules, Exhibits, Appendices, amendments, modifications, and addenda thereto, collectively identified as Contract Reference No. SLG-VTS-2019-0315.

2. "VTS" means Vantor Transport Services LLC, a New York limited liability company, with its principal place of business in New York, New York, and a wholly owned subsidiary of Vantor Holdings Corp.

3. "SLO" or "Service Level Obligations" means the performance obligations set forth in the TSA, including but not limited to the specific thresholds for on-time pickup rate, on-time delivery rate, cargo claims ratio, tender acceptance rate, and equipment availability compliance, as more particularly described in Schedule B to the TSA and the related provisions of Article 7 thereof.

4. "Cure Notice" means the written Cure Notice dated January 18, 2022, sent by Raymond Hess, Director of Contract Compliance, Stonefield Logistics Group Inc., to Sandra Milescu, Chief Operating Officer, Vantor Holdings Corp. and Vantor Transport Services LLC, identifying certain material breaches of the TSA and initiating the cure period under Section 13.2 thereof.

5. "Termination Letter" means the formal termination letter dated March 4, 2022, sent by Tobias Wren, General Counsel, Stonefield Logistics Group Inc., to Vantor Holdings Corp. and Vantor Transport Services LLC, terminating the TSA pursuant to Section 13.1(a) thereof.

6. "ACV" means the Annual Committed Volume as defined in Section 4.1 of the TSA, being Forty-Three Million Two Hundred Thousand Dollars ($43,200,000) per contract year, representing the minimum aggregate value of transportation charges that Stonefield committed to tender to VTS during each twelve-month contract year.

7. "Q4 2021" means the three-month period commencing October 1, 2021 and ending December 31, 2021, inclusive.

8. "Contract Year 2" or "CY2" means the twelve-month period commencing April 1, 2020 and ending March 31, 2021, being the second contract year under the TSA.

9. "Contract Year 3" or "CY3" means the twelve-month period commencing April 1, 2021 and ending March 31, 2022, being the third contract year under the TSA.

10. "Primary Lanes" means the fourteen (14) designated origin-destination pairs identified in Schedule C to the TSA, constituting the core freight corridors for which VTS was the exclusive or primary carrier under the terms of the TSA.

11. "Secondary Lanes" means all origin-destination pairs or freight lanes not designated as Primary Lanes under Schedule C to the TSA, for which VTS served as a non-exclusive carrier or supplemental capacity provider.

III. Instructions. The following instructions apply to each Request for Admission contained herein:

1. Each Request for Admission should be answered separately and fully in writing, under oath, in accordance with the requirements of Rule 36(a) of the Federal Rules of Civil Procedure.

2. If Plaintiff cannot truthfully admit or deny a Request in its entirety, Plaintiff should specify so much of it as is true and qualify or deny the remainder, in accordance with Federal Rule of Civil Procedure 36(a)(4). A denial shall fairly respond to the substance of the matter, and when good faith requires that a party qualify an answer or deny only a part of a matter, the answer shall specify the part admitted and qualify or deny the rest.

3. When a Request involves a matter of which Plaintiff lacks knowledge or information sufficient to form a belief as to the truth of the matter, Plaintiff shall so state, but only after Plaintiff has made reasonable inquiry and the information known or readily obtainable by Plaintiff is insufficient to enable Plaintiff to admit or deny the statement. A Plaintiff may not give lack of information or knowledge as a reason for failure to admit or deny unless Plaintiff states that it has made reasonable inquiry and that the information known or readily obtainable is insufficient to enable it to admit or deny.

4. Reference to specific TSA sections, schedules, exhibits, and appendices throughout these Requests is for convenience of identification only and is not intended to limit the scope of any Request or to suggest that the referenced provision is the sole or exclusive source of the obligation or fact identified. Plaintiff is requested to review the TSA in its entirety in responding to each Request.

5. These Requests for Admission are continuing in nature pursuant to the Case Management Order entered February 17, 2023 by the Honorable Margaret T. Calloway, United States District Judge. If, after serving responses, Plaintiff obtains or becomes aware of additional information that would change or supplement any response, Plaintiff is obligated to promptly amend or supplement its responses in accordance with Rule 26(e) of the Federal Rules of Civil Procedure and the terms of the Case Management Order.

6. A matter admitted under Rule 36 is conclusively established unless the Court, on motion, permits the admission to be withdrawn or amended pursuant to Rule 36(b).

REQUESTS FOR ADMISSION

SECTION A: EXISTENCE AND EXECUTION OF THE TSA

Request for Admission No. 1:

Admit that on or about March 15, 2019, Stonefield Logistics Group Inc. and Vantor Transport Services LLC entered into the Transportation Services Agreement identified as Contract Reference No. SLG-VTS-2019-0315, a true and correct copy of which has been produced in this litigation and Bates-stamped as SLG-00001 through SLG-00147.

Request for Admission No. 2:

Admit that Vantor Transport Services LLC is a New York limited liability company, organized and existing under the laws of the State of New York, and is the sole signatory counterparty on behalf of the Vantor entities to the TSA, having executed the TSA in its capacity as "Carrier-Provider" thereunder.

Request for Admission No. 3:

Admit that Vantor Holdings Corp. is a New York corporation, organized and existing under the laws of the State of New York, and is the sole member and parent company of Vantor Transport Services LLC, holding a one hundred percent (100%) ownership interest in VTS at all times relevant to the claims and defenses in this action.

Request for Admission No. 4:

Admit that the TSA is governed by the laws of the State of New York, without regard to principles of conflicts of law, as stated in Section 17 of the TSA, and that Section 17.2 of the TSA provides for the exclusive jurisdiction and venue of any action arising out of or relating to the TSA in the United States District Court for the Southern District of New York or, in the absence of federal subject matter jurisdiction, the Supreme Court of the State of New York, New York County.

SECTION B: TSA TERM AND KEY PROVISIONS

Request for Admission No. 5:

Admit that the TSA commenced on April 1, 2019 and was to expire on March 31, 2024, for a total initial term of five (5) years, subject to one (1) automatic two-year renewal period (extending the term through March 31, 2026) unless either party provided written notice of non-renewal to the other party at least one hundred eighty (180) days before the expiration of the then-current term, as set forth in Section 2.1 of the TSA.

Request for Admission No. 6:

Admit that Section 13.1(a) of the TSA provides that either party may terminate the TSA for "Cause," and that the definition of "Cause" under the TSA includes, among other things, "a material breach of any provision of this Agreement that remains uncured for thirty (30) calendar days after written notice specifying the breach in accordance with Section 13.2."

Request for Admission No. 7:

Admit that Section 13.2 of the TSA requires the party seeking termination for Cause to deliver a written Cure Notice to the breaching party "specifying with reasonable particularity the alleged breach or breaches" and providing the breaching party the applicable cure period set forth in Section 13.1 before any termination for Cause becomes effective, and that no termination for Cause under the TSA may take effect prior to the expiration of such cure period.

Request for Admission No. 8:

Admit that Section 14.2 of the TSA provides for the payment of liquidated damages by Stonefield to VTS in the event Stonefield terminates the TSA other than "for Cause" as defined in Section 13.1, with such liquidated damages calculated as seventy-five percent (75%) of the Annual Committed Volume multiplied by the number of full and partial contract years remaining in the then-current term at the time of such termination, and that the parties agreed in Section 14.2 that the liquidated damages formula represents a reasonable estimate of the damages that VTS would suffer as a result of an early termination without Cause.

SECTION C: SERVICE LEVEL OBLIGATIONS UNDER THE TSA

Request for Admission No. 9:

Admit that pursuant to the TSA, including but not limited to Schedule B and Section 7.1 thereof, VTS was required to maintain an on-time pickup rate of at least ninety-five percent (95%), measured on a quarterly basis across all Primary Lanes and Secondary Lanes, with "on-time pickup" defined as the actual pickup of freight within two (2) hours of the scheduled pickup window.

Request for Admission No. 10:

Admit that pursuant to the TSA, including but not limited to Schedule B and Section 7.2 thereof, VTS was required to maintain an on-time delivery rate of at least ninety-three percent (93%), measured on a quarterly basis across all Primary Lanes and Secondary Lanes, with "on-time delivery" defined as the actual delivery of freight within four (4) hours of the scheduled delivery window.

Request for Admission No. 11:

Admit that pursuant to the TSA, including but not limited to Schedule B and Section 7.4 thereof, VTS was required to maintain a cargo claims ratio of no more than one-half of one percent (0.5%) of gross revenue attributable to freight transported under the TSA, measured on a quarterly basis, with "cargo claims ratio" defined as the aggregate dollar amount of filed and substantiated cargo loss and damage claims divided by gross transportation revenue for the applicable measurement period.

Request for Admission No. 12:

Admit that pursuant to the TSA, including but not limited to Schedule B and Section 7.3 thereof, VTS was required to maintain a tender acceptance rate of at least ninety percent (90%), measured on a quarterly basis, with "tender acceptance rate" defined as the percentage of loads tendered by Stonefield through its transportation management system that were accepted by VTS within the contractually specified response window of four (4) hours.

Request for Admission No. 13:

Admit that pursuant to the TSA, including but not limited to Schedule B and Section 7.5 thereof, VTS was required to maintain equipment availability compliance of at least eighty-five percent (85%) of committed fleet capacity, which the TSA defined as a minimum dedicated fleet of four hundred (400) tractors and one thousand two hundred (1,200) trailers, and that the equipment availability compliance metric was measured on a monthly average basis within each quarter.

SECTION D: VTS Q4 2021 PERFORMANCE METRICS

Request for Admission No. 14:

Admit that VTS's on-time pickup rate during Q4 2021 was approximately seventy-eight and two-tenths percent (78.2%), as reflected in the quarterly performance reports generated by Stonefield's transportation management system and provided to VTS in the ordinary course of business, and that this figure fell below the minimum on-time pickup rate threshold of ninety-five percent (95%) required under the TSA by approximately 16.8 percentage points.

Request for Admission No. 15:

Admit that VTS's on-time delivery rate during Q4 2021 was approximately eighty-one and six-tenths percent (81.6%), as reflected in the quarterly performance reports generated by Stonefield's transportation management system and provided to VTS in the ordinary course of business, and that this figure fell below the minimum on-time delivery rate threshold of ninety-three percent (93%) required under the TSA by approximately 11.4 percentage points.

Request for Admission No. 16:

Admit that VTS's tender acceptance rate during Q4 2021 was approximately seventy-one and four-tenths percent (71.4%), as reflected in the quarterly performance reports generated by Stonefield's transportation management system and provided to VTS in the ordinary course of business, and that this figure fell below the minimum tender acceptance rate threshold of ninety percent (90%) required under the TSA by approximately 18.6 percentage points.

Request for Admission No. 17:

Admit that VTS's equipment availability during Q4 2021 was approximately sixty-two percent (62%) of the committed fleet capacity, representing approximately two hundred forty-eight (248) tractors available out of the four hundred (400)-tractor commitment under the TSA, as reflected in VTS's own fleet deployment records and Stonefield's carrier compliance tracking system, and that this figure fell below the minimum equipment availability compliance threshold of eighty-five percent (85%) required under the TSA by approximately 23 percentage points.

Request for Admission No. 18:

Admit that during the months of November and December 2021, VTS incurred sixteen (16) documented cargo claims totaling approximately Three Hundred Eighty-Seven Thousand Four Hundred Dollars ($387,400), as reflected in Stonefield's cargo claims management system and the corresponding claim files, yielding a cargo claims ratio of approximately one and seven-hundredths percent (1.07%) of gross revenue for that period, and that this figure exceeded the maximum cargo claims ratio of one-half of one percent (0.5%) permitted under the TSA by approximately 0.57 percentage points.

Request for Admission No. 19:

Admit that each of the Q4 2021 performance metrics identified in Requests for Admission Nos. 14 through 18 above—including the on-time pickup rate, the on-time delivery rate, the tender acceptance rate, the equipment availability compliance rate, and the cargo claims ratio—fell below (or, in the case of the cargo claims ratio, exceeded) the corresponding Service Level Obligation thresholds set forth in the TSA, and that VTS was therefore in breach of its Service Level Obligations for Q4 2021 across all five measured categories.

SECTION E: THE CURE NOTICE AND CURE PERIOD

Request for Admission No. 20:

Admit that on or about January 18, 2022, Vantor Holdings Corp. and/or VTS received a written Cure Notice from Raymond Hess, Director of Contract Compliance at Stonefield Logistics Group Inc., addressed to Sandra Milescu, Chief Operating Officer of Vantor Holdings Corp. and VTS, sent via certified mail and electronic mail, identifying the specific performance failures set forth in Requests for Admission Nos. 14 through 18 above as material breaches of the TSA and invoking the cure provisions of Section 13.2 of the TSA.

Request for Admission No. 21:

Admit that the Cure Notice dated January 18, 2022 specified with reasonable particularity: (a) each Service Level Obligation metric that was not being met by VTS, identifying the specific contractual provision imposing the obligation; (b) the relevant contractual threshold for each such metric as set forth in the TSA and Schedule B thereto; and (c) VTS's actual performance for Q4 2021 against each such threshold, including the numerical shortfall for each metric, thereby providing VTS with sufficient information to understand the nature and extent of the alleged breaches.

Request for Admission No. 22:

Admit that the Cure Notice dated January 18, 2022 expressly provided VTS with a thirty (30) calendar day cure period to cure the identified breaches, commencing on the date of receipt of the Cure Notice, and that the cure period expired on or about February 17, 2022, consistent with the requirements of Section 13.1(a) and Section 13.2 of the TSA.

Request for Admission No. 23:

Admit that on or about February 14, 2022, Derek Pruitt, Vice President of Business Development at Vantor Holdings Corp., sent a letter to Janet Kirkwood, Vice President of Carrier Relations at Stonefield Logistics Group Inc., in response to the Cure Notice dated January 18, 2022, and that this letter: (a) acknowledged that VTS had experienced "operational challenges" during Q4 2021; (b) attributed those challenges to labor shortages and supply chain disruptions; but (c) did not present evidence, data, or documentation demonstrating that VTS had in fact cured the identified performance deficiencies to the Service Level Obligation thresholds specified in the TSA during the cure period, nor did the letter identify a specific date by which VTS anticipated achieving compliance with such thresholds.

SECTION F: VTS FLEET REDEPLOYMENT AND REMOVAL OF TRACTORS

Request for Admission No. 24:

Admit that in or about October 2021, VTS reassigned approximately eighty-five (85) tractors that had previously been dedicated to service on Stonefield Primary Lanes and Secondary Lanes under the TSA to service the account of another shipper, and that this reassignment reduced the number of tractors available for Stonefield freight from approximately three hundred thirty-three (333) to approximately two hundred forty-eight (248).

Request for Admission No. 25:

Admit that VTS did not notify Stonefield, in writing or otherwise, prior to or contemporaneously with the reassignment of the approximately eighty-five (85) tractors referenced in Request for Admission No. 24 above, notwithstanding VTS's obligations under Section 7.5 and Section 8.3 of the TSA to maintain committed fleet capacity and to provide Stonefield with advance written notice of any material changes to VTS's dedicated fleet allocation.

Request for Admission No. 26:

Admit that Sandra Milescu, Chief Operating Officer of Vantor Holdings Corp. and VTS, sent an email to Nikolai Vantorovich, Chief Executive Officer and Founder of Vantor Holdings Corp., on or about November 12, 2021, at approximately 9:47 p.m. Eastern Time, stating in substance that VTS had "pulled 85 tractors off the SLG dedicated lanes" and that "SLG won't notice until January," and that a true and correct copy of this email has been produced in this litigation and Bates-stamped as VHC-00823.

SECTION G: TERMINATION OF THE TSA

Request for Admission No. 27:

Admit that on or about March 4, 2022, Tobias Wren, General Counsel of Stonefield Logistics Group Inc., sent a formal termination letter to Vantor Holdings Corp. and VTS, via certified mail, return receipt requested, and electronic mail, stating that VTS had "failed to cure the material breaches of the Transportation Services Agreement" identified in the Cure Notice dated January 18, 2022 within the thirty (30) calendar day cure period provided therein, and that the TSA was thereby terminated effective immediately pursuant to Section 13.1(a) of the TSA.

Request for Admission No. 28:

Admit that VTS did not dispute the accuracy of the Q4 2021 performance metrics set forth in the Cure Notice at any time during the thirty (30) calendar day cure period running from January 18, 2022 through February 17, 2022, nor did VTS provide Stonefield with any written communication during that period challenging or contesting the data, methodology, or calculations underlying the performance metrics identified in the Cure Notice.

SECTION H: FORCE MAJEURE AND VOLUME COMMITMENTS

Request for Admission No. 29:

Admit that Section 12.1 of the TSA contains a force majeure provision that excuses the performance of obligations under the TSA to the extent, and for so long as, such performance is prevented, delayed, or hindered by force majeure events, defined therein to include, among other enumerated events, epidemics, pandemics, and government-imposed restrictions, and that the COVID-19 pandemic and its effects on freight demand, labor availability, and supply chain operations constitute force majeure events within the meaning of Section 12.1 of the TSA.

Request for Admission No. 30:

Admit that during Contract Year 2 (April 1, 2020 through March 31, 2021), Stonefield tendered transportation charges to VTS totaling approximately Thirty-One Million Eight Hundred Thousand Dollars ($31,800,000), and that this amount exceeded the adjusted Annual Committed Volume of Twenty-One Million Six Hundred Thousand Dollars ($21,600,000) applicable for Contract Year 2 after accounting for Stonefield's invocation of the force majeure provision under Section 12.1 of the TSA for the six-month period from April 2020 through September 2020 (calculated as $43,200,000 multiplied by 6/12, yielding $21,600,000), such that Stonefield's volume commitment for Contract Year 2 was satisfied and exceeded by a margin of approximately $10,200,000.

SIGNATURE AND CERTIFICATION

Respectfully submitted,

CALDERWOOD & HARKNESS LLP

By: ________

Patrick Gallagher (Bar No. PG-4291) Samuel Eklund (Bar No. SE-7053) 200 Park Avenue, 38th Floor New York, New York 10166 Telephone: (212) 554-8300 Facsimile: (212) 554-8301

Email: pgallagher@calderwoodharkness.com

Email: seklund@calderwoodharkness.com

Attorneys for Defendant Stonefield Logistics Group Inc.

Dated: March 6, 2023

CERTIFICATE OF SERVICE

I, Patrick Gallagher, hereby certify that on March 6, 2023, a true and correct copy of the foregoing Defendant Stonefield Logistics Group Inc.'s First Set of Requests for Admission to Plaintiff Vantor Holdings Corp. was served upon counsel for Plaintiff via the Court's Electronic Case Filing (ECF) system, which effectuates electronic notice to all registered participants, and additionally by email transmission to the following counsel of record:

Harrison Caldwell, Esq. Jason Whitford, Esq. Caldwell Royce & Shapiro LLP 1 Liberty Plaza, 22nd Floor New York, New York 10006 hcaldwell@caldwellroyce.com jwhitford@caldwellroyce.com

________________________________________

Patrick Gallagher

VANTOR HOLDINGS CORP.,

Plaintiff,

Case No. 22-cv-07841

Before Hon. Margaret T. Calloway, U.S.D.J.

STONEFIELD LOGISTICS GROUP INC.,

Defendant.

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK
DEFENDANT STONEFIELD LOGISTICS GROUP INC.'S FIRST SET OF REQUESTS FOR ADMISSION TO PLAINTIFF VANTOR HOLDINGS CORP.
Served: March 6, 2023 Calderwood & Harkness LLP Matter No.: 1012-00005
Propounded by:
Patrick Gallagher, Lead Associate Calderwood & Harkness LLP 200 Park Avenue, 38th Floor New York, New York 10166
Directed to:
Vantor Holdings Corp., by and through its counsel of record, Caldwell Royce & Shapiro LLP, 1 Liberty Plaza, 22nd Floor, New York, New York 10006 (Attention: Harrison Caldwell, Esq. / Jason Whitford, Esq.)
INTRODUCTORY STATEMENT AND PRELIMINARY MATTERS
I. Preamble. Defendant Stonefield Logistics Group Inc. ("Stonefield" or "Defendant"), by and through its undersigned attorneys, Calderwood & Harkness LLP, hereby requests that Plaintiff Vantor Holdings Corp. ("Vantor" or "Plaintiff"), pursuant to Rules 26 and 36 of the Federal Rules of Civil Procedure and the Local Civil Rules of the United States District Court for the Southern District of New York, admit or deny the truth of each of the following statements within thirty (30) days of service of these Requests.
These Requests for Admission are directed to Vantor Holdings Corp. and, to the extent applicable, its wholly owned subsidiary Vantor Transport Services LLC ("VTS"), the signatory counterparty to the Transportation Services Agreement dated March 15, 2019 (the "TSA," Contract Reference No. SLG-VTS-2019-0315). Where a Request refers to "Vantor" or "Plaintiff," it shall be understood to encompass both Vantor Holdings Corp. and VTS, unless the context specifically requires otherwise or a particular entity is expressly identified.
II. Definitions. As used in these Requests for Admission, the following terms shall have the meanings set forth below:
1. "TSA" means the Transportation Services Agreement dated March 15, 2019, by and between Stonefield Logistics Group Inc. (in its capacity as "Shipper-Broker") and Vantor Transport Services LLC (in its capacity as "Carrier-Provider"), including all Schedules, Exhibits, Appendices, amendments, modifications, and addenda thereto, collectively identified as Contract Reference No. SLG-VTS-2019-0315.
2. "VTS" means Vantor Transport Services LLC, a New York limited liability company, with its principal place of business in New York, New York, and a wholly owned subsidiary of Vantor Holdings Corp.
3. "SLO" or "Service Level Obligations" means the performance obligations set forth in the TSA, including but not limited to the specific thresholds for on-time pickup rate, on-time delivery rate, cargo claims ratio, tender acceptance rate, and equipment availability compliance, as more particularly described in Schedule B to the TSA and the related provisions of Article 7 thereof.
4. "Cure Notice" means the written Cure Notice dated January 18, 2022, sent by Raymond Hess, Director of Contract Compliance, Stonefield Logistics Group Inc., to Sandra Milescu, Chief Operating Officer, Vantor Holdings Corp. and Vantor Transport Services LLC, identifying certain material breaches of the TSA and initiating the cure period under Section 13.2 thereof.
5. "Termination Letter" means the formal termination letter dated March 4, 2022, sent by Tobias Wren, General Counsel, Stonefield Logistics Group Inc., to Vantor Holdings Corp. and Vantor Transport Services LLC, terminating the TSA pursuant to Section 13.1(a) thereof.
6. "ACV" means the Annual Committed Volume as defined in Section 4.1 of the TSA, being Forty-Three Million Two Hundred Thousand Dollars ($43,200,000) per contract year, representing the minimum aggregate value of transportation charges that Stonefield committed to tender to VTS during each twelve-month contract year.
7. "Q4 2021" means the three-month period commencing October 1, 2021 and ending December 31, 2021, inclusive.
8. "Contract Year 2" or "CY2" means the twelve-month period commencing April 1, 2020 and ending March 31, 2021, being the second contract year under the TSA.
9. "Contract Year 3" or "CY3" means the twelve-month period commencing April 1, 2021 and ending March 31, 2022, being the third contract year under the TSA.
10. "Primary Lanes" means the fourteen (14) designated origin-destination pairs identified in Schedule C to the TSA, constituting the core freight corridors for which VTS was the exclusive or primary carrier under the terms of the TSA.
11. "Secondary Lanes" means all origin-destination pairs or freight lanes not designated as Primary Lanes under Schedule C to the TSA, for which VTS served as a non-exclusive carrier or supplemental capacity provider.
III. Instructions. The following instructions apply to each Request for Admission contained herein:
1. Each Request for Admission should be answered separately and fully in writing, under oath, in accordance with the requirements of Rule 36(a) of the Federal Rules of Civil Procedure.
2. If Plaintiff cannot truthfully admit or deny a Request in its entirety, Plaintiff should specify so much of it as is true and qualify or deny the remainder, in accordance with Federal Rule of Civil Procedure 36(a)(4). A denial shall fairly respond to the substance of the matter, and when good faith requires that a party qualify an answer or deny only a part of a matter, the answer shall specify the part admitted and qualify or deny the rest.
3. When a Request involves a matter of which Plaintiff lacks knowledge or information sufficient to form a belief as to the truth of the matter, Plaintiff shall so state, but only after Plaintiff has made reasonable inquiry and the information known or readily obtainable by Plaintiff is insufficient to enable Plaintiff to admit or deny the statement. A Plaintiff may not give lack of information or knowledge as a reason for failure to admit or deny unless Plaintiff states that it has made reasonable inquiry and that the information known or readily obtainable is insufficient to enable it to admit or deny.
4. Reference to specific TSA sections, schedules, exhibits, and appendices throughout these Requests is for convenience of identification only and is not intended to limit the scope of any Request or to suggest that the referenced provision is the sole or exclusive source of the obligation or fact identified. Plaintiff is requested to review the TSA in its entirety in responding to each Request.
5. These Requests for Admission are continuing in nature pursuant to the Case Management Order entered February 17, 2023 by the Honorable Margaret T. Calloway, United States District Judge. If, after serving responses, Plaintiff obtains or becomes aware of additional information that would change or supplement any response, Plaintiff is obligated to promptly amend or supplement its responses in accordance with Rule 26(e) of the Federal Rules of Civil Procedure and the terms of the Case Management Order.
6. A matter admitted under Rule 36 is conclusively established unless the Court, on motion, permits the admission to be withdrawn or amended pursuant to Rule 36(b).
REQUESTS FOR ADMISSION
SECTION A: EXISTENCE AND EXECUTION OF THE TSA
Request for Admission No. 1:
Admit that on or about March 15, 2019, Stonefield Logistics Group Inc. and Vantor Transport Services LLC entered into the Transportation Services Agreement identified as Contract Reference No. SLG-VTS-2019-0315, a true and correct copy of which has been produced in this litigation and Bates-stamped as SLG-00001 through SLG-00147.
Request for Admission No. 2:
Admit that Vantor Transport Services LLC is a New York limited liability company, organized and existing under the laws of the State of New York, and is the sole signatory counterparty on behalf of the Vantor entities to the TSA, having executed the TSA in its capacity as "Carrier-Provider" thereunder.
Request for Admission No. 3:
Admit that Vantor Holdings Corp. is a New York corporation, organized and existing under the laws of the State of New York, and is the sole member and parent company of Vantor Transport Services LLC, holding a one hundred percent (100%) ownership interest in VTS at all times relevant to the claims and defenses in this action.
Request for Admission No. 4:
Admit that the TSA is governed by the laws of the State of New York, without regard to principles of conflicts of law, as stated in Section 17 of the TSA, and that Section 17.2 of the TSA provides for the exclusive jurisdiction and venue of any action arising out of or relating to the TSA in the United States District Court for the Southern District of New York or, in the absence of federal subject matter jurisdiction, the Supreme Court of the State of New York, New York County.
SECTION B: TSA TERM AND KEY PROVISIONS
Request for Admission No. 5:
Admit that the TSA commenced on April 1, 2019 and was to expire on March 31, 2024, for a total initial term of five (5) years, subject to one (1) automatic two-year renewal period (extending the term through March 31, 2026) unless either party provided written notice of non-renewal to the other party at least one hundred eighty (180) days before the expiration of the then-current term, as set forth in Section 2.1 of the TSA.
Request for Admission No. 6:
Admit that Section 13.1(a) of the TSA provides that either party may terminate the TSA for "Cause," and that the definition of "Cause" under the TSA includes, among other things, "a material breach of any provision of this Agreement that remains uncured for thirty (30) calendar days after written notice specifying the breach in accordance with Section 13.2."
Request for Admission No. 7:
Admit that Section 13.2 of the TSA requires the party seeking termination for Cause to deliver a written Cure Notice to the breaching party "specifying with reasonable particularity the alleged breach or breaches" and providing the breaching party the applicable cure period set forth in Section 13.1 before any termination for Cause becomes effective, and that no termination for Cause under the TSA may take effect prior to the expiration of such cure period.
Request for Admission No. 8:
Admit that Section 14.2 of the TSA provides for the payment of liquidated damages by Stonefield to VTS in the event Stonefield terminates the TSA other than "for Cause" as defined in Section 13.1, with such liquidated damages calculated as seventy-five percent (75%) of the Annual Committed Volume multiplied by the number of full and partial contract years remaining in the then-current term at the time of such termination, and that the parties agreed in Section 14.2 that the liquidated damages formula represents a reasonable estimate of the damages that VTS would suffer as a result of an early termination without Cause.
SECTION C: SERVICE LEVEL OBLIGATIONS UNDER THE TSA
Request for Admission No. 9:
Admit that pursuant to the TSA, including but not limited to Schedule B and Section 7.1 thereof, VTS was required to maintain an on-time pickup rate of at least ninety-five percent (95%), measured on a quarterly basis across all Primary Lanes and Secondary Lanes, with "on-time pickup" defined as the actual pickup of freight within two (2) hours of the scheduled pickup window.
Request for Admission No. 10:
Admit that pursuant to the TSA, including but not limited to Schedule B and Section 7.2 thereof, VTS was required to maintain an on-time delivery rate of at least ninety-three percent (93%), measured on a quarterly basis across all Primary Lanes and Secondary Lanes, with "on-time delivery" defined as the actual delivery of freight within four (4) hours of the scheduled delivery window.
Request for Admission No. 11:
Admit that pursuant to the TSA, including but not limited to Schedule B and Section 7.4 thereof, VTS was required to maintain a cargo claims ratio of no more than one-half of one percent (0.5%) of gross revenue attributable to freight transported under the TSA, measured on a quarterly basis, with "cargo claims ratio" defined as the aggregate dollar amount of filed and substantiated cargo loss and damage claims divided by gross transportation revenue for the applicable measurement period.
Request for Admission No. 12:
Admit that pursuant to the TSA, including but not limited to Schedule B and Section 7.3 thereof, VTS was required to maintain a tender acceptance rate of at least ninety percent (90%), measured on a quarterly basis, with "tender acceptance rate" defined as the percentage of loads tendered by Stonefield through its transportation management system that were accepted by VTS within the contractually specified response window of four (4) hours.
Request for Admission No. 13:
Admit that pursuant to the TSA, including but not limited to Schedule B and Section 7.5 thereof, VTS was required to maintain equipment availability compliance of at least eighty-five percent (85%) of committed fleet capacity, which the TSA defined as a minimum dedicated fleet of four hundred (400) tractors and one thousand two hundred (1,200) trailers, and that the equipment availability compliance metric was measured on a monthly average basis within each quarter.
SECTION D: VTS Q4 2021 PERFORMANCE METRICS
Request for Admission No. 14:
Admit that VTS's on-time pickup rate during Q4 2021 was approximately seventy-eight and two-tenths percent (78.2%), as reflected in the quarterly performance reports generated by Stonefield's transportation management system and provided to VTS in the ordinary course of business, and that this figure fell below the minimum on-time pickup rate threshold of ninety-five percent (95%) required under the TSA by approximately 16.8 percentage points.
Request for Admission No. 15:
Admit that VTS's on-time delivery rate during Q4 2021 was approximately eighty-one and six-tenths percent (81.6%), as reflected in the quarterly performance reports generated by Stonefield's transportation management system and provided to VTS in the ordinary course of business, and that this figure fell below the minimum on-time delivery rate threshold of ninety-three percent (93%) required under the TSA by approximately 11.4 percentage points.
Request for Admission No. 16:
Admit that VTS's tender acceptance rate during Q4 2021 was approximately seventy-one and four-tenths percent (71.4%), as reflected in the quarterly performance reports generated by Stonefield's transportation management system and provided to VTS in the ordinary course of business, and that this figure fell below the minimum tender acceptance rate threshold of ninety percent (90%) required under the TSA by approximately 18.6 percentage points.
Request for Admission No. 17:
Admit that VTS's equipment availability during Q4 2021 was approximately sixty-two percent (62%) of the committed fleet capacity, representing approximately two hundred forty-eight (248) tractors available out of the four hundred (400)-tractor commitment under the TSA, as reflected in VTS's own fleet deployment records and Stonefield's carrier compliance tracking system, and that this figure fell below the minimum equipment availability compliance threshold of eighty-five percent (85%) required under the TSA by approximately 23 percentage points.
Request for Admission No. 18:
Admit that during the months of November and December 2021, VTS incurred sixteen (16) documented cargo claims totaling approximately Three Hundred Eighty-Seven Thousand Four Hundred Dollars ($387,400), as reflected in Stonefield's cargo claims management system and the corresponding claim files, yielding a cargo claims ratio of approximately one and seven-hundredths percent (1.07%) of gross revenue for that period, and that this figure exceeded the maximum cargo claims ratio of one-half of one percent (0.5%) permitted under the TSA by approximately 0.57 percentage points.
Request for Admission No. 19:
Admit that each of the Q4 2021 performance metrics identified in Requests for Admission Nos. 14 through 18 above—including the on-time pickup rate, the on-time delivery rate, the tender acceptance rate, the equipment availability compliance rate, and the cargo claims ratio—fell below (or, in the case of the cargo claims ratio, exceeded) the corresponding Service Level Obligation thresholds set forth in the TSA, and that VTS was therefore in breach of its Service Level Obligations for Q4 2021 across all five measured categories.
SECTION E: THE CURE NOTICE AND CURE PERIOD
Request for Admission No. 20:
Admit that on or about January 18, 2022, Vantor Holdings Corp. and/or VTS received a written Cure Notice from Raymond Hess, Director of Contract Compliance at Stonefield Logistics Group Inc., addressed to Sandra Milescu, Chief Operating Officer of Vantor Holdings Corp. and VTS, sent via certified mail and electronic mail, identifying the specific performance failures set forth in Requests for Admission Nos. 14 through 18 above as material breaches of the TSA and invoking the cure provisions of Section 13.2 of the TSA.
Request for Admission No. 21:
Admit that the Cure Notice dated January 18, 2022 specified with reasonable particularity: (a) each Service Level Obligation metric that was not being met by VTS, identifying the specific contractual provision imposing the obligation; (b) the relevant contractual threshold for each such metric as set forth in the TSA and Schedule B thereto; and (c) VTS's actual performance for Q4 2021 against each such threshold, including the numerical shortfall for each metric, thereby providing VTS with sufficient information to understand the nature and extent of the alleged breaches.
Request for Admission No. 22:
Admit that the Cure Notice dated January 18, 2022 expressly provided VTS with a thirty (30) calendar day cure period to cure the identified breaches, commencing on the date of receipt of the Cure Notice, and that the cure period expired on or about February 17, 2022, consistent with the requirements of Section 13.1(a) and Section 13.2 of the TSA.
Request for Admission No. 23:
Admit that on or about February 14, 2022, Derek Pruitt, Vice President of Business Development at Vantor Holdings Corp., sent a letter to Janet Kirkwood, Vice President of Carrier Relations at Stonefield Logistics Group Inc., in response to the Cure Notice dated January 18, 2022, and that this letter: (a) acknowledged that VTS had experienced "operational challenges" during Q4 2021; (b) attributed those challenges to labor shortages and supply chain disruptions; but (c) did not present evidence, data, or documentation demonstrating that VTS had in fact cured the identified performance deficiencies to the Service Level Obligation thresholds specified in the TSA during the cure period, nor did the letter identify a specific date by which VTS anticipated achieving compliance with such thresholds.
SECTION F: VTS FLEET REDEPLOYMENT AND REMOVAL OF TRACTORS
Request for Admission No. 24:
Admit that in or about October 2021, VTS reassigned approximately eighty-five (85) tractors that had previously been dedicated to service on Stonefield Primary Lanes and Secondary Lanes under the TSA to service the account of another shipper, and that this reassignment reduced the number of tractors available for Stonefield freight from approximately three hundred thirty-three (333) to approximately two hundred forty-eight (248).
Request for Admission No. 25:
Admit that VTS did not notify Stonefield, in writing or otherwise, prior to or contemporaneously with the reassignment of the approximately eighty-five (85) tractors referenced in Request for Admission No. 24 above, notwithstanding VTS's obligations under Section 7.5 and Section 8.3 of the TSA to maintain committed fleet capacity and to provide Stonefield with advance written notice of any material changes to VTS's dedicated fleet allocation.
Request for Admission No. 26:
Admit that Sandra Milescu, Chief Operating Officer of Vantor Holdings Corp. and VTS, sent an email to Nikolai Vantorovich, Chief Executive Officer and Founder of Vantor Holdings Corp., on or about November 12, 2021, at approximately 9:47 p.m. Eastern Time, stating in substance that VTS had "pulled 85 tractors off the SLG dedicated lanes" and that "SLG won't notice until January," and that a true and correct copy of this email has been produced in this litigation and Bates-stamped as VHC-00823.
SECTION G: TERMINATION OF THE TSA
Request for Admission No. 27:
Admit that on or about March 4, 2022, Tobias Wren, General Counsel of Stonefield Logistics Group Inc., sent a formal termination letter to Vantor Holdings Corp. and VTS, via certified mail, return receipt requested, and electronic mail, stating that VTS had "failed to cure the material breaches of the Transportation Services Agreement" identified in the Cure Notice dated January 18, 2022 within the thirty (30) calendar day cure period provided therein, and that the TSA was thereby terminated effective immediately pursuant to Section 13.1(a) of the TSA.
Request for Admission No. 28:
Admit that VTS did not dispute the accuracy of the Q4 2021 performance metrics set forth in the Cure Notice at any time during the thirty (30) calendar day cure period running from January 18, 2022 through February 17, 2022, nor did VTS provide Stonefield with any written communication during that period challenging or contesting the data, methodology, or calculations underlying the performance metrics identified in the Cure Notice.
SECTION H: FORCE MAJEURE AND VOLUME COMMITMENTS
Request for Admission No. 29:
Admit that Section 12.1 of the TSA contains a force majeure provision that excuses the performance of obligations under the TSA to the extent, and for so long as, such performance is prevented, delayed, or hindered by force majeure events, defined therein to include, among other enumerated events, epidemics, pandemics, and government-imposed restrictions, and that the COVID-19 pandemic and its effects on freight demand, labor availability, and supply chain operations constitute force majeure events within the meaning of Section 12.1 of the TSA.
Request for Admission No. 30:
Admit that during Contract Year 2 (April 1, 2020 through March 31, 2021), Stonefield tendered transportation charges to VTS totaling approximately Thirty-One Million Eight Hundred Thousand Dollars ($31,800,000), and that this amount exceeded the adjusted Annual Committed Volume of Twenty-One Million Six Hundred Thousand Dollars ($21,600,000) applicable for Contract Year 2 after accounting for Stonefield's invocation of the force majeure provision under Section 12.1 of the TSA for the six-month period from April 2020 through September 2020 (calculated as $43,200,000 multiplied by 6/12, yielding $21,600,000), such that Stonefield's volume commitment for Contract Year 2 was satisfied and exceeded by a margin of approximately $10,200,000.
SIGNATURE AND CERTIFICATION
Respectfully submitted,
CALDERWOOD & HARKNESS LLP
By: ________
Patrick Gallagher (Bar No. PG-4291) Samuel Eklund (Bar No. SE-7053) 200 Park Avenue, 38th Floor New York, New York 10166 Telephone: (212) 554-8300 Facsimile: (212) 554-8301
Email: pgallagher@calderwoodharkness.com
Email: seklund@calderwoodharkness.com
Attorneys for Defendant Stonefield Logistics Group Inc.
Dated: March 6, 2023
CERTIFICATE OF SERVICE
I, Patrick Gallagher, hereby certify that on March 6, 2023, a true and correct copy of the foregoing Defendant Stonefield Logistics Group Inc.'s First Set of Requests for Admission to Plaintiff Vantor Holdings Corp. was served upon counsel for Plaintiff via the Court's Electronic Case Filing (ECF) system, which effectuates electronic notice to all registered participants, and additionally by email transmission to the following counsel of record:
Harrison Caldwell, Esq. Jason Whitford, Esq. Caldwell Royce & Shapiro LLP 1 Liberty Plaza, 22nd Floor New York, New York 10006 hcaldwell@caldwellroyce.com jwhitford@caldwellroyce.com
________________________________________
Patrick Gallagher
VANTOR HOLDINGS CORP.,
Plaintiff,
Case No. 22-cv-07841
v.
Before Hon. Margaret T. Calloway, U.S.D.J.
STONEFIELD LOGISTICS GROUP INC.,
Defendant.