letter-to-court-aldrich-status.docx

1017-00004 · Entities. Aurelius Global Media Group · Pleadings/Aldrich

letter-to-court-aldrich-status.docx DOCUMENT Finance & Banking

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CALDERWOOD & HARKNESS LLP 777 South Flower Street, Suite 4200 Los Angeles, California 90017 Telephone: (213) 688-7400 Facsimile: (213) 688-7401 www.calderwoodharkness.com

May 5, 2023

VIA HAND DELIVERY

Hon. Catherine Villanueva Department 52 Superior Court of the State of California County of Los Angeles — Central District 111 N. Hill Street Los Angeles, CA 90012

Re: Aldrich v. Aurelius Media Americas Inc., Case No. 22STCV41087 — Status of Cross-Claims and Mediation Scheduling

Dear Judge Villanueva:

I write on behalf of Defendant and Cross-Complainant Aurelius Media Americas Inc. ("AMA"), which is represented by Calderwood & Harkness LLP in the above-referenced matter, to respectfully provide the Court with a status update regarding the cross-claims asserted by AMA, the current posture of discovery, and the parties' discussions concerning mediation scheduling. This letter is submitted in advance of any further status conference the Court may wish to set, and is intended to assist the Court in its management of this action going forward.

I. Cross-Claims and discovery Status

A. Amended Cross-Complaint

AMA filed its original Cross-Complaint on January 20, 2023, asserting four causes of action against Plaintiff Gavin Aldrich ("Aldrich" or "Plaintiff"): (1) Breach of Employment Agreement, specifically the confidentiality provisions set forth in Section 9.4 of the parties' Employment Agreement dated March 15, 2021 (the "Agreement"); (2) Misappropriation of Trade Secrets under the California Uniform Trade Secrets Act, California Civil Code Section 3426 et seq. ("CUTSA"); (3) Breach of Fiduciary Duty; and (4) Conversion. These claims arise out of Aldrich's conduct during and after his employment with AMA, including, among other things, his unauthorized transmission of proprietary and confidential AMA materials to personal email accounts and to third parties.

Following the Court's March 22, 2023 Order granting in part and denying in part Plaintiff's Motion to Strike portions of the original Cross-Complaint, AMA filed an Amended Cross-Complaint on April 5, 2023. In accordance with the Court's ruling, the Amended Cross-Complaint removed the non-competition clause (Section 9.1 of the Agreement) from the caption of the First Cause of Action for Breach of Employment Agreement. The amendment further clarified that AMA does not seek to enforce Section 9.1, the non-competition provision, against Aldrich in this action. AMA, however, retained references to the broader restrictive covenant framework contained in the Agreement as factual context for the remaining claims — specifically, the confidentiality obligations under Section 9.4, the trade secret misappropriation claims under CUTSA, and the breach of fiduciary duty claim. These references are necessary to provide the Court and the parties with a complete understanding of the contractual relationship between AMA and Aldrich, and the scope of Aldrich's obligations to AMA during and after his employment.

The Amended Cross-Complaint otherwise maintains all four causes of action as originally pleaded, and no further challenge to the pleadings has been filed by Plaintiff.

B. Discovery Status

Discovery is proceeding in accordance with the case management schedule established by the Court. The parties have been engaged in active written discovery, as described below.

AMA served its First Set of Requests for Production of Documents (Request Nos. 1 through 28) and its First Set of Special Interrogatories (Interrogatory Nos. 1 through 30) on Plaintiff Aldrich on February 20, 2023. Plaintiff's responses to these discovery requests were received on March 30, 2023. AMA is continuing to review and assess the sufficiency of those responses, and, as discussed further in Section I.C below, has identified certain deficiencies that are the subject of a pending motion.

Plaintiff Aldrich, for his part, served his First Set of Requests for Production of Documents (Request Nos. 1 through 30) and First Set of Special Interrogatories (Interrogatory Nos. 1 through 25) on AMA. AMA served its responses to Plaintiff's discovery requests on March 3, 2023. AMA believes its responses were timely and substantively complete. No motion to compel further responses from AMA has been filed by Plaintiff to date.

C. Pending Motion to Compel

AMA has filed a Motion to Compel Further Responses from Plaintiff regarding Requests for Production Nos. 8, 11, 12, 13, and 14. These requests are central to AMA's cross-claims and seek, among other things, communications between Aldrich and Halcyon Creek Productions LLC ("Halcyon Creek"), a California-based production company, as well as documents transmitted by Aldrich from AMA's internal systems to personal email accounts and to third parties during and after his employment with AMA. Plaintiff's responses to these requests were, in AMA's view, evasive, incomplete, and improperly limited by overbroad objections that do not withstand scrutiny under applicable law.

The Motion to Compel is currently set for hearing on May 19, 2023, before this Court. AMA's motion is supported by the Declaration of Nadia Petrov, an associate at Calderwood & Harkness LLP, filed on April 14, 2023, which documents in detail the extensive meet-and-confer efforts undertaken by AMA's counsel with Plaintiff's counsel, Julia Nazarian of Whitfield & Associates, prior to the filing of the motion. Despite multiple telephonic and written communications, the parties were unable to resolve the discovery dispute informally, necessitating Court intervention.

AMA respectfully submits that the documents and communications sought through these requests are directly relevant to AMA's trade secret misappropriation and breach of confidentiality claims, and are essential to AMA's ability to assess the full scope of Aldrich's unauthorized disclosures. AMA will present its arguments on the merits at the scheduled hearing.

D. Deposition of Gavin Aldrich

AMA has noticed the deposition of Gavin Aldrich for May 22, 2023. The Notice of Deposition was served on Plaintiff's counsel on April 25, 2023. The deposition will cover the following topics, among others: Aldrich's employment with AMA, including his duties, responsibilities, and access to confidential and proprietary information; the circumstances surrounding his termination from AMA; his relationship with Halcyon Creek Productions LLC and its principal, Nina Castellanos, both during and after his employment with AMA; the email transmissions of proprietary AMA materials from AMA systems to personal accounts and to third parties; Aldrich's restrictive covenant obligations under the Agreement; and the factual basis for his damages claims asserted in the Complaint. AMA anticipates the deposition will require a full day and may need to continue to a second session depending on the scope and complexity of the testimony.

II. Related Class Action

AMA brings to the Court's attention a related action pending in this courthouse: Fuentes v. Aurelius Media Americas Inc., Case No. 22STCV38214, which has been consolidated with Case No. 22STCV39501 and is assigned to Hon. Raymond Escobedo, Department 34. The Fuentes class action involves materially different legal theories and facts from the Aldrich matter presently before this Court. Specifically, the class action asserts wage-and-hour claims on behalf of approximately 1,850 non-exempt, hourly employees of AMA, alleging violations of overtime, meal and rest break, and wage statement provisions of the California Labor Code. The Fuentes action does not involve claims of trade secret misappropriation, breach of fiduciary duty, or any of the other claims at issue in the present case.

For these reasons, AMA does not believe that consolidation of the Aldrich matter with the Fuentes class action is appropriate, and AMA has not sought such relief. The two cases involve distinct plaintiffs, distinct legal theories, and distinct underlying facts, and consolidation would not promote judicial efficiency but would instead risk confusion and delay in both proceedings.

AMA provides this information to the Court because the Fuentes class action is relevant to AMA's mediation proposal, as discussed in Section III below. The class certification motion in the Fuentes action was filed on April 14, 2023, with AMA's opposition due on June 16, 2023, and a hearing currently scheduled for July 28, 2023. AMA anticipates that the class action will proceed through the certification briefing process and, depending on the outcome of the certification motion, will move to mediation in the late summer or early fall of 2023.

III. Mediation Proposal

The parties are amenable to mediation of the Aldrich dispute. Counsel for AMA and counsel for Plaintiff have discussed mediation in general terms and agree that it is a productive avenue for resolution of this matter. AMA, however, respectfully proposes that mediation be scheduled after the completion of the following milestones, which AMA believes are necessary to ensure that mediation is conducted efficiently and with sufficient information to enable meaningful settlement discussions:

1. Completion of the deposition of Gavin Aldrich, which is currently noticed for May 22, 2023. The Aldrich deposition is critical to AMA's evaluation of the case, as it will provide direct testimony on the key factual disputes underlying both Plaintiff's claims and AMA's cross-claims.

2. Resolution of the pending Motion to Compel Further Responses (hearing scheduled for May 19, 2023). The outcome of this motion will determine whether AMA obtains documents and communications that are central to its claims and that will materially affect AMA's assessment of the case for purposes of settlement discussions.

3. Progress toward resolution of the related class action, Fuentes v. Aurelius Media Americas Inc., Case No. 22STCV38214. As discussed in Section II above, AMA anticipates that the class certification briefing and hearing will be completed by mid- to late summer 2023. The resolution or advancement of the class action will bear on the broader landscape of AMA's employment litigation exposure and will enable AMA to assess a potential global resolution of all pending employment-related claims.

In light of these considerations, AMA anticipates that mediation of the Aldrich matter could occur in late 2023, potentially in conjunction with mediation of the Fuentes class action. A combined or coordinated mediation could promote a global resolution of all pending employment litigation involving AMA, reduce costs for all parties, and allow the mediator to consider the full scope of claims and potential exposure in a single proceeding. AMA believes this approach would be efficient and beneficial to the parties and to the Court.

AMA proposes Hon. Patricia Okoro (Ret.) of Westpark Dispute Resolution Inc., located at 1925 Century Park East, Suite 1700, Los Angeles, CA 90067, as mediator for the Aldrich matter and, potentially, for the coordinated mediation. Hon. Okoro is a retired Judge of the Los Angeles Superior Court, having served on the bench for over 25 years. She brings extensive experience in mediating complex employment disputes, including cases involving trade secret misappropriation, breach of fiduciary duty, and wage-and-hour class actions. AMA has discussed the potential selection of Hon. Okoro with Plaintiff's counsel, Cameron Whitfield of Whitfield & Associates, who has indicated his preliminary agreement to the selection, subject to further discussion of scheduling and logistics.

IV. Request for Further Status Conference

AMA respectfully requests that the Court set a further status conference for July 2023 to address the following matters:

• The status of discovery, including the outcome of the pending Motion to Compel Further Responses and any additional discovery disputes that may arise in the interim;

• The scheduling of mediation and the selection of a mediator; and

• Any other matters the Court deems appropriate to address at that time.

A July status conference would allow the parties to report on the completion of the Aldrich deposition, the resolution of the Motion to Compel, and any developments in the Fuentes class action that may bear on the timing and structure of mediation. AMA is prepared to submit a joint status conference statement in advance of such a conference, in coordination with Plaintiff's counsel, if the Court so directs.

AMA appreciates the Court's attention to these matters and remains committed to the efficient and orderly resolution of this action. Should the Court require any additional information or wish to address any of these issues on a different timeline, AMA is available at the Court's convenience.

Respectfully submitted,

CALDERWOOD & HARKNESS LLP

By: ________

Devon Archer (SBN 301462) Senior Associate Attorneys for Defendant and Cross-Complainant Aurelius Media Americas Inc.

cc: Cameron Whitfield, Esq.

Whitfield & Associates 9465 Wilshire Boulevard, Suite 320 Beverly Hills, CA 90212

CALDERWOOD & HARKNESS LLP 777 South Flower Street, Suite 4200 Los Angeles, California 90017 Telephone: (213) 688-7400 Facsimile: (213) 688-7401 www.calderwoodharkness.com
May 5, 2023
VIA HAND DELIVERY
Hon. Catherine Villanueva Department 52 Superior Court of the State of California County of Los Angeles — Central District 111 N. Hill Street Los Angeles, CA 90012
Re: Aldrich v. Aurelius Media Americas Inc., Case No. 22STCV41087 — Status of Cross-Claims and Mediation Scheduling
Dear Judge Villanueva:
I write on behalf of Defendant and Cross-Complainant Aurelius Media Americas Inc. ("AMA"), which is represented by Calderwood & Harkness LLP in the above-referenced matter, to respectfully provide the Court with a status update regarding the cross-claims asserted by AMA, the current posture of discovery, and the parties' discussions concerning mediation scheduling. This letter is submitted in advance of any further status conference the Court may wish to set, and is intended to assist the Court in its management of this action going forward.
I. Cross-Claims and discovery Status
A. Amended Cross-Complaint
AMA filed its original Cross-Complaint on January 20, 2023, asserting four causes of action against Plaintiff Gavin Aldrich ("Aldrich" or "Plaintiff"): (1) Breach of Employment Agreement, specifically the confidentiality provisions set forth in Section 9.4 of the parties' Employment Agreement dated March 15, 2021 (the "Agreement"); (2) Misappropriation of Trade Secrets under the California Uniform Trade Secrets Act, California Civil Code Section 3426 et seq. ("CUTSA"); (3) Breach of Fiduciary Duty; and (4) Conversion. These claims arise out of Aldrich's conduct during and after his employment with AMA, including, among other things, his unauthorized transmission of proprietary and confidential AMA materials to personal email accounts and to third parties.
Following the Court's March 22, 2023 Order granting in part and denying in part Plaintiff's Motion to Strike portions of the original Cross-Complaint, AMA filed an Amended Cross-Complaint on April 5, 2023. In accordance with the Court's ruling, the Amended Cross-Complaint removed the non-competition clause (Section 9.1 of the Agreement) from the caption of the First Cause of Action for Breach of Employment Agreement. The amendment further clarified that AMA does not seek to enforce Section 9.1, the non-competition provision, against Aldrich in this action. AMA, however, retained references to the broader restrictive covenant framework contained in the Agreement as factual context for the remaining claims — specifically, the confidentiality obligations under Section 9.4, the trade secret misappropriation claims under CUTSA, and the breach of fiduciary duty claim. These references are necessary to provide the Court and the parties with a complete understanding of the contractual relationship between AMA and Aldrich, and the scope of Aldrich's obligations to AMA during and after his employment.
The Amended Cross-Complaint otherwise maintains all four causes of action as originally pleaded, and no further challenge to the pleadings has been filed by Plaintiff.
B. Discovery Status
Discovery is proceeding in accordance with the case management schedule established by the Court. The parties have been engaged in active written discovery, as described below.
AMA served its First Set of Requests for Production of Documents (Request Nos. 1 through 28) and its First Set of Special Interrogatories (Interrogatory Nos. 1 through 30) on Plaintiff Aldrich on February 20, 2023. Plaintiff's responses to these discovery requests were received on March 30, 2023. AMA is continuing to review and assess the sufficiency of those responses, and, as discussed further in Section I.C below, has identified certain deficiencies that are the subject of a pending motion.
Plaintiff Aldrich, for his part, served his First Set of Requests for Production of Documents (Request Nos. 1 through 30) and First Set of Special Interrogatories (Interrogatory Nos. 1 through 25) on AMA. AMA served its responses to Plaintiff's discovery requests on March 3, 2023. AMA believes its responses were timely and substantively complete. No motion to compel further responses from AMA has been filed by Plaintiff to date.
C. Pending Motion to Compel
AMA has filed a Motion to Compel Further Responses from Plaintiff regarding Requests for Production Nos. 8, 11, 12, 13, and 14. These requests are central to AMA's cross-claims and seek, among other things, communications between Aldrich and Halcyon Creek Productions LLC ("Halcyon Creek"), a California-based production company, as well as documents transmitted by Aldrich from AMA's internal systems to personal email accounts and to third parties during and after his employment with AMA. Plaintiff's responses to these requests were, in AMA's view, evasive, incomplete, and improperly limited by overbroad objections that do not withstand scrutiny under applicable law.
The Motion to Compel is currently set for hearing on May 19, 2023, before this Court. AMA's motion is supported by the Declaration of Nadia Petrov, an associate at Calderwood & Harkness LLP, filed on April 14, 2023, which documents in detail the extensive meet-and-confer efforts undertaken by AMA's counsel with Plaintiff's counsel, Julia Nazarian of Whitfield & Associates, prior to the filing of the motion. Despite multiple telephonic and written communications, the parties were unable to resolve the discovery dispute informally, necessitating Court intervention.
AMA respectfully submits that the documents and communications sought through these requests are directly relevant to AMA's trade secret misappropriation and breach of confidentiality claims, and are essential to AMA's ability to assess the full scope of Aldrich's unauthorized disclosures. AMA will present its arguments on the merits at the scheduled hearing.
D. Deposition of Gavin Aldrich
AMA has noticed the deposition of Gavin Aldrich for May 22, 2023. The Notice of Deposition was served on Plaintiff's counsel on April 25, 2023. The deposition will cover the following topics, among others: Aldrich's employment with AMA, including his duties, responsibilities, and access to confidential and proprietary information; the circumstances surrounding his termination from AMA; his relationship with Halcyon Creek Productions LLC and its principal, Nina Castellanos, both during and after his employment with AMA; the email transmissions of proprietary AMA materials from AMA systems to personal accounts and to third parties; Aldrich's restrictive covenant obligations under the Agreement; and the factual basis for his damages claims asserted in the Complaint. AMA anticipates the deposition will require a full day and may need to continue to a second session depending on the scope and complexity of the testimony.
II. Related Class Action
AMA brings to the Court's attention a related action pending in this courthouse: Fuentes v. Aurelius Media Americas Inc., Case No. 22STCV38214, which has been consolidated with Case No. 22STCV39501 and is assigned to Hon. Raymond Escobedo, Department 34. The Fuentes class action involves materially different legal theories and facts from the Aldrich matter presently before this Court. Specifically, the class action asserts wage-and-hour claims on behalf of approximately 1,850 non-exempt, hourly employees of AMA, alleging violations of overtime, meal and rest break, and wage statement provisions of the California Labor Code. The Fuentes action does not involve claims of trade secret misappropriation, breach of fiduciary duty, or any of the other claims at issue in the present case.
For these reasons, AMA does not believe that consolidation of the Aldrich matter with the Fuentes class action is appropriate, and AMA has not sought such relief. The two cases involve distinct plaintiffs, distinct legal theories, and distinct underlying facts, and consolidation would not promote judicial efficiency but would instead risk confusion and delay in both proceedings.
AMA provides this information to the Court because the Fuentes class action is relevant to AMA's mediation proposal, as discussed in Section III below. The class certification motion in the Fuentes action was filed on April 14, 2023, with AMA's opposition due on June 16, 2023, and a hearing currently scheduled for July 28, 2023. AMA anticipates that the class action will proceed through the certification briefing process and, depending on the outcome of the certification motion, will move to mediation in the late summer or early fall of 2023.
III. Mediation Proposal
The parties are amenable to mediation of the Aldrich dispute. Counsel for AMA and counsel for Plaintiff have discussed mediation in general terms and agree that it is a productive avenue for resolution of this matter. AMA, however, respectfully proposes that mediation be scheduled after the completion of the following milestones, which AMA believes are necessary to ensure that mediation is conducted efficiently and with sufficient information to enable meaningful settlement discussions:
1. Completion of the deposition of Gavin Aldrich, which is currently noticed for May 22, 2023. The Aldrich deposition is critical to AMA's evaluation of the case, as it will provide direct testimony on the key factual disputes underlying both Plaintiff's claims and AMA's cross-claims.
2. Resolution of the pending Motion to Compel Further Responses (hearing scheduled for May 19, 2023). The outcome of this motion will determine whether AMA obtains documents and communications that are central to its claims and that will materially affect AMA's assessment of the case for purposes of settlement discussions.
3. Progress toward resolution of the related class action, Fuentes v. Aurelius Media Americas Inc., Case No. 22STCV38214. As discussed in Section II above, AMA anticipates that the class certification briefing and hearing will be completed by mid- to late summer 2023. The resolution or advancement of the class action will bear on the broader landscape of AMA's employment litigation exposure and will enable AMA to assess a potential global resolution of all pending employment-related claims.
In light of these considerations, AMA anticipates that mediation of the Aldrich matter could occur in late 2023, potentially in conjunction with mediation of the Fuentes class action. A combined or coordinated mediation could promote a global resolution of all pending employment litigation involving AMA, reduce costs for all parties, and allow the mediator to consider the full scope of claims and potential exposure in a single proceeding. AMA believes this approach would be efficient and beneficial to the parties and to the Court.
AMA proposes Hon. Patricia Okoro (Ret.) of Westpark Dispute Resolution Inc., located at 1925 Century Park East, Suite 1700, Los Angeles, CA 90067, as mediator for the Aldrich matter and, potentially, for the coordinated mediation. Hon. Okoro is a retired Judge of the Los Angeles Superior Court, having served on the bench for over 25 years. She brings extensive experience in mediating complex employment disputes, including cases involving trade secret misappropriation, breach of fiduciary duty, and wage-and-hour class actions. AMA has discussed the potential selection of Hon. Okoro with Plaintiff's counsel, Cameron Whitfield of Whitfield & Associates, who has indicated his preliminary agreement to the selection, subject to further discussion of scheduling and logistics.
IV. Request for Further Status Conference
AMA respectfully requests that the Court set a further status conference for July 2023 to address the following matters:
• The status of discovery, including the outcome of the pending Motion to Compel Further Responses and any additional discovery disputes that may arise in the interim;
• The scheduling of mediation and the selection of a mediator; and
• Any other matters the Court deems appropriate to address at that time.
A July status conference would allow the parties to report on the completion of the Aldrich deposition, the resolution of the Motion to Compel, and any developments in the Fuentes class action that may bear on the timing and structure of mediation. AMA is prepared to submit a joint status conference statement in advance of such a conference, in coordination with Plaintiff's counsel, if the Court so directs.
AMA appreciates the Court's attention to these matters and remains committed to the efficient and orderly resolution of this action. Should the Court require any additional information or wish to address any of these issues on a different timeline, AMA is available at the Court's convenience.
Respectfully submitted,
CALDERWOOD & HARKNESS LLP
By: ________
Devon Archer (SBN 301462) Senior Associate Attorneys for Defendant and Cross-Complainant Aurelius Media Americas Inc.
cc: Cameron Whitfield, Esq.
Whitfield & Associates 9465 Wilshire Boulevard, Suite 320 Beverly Hills, CA 90212

VIA HAND DELIVERY

CALDERWOOD & HARKNESS LLP

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