deposition-summary-farnham.docx

1018-00007 · Penterra Pharmaceuticals Corp · Discovery

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CALDERWOOD & HARKNESS LLP INTEROFFICE MEMORANDUM

October 22, 2021

TO: Linda Osei, Responsible Partner Priya Anand, Billing Partner

FROM: Hannah Brinkley, Lead Associate

RE: Deposition Summary — Donald R. Farnham, Managing Member & CEO, Vantage Medical Distribution, LLC

MATTER: Penterra Pharmaceuticals Corp. v. Vantage Medical Distribution, LLC, Docket No. 2184-CV-01537-BLS (Massachusetts Superior Court, Business Litigation Session, Suffolk County)

C&H MATTER NO.: 1018-00007

CLIENT: Penterra Pharmaceuticals Corp.

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I. Introduction and Deposition Overview

This memorandum summarizes the deposition testimony of Donald R. Farnham, the Managing Member and Chief Executive Officer of Vantage Medical Distribution, LLC ("Vantage"), taken on Monday, October 18, 2021. The deposition was conducted at the offices of Calderwood & Harkness LLP, 1 Federal Street, 35th Floor, Boston, Massachusetts 02110, pursuant to a notice of deposition served on Vantage's counsel on September 17, 2021.

The deposition commenced at approximately 9:30 a.m. and concluded at approximately 4:45 p.m. Several breaks were taken during the day, including a morning recess, a lunch break of approximately one hour, and two brief afternoon recesses requested by opposing counsel.

Examination of the witness was conducted by the undersigned, Hannah Brinkley, on behalf of Penterra Pharmaceuticals Corp. ("Penterra"). Patrick Gallagher, also of Calderwood & Harkness LLP, attended and assisted throughout the deposition. Mr. Farnham was represented by Kenneth M. Rourke and Alicia Fontaine of Hargrove, Sinclair & Polk LLP ("HSP"), 200 Ashbury Asset Advisors, Suite 1800, Boston, Massachusetts 02109. Both Mr. Rourke and Ms. Fontaine were present for the entirety of the proceeding. No objections were made to the form of the deposition or the scope of the notice, though Mr. Rourke interposed several objections on the record as to the form of specific questions, as noted below where relevant.

A certified court reporter was present and recorded the proceeding stenographically. A certified transcript is expected within approximately ten business days, and receipt should be calendared for follow-up. Upon receipt, the transcript should be reviewed promptly and compared against this summary for accuracy.

Mr. Farnham testified under oath regarding the following principal topics: (a) his role as founder, Managing Member, and CEO of Vantage; (b) the negotiation, execution, and his understanding of the terms of the Exclusive Distribution Agreement dated July 1, 2017, between Penterra and Vantage (the "EDA"); (c) the scope and meaning of the Territory as defined in Exhibit A to the EDA; (d) the January 12, 2018 email from Steven Kapoor to Mr. Farnham, which Vantage contends authorized distribution in New York, New Jersey, and Pennsylvania; (e) Vantage's commencement of shipments of Penterra products into the tri-state area beginning on or about September 14, 2020; (f) Vantage's alleged course-of-dealing defense and theory of acquiescence by Penterra; (g) the basis for Vantage's $35 million counterclaim; and (h) Mr. Farnham's knowledge of Penterra's negotiations with Meridian National Distributors, Inc. ("Meridian").

As detailed throughout this memorandum, Mr. Farnham made several critical admissions that are favorable to Penterra's position and should feature prominently in the summary judgment materials anticipated for filing on or about February 11, 2022.

II. Summary of Key Testimony — Background and Role

Mr. Farnham confirmed on the record that he is the sole founder, Managing Member, and Chief Executive Officer of Vantage Medical Distribution, LLC, a Massachusetts limited liability company with its principal place of business at 75 Cabot Road, Suite 310, Medford, Massachusetts 02155. He testified that he founded Vantage in 2009.

Prior to founding Vantage, Farnham testified that he spent approximately twelve years as an executive at a national pharmaceutical wholesaler, the name of which he identified as "Cardinal Logistics Health" or a similar entity. In that capacity, he gained experience in pharmaceutical distribution, supply chain management, regulatory compliance, and customer-relationship development within the hospital and institutional pharmacy channels. He testified that he left this position to start Vantage because he identified an opportunity to create a regional specialty pharmaceutical distributor focused specifically on hospital-based and clinic-based oncology and immunology products in the northeastern United States.

Farnham testified that Vantage's business model is built around providing high-touch distribution services to hospitals, outpatient oncology clinics, and specialty pharmacies that administer complex, often temperature-sensitive oncology and immunology therapies. He stated that Vantage differentiates itself from larger national distributors through dedicated account management, flexible delivery scheduling, and deep familiarity with the clinical protocols of its customer base.

With respect to Vantage's financial performance, Farnham confirmed that Vantage's total revenue in fiscal year 2021 was approximately $148 million. He further confirmed that Penterra products, principally Oncalaris® (pegvisomant-axel), accounted for approximately $67 million of that total, representing approximately 45.3% of Vantage's total revenue. This figure underscores the commercial significance of the Penterra relationship to Vantage's business operations and provides important context for Vantage's aggressive posture in this litigation.

Regarding the negotiation of the EDA, Farnham testified that he personally led negotiations on behalf of Vantage. He identified his principal counterparts at Penterra as Steven Kapoor, who at the time held the title of Vice President, Commercial Operations, and Rachel Mendez, who served as Director of Distribution & Logistics. Farnham testified that negotiations took place over a period of approximately four to five months prior to execution, primarily through in-person meetings in Boston and at Penterra's offices in Princeton, New Jersey, supplemented by telephone conferences and email exchanges. He described the negotiations as "collaborative" and stated that he and Kapoor developed a "strong working relationship" during this period.

Farnham acknowledged that he signed the EDA on behalf of Vantage and confirmed that no other individual at Vantage had the authority to execute or amend the EDA. This admission is significant because it establishes that Farnham was the sole decision-maker with respect to the agreement, and any failure to obtain required written amendments or consents is attributable to him directly.

Farnham identified his principal direct reports as Lisa Petrangelo, who serves as Vantage's Chief Operating Officer, and Brian Kopec, who serves as Outside Sales Director. Farnham confirmed that both Petrangelo and Kopec report directly to him and that significant business decisions, including decisions regarding geographic expansion and new customer relationships, require his approval.

III. Summary of Key Testimony — Understanding of the Exclusive Distribution Agreement

A. Execution and Terms of the EDA

Mr. Farnham confirmed that the Exclusive Distribution Agreement was executed effective July 1, 2017, between Penterra Pharmaceuticals Corp., identified in the agreement as "Supplier," and Vantage Medical Distribution, LLC, identified as "Distributor." The EDA was marked as Exhibit 1 to the deposition, and Farnham confirmed the authenticity of his signature on the execution page.

Farnham testified as to the principal commercial terms of the EDA. The Products covered by the agreement are (a) Oncalaris® (pegvisomant-axel), available in 20 mg and 40 mg vials, and (b) Renuvesta® (cilosporin-beta), available in 5 mg capsules. Farnham acknowledged that the vast majority of Vantage's revenue from Penterra products is attributable to Oncalaris®, which is a high-cost oncology therapeutic with significant demand in the hospital and clinic setting.

The initial term of the EDA is five years, commencing July 1, 2017, and expiring June 30, 2022. The agreement provides for two successive one-year auto-renewal options, such that the agreement would automatically renew unless either party provided 180 days' written notice of non-renewal prior to the end of the then-current term. As of the date of the deposition, neither party had issued such a non-renewal notice, though Farnham acknowledged that the parties' dispute could affect the renewal process.

Under Section 5.2 of the EDA, Vantage committed to a minimum annual purchase commitment of $9.5 million per year at wholesale acquisition cost ("WAC") for Oncalaris®. Farnham confirmed that this minimum purchase obligation was a material inducement for Penterra to enter into the agreement and that failure to meet the minimum could trigger a termination right under the EDA.

Farnham was questioned in detail about Vantage's actual purchase volumes relative to the minimum. He confirmed that Vantage consistently and substantially exceeded the minimum annual purchase commitment. Specifically, he testified as follows:

• FY 2018 (July 2017–June 2018): Approximately $11.2 million in Oncalaris® purchases at WAC.

• FY 2019 (July 2018–June 2019): Approximately $14.8 million in Oncalaris® purchases at WAC.

• FY 2020 (July 2019–June 2020): Approximately $18.3 million in Oncalaris® purchases at WAC.

• FY 2021 (through March 2021): Approximately $16.1 million in Oncalaris® purchases at WAC for the first nine months of the fiscal year, which annualizes to approximately $21.47 million.

Farnham emphasized Vantage's track record of exceeding the minimum, characterizing it as evidence of Vantage's strong performance as a distribution partner. While this testimony demonstrates Vantage's commercial success in the New England territory, it does not bear directly on the question of whether the EDA was amended to expand the Territory to include the tri-state area.

B. Exhibit A — Territory Definition

Mr. Farnham was shown the executed EDA, including Exhibit A, which is the document that defines the geographic scope of Vantage's distribution rights. Exhibit A was separately marked as Exhibit 2 to the deposition for ease of reference.

Exhibit A provides the following Territory definition:

"The states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont (collectively, the 'New England States')."

Farnham confirmed that the language quoted above is the complete text of the Territory definition in Exhibit A as executed. He acknowledged that Exhibit A contains no additional language qualifying, expanding, or modifying the definition of the Territory beyond the six enumerated New England states.

Key Admission: When asked directly whether the text of Exhibit A as executed lists only the six New England states and does not reference New York, New Jersey, or Pennsylvania, Farnham answered affirmatively. This admission is unequivocal and should be cited in Penterra's summary judgment brief as establishing that, on the face of the agreement, Vantage had no contractual right to distribute Penterra products in the tri-state area.

Farnham was then asked whether he understood, at the time he signed the EDA on July 1, 2017, that the Territory was limited to the six New England states identified in Exhibit A. His response was qualified. Farnham stated that he understood the "initial territory" was the six New England states, but that he "believed the parties had a mutual understanding that expansion to the tri-state area would follow." He characterized the Territory definition as a "starting point" rather than a "fixed boundary," and testified that he entered into the EDA with the expectation that the territorial scope would be broadened as Vantage demonstrated its distribution capabilities.

On redirect examination conducted by Mr. Rourke, Farnham attempted to elaborate on this point and stated that the Territory was "intended to grow" based on discussions between himself and Mr. Kapoor during the negotiation phase. However, critically, Farnham could not point to any language in Exhibit A itself that reflected this alleged understanding. He was unable to identify any provision in the EDA — whether in Exhibit A, in the body of the agreement, or in any side letter or ancillary document — that contemplated automatic or conditional expansion of the Territory. This inability to identify contractual support for his position significantly undermines Vantage's claim that the Territory was understood to include the tri-state area.

C. Section 2.3 — Limitation on Distribution Outside the Territory

Mr. Farnham was read Section 2.3 of the EDA, which provides:

"Distributor shall not actively solicit orders for, or deliver, the Products outside the Territory without Supplier's prior written consent."

Farnham acknowledged that he was aware of this provision at the time he signed the EDA and that he understood it to impose a restriction on Vantage's ability to distribute Penterra products outside of the six New England states defined in Exhibit A. He agreed that Section 2.3 requires "prior written consent" from the Supplier (Penterra) before any out-of-territory distribution activity.

Key Admission: Mr. Farnham admitted that he did not obtain a signed, formal written consent from any Penterra officer — whether Mr. Kapoor, Ms. Mendez, Jennifer Chao (General Counsel), or any other individual — authorizing Vantage to distribute Oncalaris® or Renuvesta® in New York, New Jersey, or Pennsylvania prior to commencing tri-state shipments on or about September 14, 2020. When asked whether he had any document that could fairly be characterized as "prior written consent" from Penterra, Farnham's only reference was the January 12, 2018 email from Mr. Kapoor, discussed in detail in Section IV below.

D. Section 13.1 — Amendments Requirement

Mr. Farnham was shown Section 13.1 of the EDA, which provides:

"No amendment, modification, or waiver of any provision of this Agreement shall be effective unless set forth in a written instrument signed by both parties."

Farnham confirmed that he was aware of this provision. He acknowledged that Section 13.1 requires that any amendment to the EDA — including any amendment to the Territory definition set forth in Exhibit A — must be memorialized in a written instrument signed by both Penterra and Vantage.

Key Admission: Farnham admitted that he did not obtain a signed amendment to Exhibit A expanding the Territory to include New York, New Jersey, or Pennsylvania. He acknowledged that no document exists that bears the signatures of both a Penterra representative and a Vantage representative and that purports to modify the Territory definition.

When pressed on this point, Farnham offered two alternative theories in justification of Vantage's conduct. First, he stated that he believed the January 12, 2018 email from Steven Kapoor was sufficient to constitute the required "written consent" referenced in Section 2.3, even if it did not satisfy the formal amendment requirement of Section 13.1. Second, he stated that he believed the parties' "course of dealing" over the life of the agreement effectively superseded the formal amendment requirement. Neither of these theories was supported by documentary evidence or specific factual detail during the deposition.

E. Section 14.8 — Integration Clause

Mr. Farnham was shown Section 14.8 of the EDA, the agreement's integration clause, which provides:

"This Agreement, including all Exhibits, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations, representations, or agreements relating thereto, whether written or oral."

Farnham acknowledged that this clause exists in the EDA and that he was aware of it. He testified, however, that he did not believe the integration clause prevented the parties from modifying the agreement through their subsequent conduct. Specifically, he stated: "I understood this clause as being about what happened before the agreement was signed. I didn't think it prevented us from adapting and evolving the deal after we started working together."

When pressed on whether he could identify any legal authority, contractual provision, or factual basis for that interpretation, Farnham was unable to do so. He conceded that he is not a lawyer and that his understanding of the integration clause was based on his own "business judgment." He deferred further legal analysis to his counsel. This testimony is notable because it reflects Farnham's acknowledgment that the contractual formalities contained in the EDA were not followed, while simultaneously offering a legal conclusion — that course of dealing can override a fully integrated written agreement — for which he has no factual or legal foundation.

IV. Summary of Key Testimony — The January 12, 2018 Kapoor Email

A substantial portion of the deposition was devoted to questioning Mr. Farnham about the January 12, 2018 email from Steven Kapoor to Donald Farnham, which was marked as Exhibit 7 to the deposition. This email is the central document in Vantage's defense and is the only written communication that Farnham could identify as supporting his claim that Penterra authorized distribution in the tri-state area. The full text of the email, as displayed on the record, reads as follows:

"Don — good catching up yesterday. We're definitely open to exploring expansion into NY/NJ/PA once your New England footprint is fully ramped. Let's circle back mid-year and see where things stand."

Farnham testified that he received this email on or about January 12, 2018, and that it was the primary basis for his belief that Penterra had authorized Vantage to distribute Oncalaris® and Renuvesta® in New York, New Jersey, and Pennsylvania. He characterized the email as a "green light" from Mr. Kapoor, explaining: "When Steve said they were 'definitely open,' I took that as a strong signal that expansion was coming and that we should start planning accordingly."

Farnham confirmed that the email was sent by Mr. Kapoor in his capacity as Vice President, Commercial Operations at Penterra. Farnham acknowledged that the email was sent approximately six months after the EDA was executed and approximately two years and eight months before Vantage commenced systematic tri-state shipments.

On detailed questioning, Farnham made the following admissions regarding the Kapoor Email:

1. Exploratory Language. Farnham acknowledged that the email uses the phrase "open to exploring expansion" rather than language granting consent, authorization, or approval. When asked whether "open to exploring" is the same as "authorized to proceed," Farnham conceded that the two phrases "have different meanings" but maintained that, in context, the email conveyed Penterra's intent to support expansion.

2. Condition Precedent. Farnham acknowledged that the email conditions any expansion on Vantage's New England footprint being "fully ramped." When asked what "fully ramped" meant and whether that condition had been satisfied as of any particular date, Farnham's answer was vague. He testified that he believed Vantage's New England operations were "substantially ramped" by mid-2019 but could not identify a specific date or metric by which "fully ramped" status was achieved or communicated to Penterra.

3. Further Discussion Required. Farnham acknowledged that the email's instruction to "circle back mid-year and see where things stand" suggested that further discussion and evaluation were needed before any expansion could proceed. He agreed that the phrase "see where things stand" implies that a decision had not yet been made.

4. No Express Written Authorization. Key Admission: Farnham acknowledged that no Penterra officer expressly authorized tri-state shipments in writing — neither in the Kapoor Email nor in any other document that Farnham could identify during the deposition. When asked point-blank, "Can you identify any document in which a Penterra representative states, in substance, 'Vantage is authorized to distribute Penterra products in New York, New Jersey, or Pennsylvania'?", Farnham answered, "Not in those specific words, no."

5. Failure to Follow Up. Farnham admitted that he did not "circle back" with Mr. Kapoor at mid-year 2018 — or at any subsequent time — to formalize the expansion that the Kapoor Email contemplated. He testified that "things got busy" and that the follow-up "fell through the cracks." This admission is significant because it demonstrates that even the preliminary steps contemplated by the Kapoor Email were never completed.

6. No Written Follow-Up. Farnham confirmed that there is no written follow-up to the Kapoor Email — from either party — in which Penterra confirmed authorization for tri-state distribution. He could not produce any responsive email, letter, memorandum, or other document reflecting that the mid-year check-in proposed by Mr. Kapoor ever occurred or that any determination was made that Vantage's New England footprint was "fully ramped."

7. Section 13.1 Compliance. When asked whether the Kapoor Email constituted the "written instrument signed by both parties" required under Section 13.1 for any amendment to the EDA, Farnham conceded that the email was signed (or sent) only by Mr. Kapoor on behalf of Penterra and was not countersigned or otherwise acknowledged in writing by Vantage. He further conceded that the email is not styled as a contract amendment, does not reference the EDA by name or date, does not reference Exhibit A, and does not purport to modify the Territory definition.

In sum, Farnham's testimony regarding the Kapoor Email, while presented with conviction, actually reinforces Penterra's position. The email is, at best, an expression of willingness to consider future expansion under conditions that were never formalized or confirmed. It falls far short of the "prior written consent" required by Section 2.3 and does not satisfy the amendment requirements of Section 13.1. These admissions should be highlighted prominently in Penterra's motion for summary judgment.

V. Summary of Key Testimony — Commencement of Tri-State Shipments

Mr. Farnham confirmed that Vantage began shipping Oncalaris® to hospitals and oncology clinics in New York, New Jersey, and Pennsylvania on or about September 14, 2020. He identified this date based on Vantage's internal records and testimony from his recollection. He acknowledged that these shipments were the first systematic, large-scale distribution of Penterra products by Vantage in the tri-state area.

Farnham was asked to explain the delay of more than two and a half years between the January 12, 2018 Kapoor Email and the commencement of tri-state shipments in September 2020. He explained that Vantage needed time to "build out its New England operations first," consistent with the Kapoor Email's reference to Vantage's New England footprint being "fully ramped." He testified that Vantage spent the intervening period strengthening its customer relationships, improving its logistics and warehousing capabilities, and increasing its New England revenue. He acknowledged that the COVID-19 pandemic, which began affecting operations in early 2020, also played a role in the timing, though he was not entirely clear on whether the pandemic accelerated or delayed Vantage's decision to enter the tri-state market.

When asked what specifically triggered the decision to begin tri-state shipments in September 2020 as opposed to any other date, Farnham testified that Brian Kopec, Vantage's Outside Sales Director, had developed customer relationships in the tri-state area — particularly with several large hospital systems and outpatient oncology clinics in the New York metropolitan area — and that market demand justified expansion at that time. Farnham stated that Kopec presented a business case to him, and that he (Farnham) made the decision to begin shipments.

Key Admission: Farnham acknowledged that Vantage did not notify Penterra in writing before commencing tri-state shipments on or about September 14, 2020. He did not send a letter, email, or other written communication to Mr. Kapoor, Ms. Mendez, or any other Penterra representative informing them that Vantage intended to begin or had begun distributing Oncalaris® outside the six New England states.

When asked whether Penterra was aware of the tri-state shipments, Farnham testified that he "believed" Penterra was "aware" based on "informal conversations" and the general flow of business. However, he could not identify a specific written communication — email, letter, text message, or otherwise — in which he informed Penterra that Vantage was distributing Penterra products in New York, New Jersey, or Pennsylvania. He could not recall the date, substance, or participants in any of the alleged informal conversations. He stated: "I assumed they knew because they could see the order patterns," but acknowledged on further questioning that he did not know whether Penterra's systems would have flagged delivery addresses outside New England as anomalous.

Farnham confirmed that Vantage's tri-state revenues from approximately September 2020 through March 2021 — a period of approximately six months — totaled approximately $6.4 million. He acknowledged that this figure represented a meaningful portion of Vantage's total Penterra revenue during that period and that the tri-state operations had been growing.

VI. Summary of Key Testimony — Course of Dealing / Alleged Acquiescence

Mr. Farnham devoted significant testimony to what he characterized as Penterra's acquiescence in and tacit approval of Vantage's tri-state distribution activities. This theory — that Penterra's failure to object to Vantage's shipments constituted a modification of the Territory by course of dealing — is central to Vantage's defense and counterclaim.

Farnham initially asserted that Penterra's failure to object to Vantage's shipments to New York beginning in "late 2019" demonstrated that Penterra was aware of and acquiesced in the expansion. This timeline, however, was inconsistent with his other testimony and with the documentary record.

On examination, Farnham's timeline proved unreliable. He initially referenced "late 2019" shipments to New York, suggesting that Vantage had begun distributing in the tri-state area well before September 2020. However, when pressed for specifics, he acknowledged that the systematic tri-state shipments began on or about September 14, 2020. When asked to reconcile his reference to "late 2019" shipments with his earlier testimony that systematic shipments began in September 2020, Farnham stated that there may have been "a few preliminary or test shipments" to a small number of New York customers in late 2019, but he could not provide specifics.

When asked to produce documentation of the "late 2019" New York shipments — such as invoices, shipping records, bills of lading, or customer orders — Farnham could not identify any such documents during the deposition. He stated that he would need to defer to Vantage's sales records and that Lisa Petrangelo (COO) or Brian Kopec (Outside Sales Director) might have more detailed information. This is a significant area for follow-up in discovery and in the upcoming depositions of Kopec and Petrangelo.

Farnham acknowledged that the first formal communication he received from Penterra regarding the tri-state issue was the March 8, 2021 cease-and-desist letter from Jennifer Chao, Penterra's General Counsel (marked as Exhibit 9 to the deposition). The cease-and-desist letter demanded that Vantage immediately cease distributing Oncalaris® and all other Penterra products outside the six New England states identified in Exhibit A to the EDA. Farnham confirmed he received this letter and understood its contents.

Key Admission: Farnham admitted that the period between September 14, 2020 (the commencement of systematic tri-state shipments) and March 8, 2021 (the date of the cease-and-desist letter) was approximately six months. When asked whether he considered six months to be a long or short period for purposes of a course-of-dealing argument, Farnham acknowledged that it was "a relatively short window" but maintained that Penterra should have objected sooner if it disagreed with the expansion.

On redirect examination, Mr. Rourke attempted to elicit testimony about informal conversations between Farnham and Mr. Kapoor and Ms. Mendez that allegedly signaled Penterra's awareness and approval of the tri-state distribution. Farnham testified that he had "multiple conversations" with Kapoor and Mendez over the years in which the topic of tri-state expansion came up and in which he perceived "positive signals." However, Farnham could not provide the dates of these conversations, the specific substance discussed, or any corroborating documents such as notes, follow-up emails, calendar entries, or memoranda. His testimony on this point was entirely conclusory and unsupported by the documentary record.

The course-of-dealing defense is substantially weakened by the following factors established in the deposition: (a) Farnham's inability to document any pre-September 2020 shipments to the tri-state area; (b) the relatively short six-month window of alleged acquiescence; (c) the absence of any written evidence that Penterra knew about or consented to the tri-state shipments; and (d) Farnham's inability to provide any specific details about the alleged informal conversations.

VII. Summary of Key Testimony — Vantage's Response and Counterclaim Damages

Farnham confirmed that upon receiving the March 8, 2021 cease-and-desist letter from Penterra's General Counsel, Vantage retained Hargrove, Sinclair & Polk LLP to represent it in the dispute. He identified Kenneth M. Rourke as the lead attorney responsible for the matter.

Mr. Rourke, on behalf of Vantage, sent a response letter dated March 22, 2021, addressed to Jennifer Chao at Penterra (marked as Exhibit 10 to the deposition). Farnham confirmed that he reviewed and approved the letter before it was sent. The letter asserted Vantage's right to distribute Penterra products in the tri-state area based on the Kapoor Email, the parties' course of dealing, and alleged oral representations. The letter also threatened a counterclaim for breach of contract and tortious interference with Vantage's business relationships, quantified at $35 million in damages.

Farnham was questioned in detail about the basis for the $35 million damages figure set forth in the HSP response letter. He testified that the figure was derived from a combination of two categories of damages:

(a) Projected Lost Profits: The estimated profits that Vantage would have earned from distributing Penterra products in New York, New Jersey, and Pennsylvania over the remaining term of the EDA (through June 30, 2022), plus the two one-year auto-renewal periods (through June 30, 2024), assuming the agreement was not terminated or non-renewed.

(b) Reliance Damages: The investments Vantage had made in tri-state infrastructure in reliance on what Farnham characterized as Penterra's authorization of the expansion. These investments allegedly included warehouse space (Farnham referenced a lease for warehousing in northern New Jersey but could not identify the specific address or landlord), additional sales personnel (Farnham referenced "two or three new hires" in the tri-state area but could not name them), and the cost of developing customer relationships in the region.

On examination, Farnham's damages testimony was notably vague and lacked specificity. He could not provide detailed calculations or a breakdown of the $35 million figure. He stated that the damages analysis was developed "in consultation with" Vantage's outside accountants at Cranmer, Hodges & Associates, P.C., a firm based in Medford, Massachusetts, and with his counsel at HSP. He deferred to those professionals for the specifics of the calculation.

Farnham acknowledged that the $6.4 million in actual tri-state revenues earned over approximately six months (September 2020 through March 2021) was the only concrete, documented revenue figure he could point to in support of Vantage's damages claim. He agreed that $6.4 million in six months annualizes to approximately $12.8 million in revenue, but he could not clearly explain how that figure extrapolated to a damages claim of $35 million.

When asked whether the $35 million figure assumed that all tri-state revenue constituted pure profit, Farnham acknowledged that it did not, but he could not articulate Vantage's margin on Penterra products or the assumed profit rate embedded in the damages calculation. He repeatedly deferred to Cranmer, Hodges & Associates for these details.

This testimony is significant because it establishes that as of the date of the deposition, Vantage's $35 million counterclaim damages figure lacks a detailed evidentiary foundation in Farnham's testimony. The damages theory appears to depend heavily on projections and assumptions that have not been substantiated.

VIII. Summary of Key Testimony — Knowledge of Meridian National Distributors, Inc.

Mr. Farnham was asked about his awareness of Penterra's relationship with Meridian National Distributors, Inc. ("Meridian"), a pharmaceutical distribution company with offices at 520 Seventh Avenue, 12th Floor, New York, New York 10018.

Farnham testified that he first learned of Penterra's negotiations with Meridian to distribute Oncalaris® in the tri-state area "around March 2021." He stated that he could not recall the precise source of this information, testifying that he may have learned of it from "industry contacts" or from the contents of the March 8, 2021 cease-and-desist letter itself. He could not definitively confirm which source informed him first.

Penterra executed a term sheet with Meridian on February 15, 2021, approximately three weeks before sending the cease-and-desist letter to Vantage. Farnham was asked whether he was aware of the Meridian term sheet prior to receiving the cease-and-desist letter. He testified that he "might have heard something through the grapevine" but could not confirm definitively whether he had knowledge of the term sheet before the letter arrived.

Farnham characterized Penterra's engagement of Meridian as constituting both a breach of the EDA and tortious interference with Vantage's existing and prospective business relationships in the tri-state area. He testified that Penterra's decision to appoint a competing distributor in a territory that Vantage believed it had the right to serve was "a direct attack on our business" and that it caused significant harm to Vantage's customer relationships and reputation in the marketplace.

When asked whether the EDA, as executed, granted Vantage exclusive distribution rights in New York, New Jersey, or Pennsylvania, Farnham conceded that the text of the EDA and Exhibit A does not. He admitted: "The agreement as written doesn't list those states." However, he reiterated his belief that the Territory had been informally expanded through the Kapoor Email and the parties' course of dealing, and that Penterra's appointment of Meridian was therefore inconsistent with Vantage's rights as he understood them.

This testimony highlights a fundamental weakness in Vantage's tortious interference theory: Farnham cannot point to any contractual provision granting Vantage rights in the tri-state area, and his claim to such rights rests entirely on the informal understandings and course-of-dealing arguments that, as discussed throughout this memorandum, lack documentary support.

IX. Assessment of Farnham's Credibility and Testimony

Overall, Mr. Farnham presented as a knowledgeable and confident witness. He was generally responsive to questions, maintained composure under sustained cross-examination, and demonstrated a thorough understanding of Vantage's business operations, the pharmaceutical distribution industry, and the commercial importance of the Penterra relationship. He was clearly well prepared by his counsel for the deposition.

However, his testimony was materially undermined on several key points that are central to the disputed issues in this case:

1. Reliance on the Kapoor Email. Farnham's characterization of the January 12, 2018 email as a "green light" for tri-state expansion is unsupported by the text of the email itself. As established through his own admissions:

(a) The email uses tentative, exploratory language ("open to exploring expansion") rather than language of authorization or consent;

(b) Farnham conceded that no follow-up discussion or formalization ever occurred, despite the email's express directive to "circle back mid-year";

(d) Farnham acknowledged that no Penterra officer expressly authorized tri-state shipments in writing, whether in the Kapoor Email or in any other document.

2. Course-of-Dealing Argument. Farnham's theory that Penterra acquiesced in the tri-state expansion through its failure to object is undercut by several factors:

(a) Farnham could not provide specifics — including dates, invoice numbers, or customer identities — regarding the alleged "late 2019" shipments to New York that he referenced during the deposition;

(b) The window of alleged acquiescence — approximately six months between September 2020 and March 2021 — is relatively short, particularly for a course-of-dealing modification argument;

(c) There is no written evidence in the record that Penterra was aware of the tri-state shipments prior to the issuance of the cease-and-desist letter;

(d) The informal conversations that Farnham referenced as evidence of Penterra's awareness are entirely uncorroborated by documents, dates, or specifics.

3. Damages Testimony. Farnham's testimony regarding the $35 million counterclaim damages figure was conspicuously vague. He could not provide a breakdown of the calculation, could not articulate the assumptions underlying the figure, and repeatedly deferred to Vantage's outside accountants. The only concrete figure he could point to — $6.4 million in actual tri-state revenues over six months — does not, on its face, support a $35 million claim, and Farnham could not bridge the gap.

4. Integration and Amendment Clauses. Farnham's testimony regarding Section 14.8 (integration clause) and Section 13.1 (amendment requirement) essentially constituted an acknowledgment that the contractual formalities required by the EDA were not followed. His position — that the parties' course of dealing overrode the written agreement — is a legal conclusion for which he provided no factual foundation, and one that is difficult to sustain given the express terms of the contract.

In summary, while Farnham was a competent witness in terms of demeanor, his substantive testimony on the critical disputed issues was consistently weak and supported by admissions that are favorable to Penterra.

X. Key Admissions — Summary for Motion Practice

The following is a consolidated list of Mr. Farnham's critical admissions during the October 18, 2021 deposition, organized for ease of reference in the preparation of Penterra's anticipated motion for summary judgment, currently scheduled for filing on February 11, 2022:

1. Territory Definition. Exhibit A to the EDA lists only the states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont as the Territory. Exhibit A does not include New York, New Jersey, or Pennsylvania. Farnham confirmed this on the record.

2. No Signed Amendment to Exhibit A. Farnham admitted that he did not obtain a signed amendment to Exhibit A expanding the Territory to include New York, New Jersey, or Pennsylvania. No such amendment exists.

3. No Written Instrument Signed by Both Parties. Farnham admitted that he did not obtain any written instrument signed by both Penterra and Vantage amending the EDA in any respect relevant to the Territory definition, as required by Section 13.1 of the agreement.

4. No Express Written Authorization. No Penterra officer expressly authorized Vantage to distribute Penterra products in the tri-state area in writing. Farnham confirmed this and could not identify any document containing such authorization.

5. Kapoor Email — Exploratory Language. The January 12, 2018 email from Steven Kapoor uses the phrase "open to exploring expansion," which Farnham acknowledged is different from an authorization or grant of consent. The email is not styled as a contract amendment, does not reference the EDA by name, and does not reference Exhibit A.

6. No Mid-Year 2018 Follow-Up. Farnham admitted that he did not follow up with Mr. Kapoor at mid-year 2018 or at any subsequent time to formalize the expansion contemplated by the Kapoor Email, despite the email's express instruction to "circle back mid-year."

7. No Written Notice Before Tri-State Shipments. Vantage did not notify Penterra in writing before commencing tri-state shipments on or about September 14, 2020. Farnham confirmed this.

8. No Documentary Evidence of Penterra's Knowledge or Acquiescence. Farnham could not identify specific documentary evidence — including emails, letters, notes, or other writings — establishing that Penterra knew about or acquiesced in Vantage's tri-state distribution activities prior to the March 8, 2021 cease-and-desist letter.

9. Unsupported Damages Figure. The $35 million damages figure asserted in Vantage's counterclaim lacks detailed calculation support in Farnham's deposition testimony. The only concrete revenue figure Farnham could cite was $6.4 million in actual tri-state revenues over approximately six months, and he could not articulate how that figure supported a $35 million claim.

These admissions, taken together, establish that the contractual formalities required for territorial expansion under the EDA were not satisfied and that Vantage's principal justifications — the Kapoor Email and the alleged course of dealing — are factually and legally insufficient.

XI. Recommended Follow-Up Actions

Based on Mr. Farnham's deposition testimony, the following follow-up actions are recommended:

1. Cross-Reference "Late 2019" Shipment Claim. Farnham's reference to "late 2019" shipments to New York should be tested against Vantage's sales and shipping records produced in discovery. Review all invoices, bills of lading, shipping manifests, and customer orders from Vantage's production to determine whether any Penterra product shipments were made to New York, New Jersey, or Pennsylvania before September 14, 2020. If such shipments occurred, determine their scope, frequency, and dollar value. If no such records exist, this further undermines Farnham's credibility and his course-of-dealing argument.

2. Prepare Deposition of Brian Kopec (Scheduled December 7, 2021). Kopec is Vantage's Outside Sales Director and, according to Farnham, the individual who developed the customer relationships in the tri-state area and presented the business case for expansion. His deposition should probe the specific timeline and circumstances of the tri-state sales initiative, including when customer outreach began, which customers were targeted, and what representations (if any) Kopec made to tri-state customers about Vantage's authority to distribute Penterra products. Kopec's testimony should be compared against Farnham's for consistency.

3. Prepare Steven Kapoor (Deposition Scheduled November 2, 2021). Kapoor is the author of the January 12, 2018 email and is the most important witness from Penterra's perspective on the question of what the email was intended to communicate. He should be prepared to testify consistently with Penterra's position — namely, that the email expressed a willingness to explore future expansion but did not constitute written consent to distribute in the tri-state area or an amendment to the EDA. Kapoor should also be prepared to testify about whether he was aware of Vantage's tri-state shipments before the cease-and-desist letter was issued.

4. Prepare Rachel Mendez (Deposition Scheduled November 19, 2021). Mendez, as Director of Distribution & Logistics, should be prepared to testify about Penterra's distribution logistics systems and order management processes. Specifically, she should address whether Penterra's systems would have flagged or detected Vantage orders with delivery addresses outside the six New England states, and whether any such anomalies were identified and, if so, how they were addressed.

5. Damages discovery — Cranmer, Hodges & Associates, P.C. Issue a subpoena to or request production from Cranmer, Hodges & Associates, P.C. (Medford, MA) for any damages analysis, financial projections, or work papers underlying Vantage's $35 million counterclaim figure, if such documents have not already been produced in response to prior discovery requests. Review Vantage's document production to confirm the completeness of financial documents related to the damages claim.

6. Begin Drafting Summary Judgment Materials. Begin preparing Penterra's motion for summary judgment, incorporating Farnham's key admissions as set forth in Section X above. The motion should focus on the unambiguous language of Exhibit A, the failure to satisfy Section 2.3's prior written consent requirement, the failure to satisfy Section 13.1's amendment requirement, the insufficiency of the Kapoor Email as a matter of law, and the weakness of the course-of-dealing defense in light of Section 14.8 and the short duration of alleged acquiescence. Coordinate with Linda Osei regarding the structure and strategy for the motion.

XII. Exhibits Referenced During Deposition

The following deposition exhibits are referenced in this memorandum and were marked during the October 18, 2021 deposition of Donald R. Farnham:

Additional exhibits were marked and used during the deposition. A complete exhibit list will be compiled upon receipt of the certified transcript, which is expected within approximately ten business days. All deposition exhibits should be organized, Bates-stamped to the extent not already done, and filed in the matter work product file.

This memorandum was prepared by Hannah Brinkley, Lead Associate, Calderwood & Harkness LLP.

Distribution:

Linda Osei, Responsible Partner Priya Anand, Billing Partner Patrick Gallagher, Associate

Filed in: C&H Matter No. 1018-00007 — Work Product File

Transcript Status: The certified deposition transcript is expected within approximately ten business days of October 18, 2021. Receipt of the transcript should be calendared. Upon receipt, the transcript should be reviewed against this memorandum for accuracy, and any discrepancies should be noted. Mr. Farnham and his counsel are entitled to review the transcript and submit an errata sheet pursuant to Mass. R. Civ. P. 30(e). We anticipate the errata process will be completed within 30 days of transcript receipt.

Exhibit No.	Description
Exhibit 1	Exclusive Distribution Agreement dated July 1, 2017, between Penterra Pharmaceuticals Corp. and Vantage Medical Distribution, LLC (including all Exhibits, Schedules, and Attachments, including Exhibit A — Territory Definition)
Exhibit 2	Exhibit A to the EDA — Territory Definition
Exhibit 7	Email from Steven Kapoor to Donald Farnham, dated January 12, 2018
Exhibit 9	Cease-and-desist letter from Jennifer Chao (General Counsel, Penterra Pharmaceuticals Corp.) to Donald R. Farnham, dated March 8, 2021
Exhibit 10	Response letter from Kenneth M. Rourke (Hargrove, Sinclair & Polk LLP) to Jennifer Chao, dated March 22, 2021

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT This memorandum is protected by the attorney-client privilege and the work product doctrine. It has been prepared by counsel in anticipation of litigation and for the purpose of providing legal analysis and advice. It should not be disclosed to any person outside of Calderwood & Harkness LLP and authorized representatives of Penterra Pharmaceuticals Corp. without the prior written consent of counsel.
CALDERWOOD & HARKNESS LLP INTEROFFICE MEMORANDUM
October 22, 2021
TO: Linda Osei, Responsible Partner Priya Anand, Billing Partner
FROM: Hannah Brinkley, Lead Associate
RE: Deposition Summary — Donald R. Farnham, Managing Member & CEO, Vantage Medical Distribution, LLC
MATTER: Penterra Pharmaceuticals Corp. v. Vantage Medical Distribution, LLC, Docket No. 2184-CV-01537-BLS (Massachusetts Superior Court, Business Litigation Session, Suffolk County)
C&H MATTER NO.: 1018-00007
CLIENT: Penterra Pharmaceuticals Corp.
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I. Introduction and Deposition Overview
This memorandum summarizes the deposition testimony of Donald R. Farnham, the Managing Member and Chief Executive Officer of Vantage Medical Distribution, LLC ("Vantage"), taken on Monday, October 18, 2021. The deposition was conducted at the offices of Calderwood & Harkness LLP, 1 Federal Street, 35th Floor, Boston, Massachusetts 02110, pursuant to a notice of deposition served on Vantage's counsel on September 17, 2021.
The deposition commenced at approximately 9:30 a.m. and concluded at approximately 4:45 p.m. Several breaks were taken during the day, including a morning recess, a lunch break of approximately one hour, and two brief afternoon recesses requested by opposing counsel.
Examination of the witness was conducted by the undersigned, Hannah Brinkley, on behalf of Penterra Pharmaceuticals Corp. ("Penterra"). Patrick Gallagher, also of Calderwood & Harkness LLP, attended and assisted throughout the deposition. Mr. Farnham was represented by Kenneth M. Rourke and Alicia Fontaine of Hargrove, Sinclair & Polk LLP ("HSP"), 200 Ashbury Asset Advisors, Suite 1800, Boston, Massachusetts 02109. Both Mr. Rourke and Ms. Fontaine were present for the entirety of the proceeding. No objections were made to the form of the deposition or the scope of the notice, though Mr. Rourke interposed several objections on the record as to the form of specific questions, as noted below where relevant.
A certified court reporter was present and recorded the proceeding stenographically. A certified transcript is expected within approximately ten business days, and receipt should be calendared for follow-up. Upon receipt, the transcript should be reviewed promptly and compared against this summary for accuracy.
Mr. Farnham testified under oath regarding the following principal topics: (a) his role as founder, Managing Member, and CEO of Vantage; (b) the negotiation, execution, and his understanding of the terms of the Exclusive Distribution Agreement dated July 1, 2017, between Penterra and Vantage (the "EDA"); (c) the scope and meaning of the Territory as defined in Exhibit A to the EDA; (d) the January 12, 2018 email from Steven Kapoor to Mr. Farnham, which Vantage contends authorized distribution in New York, New Jersey, and Pennsylvania; (e) Vantage's commencement of shipments of Penterra products into the tri-state area beginning on or about September 14, 2020; (f) Vantage's alleged course-of-dealing defense and theory of acquiescence by Penterra; (g) the basis for Vantage's $35 million counterclaim; and (h) Mr. Farnham's knowledge of Penterra's negotiations with Meridian National Distributors, Inc. ("Meridian").
As detailed throughout this memorandum, Mr. Farnham made several critical admissions that are favorable to Penterra's position and should feature prominently in the summary judgment materials anticipated for filing on or about February 11, 2022.
II. Summary of Key Testimony — Background and Role
Mr. Farnham confirmed on the record that he is the sole founder, Managing Member, and Chief Executive Officer of Vantage Medical Distribution, LLC, a Massachusetts limited liability company with its principal place of business at 75 Cabot Road, Suite 310, Medford, Massachusetts 02155. He testified that he founded Vantage in 2009.
Prior to founding Vantage, Farnham testified that he spent approximately twelve years as an executive at a national pharmaceutical wholesaler, the name of which he identified as "Cardinal Logistics Health" or a similar entity. In that capacity, he gained experience in pharmaceutical distribution, supply chain management, regulatory compliance, and customer-relationship development within the hospital and institutional pharmacy channels. He testified that he left this position to start Vantage because he identified an opportunity to create a regional specialty pharmaceutical distributor focused specifically on hospital-based and clinic-based oncology and immunology products in the northeastern United States.
Farnham testified that Vantage's business model is built around providing high-touch distribution services to hospitals, outpatient oncology clinics, and specialty pharmacies that administer complex, often temperature-sensitive oncology and immunology therapies. He stated that Vantage differentiates itself from larger national distributors through dedicated account management, flexible delivery scheduling, and deep familiarity with the clinical protocols of its customer base.
With respect to Vantage's financial performance, Farnham confirmed that Vantage's total revenue in fiscal year 2021 was approximately $148 million. He further confirmed that Penterra products, principally Oncalaris® (pegvisomant-axel), accounted for approximately $67 million of that total, representing approximately 45.3% of Vantage's total revenue. This figure underscores the commercial significance of the Penterra relationship to Vantage's business operations and provides important context for Vantage's aggressive posture in this litigation.
Regarding the negotiation of the EDA, Farnham testified that he personally led negotiations on behalf of Vantage. He identified his principal counterparts at Penterra as Steven Kapoor, who at the time held the title of Vice President, Commercial Operations, and Rachel Mendez, who served as Director of Distribution & Logistics. Farnham testified that negotiations took place over a period of approximately four to five months prior to execution, primarily through in-person meetings in Boston and at Penterra's offices in Princeton, New Jersey, supplemented by telephone conferences and email exchanges. He described the negotiations as "collaborative" and stated that he and Kapoor developed a "strong working relationship" during this period.
Farnham acknowledged that he signed the EDA on behalf of Vantage and confirmed that no other individual at Vantage had the authority to execute or amend the EDA. This admission is significant because it establishes that Farnham was the sole decision-maker with respect to the agreement, and any failure to obtain required written amendments or consents is attributable to him directly.
Farnham identified his principal direct reports as Lisa Petrangelo, who serves as Vantage's Chief Operating Officer, and Brian Kopec, who serves as Outside Sales Director. Farnham confirmed that both Petrangelo and Kopec report directly to him and that significant business decisions, including decisions regarding geographic expansion and new customer relationships, require his approval.
III. Summary of Key Testimony — Understanding of the Exclusive Distribution Agreement
A. Execution and Terms of the EDA
Mr. Farnham confirmed that the Exclusive Distribution Agreement was executed effective July 1, 2017, between Penterra Pharmaceuticals Corp., identified in the agreement as "Supplier," and Vantage Medical Distribution, LLC, identified as "Distributor." The EDA was marked as Exhibit 1 to the deposition, and Farnham confirmed the authenticity of his signature on the execution page.
Farnham testified as to the principal commercial terms of the EDA. The Products covered by the agreement are (a) Oncalaris® (pegvisomant-axel), available in 20 mg and 40 mg vials, and (b) Renuvesta® (cilosporin-beta), available in 5 mg capsules. Farnham acknowledged that the vast majority of Vantage's revenue from Penterra products is attributable to Oncalaris®, which is a high-cost oncology therapeutic with significant demand in the hospital and clinic setting.
The initial term of the EDA is five years, commencing July 1, 2017, and expiring June 30, 2022. The agreement provides for two successive one-year auto-renewal options, such that the agreement would automatically renew unless either party provided 180 days' written notice of non-renewal prior to the end of the then-current term. As of the date of the deposition, neither party had issued such a non-renewal notice, though Farnham acknowledged that the parties' dispute could affect the renewal process.
Under Section 5.2 of the EDA, Vantage committed to a minimum annual purchase commitment of $9.5 million per year at wholesale acquisition cost ("WAC") for Oncalaris®. Farnham confirmed that this minimum purchase obligation was a material inducement for Penterra to enter into the agreement and that failure to meet the minimum could trigger a termination right under the EDA.
Farnham was questioned in detail about Vantage's actual purchase volumes relative to the minimum. He confirmed that Vantage consistently and substantially exceeded the minimum annual purchase commitment. Specifically, he testified as follows:
• FY 2018 (July 2017–June 2018): Approximately $11.2 million in Oncalaris® purchases at WAC.
• FY 2019 (July 2018–June 2019): Approximately $14.8 million in Oncalaris® purchases at WAC.
• FY 2020 (July 2019–June 2020): Approximately $18.3 million in Oncalaris® purchases at WAC.
• FY 2021 (through March 2021): Approximately $16.1 million in Oncalaris® purchases at WAC for the first nine months of the fiscal year, which annualizes to approximately $21.47 million.
Farnham emphasized Vantage's track record of exceeding the minimum, characterizing it as evidence of Vantage's strong performance as a distribution partner. While this testimony demonstrates Vantage's commercial success in the New England territory, it does not bear directly on the question of whether the EDA was amended to expand the Territory to include the tri-state area.
B. Exhibit A — Territory Definition
Mr. Farnham was shown the executed EDA, including Exhibit A, which is the document that defines the geographic scope of Vantage's distribution rights. Exhibit A was separately marked as Exhibit 2 to the deposition for ease of reference.
Exhibit A provides the following Territory definition:
"The states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont (collectively, the 'New England States')."
Farnham confirmed that the language quoted above is the complete text of the Territory definition in Exhibit A as executed. He acknowledged that Exhibit A contains no additional language qualifying, expanding, or modifying the definition of the Territory beyond the six enumerated New England states.
Key Admission: When asked directly whether the text of Exhibit A as executed lists only the six New England states and does not reference New York, New Jersey, or Pennsylvania, Farnham answered affirmatively. This admission is unequivocal and should be cited in Penterra's summary judgment brief as establishing that, on the face of the agreement, Vantage had no contractual right to distribute Penterra products in the tri-state area.
Farnham was then asked whether he understood, at the time he signed the EDA on July 1, 2017, that the Territory was limited to the six New England states identified in Exhibit A. His response was qualified. Farnham stated that he understood the "initial territory" was the six New England states, but that he "believed the parties had a mutual understanding that expansion to the tri-state area would follow." He characterized the Territory definition as a "starting point" rather than a "fixed boundary," and testified that he entered into the EDA with the expectation that the territorial scope would be broadened as Vantage demonstrated its distribution capabilities.
On redirect examination conducted by Mr. Rourke, Farnham attempted to elaborate on this point and stated that the Territory was "intended to grow" based on discussions between himself and Mr. Kapoor during the negotiation phase. However, critically, Farnham could not point to any language in Exhibit A itself that reflected this alleged understanding. He was unable to identify any provision in the EDA — whether in Exhibit A, in the body of the agreement, or in any side letter or ancillary document — that contemplated automatic or conditional expansion of the Territory. This inability to identify contractual support for his position significantly undermines Vantage's claim that the Territory was understood to include the tri-state area.
C. Section 2.3 — Limitation on Distribution Outside the Territory
Mr. Farnham was read Section 2.3 of the EDA, which provides:
"Distributor shall not actively solicit orders for, or deliver, the Products outside the Territory without Supplier's prior written consent."
Farnham acknowledged that he was aware of this provision at the time he signed the EDA and that he understood it to impose a restriction on Vantage's ability to distribute Penterra products outside of the six New England states defined in Exhibit A. He agreed that Section 2.3 requires "prior written consent" from the Supplier (Penterra) before any out-of-territory distribution activity.
Key Admission: Mr. Farnham admitted that he did not obtain a signed, formal written consent from any Penterra officer — whether Mr. Kapoor, Ms. Mendez, Jennifer Chao (General Counsel), or any other individual — authorizing Vantage to distribute Oncalaris® or Renuvesta® in New York, New Jersey, or Pennsylvania prior to commencing tri-state shipments on or about September 14, 2020. When asked whether he had any document that could fairly be characterized as "prior written consent" from Penterra, Farnham's only reference was the January 12, 2018 email from Mr. Kapoor, discussed in detail in Section IV below.
D. Section 13.1 — Amendments Requirement
Mr. Farnham was shown Section 13.1 of the EDA, which provides:
"No amendment, modification, or waiver of any provision of this Agreement shall be effective unless set forth in a written instrument signed by both parties."
Farnham confirmed that he was aware of this provision. He acknowledged that Section 13.1 requires that any amendment to the EDA — including any amendment to the Territory definition set forth in Exhibit A — must be memorialized in a written instrument signed by both Penterra and Vantage.
Key Admission: Farnham admitted that he did not obtain a signed amendment to Exhibit A expanding the Territory to include New York, New Jersey, or Pennsylvania. He acknowledged that no document exists that bears the signatures of both a Penterra representative and a Vantage representative and that purports to modify the Territory definition.
When pressed on this point, Farnham offered two alternative theories in justification of Vantage's conduct. First, he stated that he believed the January 12, 2018 email from Steven Kapoor was sufficient to constitute the required "written consent" referenced in Section 2.3, even if it did not satisfy the formal amendment requirement of Section 13.1. Second, he stated that he believed the parties' "course of dealing" over the life of the agreement effectively superseded the formal amendment requirement. Neither of these theories was supported by documentary evidence or specific factual detail during the deposition.
E. Section 14.8 — Integration Clause
Mr. Farnham was shown Section 14.8 of the EDA, the agreement's integration clause, which provides:
"This Agreement, including all Exhibits, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations, representations, or agreements relating thereto, whether written or oral."
Farnham acknowledged that this clause exists in the EDA and that he was aware of it. He testified, however, that he did not believe the integration clause prevented the parties from modifying the agreement through their subsequent conduct. Specifically, he stated: "I understood this clause as being about what happened before the agreement was signed. I didn't think it prevented us from adapting and evolving the deal after we started working together."
When pressed on whether he could identify any legal authority, contractual provision, or factual basis for that interpretation, Farnham was unable to do so. He conceded that he is not a lawyer and that his understanding of the integration clause was based on his own "business judgment." He deferred further legal analysis to his counsel. This testimony is notable because it reflects Farnham's acknowledgment that the contractual formalities contained in the EDA were not followed, while simultaneously offering a legal conclusion — that course of dealing can override a fully integrated written agreement — for which he has no factual or legal foundation.
IV. Summary of Key Testimony — The January 12, 2018 Kapoor Email
A substantial portion of the deposition was devoted to questioning Mr. Farnham about the January 12, 2018 email from Steven Kapoor to Donald Farnham, which was marked as Exhibit 7 to the deposition. This email is the central document in Vantage's defense and is the only written communication that Farnham could identify as supporting his claim that Penterra authorized distribution in the tri-state area. The full text of the email, as displayed on the record, reads as follows:
"Don — good catching up yesterday. We're definitely open to exploring expansion into NY/NJ/PA once your New England footprint is fully ramped. Let's circle back mid-year and see where things stand."
Farnham testified that he received this email on or about January 12, 2018, and that it was the primary basis for his belief that Penterra had authorized Vantage to distribute Oncalaris® and Renuvesta® in New York, New Jersey, and Pennsylvania. He characterized the email as a "green light" from Mr. Kapoor, explaining: "When Steve said they were 'definitely open,' I took that as a strong signal that expansion was coming and that we should start planning accordingly."
Farnham confirmed that the email was sent by Mr. Kapoor in his capacity as Vice President, Commercial Operations at Penterra. Farnham acknowledged that the email was sent approximately six months after the EDA was executed and approximately two years and eight months before Vantage commenced systematic tri-state shipments.
On detailed questioning, Farnham made the following admissions regarding the Kapoor Email:
1. Exploratory Language. Farnham acknowledged that the email uses the phrase "open to exploring expansion" rather than language granting consent, authorization, or approval. When asked whether "open to exploring" is the same as "authorized to proceed," Farnham conceded that the two phrases "have different meanings" but maintained that, in context, the email conveyed Penterra's intent to support expansion.
2. Condition Precedent. Farnham acknowledged that the email conditions any expansion on Vantage's New England footprint being "fully ramped." When asked what "fully ramped" meant and whether that condition had been satisfied as of any particular date, Farnham's answer was vague. He testified that he believed Vantage's New England operations were "substantially ramped" by mid-2019 but could not identify a specific date or metric by which "fully ramped" status was achieved or communicated to Penterra.
3. Further Discussion Required. Farnham acknowledged that the email's instruction to "circle back mid-year and see where things stand" suggested that further discussion and evaluation were needed before any expansion could proceed. He agreed that the phrase "see where things stand" implies that a decision had not yet been made.
4. No Express Written Authorization. Key Admission: Farnham acknowledged that no Penterra officer expressly authorized tri-state shipments in writing — neither in the Kapoor Email nor in any other document that Farnham could identify during the deposition. When asked point-blank, "Can you identify any document in which a Penterra representative states, in substance, 'Vantage is authorized to distribute Penterra products in New York, New Jersey, or Pennsylvania'?", Farnham answered, "Not in those specific words, no."
5. Failure to Follow Up. Farnham admitted that he did not "circle back" with Mr. Kapoor at mid-year 2018 — or at any subsequent time — to formalize the expansion that the Kapoor Email contemplated. He testified that "things got busy" and that the follow-up "fell through the cracks." This admission is significant because it demonstrates that even the preliminary steps contemplated by the Kapoor Email were never completed.
6. No Written Follow-Up. Farnham confirmed that there is no written follow-up to the Kapoor Email — from either party — in which Penterra confirmed authorization for tri-state distribution. He could not produce any responsive email, letter, memorandum, or other document reflecting that the mid-year check-in proposed by Mr. Kapoor ever occurred or that any determination was made that Vantage's New England footprint was "fully ramped."
7. Section 13.1 Compliance. When asked whether the Kapoor Email constituted the "written instrument signed by both parties" required under Section 13.1 for any amendment to the EDA, Farnham conceded that the email was signed (or sent) only by Mr. Kapoor on behalf of Penterra and was not countersigned or otherwise acknowledged in writing by Vantage. He further conceded that the email is not styled as a contract amendment, does not reference the EDA by name or date, does not reference Exhibit A, and does not purport to modify the Territory definition.
In sum, Farnham's testimony regarding the Kapoor Email, while presented with conviction, actually reinforces Penterra's position. The email is, at best, an expression of willingness to consider future expansion under conditions that were never formalized or confirmed. It falls far short of the "prior written consent" required by Section 2.3 and does not satisfy the amendment requirements of Section 13.1. These admissions should be highlighted prominently in Penterra's motion for summary judgment.
V. Summary of Key Testimony — Commencement of Tri-State Shipments
Mr. Farnham confirmed that Vantage began shipping Oncalaris® to hospitals and oncology clinics in New York, New Jersey, and Pennsylvania on or about September 14, 2020. He identified this date based on Vantage's internal records and testimony from his recollection. He acknowledged that these shipments were the first systematic, large-scale distribution of Penterra products by Vantage in the tri-state area.
Farnham was asked to explain the delay of more than two and a half years between the January 12, 2018 Kapoor Email and the commencement of tri-state shipments in September 2020. He explained that Vantage needed time to "build out its New England operations first," consistent with the Kapoor Email's reference to Vantage's New England footprint being "fully ramped." He testified that Vantage spent the intervening period strengthening its customer relationships, improving its logistics and warehousing capabilities, and increasing its New England revenue. He acknowledged that the COVID-19 pandemic, which began affecting operations in early 2020, also played a role in the timing, though he was not entirely clear on whether the pandemic accelerated or delayed Vantage's decision to enter the tri-state market.
When asked what specifically triggered the decision to begin tri-state shipments in September 2020 as opposed to any other date, Farnham testified that Brian Kopec, Vantage's Outside Sales Director, had developed customer relationships in the tri-state area — particularly with several large hospital systems and outpatient oncology clinics in the New York metropolitan area — and that market demand justified expansion at that time. Farnham stated that Kopec presented a business case to him, and that he (Farnham) made the decision to begin shipments.
Key Admission: Farnham acknowledged that Vantage did not notify Penterra in writing before commencing tri-state shipments on or about September 14, 2020. He did not send a letter, email, or other written communication to Mr. Kapoor, Ms. Mendez, or any other Penterra representative informing them that Vantage intended to begin or had begun distributing Oncalaris® outside the six New England states.
When asked whether Penterra was aware of the tri-state shipments, Farnham testified that he "believed" Penterra was "aware" based on "informal conversations" and the general flow of business. However, he could not identify a specific written communication — email, letter, text message, or otherwise — in which he informed Penterra that Vantage was distributing Penterra products in New York, New Jersey, or Pennsylvania. He could not recall the date, substance, or participants in any of the alleged informal conversations. He stated: "I assumed they knew because they could see the order patterns," but acknowledged on further questioning that he did not know whether Penterra's systems would have flagged delivery addresses outside New England as anomalous.
Farnham confirmed that Vantage's tri-state revenues from approximately September 2020 through March 2021 — a period of approximately six months — totaled approximately $6.4 million. He acknowledged that this figure represented a meaningful portion of Vantage's total Penterra revenue during that period and that the tri-state operations had been growing.
VI. Summary of Key Testimony — Course of Dealing / Alleged Acquiescence
Mr. Farnham devoted significant testimony to what he characterized as Penterra's acquiescence in and tacit approval of Vantage's tri-state distribution activities. This theory — that Penterra's failure to object to Vantage's shipments constituted a modification of the Territory by course of dealing — is central to Vantage's defense and counterclaim.
Farnham initially asserted that Penterra's failure to object to Vantage's shipments to New York beginning in "late 2019" demonstrated that Penterra was aware of and acquiesced in the expansion. This timeline, however, was inconsistent with his other testimony and with the documentary record.
On examination, Farnham's timeline proved unreliable. He initially referenced "late 2019" shipments to New York, suggesting that Vantage had begun distributing in the tri-state area well before September 2020. However, when pressed for specifics, he acknowledged that the systematic tri-state shipments began on or about September 14, 2020. When asked to reconcile his reference to "late 2019" shipments with his earlier testimony that systematic shipments began in September 2020, Farnham stated that there may have been "a few preliminary or test shipments" to a small number of New York customers in late 2019, but he could not provide specifics.
When asked to produce documentation of the "late 2019" New York shipments — such as invoices, shipping records, bills of lading, or customer orders — Farnham could not identify any such documents during the deposition. He stated that he would need to defer to Vantage's sales records and that Lisa Petrangelo (COO) or Brian Kopec (Outside Sales Director) might have more detailed information. This is a significant area for follow-up in discovery and in the upcoming depositions of Kopec and Petrangelo.
Farnham acknowledged that the first formal communication he received from Penterra regarding the tri-state issue was the March 8, 2021 cease-and-desist letter from Jennifer Chao, Penterra's General Counsel (marked as Exhibit 9 to the deposition). The cease-and-desist letter demanded that Vantage immediately cease distributing Oncalaris® and all other Penterra products outside the six New England states identified in Exhibit A to the EDA. Farnham confirmed he received this letter and understood its contents.
Key Admission: Farnham admitted that the period between September 14, 2020 (the commencement of systematic tri-state shipments) and March 8, 2021 (the date of the cease-and-desist letter) was approximately six months. When asked whether he considered six months to be a long or short period for purposes of a course-of-dealing argument, Farnham acknowledged that it was "a relatively short window" but maintained that Penterra should have objected sooner if it disagreed with the expansion.
On redirect examination, Mr. Rourke attempted to elicit testimony about informal conversations between Farnham and Mr. Kapoor and Ms. Mendez that allegedly signaled Penterra's awareness and approval of the tri-state distribution. Farnham testified that he had "multiple conversations" with Kapoor and Mendez over the years in which the topic of tri-state expansion came up and in which he perceived "positive signals." However, Farnham could not provide the dates of these conversations, the specific substance discussed, or any corroborating documents such as notes, follow-up emails, calendar entries, or memoranda. His testimony on this point was entirely conclusory and unsupported by the documentary record.
The course-of-dealing defense is substantially weakened by the following factors established in the deposition: (a) Farnham's inability to document any pre-September 2020 shipments to the tri-state area; (b) the relatively short six-month window of alleged acquiescence; (c) the absence of any written evidence that Penterra knew about or consented to the tri-state shipments; and (d) Farnham's inability to provide any specific details about the alleged informal conversations.
VII. Summary of Key Testimony — Vantage's Response and Counterclaim Damages
Farnham confirmed that upon receiving the March 8, 2021 cease-and-desist letter from Penterra's General Counsel, Vantage retained Hargrove, Sinclair & Polk LLP to represent it in the dispute. He identified Kenneth M. Rourke as the lead attorney responsible for the matter.
Mr. Rourke, on behalf of Vantage, sent a response letter dated March 22, 2021, addressed to Jennifer Chao at Penterra (marked as Exhibit 10 to the deposition). Farnham confirmed that he reviewed and approved the letter before it was sent. The letter asserted Vantage's right to distribute Penterra products in the tri-state area based on the Kapoor Email, the parties' course of dealing, and alleged oral representations. The letter also threatened a counterclaim for breach of contract and tortious interference with Vantage's business relationships, quantified at $35 million in damages.
Farnham was questioned in detail about the basis for the $35 million damages figure set forth in the HSP response letter. He testified that the figure was derived from a combination of two categories of damages:
(a) Projected Lost Profits: The estimated profits that Vantage would have earned from distributing Penterra products in New York, New Jersey, and Pennsylvania over the remaining term of the EDA (through June 30, 2022), plus the two one-year auto-renewal periods (through June 30, 2024), assuming the agreement was not terminated or non-renewed.
(b) Reliance Damages: The investments Vantage had made in tri-state infrastructure in reliance on what Farnham characterized as Penterra's authorization of the expansion. These investments allegedly included warehouse space (Farnham referenced a lease for warehousing in northern New Jersey but could not identify the specific address or landlord), additional sales personnel (Farnham referenced "two or three new hires" in the tri-state area but could not name them), and the cost of developing customer relationships in the region.
On examination, Farnham's damages testimony was notably vague and lacked specificity. He could not provide detailed calculations or a breakdown of the $35 million figure. He stated that the damages analysis was developed "in consultation with" Vantage's outside accountants at Cranmer, Hodges & Associates, P.C., a firm based in Medford, Massachusetts, and with his counsel at HSP. He deferred to those professionals for the specifics of the calculation.
Farnham acknowledged that the $6.4 million in actual tri-state revenues earned over approximately six months (September 2020 through March 2021) was the only concrete, documented revenue figure he could point to in support of Vantage's damages claim. He agreed that $6.4 million in six months annualizes to approximately $12.8 million in revenue, but he could not clearly explain how that figure extrapolated to a damages claim of $35 million.
When asked whether the $35 million figure assumed that all tri-state revenue constituted pure profit, Farnham acknowledged that it did not, but he could not articulate Vantage's margin on Penterra products or the assumed profit rate embedded in the damages calculation. He repeatedly deferred to Cranmer, Hodges & Associates for these details.
This testimony is significant because it establishes that as of the date of the deposition, Vantage's $35 million counterclaim damages figure lacks a detailed evidentiary foundation in Farnham's testimony. The damages theory appears to depend heavily on projections and assumptions that have not been substantiated.
VIII. Summary of Key Testimony — Knowledge of Meridian National Distributors, Inc.
Mr. Farnham was asked about his awareness of Penterra's relationship with Meridian National Distributors, Inc. ("Meridian"), a pharmaceutical distribution company with offices at 520 Seventh Avenue, 12th Floor, New York, New York 10018.
Farnham testified that he first learned of Penterra's negotiations with Meridian to distribute Oncalaris® in the tri-state area "around March 2021." He stated that he could not recall the precise source of this information, testifying that he may have learned of it from "industry contacts" or from the contents of the March 8, 2021 cease-and-desist letter itself. He could not definitively confirm which source informed him first.
Penterra executed a term sheet with Meridian on February 15, 2021, approximately three weeks before sending the cease-and-desist letter to Vantage. Farnham was asked whether he was aware of the Meridian term sheet prior to receiving the cease-and-desist letter. He testified that he "might have heard something through the grapevine" but could not confirm definitively whether he had knowledge of the term sheet before the letter arrived.
Farnham characterized Penterra's engagement of Meridian as constituting both a breach of the EDA and tortious interference with Vantage's existing and prospective business relationships in the tri-state area. He testified that Penterra's decision to appoint a competing distributor in a territory that Vantage believed it had the right to serve was "a direct attack on our business" and that it caused significant harm to Vantage's customer relationships and reputation in the marketplace.
When asked whether the EDA, as executed, granted Vantage exclusive distribution rights in New York, New Jersey, or Pennsylvania, Farnham conceded that the text of the EDA and Exhibit A does not. He admitted: "The agreement as written doesn't list those states." However, he reiterated his belief that the Territory had been informally expanded through the Kapoor Email and the parties' course of dealing, and that Penterra's appointment of Meridian was therefore inconsistent with Vantage's rights as he understood them.
This testimony highlights a fundamental weakness in Vantage's tortious interference theory: Farnham cannot point to any contractual provision granting Vantage rights in the tri-state area, and his claim to such rights rests entirely on the informal understandings and course-of-dealing arguments that, as discussed throughout this memorandum, lack documentary support.
IX. Assessment of Farnham's Credibility and Testimony
Overall, Mr. Farnham presented as a knowledgeable and confident witness. He was generally responsive to questions, maintained composure under sustained cross-examination, and demonstrated a thorough understanding of Vantage's business operations, the pharmaceutical distribution industry, and the commercial importance of the Penterra relationship. He was clearly well prepared by his counsel for the deposition.
However, his testimony was materially undermined on several key points that are central to the disputed issues in this case:
1. Reliance on the Kapoor Email. Farnham's characterization of the January 12, 2018 email as a "green light" for tri-state expansion is unsupported by the text of the email itself. As established through his own admissions:
(a) The email uses tentative, exploratory language ("open to exploring expansion") rather than language of authorization or consent;
(b) Farnham conceded that no follow-up discussion or formalization ever occurred, despite the email's express directive to "circle back mid-year";
(c) The email lacks the dual-party signature required by Section 13.1 for any amendment to the EDA;
(d) Farnham acknowledged that no Penterra officer expressly authorized tri-state shipments in writing, whether in the Kapoor Email or in any other document.
2. Course-of-Dealing Argument. Farnham's theory that Penterra acquiesced in the tri-state expansion through its failure to object is undercut by several factors:
(a) Farnham could not provide specifics — including dates, invoice numbers, or customer identities — regarding the alleged "late 2019" shipments to New York that he referenced during the deposition;
(b) The window of alleged acquiescence — approximately six months between September 2020 and March 2021 — is relatively short, particularly for a course-of-dealing modification argument;
(c) There is no written evidence in the record that Penterra was aware of the tri-state shipments prior to the issuance of the cease-and-desist letter;
(d) The informal conversations that Farnham referenced as evidence of Penterra's awareness are entirely uncorroborated by documents, dates, or specifics.
3. Damages Testimony. Farnham's testimony regarding the $35 million counterclaim damages figure was conspicuously vague. He could not provide a breakdown of the calculation, could not articulate the assumptions underlying the figure, and repeatedly deferred to Vantage's outside accountants. The only concrete figure he could point to — $6.4 million in actual tri-state revenues over six months — does not, on its face, support a $35 million claim, and Farnham could not bridge the gap.
4. Integration and Amendment Clauses. Farnham's testimony regarding Section 14.8 (integration clause) and Section 13.1 (amendment requirement) essentially constituted an acknowledgment that the contractual formalities required by the EDA were not followed. His position — that the parties' course of dealing overrode the written agreement — is a legal conclusion for which he provided no factual foundation, and one that is difficult to sustain given the express terms of the contract.
In summary, while Farnham was a competent witness in terms of demeanor, his substantive testimony on the critical disputed issues was consistently weak and supported by admissions that are favorable to Penterra.
X. Key Admissions — Summary for Motion Practice
The following is a consolidated list of Mr. Farnham's critical admissions during the October 18, 2021 deposition, organized for ease of reference in the preparation of Penterra's anticipated motion for summary judgment, currently scheduled for filing on February 11, 2022:
1. Territory Definition. Exhibit A to the EDA lists only the states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont as the Territory. Exhibit A does not include New York, New Jersey, or Pennsylvania. Farnham confirmed this on the record.
2. No Signed Amendment to Exhibit A. Farnham admitted that he did not obtain a signed amendment to Exhibit A expanding the Territory to include New York, New Jersey, or Pennsylvania. No such amendment exists.
3. No Written Instrument Signed by Both Parties. Farnham admitted that he did not obtain any written instrument signed by both Penterra and Vantage amending the EDA in any respect relevant to the Territory definition, as required by Section 13.1 of the agreement.
4. No Express Written Authorization. No Penterra officer expressly authorized Vantage to distribute Penterra products in the tri-state area in writing. Farnham confirmed this and could not identify any document containing such authorization.
5. Kapoor Email — Exploratory Language. The January 12, 2018 email from Steven Kapoor uses the phrase "open to exploring expansion," which Farnham acknowledged is different from an authorization or grant of consent. The email is not styled as a contract amendment, does not reference the EDA by name, and does not reference Exhibit A.
6. No Mid-Year 2018 Follow-Up. Farnham admitted that he did not follow up with Mr. Kapoor at mid-year 2018 or at any subsequent time to formalize the expansion contemplated by the Kapoor Email, despite the email's express instruction to "circle back mid-year."
7. No Written Notice Before Tri-State Shipments. Vantage did not notify Penterra in writing before commencing tri-state shipments on or about September 14, 2020. Farnham confirmed this.
8. No Documentary Evidence of Penterra's Knowledge or Acquiescence. Farnham could not identify specific documentary evidence — including emails, letters, notes, or other writings — establishing that Penterra knew about or acquiesced in Vantage's tri-state distribution activities prior to the March 8, 2021 cease-and-desist letter.
9. Unsupported Damages Figure. The $35 million damages figure asserted in Vantage's counterclaim lacks detailed calculation support in Farnham's deposition testimony. The only concrete revenue figure Farnham could cite was $6.4 million in actual tri-state revenues over approximately six months, and he could not articulate how that figure supported a $35 million claim.
These admissions, taken together, establish that the contractual formalities required for territorial expansion under the EDA were not satisfied and that Vantage's principal justifications — the Kapoor Email and the alleged course of dealing — are factually and legally insufficient.
XI. Recommended Follow-Up Actions
Based on Mr. Farnham's deposition testimony, the following follow-up actions are recommended:
1. Cross-Reference "Late 2019" Shipment Claim. Farnham's reference to "late 2019" shipments to New York should be tested against Vantage's sales and shipping records produced in discovery. Review all invoices, bills of lading, shipping manifests, and customer orders from Vantage's production to determine whether any Penterra product shipments were made to New York, New Jersey, or Pennsylvania before September 14, 2020. If such shipments occurred, determine their scope, frequency, and dollar value. If no such records exist, this further undermines Farnham's credibility and his course-of-dealing argument.
2. Prepare Deposition of Brian Kopec (Scheduled December 7, 2021). Kopec is Vantage's Outside Sales Director and, according to Farnham, the individual who developed the customer relationships in the tri-state area and presented the business case for expansion. His deposition should probe the specific timeline and circumstances of the tri-state sales initiative, including when customer outreach began, which customers were targeted, and what representations (if any) Kopec made to tri-state customers about Vantage's authority to distribute Penterra products. Kopec's testimony should be compared against Farnham's for consistency.
3. Prepare Steven Kapoor (Deposition Scheduled November 2, 2021). Kapoor is the author of the January 12, 2018 email and is the most important witness from Penterra's perspective on the question of what the email was intended to communicate. He should be prepared to testify consistently with Penterra's position — namely, that the email expressed a willingness to explore future expansion but did not constitute written consent to distribute in the tri-state area or an amendment to the EDA. Kapoor should also be prepared to testify about whether he was aware of Vantage's tri-state shipments before the cease-and-desist letter was issued.
4. Prepare Rachel Mendez (Deposition Scheduled November 19, 2021). Mendez, as Director of Distribution & Logistics, should be prepared to testify about Penterra's distribution logistics systems and order management processes. Specifically, she should address whether Penterra's systems would have flagged or detected Vantage orders with delivery addresses outside the six New England states, and whether any such anomalies were identified and, if so, how they were addressed.
5. Damages discovery — Cranmer, Hodges & Associates, P.C. Issue a subpoena to or request production from Cranmer, Hodges & Associates, P.C. (Medford, MA) for any damages analysis, financial projections, or work papers underlying Vantage's $35 million counterclaim figure, if such documents have not already been produced in response to prior discovery requests. Review Vantage's document production to confirm the completeness of financial documents related to the damages claim.
6. Begin Drafting Summary Judgment Materials. Begin preparing Penterra's motion for summary judgment, incorporating Farnham's key admissions as set forth in Section X above. The motion should focus on the unambiguous language of Exhibit A, the failure to satisfy Section 2.3's prior written consent requirement, the failure to satisfy Section 13.1's amendment requirement, the insufficiency of the Kapoor Email as a matter of law, and the weakness of the course-of-dealing defense in light of Section 14.8 and the short duration of alleged acquiescence. Coordinate with Linda Osei regarding the structure and strategy for the motion.
XII. Exhibits Referenced During Deposition
The following deposition exhibits are referenced in this memorandum and were marked during the October 18, 2021 deposition of Donald R. Farnham:
Additional exhibits were marked and used during the deposition. A complete exhibit list will be compiled upon receipt of the certified transcript, which is expected within approximately ten business days. All deposition exhibits should be organized, Bates-stamped to the extent not already done, and filed in the matter work product file.
This memorandum was prepared by Hannah Brinkley, Lead Associate, Calderwood & Harkness LLP.
Distribution:
Linda Osei, Responsible Partner Priya Anand, Billing Partner Patrick Gallagher, Associate
Filed in: C&H Matter No. 1018-00007 — Work Product File
Transcript Status: The certified deposition transcript is expected within approximately ten business days of October 18, 2021. Receipt of the transcript should be calendared. Upon receipt, the transcript should be reviewed against this memorandum for accuracy, and any discrepancies should be noted. Mr. Farnham and his counsel are entitled to review the transcript and submit an errata sheet pursuant to Mass. R. Civ. P. 30(e). We anticipate the errata process will be completed within 30 days of transcript receipt.
Exhibit No. | Description
Exhibit 1 | Exclusive Distribution Agreement dated July 1, 2017, between Penterra Pharmaceuticals Corp. and Vantage Medical Distribution, LLC (including all Exhibits, Schedules, and Attachments, including Exhibit A — Territory Definition)
Exhibit 2 | Exhibit A to the EDA — Territory Definition
Exhibit 7 | Email from Steven Kapoor to Donald Farnham, dated January 12, 2018
Exhibit 9 | Cease-and-desist letter from Jennifer Chao (General Counsel, Penterra Pharmaceuticals Corp.) to Donald R. Farnham, dated March 8, 2021
Exhibit 10 | Response letter from Kenneth M. Rourke (Hargrove, Sinclair & Polk LLP) to Jennifer Chao, dated March 22, 2021

CALDERWOOD & HARKNESS LLP INTEROFFICE MEMORANDUM

C&H MATTER NO.: 1018-00007

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