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PRIVILEGED & CONFIDENTIAL — ATTORNEY WORK PRODUCT

This memorandum is protected by the attorney-client privilege and the work-product doctrine. It contains the mental impressions, conclusions, opinions, and legal theories of attorneys at Calderwood & Harkness LLP. It is prepared in anticipation of litigation and is not to be disclosed to any third party without the express prior authorization of Calderwood & Harkness LLP.

MEMORANDUM

TO: Priya Anand, Partner, Litigation (General) Yuki Nakamura, Lead Associate, Litigation (General)

FROM: Carlos Espinoza, Working Associate, Litigation (General)

DATE: January 25, 2023

RE: Deposition Summary — Randall "Randy" Brecker (Days 1 & 2), January 9–10, 2023

MATTER: Verimark Hospitality Group Inc. v. Coastal Palms Franchise Holdings LLC et al., Case No. 1021-00006, Circuit Court of the 17th Judicial Circuit, Broward County, Florida

CLIENT: Verimark Hospitality Group Inc.

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I. EXECUTIVE SUMMARY

This memorandum summarizes the two-day deposition of Randall "Randy" Brecker, Managing Member and 60% equity holder of Coastal Palms Franchise Holdings LLC ("CPFH") and President of Suncoast Room Management Inc. ("Suncoast"). The deposition was conducted on January 9, 2023 (Day 1) and January 10, 2023 (Day 2), at the offices of Whitfield, Barrow & Crane LLP, 1221 Brickell Avenue, Suite 3000, Miami, Florida 33131. Day 1 encompassed approximately seven (7) hours of testimony, and Day 2 encompassed approximately seven (7) hours of testimony, for a combined total of approximately fourteen (14) hours of testimony across both days.

The examination was conducted by Priya Anand of Calderwood & Harkness LLP (FL Bar No. 0087451) on behalf of our client, Verimark Hospitality Group Inc. ("Verimark"). Defending counsel were Nathan Whitfield III and Gabriela Montes of Whitfield, Barrow & Crane LLP. A certified court reporter was present throughout both days, and the deposition was videographed in its entirety.

The purpose of this memorandum is threefold: (1) to summarize key admissions obtained from Brecker during the deposition; (2) to identify impeachment points that may be used in subsequent proceedings, including summary-judgment briefing, expert coordination, and potential trial; and (3) to catalog critical document references for efficient retrieval and cross-referencing by the litigation team.

Overall Assessment. Brecker made several damaging admissions during the course of his testimony. Most critically, he admitted on Day 2 that he personally directed property-level controllers to exclude revenues collected through Suncoast Room Management Inc. from the monthly Gross Room Revenue ("GRR") reports submitted to Verimark. This admission is devastating to the defense because it establishes that the underreporting was not the result of inadvertent error, a good-faith interpretive disagreement, or decisions made independently by lower-level employees, but rather a deliberate and systematic directive issued by Brecker himself — the individual who also signed all twenty-two (22) Franchise License Agreements ("FLAs") on behalf of CPFH.

Additionally, Brecker acknowledged creating the unbranded booking website gulfcoastrooms.com for the express purpose of capturing direct bookings outside Verimark's central reservation system. A March 12, 2016 email from Brecker to property managers (Exhibit 31) referencing savings of "7.5 cents on the dollar" — a figure that precisely matches the combined 5% royalty and 2.5% marketing-fund contribution under the FLAs — provides powerful evidence of Brecker's awareness that the booking-diversion scheme was designed to reduce franchise-fee obligations.

Brecker consistently maintained throughout both days of testimony that his interpretation of the FLA's GRR definition was "reasonable" and that Verimark was aware of Suncoast's role. However, his testimony on the purported awareness defense was vague, largely unsupported by specific documentary evidence, and ultimately undercut by his own inability to identify any Verimark representative who approved or acquiesced in the exclusion of Suncoast-collected revenues from GRR. The single document he cited in support of the awareness defense — a property-management agreement submitted with a 2013 franchise application for a Savannah, Georgia property (Exhibit 48) — identifies Suncoast as the management company but does not disclose that Suncoast would collect guest-room revenues or that those revenues would be excluded from GRR.

The sections that follow provide a detailed summary of Brecker's testimony, organized by topic and by day, followed by summary tables of key admissions and impeachment points, a catalog of critical document references, an assessment of witness credibility, and recommendations for next steps.

II. BACKGROUND — WITNESS PROFILE

Randall Thomas Brecker, who goes by "Randy," is fifty-eight (58) years old and resides in Naples, Florida. He is the central figure in the Coastal Palms franchise network and occupies several overlapping roles across the network's various entities.

Coastal Palms Franchise Holdings LLC. Brecker is the Managing Member and holds a 60% equity interest in CPFH, the entity that serves as the primary franchisee under the Verimark FLAs. The remaining equity is held by Theresa Brecker (15%), Brecker's spouse, who manages payroll and human-resources functions across the portfolio, and Nolan Prescott (25%), a retired commercial real-estate developer whom Brecker described during the deposition as a "passive investor" who "put up money" for acquisitions but had "no involvement in day-to-day operations."

Suncoast Room Management Inc. Brecker is the President and sole director of Suncoast Room Management Inc., a Florida corporation that he formed approximately in 2012 or 2013. As described in greater detail below, Suncoast served as the vehicle through which Brecker collected and retained revenues from guest-room bookings that were not processed through Verimark's central reservation system, including walk-in guests, corporate-direct contracts, and bookings through the unbranded website gulfcoastrooms.com.

Other Entities. Brecker is also the Managing Member of Gulf Breeze Hospitality LLC, which owns and operates six (6) Verimark Suites properties in Southwest Florida, and Savannah Lodging Partners LLC, which owns and operates four (4) Verimark Suites properties in coastal Georgia. Additional property-level LLCs exist for the remaining properties in the portfolio, each of which is managed by Brecker.

Career Background. Brecker is a former hotel general manager who built the Coastal Palms portfolio from a single property in 2007 to its current size of twenty-two (22) hotels — consisting of eighteen (18) Verimark Suites properties and four (4) Verimark Select properties — comprising approximately 3,740 total guest rooms across the states of Florida and Georgia. His first Franchise License Agreement with Verimark was executed on June 15, 2007, for a single Verimark Suites property in Naples, Florida. The most recent FLA in the portfolio was executed on September 3, 2019. Throughout this period, Brecker personally signed each FLA on behalf of CPFH, and he testified that he was personally involved in virtually all significant operational and financial decisions affecting the franchise network.

III. DAY 1 SUMMARY — JANUARY 9, 2023

A. Formation and Structure of Coastal Palms Entities

The first substantive topic of examination on Day 1 addressed the formation, organizational structure, and governance of the Coastal Palms entities. This line of questioning was designed to establish Brecker's personal control over the franchise network's operations and financial reporting, a foundation necessary for attributing the underreporting to his deliberate direction rather than to autonomous decisions by subordinates.

Brecker testified that he formed Coastal Palms Franchise Holdings LLC in approximately 2006, in preparation for entering into the first Verimark franchise agreement. He confirmed that CPFH is a Florida limited liability company with its principal office located at 9500 Gulf Shore Drive, Suite 450, Naples, Florida 34108, and its registered agent is Garrison Registered Agents LLC, 100 South Ashley Drive, Suite 600, Tampa, Florida 33602.

Brecker described the entity structure as follows: CPFH serves as the holding entity and the franchisee of record under the Verimark FLAs. Below CPFH, a series of property-level LLCs — including Gulf Breeze Hospitality LLC, Savannah Lodging Partners LLC, and additional entities not individually named during this portion of the deposition — own and operate the individual hotel properties. Suncoast Room Management Inc. sits alongside these property-level entities and serves as an affiliated management company. Brecker is the Managing Member of each property-level LLC and the President of Suncoast.

Nolan Prescott. Brecker's testimony regarding the role of his minority equity partner, Nolan Prescott, was notably equivocal. Brecker described Prescott as a "passive investor" who "put up money" for acquisitions but had "no involvement in day-to-day operations." However, when shown quarterly financial summary reports that had been sent to Prescott (Exhibit 14), Brecker acknowledged that those reports included line items showing Suncoast revenue. This is significant because it demonstrates that at least some financial reporting within the Coastal Palms network documented the existence and magnitude of Suncoast revenue, even if such revenue was excluded from external GRR reports to Verimark. Brecker attempted to minimize the significance of Prescott's receipt of these reports by stating that Prescott "probably didn't look at the details," but he offered no basis for this assertion other than his own speculation about Prescott's reading habits.

Theresa Brecker. Regarding his spouse Theresa Brecker's role, Brecker confirmed that she handled payroll and human-resources functions across the Coastal Palms portfolio and was not involved in revenue reporting or GRR calculations. This testimony, if credited, limits Theresa Brecker's exposure as a witness on the underreporting issues but does not eliminate the need to evaluate her knowledge during the relevant period.

B. Franchise License Agreements — Knowledge and Understanding

A substantial portion of the Day 1 morning session was devoted to establishing Brecker's knowledge of, and agreement to, the specific terms of the Franchise License Agreements, particularly the GRR definition and related financial provisions.

Brecker confirmed that he personally signed each of the twenty-two (22) FLAs on behalf of CPFH. He further acknowledged that he had read the FLAs before signing them, a concession that forecloses any future argument that he was unaware of the contractual terms governing GRR reporting.

When shown FLA § 4.1, which defines Gross Room Revenue as "all revenues derived from or attributable to the rental of guest rooms at the Hotel, including revenues from any booking channel, direct or indirect, and regardless of the entity collecting such revenue," Brecker acknowledged both having read and having understood this provision at the time of signing.

Key Admission (Day 1, approximately 10:42 AM). When asked whether he understood § 4.1 to include revenues collected by entities other than the franchisee (i.e., entities other than CPFH itself), Brecker testified:

"I understood GRR to mean the revenues that came through the Verimark system. I didn't think it covered revenues we brought in ourselves through our own efforts."

This testimony is critical. It directly contradicts the plain language of § 4.1, which expressly encompasses revenues collected "regardless of the entity collecting such revenue." Brecker's purported interpretation — that GRR was limited to revenues processed through Verimark's central reservation system — is irreconcilable with the breadth of the contractual definition, which reaches "all revenues derived from or attributable to the rental of guest rooms at the Hotel, including revenues from any booking channel, direct or indirect." This admission will be a key impeachment point in summary-judgment briefing and at trial.

Brecker also confirmed his knowledge of the following FLA provisions:

• § 4.1 — Royalty Rate: 5% of GRR, payable monthly.

• § 4.2 — Marketing-Fund Contribution: 2.5% of GRR, payable monthly.

• § 4.3 — Technology Fee: $12.50 per room per month, adjusted annually for changes in the Consumer Price Index ("CPI"), with a cap of 3% per year.

• § 4.6 — Late-Payment Interest: 1.5% per month on overdue amounts, compounded monthly.

• § 8.2 — Audit Rights: Verimark's right to audit the franchisee's books and records upon ten (10) business days' written notice; the franchisee bears the costs of the audit if underpayment exceeds 2% of reported GRR.

• § 14.1 — Cure Provision: Thirty (30) days to cure a noticed breach.

• § 15.3 — Liquidated Damages: Three times (3×) the trailing-twelve-month royalties per property.

Notably, Brecker stated that he had "never really focused on" § 14.2(c), which provides that "systematic underreporting of Gross Room Revenue shall constitute a material breach that is incapable of cure." He claimed he did not recall reviewing that specific subsection. This lack-of-awareness claim is facially implausible and is undermined by the undisputed fact that Brecker signed twenty-two (22) separate FLAs containing identical language. It strains credulity that a sophisticated franchisee who built a 3,740-room portfolio over fifteen years could have repeatedly executed identical contracts without ever "focusing on" the provision that specifically addresses the consequences of the very conduct at issue in this case.

C. Establishment of Suncoast Room Management Inc.

The afternoon session on Day 1 focused on the creation and purpose of Suncoast Room Management Inc., a topic central to Verimark's claims.

Brecker confirmed that he incorporated Suncoast Room Management Inc. in the State of Florida, with himself as President and sole director. He testified that Suncoast was established "around 2012 or 2013," a timeline that is consistent with Verimark's allegation in the Complaint that the underreporting scheme began no later than January 2013.

When pressed on the specific purpose for which Suncoast was created, Brecker stated:

"[Suncoast was established] to handle the operations side — direct bookings, walk-ins, corporate accounts — and give us a management structure separate from the franchise."

Key Admission (Day 1, approximately 1:45 PM). Upon further questioning, Brecker acknowledged that Suncoast was created specifically to collect revenues from bookings that were not processed through Verimark's central reservation system. These non-Verimark bookings included walk-in guests, corporate-direct contracts negotiated by Brecker's team outside the Verimark sales infrastructure, and bookings made through the unbranded website gulfcoastrooms.com (discussed in Section III.D below). This admission is significant because it establishes that Suncoast was not merely a management company providing operational services; it was a revenue-collection vehicle designed to capture and hold revenues outside the franchise system.

Brecker confirmed that Suncoast retained a 12% "management fee" on all revenues it collected before forwarding the balance to the property-level LLCs (Gulf Breeze Hospitality LLC, Savannah Lodging Partners LLC, and others). He further confirmed that neither the 12% management fee nor the underlying gross revenue collected by Suncoast was reported in GRR to Verimark. This means that Verimark received no royalty, marketing-fund contribution, or technology-fee adjustment attributable to any revenue that passed through Suncoast.

When shown Suncoast bank statements (Exhibit 22) reflecting substantial direct-booking revenue flows, Brecker did not dispute the figures. Exhibit 22 reflects that Suncoast collected over $14 million in direct-booking revenue in 2020 alone at the six (6) Gulf Breeze Hospitality LLC properties in Southwest Florida. Brecker again characterized these revenues as "outside the franchise system," but this characterization is inconsistent with the plain language of FLA § 4.1, which defines GRR to include revenues from "any booking channel, direct or indirect, and regardless of the entity collecting such revenue."

D. The gulfcoastrooms.com Website

Brecker acknowledged that he directed the creation of gulfcoastrooms.com, an unbranded booking website, "sometime around 2014 or 2015." The website was designed to allow prospective guests to book rooms at Coastal Palms properties directly, bypassing Verimark's central reservation system entirely.

Brecker confirmed that the website was intentionally unbranded. It did not use Verimark trademarks, logos, or brand names, even though all of the properties listed on the website were Verimark Suites and Verimark Select hotels operating under Verimark franchise agreements. This deliberate omission of Verimark branding is significant because it suggests a conscious effort to create distance between the direct-booking channel and the franchise system, thereby facilitating the exclusion of the resulting revenues from GRR.

When asked about the purpose of the website, Brecker testified that it was designed to capture "rate-sensitive" guests who might search for hotel rooms online and to avoid paying the Verimark central reservation system fees. He did not, however, identify any specific Verimark reservation-system fee that the direct website would have allowed him to avoid, and the record does not reflect the existence of a per-booking fee charged by Verimark for use of its central reservation system that would approach the magnitude of savings referenced in his contemporaneous communications.

Impeachment Point — Exhibit 31. When asked whether avoiding royalty and marketing-fund obligations was also a purpose of the website, Brecker denied it, stating "that was never the intent." However, this denial is directly contradicted by Exhibit 31, an email sent by Brecker to property managers on March 12, 2016, which states in relevant part:

"Push the direct site. Every booking we keep off the Verimark system saves us 7.5 cents on the dollar."

The "7.5 cents on the dollar" figure — i.e., 7.5% of revenue — corresponds precisely to the combined 5% royalty rate (FLA § 4.1) plus 2.5% marketing-fund contribution (FLA § 4.2) payable to Verimark under the FLAs. There is no Verimark reservation-system fee of 7.5% in the record, and Brecker could not identify one when confronted with this discrepancy during the deposition.

When confronted with Exhibit 31, Brecker attempted to recharacterize his email, stating: "I was talking about reservation-system fees, not royalties." However, when asked to identify any Verimark reservation-system fee that totaled 7.5% of revenue, Brecker was unable to do so. His inability to substantiate this attempted explanation further undermines his credibility on this point and supports the inference that the "7.5 cents on the dollar" reference was, in fact, a reference to the combined royalty and marketing-fund obligations that Brecker sought to avoid by diverting bookings to the unbranded website.

E. OTA Revenue Netting Practices

The final substantive topic on Day 1 addressed Coastal Palms' practice of netting commissions paid to online travel agencies ("OTAs") against GRR, a practice that resulted in additional underreporting beyond the Suncoast revenue exclusions.

Brecker was examined regarding Coastal Palms' practice of classifying net-rate payments from OTAs as "commissions receivable" and netting them against GRR. Under this practice, for OTA bookings processed on a "merchant model" — in which the OTA collects payment from the guest and remits a net amount to the hotel after deducting the OTA's commission — Coastal Palms reported only the net amount received from the OTA, rather than the gross room rate charged to and paid by the guest.

Brecker confirmed this netting methodology and maintained that it was a "reasonable interpretation" of the FLA's GRR definition. His rationale was that "the money we got from the OTA was the net amount," and therefore that the net amount constituted the "revenue" derived from the rental of the guest room. This interpretation, however, is inconsistent with both the contractual language and the explicit guidance in Verimark's Franchise Operations Manual.

Impeachment Point — Exhibit 35. Exhibit 35 consists of the relevant portion of Verimark's Franchise Operations Manual, Section 7.3, which Brecker acknowledged receiving. Section 7.3 explicitly states:

"GRR includes the full rack rate or negotiated rate charged to the guest, regardless of the booking channel, and franchisees may not net commissions, fees, or charges paid to third-party intermediaries against GRR."

This provision squarely addresses and prohibits the netting practice that Coastal Palms employed. When confronted with this language, Brecker claimed he "didn't recall" this specific provision of the Franchise Operations Manual. Given that the manual is a foundational document governing franchise operations — and one that Brecker acknowledged receiving — his claimed lack of recall is difficult to credit and provides an additional basis for impeachment.

IV. DAY 2 SUMMARY — JANUARY 10, 2023

A. Direction to Controllers Regarding GRR Reporting

Day 2 of the deposition yielded the single most important admission of the entire fourteen-hour proceeding. The morning session opened with a line of questioning designed to establish Brecker's personal involvement in the GRR reporting methodology used by Coastal Palms, and Brecker's responses exceeded the team's expectations in terms of directness and clarity.

Critical Admission (Day 2, approximately 9:35 AM). When asked directly whether he gave instructions to property-level controllers about what revenues to include or exclude from GRR reports submitted to Verimark, Brecker testified:

"I told them to report what came through the Verimark system and the OTA channels, minus the commissions. The Suncoast stuff was separate."

Ms. Anand then pressed further, asking the follow-up question with precision:

Q: "So you personally directed controllers to exclude Suncoast-collected revenues from the monthly GRR reports to Verimark?"

A: "I told them Suncoast was a different bucket. Yes, I told them not to include Suncoast numbers in the Verimark reports."

This is the most significant testimony obtained in the deposition. It establishes unequivocally that the exclusion of Suncoast revenues from GRR was not an inadvertent error, a misunderstanding by lower-level accounting personnel, or a decision made independently by property-level controllers operating without direction from management. Rather, it was a deliberate and affirmative directive from Brecker himself — the person who controlled the entire Coastal Palms franchise network, who signed all twenty-two FLAs, and who acknowledged reading and understanding the GRR definition in FLA § 4.1. This admission directly supports Verimark's claims of intentional and systematic underreporting under FLA § 14.2(c) and is central to the damages theory advanced by Dr. Sharon Kettlewell of Ridgeline Forensic Advisory LLC.

Follow-up questioning explored whether Brecker consulted any attorney or accountant before deciding to exclude Suncoast revenues from GRR reports. Brecker testified that he "talked to my accountant" about the issue, but he could not recall the accountant's name, the firm at which the accountant practiced, or when the conversation occurred. He provided no details about what was discussed or what advice, if any, the accountant provided. Defense counsel Nathan Whitfield objected to further inquiry on this topic on privilege grounds, and Ms. Anand noted the objection on the record and moved on. Ms. Anand reserved the right to revisit this area of inquiry, and the team should monitor whether defense counsel ultimately asserts a formal advice-of-counsel defense, which would result in a waiver of any applicable privilege.

Brecker confirmed that this directive to exclude Suncoast revenues from GRR applied to all twenty-two (22) franchised properties across the Coastal Palms portfolio — including both the Florida properties (operated through Gulf Breeze Hospitality LLC and other entities) and the Georgia properties (operated through Savannah Lodging Partners LLC). He further confirmed that the directive covered the entire period from the establishment of Suncoast (approximately January 2013) through the date Verimark issued its Notice of Material Breach (February 4, 2022), a period of approximately nine (9) years.

B. Suncoast Financial Records and Revenue Volumes

Following the critical admission regarding the directive to controllers, the examination turned to the Suncoast financial records themselves. These records had been the subject of significant discovery disputes, and many of the documents discussed in this portion of the deposition were produced only in the supplemental production of November 18, 2022 (consisting of approximately 312,000 additional documents), which followed the Court's October 28, 2022 order granting Verimark's Motion to Compel.

Brecker was shown Suncoast general ledger summaries (Exhibit 41) covering the period from 2013 through 2021. These summaries reflect, on a year-by-year basis, the aggregate direct-booking revenue collected through Suncoast across all twenty-two (22) properties. Brecker confirmed that these general ledger summaries were maintained in the ordinary course of Suncoast's business and that they reflected the revenue flows that passed through Suncoast's accounts.

Brecker did not dispute that Suncoast collected substantial revenues during the relevant period. However, he challenged the specific totals for certain years, characterizing them as "estimates" or "rounded numbers." He did not identify any specific errors in the general ledger summaries and did not produce or reference any alternative accounting that would support different figures.

When shown a reconciliation prepared by Ridgeline Forensic Advisory LLC — referenced in Dr. Sharon Kettlewell's draft expert analysis — cross-referencing Suncoast bank deposits with property-management-system ("PMS") data from the individual hotel properties, Brecker could not explain discrepancies exceeding $4 million in certain years. These discrepancies suggest that the actual Suncoast-collected revenue may be even greater than the amounts reflected in the general ledger summaries, a point that will be developed further in Dr. Kettlewell's expert report.

Brecker reiterated his earlier confirmation that Suncoast retained a 12% management fee on gross direct-booking revenue before forwarding the balance to the property-level LLCs. He further acknowledged — in a significant concession — that neither the 12% management fee nor the underlying gross revenue was reported in GRR to Verimark. This means that Verimark received no royalty (5%), no marketing-fund contribution (2.5%), and no technology-fee payments attributable to any of the revenue that flowed through Suncoast, for any of the twenty-two properties, over the entire nine-year period.

C. Unreported Room Additions

Brecker was examined regarding 214 rooms added across four (4) properties without notification to Verimark, resulting in underpayment of technology fees under FLA § 4.3.

Brecker confirmed that room additions — resulting from expansions and renovations — occurred at the following properties:

• Fort Myers, Florida (2 properties): Approximately 80 rooms added across both properties combined.

• Savannah, Georgia (1 property): Approximately 74 rooms added.

• Jacksonville, Florida (1 property): Approximately 60 rooms added.

Brecker acknowledged that FLA § 4.3 requires technology-fee payments to be calculated based on the number of available rooms per month, at a rate of $12.50 per room per month (subject to annual CPI adjustment, capped at 3% per year). He further acknowledged that he, as Managing Member, was responsible for notifying Verimark of changes to room counts at any franchised property.

When asked why Verimark was not notified of the room additions, Brecker offered the following explanation:

"We were in the process of renovating and the room counts changed. We just didn't update the reports right away."

This explanation is unsatisfying on its face. When pressed on the fact that some of the added rooms were operational for years without being reported to Verimark, Brecker acknowledged that "it should have been caught sooner." He did not offer any explanation for the multi-year delay in reporting, nor did he suggest that any effort was made to true-up the technology-fee payments during the relevant period.

Based on the evidence in the record, the underpaid technology fees attributable to the 214 unreported rooms are estimated as follows: 214 rooms × $12.50 per room per month × approximately 47 months (average period of underreporting across the four properties) ≈ $1,257,250 (approximately $1.26 million). This figure does not include CPI adjustments or late-payment interest under FLA § 4.6, which would increase the total.

D. Brecker's "Awareness" Defense — Verimark's Alleged Knowledge of Suncoast

A significant portion of Day 2 was devoted to exploring — and ultimately undermining — defense counsel's anticipated argument that Verimark was aware of Suncoast's role in the Coastal Palms revenue structure and acquiesced in the methodology by which Suncoast-collected revenues were excluded from GRR. This "awareness defense," if successful, could support arguments based on waiver, estoppel, or ratification. The deposition testimony, however, reveals that this defense rests on an exceedingly thin evidentiary foundation.

Brecker testified broadly that "Verimark knew about Suncoast from the beginning" and that Suncoast was identified in "property-management agreements" submitted during the franchise-application process. However, when pressed for specifics, his testimony revealed the following critical gaps:

Single Documentary Reference. When asked to identify specific documents showing Verimark's knowledge of Suncoast's revenue-collection role, Brecker could identify only a single reference: a property-management agreement submitted with the 2013 franchise application for a Savannah, Georgia property (Exhibit 48). Upon review of this document, it became clear that while the agreement does identify Suncoast as the management company for the property, it does not disclose that Suncoast would collect guest-room revenues or that those revenues would be excluded from GRR reports submitted to Verimark. The document is a standard management-company identification — the type of document that would be expected in any franchise application — and it says nothing about the revenue-reporting methodology at issue.

No Communications Disclosing the Practice. Brecker could not identify any communication — whether email, letter, memorandum, meeting notes, or any other form of written or recorded communication — in which he informed any Verimark representative that Suncoast was collecting guest-room revenues that were not being included in GRR reports. Specifically, Brecker could not point to any such communication with Deidre Langston (SVP, Franchise Operations), Renata Solis-Vega (SVP & General Counsel), or any franchise compliance officer at Verimark.

No Written Approval or Waiver. When asked whether he had ever sought written approval or a waiver from Verimark to exclude Suncoast revenues from GRR, Brecker answered directly: "No, I didn't think I needed to." This admission is significant because it forecloses any argument that Verimark affirmatively approved or consented to the exclusion of Suncoast revenues.

No Identified Verimark Employee. Brecker could not identify any Verimark employee who specifically told him that it was acceptable to exclude Suncoast revenues from GRR. He could not recall any conversation — in person, by telephone, or otherwise — in which any Verimark representative expressed awareness of or acquiescence in the revenue-reporting methodology employed by Coastal Palms.

Assessment. The awareness defense is weak on this record. At best, Brecker's testimony establishes that Verimark may have known that Suncoast existed as a management entity — a fact that is neither surprising nor particularly relevant, since the use of affiliated management companies is common in the hotel-franchise industry. What Brecker conspicuously failed to establish is that Verimark knew or approved of the exclusion of Suncoast-collected revenues from GRR. This distinction — between knowledge of an entity's existence and knowledge of a specific revenue-reporting methodology — is critical and must be emphasized in summary-judgment briefing. Brecker's inability to bridge this gap significantly weakens the defense's position.

E. Janet Kerrigan — Termination and Whistleblower Allegations

Brecker was questioned about Janet Kerrigan, the former Regional Controller for Coastal Palms, who was terminated in October 2021 and subsequently filed a whistleblower complaint with Verimark's compliance hotline on November 8, 2021.

Brecker confirmed that Kerrigan served as Regional Controller and that she "had access to all the financial records" for the Florida properties in the Coastal Palms portfolio. This confirmation is important because it establishes that Kerrigan was in a position to observe and understand the GRR reporting methodology, including the exclusion of Suncoast revenues.

Regarding the circumstances of Kerrigan's termination, Brecker testified that it was "a performance issue — she wasn't meeting deadlines." Defense counsel objected to further questioning about the specific circumstances of her termination as beyond the scope, and the examination moved to the more critical question of whether Kerrigan had raised concerns about GRR reporting during her tenure.

On this point, Brecker provided testimony that is highly favorable to Verimark's position:

"She mentioned it once or twice, said she thought we should be including Suncoast numbers. I told her that was management's decision and not to worry about it."

Impeachment Point. This admission is significant for two reasons. First, it corroborates the testimony that Verimark anticipates from Kerrigan herself — whose deposition is scheduled for January 25, 2023, and is being prepared by Yuki Nakamura — that she was instructed by Brecker not to include Suncoast revenues in GRR reports and was terminated shortly after raising the issue internally. Second, the timeline of events is highly suggestive: Kerrigan raised concerns about GRR reporting, was told by Brecker to disregard those concerns, and was terminated in October 2021 — barely a month before she filed her whistleblower complaint with Verimark on November 8, 2021. This sequence of events provides additional context for the jury regarding both Brecker's state of mind and the retaliatory character of Kerrigan's termination.

F. Counterclaim — Brand-Standard Violations

On Day 2, defense counsel Nathan Whitfield conducted redirect examination covering Coastal Palms' $12 million counterclaim alleging that Verimark failed to maintain brand standards across the franchise system. The counterclaim alleges deferred maintenance at the corporate level, inadequate reservation-system uptime, and other unspecified brand-standard deficiencies.

On re-cross by Ms. Anand, Brecker was asked to identify specific instances of brand-standard failures by Verimark. His testimony on this point was notably vague and unsubstantiated. He cited "the reservation system going down a few times in 2019 and 2020" and "some issues with the loyalty-program website," but he could not provide specific dates, durations, or quantification of any impact. When asked to quantify the financial impact of these alleged failures on Coastal Palms' operations, Brecker was unable to do so with any degree of specificity. He offered no calculations, no lost-revenue analyses, and no documentation to support the $12 million figure asserted in the counterclaim.

Additionally, Brecker acknowledged that Coastal Palms never filed a formal complaint with Verimark's franchise-operations department regarding brand-standard violations during the relevant period. He further admitted that he never invoked any contractual remedy for brand-standard non-compliance under the FLAs. These admissions are significant because they undermine the counterclaim in two respects: they suggest both that the alleged brand-standard violations were not sufficiently serious to prompt a complaint at the time they allegedly occurred, and that Coastal Palms did not avail itself of the contractual remedies available to it, thereby potentially waiving any right to assert those claims now.

G. FY 2021 Revenue Figures and Underreporting Magnitude

The final substantive area of examination on Day 2 addressed the magnitude of the underreporting at issue in this case, with a focus on the most recent full fiscal year for which data is available.

Brecker was shown Coastal Palms' FY 2021 GRR as reported to Verimark, which totaled $112.4 million across all twenty-two (22) properties. He was then confronted with Verimark's forensic analysis — prepared by Ridgeline Forensic Advisory LLC and authored by Dr. Sharon Kettlewell — which estimates true FY 2021 GRR at $145.6 million. The discrepancy between the reported and actual figures is $33.2 million, representing approximately 29.5% underreporting for that single fiscal year.

Brecker disputed the magnitude of the discrepancy, stating "I don't think it was that much" and "some of those numbers include things that shouldn't count as room revenue." When pressed to identify which specific categories were improperly included in the Kettlewell analysis, Brecker cited "late-checkout fees" and "incidentals." However, these categories are not included in the Kettlewell analysis, which focuses solely on room-rental revenue. Brecker's inability to identify any actual error in the forensic analysis undermines his general objection to the magnitude of the underreporting.

Brecker did not dispute the general existence of a gap between reported GRR and actual revenue. He acknowledged that there was a difference but contested the 22%–31% underreporting range estimated by Verimark's experts across the 2013–2021 period. He offered no alternative analysis, no competing calculations, and no documentary evidence to support a different underreporting percentage.

V. KEY ADMISSIONS — SUMMARY TABLE

The following table summarizes the most significant admissions obtained during the Brecker deposition, organized by topic. Each admission is referenced to the day and approximate time of testimony; exact page-and-line references will be confirmed upon receipt of the final transcript.

VI. IMPEACHMENT POINTS — SUMMARY TABLE

The following table identifies the key impeachment points arising from the Brecker deposition, cross-referenced to the relevant exhibits and testimony. These points should be cataloged in the trial impeachment binder and incorporated into summary-judgment briefing.

VII. CRITICAL DOCUMENT REFERENCES

The following catalog lists the exhibits referenced during or relevant to Brecker's deposition. These documents should be compiled into a dedicated impeachment exhibit binder and cross-referenced with the deposition transcript upon its finalization.

Exhibit 14 — Quarterly Financial Summary Reports to Nolan Prescott. These reports were sent by Brecker or his staff to Prescott in his capacity as a 25% equity holder of CPFH. They include line items showing Suncoast revenue, demonstrating that Suncoast-collected revenues were tracked and reported internally even as they were excluded from GRR reports submitted to Verimark. These reports are relevant both to Brecker's knowledge and intent and to Prescott's anticipated claim of ignorance regarding Suncoast revenue flows.

Exhibit 22 — Suncoast Room Management Inc. Bank Statements. These bank statements reflect direct-booking revenue flows processed through Suncoast's accounts. At the six (6) Gulf Breeze Hospitality LLC properties in Southwest Florida alone, Suncoast collected over $14 million in direct-booking revenue in 2020. The bank statements corroborate the magnitude of the underreporting and provide an independent verification source for the Ridgeline Forensic Advisory reconciliation.

Exhibit 31 — March 12, 2016 Email from Brecker to Property Managers. This email contains the instruction to "push the direct site" and the statement that "[e]very booking we keep off the Verimark system saves us 7.5 cents on the dollar." The 7.5% figure matches the combined 5% royalty and 2.5% marketing-fund contribution under the FLAs. This is the single most powerful impeachment document in the case, as it directly evidences Brecker's awareness that diverting bookings from the Verimark system would reduce his franchise-fee obligations.

Exhibit 35 — Verimark Franchise Operations Manual, Section 7.3. This section of the manual — which Brecker acknowledged receiving — explicitly states that GRR includes the full rack rate or negotiated rate charged to the guest, regardless of the booking channel, and prohibits netting of commissions, fees, or charges paid to third-party intermediaries. This provision directly undermines Brecker's OTA netting practices and his claimed "reasonable interpretation" of the GRR definition.

Exhibit 41 — Suncoast General Ledger Summaries, 2013–2021. These summaries reflect the aggregate direct-booking revenue collected through Suncoast across all twenty-two (22) properties on a year-by-year basis. Brecker confirmed these were maintained in the ordinary course of business. Discrepancies between these summaries and the Ridgeline Forensic Advisory reconciliation (cross-referencing Suncoast bank deposits with PMS data) exceed $4 million in certain years.

Exhibit 48 — Property-Management Agreement, 2013 Savannah Franchise Application. This is the sole document Brecker identified in support of the awareness defense. It identifies Suncoast as the management company for a Savannah, Georgia property but does not disclose Suncoast's revenue-collection role or the exclusion of Suncoast revenues from GRR.

FLA Provisions. The following FLA provisions were referenced during the deposition and are central to the claims and defenses in this case:

• § 4.1 — Definition of Gross Room Revenue; 5% royalty rate

• § 4.2 — Marketing-fund contribution (2.5% of GRR)

• § 4.3 — Technology fee ($12.50/room/month, CPI-adjusted, capped at 3%/year)

• § 4.6 — Late-payment interest (1.5%/month, compounded)

• § 8.2 — Audit rights (10 business days' written notice; franchisee bears costs if underpayment exceeds 2% of reported GRR)

• § 14.1 — Thirty-day cure period

• § 14.2(c) — Systematic underreporting as incurable material breach

• § 15.3 — Liquidated damages (3× trailing-twelve-month royalties per property)

Ridgeline Forensic Advisory Reconciliation. The reconciliation prepared by Ridgeline Forensic Advisory LLC, referenced in Dr. Sharon Kettlewell's draft expert analysis, cross-references Suncoast bank deposits with PMS data from the individual hotel properties. This reconciliation was used during the deposition to confront Brecker with discrepancies in reported revenue figures and forms the evidentiary basis for Verimark's cumulative underreported GRR calculation of $197.8 million.

VIII. ASSESSMENT OF WITNESS CREDIBILITY

Overall, Brecker was a combative but ultimately damaging witness for the defense. His demeanor throughout both days of testimony alternated between confidence on topics he had clearly prepared for and evasiveness on topics where the documentary record contradicted his positions. Several observations regarding his credibility are warranted:

Central Admission. Brecker's admission that he personally directed property-level controllers to exclude Suncoast revenues from GRR is unambiguous and devastating to Coastal Palms' defense. It was made in clear and direct language — "Yes, I told them not to include Suncoast numbers in the Verimark reports" — and was not qualified, hedged, or retracted. This admission eliminates any argument that the underreporting was inadvertent, the product of lower-level error, or the result of an ambiguous contractual provision reasonably susceptible to competing interpretations.

"Reasonable Interpretation" Defense. Brecker's assertion that his interpretation of FLA § 4.1 was "reasonable" is contradicted by the plain language of the provision, which encompasses revenues collected "regardless of the entity collecting such revenue." His interpretation — that GRR included only revenues processed through the Verimark system — requires reading into the provision a limitation that does not appear in the text. Furthermore, his interpretation is belied by Exhibit 31 (the "7.5 cents" email), which strongly implies that Brecker was aware that diverting bookings from the Verimark system would result in reduced franchise-fee payments. If Brecker truly believed that Suncoast revenues were not subject to franchise fees, there would have been no "savings" to reference.

Awareness Defense. The awareness defense is thin. As discussed in Section IV.D above, Brecker identified only one document (Exhibit 48) referencing Suncoast in the franchise-application process, and that document does not disclose the revenue-collection or GRR-exclusion practices. Brecker could not identify any Verimark representative who approved or acquiesced in the exclusion, could not produce any communication disclosing the practice, and admitted he never sought written approval or a waiver. At most, the record establishes that Verimark may have known Suncoast existed as a management entity — a fact far removed from knowledge of or acquiescence in the systematic exclusion of revenues from GRR.

Claimed Reliance on Accountant's Advice. Brecker's vague testimony that he "talked to my accountant" before deciding to exclude Suncoast revenues from GRR is unsupported by any documentation. He could not name the accountant, identify the firm, recall the date of the conversation, or describe the substance of the advice allegedly received. This claim may be subject to waiver if defense counsel ultimately asserts an advice-of-counsel defense, and it should be the subject of further discovery if warranted.

Demeanor. Brecker's demeanor was occasionally evasive, particularly on questions regarding the gulfcoastrooms.com website and the OTA netting methodology. On several occasions, he provided non-responsive or tangential answers that required follow-up questioning to pin down. His attempt to recharacterize the "7.5 cents on the dollar" reference as pertaining to "reservation-system fees" — rather than franchise fees — was visibly unconvincing, as he was unable to identify any such fee when challenged. These moments could be effective for impeachment purposes at trial if selected clips from the video deposition are designated for playback.

IX. RECOMMENDATIONS AND NEXT STEPS

Based on the testimony obtained during the Brecker deposition, the following actions are recommended:

1. Expert Coordination. This deposition summary should be forwarded promptly to Dr. Sharon Kettlewell at Ridgeline Forensic Advisory LLC for incorporation into her expert analysis. Brecker's admission that he personally directed property-level controllers to exclude Suncoast-collected revenues from GRR confirms the intentional and systematic nature of the underreporting. This confirmation supports the application of the $197.8 million cumulative underreported GRR figure across all twenty-two (22) properties for the full 2013–2021 period, which forms the basis for Dr. Kettlewell's damages calculations, including unpaid royalties (5%), marketing-fund contributions (2.5%), technology-fee shortfalls, and late-payment interest (1.5%/month, compounded).

2. Kerrigan Deposition Preparation. The deposition of Janet Kerrigan, former Regional Controller for Coastal Palms, is scheduled for January 25, 2023, and is being prepared by Yuki Nakamura. Kerrigan's examination should specifically address Brecker's admission that he told Kerrigan "not to worry about" GRR reporting concerns. The examination should also explore in detail the timeline of her termination (October 2021) relative to her raising these concerns internally, and should probe whether there were additional instances in which she or other employees raised concerns about the exclusion of Suncoast revenues from GRR.

3. Prescott Deposition Preparation. The deposition of Nolan Prescott, the 25% equity holder in CPFH, is scheduled for February 2023 and is being prepared by Carlos Espinoza. Prescott's examination should focus on his receipt and review of Exhibit 14 (quarterly financial summaries containing Suncoast revenue line items) to test his anticipated claim of lack of knowledge regarding Suncoast revenue flows and the GRR reporting methodology. The examination should also explore the extent of Prescott's involvement in financial decision-making and his communications with Brecker regarding franchise-fee obligations.

4. Summary Judgment Briefing. Brecker's key admissions — particularly the directive to exclude Suncoast revenues from GRR and his inability to support the awareness defense — should be central to Verimark's anticipated Motion for Partial Summary Judgment. The admissions are directly relevant to at least the following counts: Count I (Breach of Contract — Royalties), Count II (Breach of Contract — Marketing Fund), and potentially Count III (Breach of Contract — Technology Fees) to the extent of the unreported room additions. The awareness defense, as developed in Brecker's testimony, does not create a genuine issue of material fact sufficient to preclude summary judgment. His testimony establishes, at most, that Verimark may have known Suncoast existed as a management entity — not that Verimark knew or approved of the specific practice of excluding Suncoast-collected revenues from GRR.

5. Impeachment Exhibit Binder. Compile Exhibits 14, 22, 31, 35, 41, and 48 into a dedicated impeachment binder for potential use in cross-examination at trial or in deposition-designation proceedings. Each exhibit should be tabbed and cross-referenced to the specific testimony it contradicts, with the relevant deposition transcript excerpts attached.

6. Counterclaim Assessment. Brecker's inability to quantify the financial impact of alleged brand-standard violations by Verimark, combined with his admission that Coastal Palms never filed a formal complaint with Verimark's franchise-operations department regarding such violations and never invoked any contractual remedy for brand-standard non-compliance, significantly weakens the $12 million counterclaim. We recommend flagging this issue for potential summary judgment on the counterclaim. At a minimum, a motion in limine may be appropriate to exclude any damages testimony on the counterclaim that is not supported by expert analysis or documentary evidence.

7. Privilege Follow-Up. The litigation team should monitor whether defense counsel at Whitfield, Barrow & Crane LLP ultimately asserts an advice-of-counsel defense based on Brecker's reference to an unnamed accountant. If such a defense is formally asserted, it would constitute a waiver of any applicable accountant-client or attorney-client privilege, and we should immediately pursue further discovery, including identification of the accountant, production of any communications or memoranda reflecting the advice, and deposition of the accountant.

X. APPENDIX — DEPOSITION TRANSCRIPT REFERENCES

The following table provides specific transcript citations keyed to each key admission and impeachment point identified in this memorandum. Day and approximate time references are provided below; exact page-and-line citations will be confirmed and inserted upon receipt of the final certified transcript from the reporting service.

Note on Transcript Availability. The certified court reporter transcript is expected from the reporting service within fourteen (14) business days of the deposition conclusion (i.e., on or about January 31, 2023). Upon receipt, the page-and-line references in the table above will be confirmed and updated. The video recording of the deposition is available through Nexagen Document Solutions LLC and has been requested for purposes of identifying clips suitable for trial designation and impeachment use.

This memorandum was prepared by Carlos Espinoza, Working Associate, Litigation (General), Calderwood & Harkness LLP. Please direct any questions or comments to the undersigned or to Priya Anand, Responsible Partner.

CALDERWOOD & HARKNESS LLP

By: ________

Carlos Espinoza Working Associate, Litigation (General)

Date: January 25, 2023

No.	Admission	Day/Time
1	Brecker personally directed property-level controllers to exclude Suncoast-collected revenues from monthly GRR reports submitted to Verimark. He testified: "I told them Suncoast was a different bucket. Yes, I told them not to include Suncoast numbers in the Verimark reports."	Day 2, ~9:35 AM
2	Brecker created Suncoast Room Management Inc. specifically to handle revenues from bookings outside Verimark's central reservation system, including walk-ins, corporate-direct contracts, and bookings through gulfcoastrooms.com, beginning approximately January 2013.	Day 1, ~1:45 PM
3	Brecker directed creation of the unbranded website gulfcoastrooms.com to capture direct bookings without use of Verimark branding, trademarks, or logos, even though all listed properties were Verimark Suites or Verimark Select hotels.	Day 1
4	Brecker acknowledged that Suncoast retained a 12% management fee on direct-booking revenues, and that neither the fee nor the underlying gross revenue was reported in GRR to Verimark.	Day 2
5	Brecker acknowledged awareness of FLA § 4.1's GRR definition but testified he interpreted it as limited to revenues "through the Verimark system," contradicting the provision's plain language ("regardless of the entity collecting such revenue").	Day 1, ~10:42 AM
6	Brecker never sought written approval or a waiver from Verimark to exclude Suncoast revenues from GRR. He testified: "No, I didn't think I needed to."	Day 2
7	Brecker could not identify any specific Verimark employee who told him it was acceptable to exclude Suncoast revenues from GRR.	Day 2
8	Brecker confirmed 214 rooms were added at 4 properties (Fort Myers (2), Savannah, Jacksonville) without notification to Verimark, resulting in underpaid technology fees estimated at approximately $1.26 million.	Day 2
9	Brecker confirmed that former Regional Controller Janet Kerrigan raised concerns about the GRR reporting methodology, and he told her it was "management's decision" and to "not worry about it."	Day 2
10	Brecker's March 12, 2016 email (Exhibit 31) to property managers references savings of "7.5 cents on the dollar" from pushing bookings to the direct site — a figure precisely matching the combined 5% royalty + 2.5% marketing-fund contribution under the FLAs.	Day 1
No.	Impeachment Point	Exhibit / Source	Analysis
1	March 12, 2016 email: "Every booking we keep off the Verimark system saves us 7.5 cents on the dollar." Brecker claimed this referred to "reservation-system fees," not royalties/marketing contributions.	Exhibit 31	Brecker could not identify any Verimark reservation-system fee of 7.5%. The 7.5% figure precisely matches the combined FLA royalty (5%) plus marketing-fund contribution (2.5%). This email is strong evidence of consciousness that the booking-diversion scheme was designed to reduce franchise-fee obligations.
2	Franchise Operations Manual, Section 7.3: Explicitly requires GRR to include full rack or negotiated rate and prohibits netting of OTA commissions against GRR. Brecker claimed he "didn't recall" this provision.	Exhibit 35	Brecker acknowledged receiving the Franchise Operations Manual. His claimed lack of recall regarding a provision directly relevant to his reporting practices is not credible.
3	FLA § 4.1 language: "regardless of the entity collecting such revenue." Brecker testified he understood GRR to mean only revenues "through the Verimark system."	FLA § 4.1	The contractual language is unambiguous and directly contradicts Brecker's self-serving interpretation. This contradiction is the foundation for the breach-of-contract claim.
4	FLA § 14.2(c): "systematic underreporting of Gross Room Revenue shall constitute a material breach that is incapable of cure." Brecker claimed he "never really focused on" this provision.	FLA § 14.2(c)	Brecker signed 22 FLAs containing identical language. His claimed lack of awareness of a key breach provision is implausible and undermines his credibility generally.
5	Property-management agreement for Savannah property: The sole document Brecker cited in support of the "awareness" defense identifies Suncoast as management company but does not disclose revenue-collection role or GRR exclusion.	Exhibit 48	This document fails to bridge the gap between Verimark's potential knowledge that Suncoast existed and knowledge that Suncoast was collecting revenues excluded from GRR. The awareness defense is unsupported.
6	Quarterly financial summaries to Nolan Prescott: Include Suncoast revenue line items, undermining Prescott's anticipated claim of ignorance regarding Suncoast revenue flows.	Exhibit 14	These reports demonstrate that Suncoast revenue was tracked and reported internally even as it was excluded from external GRR reports to Verimark. Relevant to Prescott deposition preparation.
7	Kerrigan termination timeline: Kerrigan raised GRR reporting concerns; Brecker told her "not to worry about it"; Kerrigan was terminated October 2021; Kerrigan filed whistleblower complaint with Verimark November 8, 2021.	Brecker testimony; Kerrigan whistleblower complaint	The temporal proximity between Kerrigan's raising concerns, her termination, and her whistleblower complaint is highly suggestive and will be explored in Kerrigan's upcoming deposition.
Reference No.	Topic	Day	Approx. Time	Transcript Page:Line
Adm. 1	Directive to controllers to exclude Suncoast revenues from GRR	Day 2	~9:35 AM	To be confirmed
Adm. 2	Creation of Suncoast to collect non-Verimark revenues	Day 1	~1:45 PM	To be confirmed
Adm. 3	Direction to create unbranded website gulfcoastrooms.com	Day 1	Afternoon session	To be confirmed
Adm. 4	Suncoast 12% management fee; neither fee nor revenue reported in GRR	Day 2	Morning session	To be confirmed
Adm. 5	Interpretation of FLA § 4.1 as limited to Verimark-system revenues	Day 1	~10:42 AM	To be confirmed

Adm. 6	No written approval or waiver sought from Verimark	Day 2	Afternoon session	To be confirmed
Adm. 7	Unable to identify any Verimark employee who approved exclusion	Day 2	Afternoon session	To be confirmed
Adm. 8	214 unreported rooms at 4 properties; underpaid technology fees	Day 2	Mid-morning session	To be confirmed
Adm. 9	Kerrigan raised concerns; told "not to worry about it"	Day 2	Afternoon session	To be confirmed
Adm. 10	Exhibit 31 — "7.5 cents on the dollar" email	Day 1	Afternoon session	To be confirmed
Imp. 1	Exhibit 31 vs. claimed "reservation-system fees" explanation	Day 1	Afternoon session	To be confirmed
Imp. 2	Exhibit 35 (Franchise Operations Manual § 7.3) — "didn't recall"	Day 1	Late afternoon	To be confirmed

Imp. 3

PRIVILEGED & CONFIDENTIAL — ATTORNEY WORK PRODUCT
This memorandum is protected by the attorney-client privilege and the work-product doctrine. It contains the mental impressions, conclusions, opinions, and legal theories of attorneys at Calderwood & Harkness LLP. It is prepared in anticipation of litigation and is not to be disclosed to any third party without the express prior authorization of Calderwood & Harkness LLP.
MEMORANDUM
TO: Priya Anand, Partner, Litigation (General) Yuki Nakamura, Lead Associate, Litigation (General)
FROM: Carlos Espinoza, Working Associate, Litigation (General)
DATE: January 25, 2023
RE: Deposition Summary — Randall "Randy" Brecker (Days 1 & 2), January 9–10, 2023
MATTER: Verimark Hospitality Group Inc. v. Coastal Palms Franchise Holdings LLC et al., Case No. 1021-00006, Circuit Court of the 17th Judicial Circuit, Broward County, Florida
CLIENT: Verimark Hospitality Group Inc.
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I. EXECUTIVE SUMMARY
This memorandum summarizes the two-day deposition of Randall "Randy" Brecker, Managing Member and 60% equity holder of Coastal Palms Franchise Holdings LLC ("CPFH") and President of Suncoast Room Management Inc. ("Suncoast"). The deposition was conducted on January 9, 2023 (Day 1) and January 10, 2023 (Day 2), at the offices of Whitfield, Barrow & Crane LLP, 1221 Brickell Avenue, Suite 3000, Miami, Florida 33131. Day 1 encompassed approximately seven (7) hours of testimony, and Day 2 encompassed approximately seven (7) hours of testimony, for a combined total of approximately fourteen (14) hours of testimony across both days.
The examination was conducted by Priya Anand of Calderwood & Harkness LLP (FL Bar No. 0087451) on behalf of our client, Verimark Hospitality Group Inc. ("Verimark"). Defending counsel were Nathan Whitfield III and Gabriela Montes of Whitfield, Barrow & Crane LLP. A certified court reporter was present throughout both days, and the deposition was videographed in its entirety.
The purpose of this memorandum is threefold: (1) to summarize key admissions obtained from Brecker during the deposition; (2) to identify impeachment points that may be used in subsequent proceedings, including summary-judgment briefing, expert coordination, and potential trial; and (3) to catalog critical document references for efficient retrieval and cross-referencing by the litigation team.
Overall Assessment. Brecker made several damaging admissions during the course of his testimony. Most critically, he admitted on Day 2 that he personally directed property-level controllers to exclude revenues collected through Suncoast Room Management Inc. from the monthly Gross Room Revenue ("GRR") reports submitted to Verimark. This admission is devastating to the defense because it establishes that the underreporting was not the result of inadvertent error, a good-faith interpretive disagreement, or decisions made independently by lower-level employees, but rather a deliberate and systematic directive issued by Brecker himself — the individual who also signed all twenty-two (22) Franchise License Agreements ("FLAs") on behalf of CPFH.
Additionally, Brecker acknowledged creating the unbranded booking website gulfcoastrooms.com for the express purpose of capturing direct bookings outside Verimark's central reservation system. A March 12, 2016 email from Brecker to property managers (Exhibit 31) referencing savings of "7.5 cents on the dollar" — a figure that precisely matches the combined 5% royalty and 2.5% marketing-fund contribution under the FLAs — provides powerful evidence of Brecker's awareness that the booking-diversion scheme was designed to reduce franchise-fee obligations.
Brecker consistently maintained throughout both days of testimony that his interpretation of the FLA's GRR definition was "reasonable" and that Verimark was aware of Suncoast's role. However, his testimony on the purported awareness defense was vague, largely unsupported by specific documentary evidence, and ultimately undercut by his own inability to identify any Verimark representative who approved or acquiesced in the exclusion of Suncoast-collected revenues from GRR. The single document he cited in support of the awareness defense — a property-management agreement submitted with a 2013 franchise application for a Savannah, Georgia property (Exhibit 48) — identifies Suncoast as the management company but does not disclose that Suncoast would collect guest-room revenues or that those revenues would be excluded from GRR.
The sections that follow provide a detailed summary of Brecker's testimony, organized by topic and by day, followed by summary tables of key admissions and impeachment points, a catalog of critical document references, an assessment of witness credibility, and recommendations for next steps.
II. BACKGROUND — WITNESS PROFILE
Randall Thomas Brecker, who goes by "Randy," is fifty-eight (58) years old and resides in Naples, Florida. He is the central figure in the Coastal Palms franchise network and occupies several overlapping roles across the network's various entities.
Coastal Palms Franchise Holdings LLC. Brecker is the Managing Member and holds a 60% equity interest in CPFH, the entity that serves as the primary franchisee under the Verimark FLAs. The remaining equity is held by Theresa Brecker (15%), Brecker's spouse, who manages payroll and human-resources functions across the portfolio, and Nolan Prescott (25%), a retired commercial real-estate developer whom Brecker described during the deposition as a "passive investor" who "put up money" for acquisitions but had "no involvement in day-to-day operations."
Suncoast Room Management Inc. Brecker is the President and sole director of Suncoast Room Management Inc., a Florida corporation that he formed approximately in 2012 or 2013. As described in greater detail below, Suncoast served as the vehicle through which Brecker collected and retained revenues from guest-room bookings that were not processed through Verimark's central reservation system, including walk-in guests, corporate-direct contracts, and bookings through the unbranded website gulfcoastrooms.com.
Other Entities. Brecker is also the Managing Member of Gulf Breeze Hospitality LLC, which owns and operates six (6) Verimark Suites properties in Southwest Florida, and Savannah Lodging Partners LLC, which owns and operates four (4) Verimark Suites properties in coastal Georgia. Additional property-level LLCs exist for the remaining properties in the portfolio, each of which is managed by Brecker.
Career Background. Brecker is a former hotel general manager who built the Coastal Palms portfolio from a single property in 2007 to its current size of twenty-two (22) hotels — consisting of eighteen (18) Verimark Suites properties and four (4) Verimark Select properties — comprising approximately 3,740 total guest rooms across the states of Florida and Georgia. His first Franchise License Agreement with Verimark was executed on June 15, 2007, for a single Verimark Suites property in Naples, Florida. The most recent FLA in the portfolio was executed on September 3, 2019. Throughout this period, Brecker personally signed each FLA on behalf of CPFH, and he testified that he was personally involved in virtually all significant operational and financial decisions affecting the franchise network.
III. DAY 1 SUMMARY — JANUARY 9, 2023
A. Formation and Structure of Coastal Palms Entities
The first substantive topic of examination on Day 1 addressed the formation, organizational structure, and governance of the Coastal Palms entities. This line of questioning was designed to establish Brecker's personal control over the franchise network's operations and financial reporting, a foundation necessary for attributing the underreporting to his deliberate direction rather than to autonomous decisions by subordinates.
Brecker testified that he formed Coastal Palms Franchise Holdings LLC in approximately 2006, in preparation for entering into the first Verimark franchise agreement. He confirmed that CPFH is a Florida limited liability company with its principal office located at 9500 Gulf Shore Drive, Suite 450, Naples, Florida 34108, and its registered agent is Garrison Registered Agents LLC, 100 South Ashley Drive, Suite 600, Tampa, Florida 33602.
Brecker described the entity structure as follows: CPFH serves as the holding entity and the franchisee of record under the Verimark FLAs. Below CPFH, a series of property-level LLCs — including Gulf Breeze Hospitality LLC, Savannah Lodging Partners LLC, and additional entities not individually named during this portion of the deposition — own and operate the individual hotel properties. Suncoast Room Management Inc. sits alongside these property-level entities and serves as an affiliated management company. Brecker is the Managing Member of each property-level LLC and the President of Suncoast.
Nolan Prescott. Brecker's testimony regarding the role of his minority equity partner, Nolan Prescott, was notably equivocal. Brecker described Prescott as a "passive investor" who "put up money" for acquisitions but had "no involvement in day-to-day operations." However, when shown quarterly financial summary reports that had been sent to Prescott (Exhibit 14), Brecker acknowledged that those reports included line items showing Suncoast revenue. This is significant because it demonstrates that at least some financial reporting within the Coastal Palms network documented the existence and magnitude of Suncoast revenue, even if such revenue was excluded from external GRR reports to Verimark. Brecker attempted to minimize the significance of Prescott's receipt of these reports by stating that Prescott "probably didn't look at the details," but he offered no basis for this assertion other than his own speculation about Prescott's reading habits.
Theresa Brecker. Regarding his spouse Theresa Brecker's role, Brecker confirmed that she handled payroll and human-resources functions across the Coastal Palms portfolio and was not involved in revenue reporting or GRR calculations. This testimony, if credited, limits Theresa Brecker's exposure as a witness on the underreporting issues but does not eliminate the need to evaluate her knowledge during the relevant period.
B. Franchise License Agreements — Knowledge and Understanding
A substantial portion of the Day 1 morning session was devoted to establishing Brecker's knowledge of, and agreement to, the specific terms of the Franchise License Agreements, particularly the GRR definition and related financial provisions.
Brecker confirmed that he personally signed each of the twenty-two (22) FLAs on behalf of CPFH. He further acknowledged that he had read the FLAs before signing them, a concession that forecloses any future argument that he was unaware of the contractual terms governing GRR reporting.
When shown FLA § 4.1, which defines Gross Room Revenue as "all revenues derived from or attributable to the rental of guest rooms at the Hotel, including revenues from any booking channel, direct or indirect, and regardless of the entity collecting such revenue," Brecker acknowledged both having read and having understood this provision at the time of signing.
Key Admission (Day 1, approximately 10:42 AM). When asked whether he understood § 4.1 to include revenues collected by entities other than the franchisee (i.e., entities other than CPFH itself), Brecker testified:
"I understood GRR to mean the revenues that came through the Verimark system. I didn't think it covered revenues we brought in ourselves through our own efforts."
This testimony is critical. It directly contradicts the plain language of § 4.1, which expressly encompasses revenues collected "regardless of the entity collecting such revenue." Brecker's purported interpretation — that GRR was limited to revenues processed through Verimark's central reservation system — is irreconcilable with the breadth of the contractual definition, which reaches "all revenues derived from or attributable to the rental of guest rooms at the Hotel, including revenues from any booking channel, direct or indirect." This admission will be a key impeachment point in summary-judgment briefing and at trial.
Brecker also confirmed his knowledge of the following FLA provisions:
•  § 4.1 — Royalty Rate: 5% of GRR, payable monthly.
•  § 4.2 — Marketing-Fund Contribution: 2.5% of GRR, payable monthly.
•  § 4.3 — Technology Fee: $12.50 per room per month, adjusted annually for changes in the Consumer Price Index ("CPI"), with a cap of 3% per year.
•  § 4.6 — Late-Payment Interest: 1.5% per month on overdue amounts, compounded monthly.
•  § 8.2 — Audit Rights: Verimark's right to audit the franchisee's books and records upon ten (10) business days' written notice; the franchisee bears the costs of the audit if underpayment exceeds 2% of reported GRR.
•  § 14.1 — Cure Provision: Thirty (30) days to cure a noticed breach.
•  § 15.3 — Liquidated Damages: Three times (3×) the trailing-twelve-month royalties per property.
Notably, Brecker stated that he had "never really focused on" § 14.2(c), which provides that "systematic underreporting of Gross Room Revenue shall constitute a material breach that is incapable of cure." He claimed he did not recall reviewing that specific subsection. This lack-of-awareness claim is facially implausible and is undermined by the undisputed fact that Brecker signed twenty-two (22) separate FLAs containing identical language. It strains credulity that a sophisticated franchisee who built a 3,740-room portfolio over fifteen years could have repeatedly executed identical contracts without ever "focusing on" the provision that specifically addresses the consequences of the very conduct at issue in this case.
C. Establishment of Suncoast Room Management Inc.
The afternoon session on Day 1 focused on the creation and purpose of Suncoast Room Management Inc., a topic central to Verimark's claims.
Brecker confirmed that he incorporated Suncoast Room Management Inc. in the State of Florida, with himself as President and sole director. He testified that Suncoast was established "around 2012 or 2013," a timeline that is consistent with Verimark's allegation in the Complaint that the underreporting scheme began no later than January 2013.
When pressed on the specific purpose for which Suncoast was created, Brecker stated:
"[Suncoast was established] to handle the operations side — direct bookings, walk-ins, corporate accounts — and give us a management structure separate from the franchise."
Key Admission (Day 1, approximately 1:45 PM). Upon further questioning, Brecker acknowledged that Suncoast was created specifically to collect revenues from bookings that were not processed through Verimark's central reservation system. These non-Verimark bookings included walk-in guests, corporate-direct contracts negotiated by Brecker's team outside the Verimark sales infrastructure, and bookings made through the unbranded website gulfcoastrooms.com (discussed in Section III.D below). This admission is significant because it establishes that Suncoast was not merely a management company providing operational services; it was a revenue-collection vehicle designed to capture and hold revenues outside the franchise system.
Brecker confirmed that Suncoast retained a 12% "management fee" on all revenues it collected before forwarding the balance to the property-level LLCs (Gulf Breeze Hospitality LLC, Savannah Lodging Partners LLC, and others). He further confirmed that neither the 12% management fee nor the underlying gross revenue collected by Suncoast was reported in GRR to Verimark. This means that Verimark received no royalty, marketing-fund contribution, or technology-fee adjustment attributable to any revenue that passed through Suncoast.
When shown Suncoast bank statements (Exhibit 22) reflecting substantial direct-booking revenue flows, Brecker did not dispute the figures. Exhibit 22 reflects that Suncoast collected over $14 million in direct-booking revenue in 2020 alone at the six (6) Gulf Breeze Hospitality LLC properties in Southwest Florida. Brecker again characterized these revenues as "outside the franchise system," but this characterization is inconsistent with the plain language of FLA § 4.1, which defines GRR to include revenues from "any booking channel, direct or indirect, and regardless of the entity collecting such revenue."
D. The gulfcoastrooms.com Website
Brecker acknowledged that he directed the creation of gulfcoastrooms.com, an unbranded booking website, "sometime around 2014 or 2015." The website was designed to allow prospective guests to book rooms at Coastal Palms properties directly, bypassing Verimark's central reservation system entirely.
Brecker confirmed that the website was intentionally unbranded. It did not use Verimark trademarks, logos, or brand names, even though all of the properties listed on the website were Verimark Suites and Verimark Select hotels operating under Verimark franchise agreements. This deliberate omission of Verimark branding is significant because it suggests a conscious effort to create distance between the direct-booking channel and the franchise system, thereby facilitating the exclusion of the resulting revenues from GRR.
When asked about the purpose of the website, Brecker testified that it was designed to capture "rate-sensitive" guests who might search for hotel rooms online and to avoid paying the Verimark central reservation system fees. He did not, however, identify any specific Verimark reservation-system fee that the direct website would have allowed him to avoid, and the record does not reflect the existence of a per-booking fee charged by Verimark for use of its central reservation system that would approach the magnitude of savings referenced in his contemporaneous communications.
Impeachment Point — Exhibit 31. When asked whether avoiding royalty and marketing-fund obligations was also a purpose of the website, Brecker denied it, stating "that was never the intent." However, this denial is directly contradicted by Exhibit 31, an email sent by Brecker to property managers on March 12, 2016, which states in relevant part:
"Push the direct site. Every booking we keep off the Verimark system saves us 7.5 cents on the dollar."
The "7.5 cents on the dollar" figure — i.e., 7.5% of revenue — corresponds precisely to the combined 5% royalty rate (FLA § 4.1) plus 2.5% marketing-fund contribution (FLA § 4.2) payable to Verimark under the FLAs. There is no Verimark reservation-system fee of 7.5% in the record, and Brecker could not identify one when confronted with this discrepancy during the deposition.
When confronted with Exhibit 31, Brecker attempted to recharacterize his email, stating: "I was talking about reservation-system fees, not royalties." However, when asked to identify any Verimark reservation-system fee that totaled 7.5% of revenue, Brecker was unable to do so. His inability to substantiate this attempted explanation further undermines his credibility on this point and supports the inference that the "7.5 cents on the dollar" reference was, in fact, a reference to the combined royalty and marketing-fund obligations that Brecker sought to avoid by diverting bookings to the unbranded website.
E. OTA Revenue Netting Practices
The final substantive topic on Day 1 addressed Coastal Palms' practice of netting commissions paid to online travel agencies ("OTAs") against GRR, a practice that resulted in additional underreporting beyond the Suncoast revenue exclusions.
Brecker was examined regarding Coastal Palms' practice of classifying net-rate payments from OTAs as "commissions receivable" and netting them against GRR. Under this practice, for OTA bookings processed on a "merchant model" — in which the OTA collects payment from the guest and remits a net amount to the hotel after deducting the OTA's commission — Coastal Palms reported only the net amount received from the OTA, rather than the gross room rate charged to and paid by the guest.
Brecker confirmed this netting methodology and maintained that it was a "reasonable interpretation" of the FLA's GRR definition. His rationale was that "the money we got from the OTA was the net amount," and therefore that the net amount constituted the "revenue" derived from the rental of the guest room. This interpretation, however, is inconsistent with both the contractual language and the explicit guidance in Verimark's Franchise Operations Manual.
Impeachment Point — Exhibit 35. Exhibit 35 consists of the relevant portion of Verimark's Franchise Operations Manual, Section 7.3, which Brecker acknowledged receiving. Section 7.3 explicitly states:
"GRR includes the full rack rate or negotiated rate charged to the guest, regardless of the booking channel, and franchisees may not net commissions, fees, or charges paid to third-party intermediaries against GRR."
This provision squarely addresses and prohibits the netting practice that Coastal Palms employed. When confronted with this language, Brecker claimed he "didn't recall" this specific provision of the Franchise Operations Manual. Given that the manual is a foundational document governing franchise operations — and one that Brecker acknowledged receiving — his claimed lack of recall is difficult to credit and provides an additional basis for impeachment.
IV. DAY 2 SUMMARY — JANUARY 10, 2023
A. Direction to Controllers Regarding GRR Reporting
Day 2 of the deposition yielded the single most important admission of the entire fourteen-hour proceeding. The morning session opened with a line of questioning designed to establish Brecker's personal involvement in the GRR reporting methodology used by Coastal Palms, and Brecker's responses exceeded the team's expectations in terms of directness and clarity.
Critical Admission (Day 2, approximately 9:35 AM). When asked directly whether he gave instructions to property-level controllers about what revenues to include or exclude from GRR reports submitted to Verimark, Brecker testified:
"I told them to report what came through the Verimark system and the OTA channels, minus the commissions. The Suncoast stuff was separate."
Ms. Anand then pressed further, asking the follow-up question with precision:
Q: "So you personally directed controllers to exclude Suncoast-collected revenues from the monthly GRR reports to Verimark?"
A: "I told them Suncoast was a different bucket. Yes, I told them not to include Suncoast numbers in the Verimark reports."
This is the most significant testimony obtained in the deposition. It establishes unequivocally that the exclusion of Suncoast revenues from GRR was not an inadvertent error, a misunderstanding by lower-level accounting personnel, or a decision made independently by property-level controllers operating without direction from management. Rather, it was a deliberate and affirmative directive from Brecker himself — the person who controlled the entire Coastal Palms franchise network, who signed all twenty-two FLAs, and who acknowledged reading and understanding the GRR definition in FLA § 4.1. This admission directly supports Verimark's claims of intentional and systematic underreporting under FLA § 14.2(c) and is central to the damages theory advanced by Dr. Sharon Kettlewell of Ridgeline Forensic Advisory LLC.
Follow-up questioning explored whether Brecker consulted any attorney or accountant before deciding to exclude Suncoast revenues from GRR reports. Brecker testified that he "talked to my accountant" about the issue, but he could not recall the accountant's name, the firm at which the accountant practiced, or when the conversation occurred. He provided no details about what was discussed or what advice, if any, the accountant provided. Defense counsel Nathan Whitfield objected to further inquiry on this topic on privilege grounds, and Ms. Anand noted the objection on the record and moved on. Ms. Anand reserved the right to revisit this area of inquiry, and the team should monitor whether defense counsel ultimately asserts a formal advice-of-counsel defense, which would result in a waiver of any applicable privilege.
Brecker confirmed that this directive to exclude Suncoast revenues from GRR applied to all twenty-two (22) franchised properties across the Coastal Palms portfolio — including both the Florida properties (operated through Gulf Breeze Hospitality LLC and other entities) and the Georgia properties (operated through Savannah Lodging Partners LLC). He further confirmed that the directive covered the entire period from the establishment of Suncoast (approximately January 2013) through the date Verimark issued its Notice of Material Breach (February 4, 2022), a period of approximately nine (9) years.
B. Suncoast Financial Records and Revenue Volumes
Following the critical admission regarding the directive to controllers, the examination turned to the Suncoast financial records themselves. These records had been the subject of significant discovery disputes, and many of the documents discussed in this portion of the deposition were produced only in the supplemental production of November 18, 2022 (consisting of approximately 312,000 additional documents), which followed the Court's October 28, 2022 order granting Verimark's Motion to Compel.
Brecker was shown Suncoast general ledger summaries (Exhibit 41) covering the period from 2013 through 2021. These summaries reflect, on a year-by-year basis, the aggregate direct-booking revenue collected through Suncoast across all twenty-two (22) properties. Brecker confirmed that these general ledger summaries were maintained in the ordinary course of Suncoast's business and that they reflected the revenue flows that passed through Suncoast's accounts.
Brecker did not dispute that Suncoast collected substantial revenues during the relevant period. However, he challenged the specific totals for certain years, characterizing them as "estimates" or "rounded numbers." He did not identify any specific errors in the general ledger summaries and did not produce or reference any alternative accounting that would support different figures.
When shown a reconciliation prepared by Ridgeline Forensic Advisory LLC — referenced in Dr. Sharon Kettlewell's draft expert analysis — cross-referencing Suncoast bank deposits with property-management-system ("PMS") data from the individual hotel properties, Brecker could not explain discrepancies exceeding $4 million in certain years. These discrepancies suggest that the actual Suncoast-collected revenue may be even greater than the amounts reflected in the general ledger summaries, a point that will be developed further in Dr. Kettlewell's expert report.
Brecker reiterated his earlier confirmation that Suncoast retained a 12% management fee on gross direct-booking revenue before forwarding the balance to the property-level LLCs. He further acknowledged — in a significant concession — that neither the 12% management fee nor the underlying gross revenue was reported in GRR to Verimark. This means that Verimark received no royalty (5%), no marketing-fund contribution (2.5%), and no technology-fee payments attributable to any of the revenue that flowed through Suncoast, for any of the twenty-two properties, over the entire nine-year period.
C. Unreported Room Additions
Brecker was examined regarding 214 rooms added across four (4) properties without notification to Verimark, resulting in underpayment of technology fees under FLA § 4.3.
Brecker confirmed that room additions — resulting from expansions and renovations — occurred at the following properties:
•  Fort Myers, Florida (2 properties): Approximately 80 rooms added across both properties combined.
•  Savannah, Georgia (1 property): Approximately 74 rooms added.
•  Jacksonville, Florida (1 property): Approximately 60 rooms added.
Brecker acknowledged that FLA § 4.3 requires technology-fee payments to be calculated based on the number of available rooms per month, at a rate of $12.50 per room per month (subject to annual CPI adjustment, capped at 3% per year). He further acknowledged that he, as Managing Member, was responsible for notifying Verimark of changes to room counts at any franchised property.
When asked why Verimark was not notified of the room additions, Brecker offered the following explanation:
"We were in the process of renovating and the room counts changed. We just didn't update the reports right away."
This explanation is unsatisfying on its face. When pressed on the fact that some of the added rooms were operational for years without being reported to Verimark, Brecker acknowledged that "it should have been caught sooner." He did not offer any explanation for the multi-year delay in reporting, nor did he suggest that any effort was made to true-up the technology-fee payments during the relevant period.
Based on the evidence in the record, the underpaid technology fees attributable to the 214 unreported rooms are estimated as follows: 214 rooms × $12.50 per room per month × approximately 47 months (average period of underreporting across the four properties) ≈ $1,257,250 (approximately $1.26 million). This figure does not include CPI adjustments or late-payment interest under FLA § 4.6, which would increase the total.
D. Brecker's "Awareness" Defense — Verimark's Alleged Knowledge of Suncoast
A significant portion of Day 2 was devoted to exploring — and ultimately undermining — defense counsel's anticipated argument that Verimark was aware of Suncoast's role in the Coastal Palms revenue structure and acquiesced in the methodology by which Suncoast-collected revenues were excluded from GRR. This "awareness defense," if successful, could support arguments based on waiver, estoppel, or ratification. The deposition testimony, however, reveals that this defense rests on an exceedingly thin evidentiary foundation.
Brecker testified broadly that "Verimark knew about Suncoast from the beginning" and that Suncoast was identified in "property-management agreements" submitted during the franchise-application process. However, when pressed for specifics, his testimony revealed the following critical gaps:
Single Documentary Reference. When asked to identify specific documents showing Verimark's knowledge of Suncoast's revenue-collection role, Brecker could identify only a single reference: a property-management agreement submitted with the 2013 franchise application for a Savannah, Georgia property (Exhibit 48). Upon review of this document, it became clear that while the agreement does identify Suncoast as the management company for the property, it does not disclose that Suncoast would collect guest-room revenues or that those revenues would be excluded from GRR reports submitted to Verimark. The document is a standard management-company identification — the type of document that would be expected in any franchise application — and it says nothing about the revenue-reporting methodology at issue.
No Communications Disclosing the Practice. Brecker could not identify any communication — whether email, letter, memorandum, meeting notes, or any other form of written or recorded communication — in which he informed any Verimark representative that Suncoast was collecting guest-room revenues that were not being included in GRR reports. Specifically, Brecker could not point to any such communication with Deidre Langston (SVP, Franchise Operations), Renata Solis-Vega (SVP & General Counsel), or any franchise compliance officer at Verimark.
No Written Approval or Waiver. When asked whether he had ever sought written approval or a waiver from Verimark to exclude Suncoast revenues from GRR, Brecker answered directly: "No, I didn't think I needed to." This admission is significant because it forecloses any argument that Verimark affirmatively approved or consented to the exclusion of Suncoast revenues.
No Identified Verimark Employee. Brecker could not identify any Verimark employee who specifically told him that it was acceptable to exclude Suncoast revenues from GRR. He could not recall any conversation — in person, by telephone, or otherwise — in which any Verimark representative expressed awareness of or acquiescence in the revenue-reporting methodology employed by Coastal Palms.
Assessment. The awareness defense is weak on this record. At best, Brecker's testimony establishes that Verimark may have known that Suncoast existed as a management entity — a fact that is neither surprising nor particularly relevant, since the use of affiliated management companies is common in the hotel-franchise industry. What Brecker conspicuously failed to establish is that Verimark knew or approved of the exclusion of Suncoast-collected revenues from GRR. This distinction — between knowledge of an entity's existence and knowledge of a specific revenue-reporting methodology — is critical and must be emphasized in summary-judgment briefing. Brecker's inability to bridge this gap significantly weakens the defense's position.
E. Janet Kerrigan — Termination and Whistleblower Allegations
Brecker was questioned about Janet Kerrigan, the former Regional Controller for Coastal Palms, who was terminated in October 2021 and subsequently filed a whistleblower complaint with Verimark's compliance hotline on November 8, 2021.
Brecker confirmed that Kerrigan served as Regional Controller and that she "had access to all the financial records" for the Florida properties in the Coastal Palms portfolio. This confirmation is important because it establishes that Kerrigan was in a position to observe and understand the GRR reporting methodology, including the exclusion of Suncoast revenues.
Regarding the circumstances of Kerrigan's termination, Brecker testified that it was "a performance issue — she wasn't meeting deadlines." Defense counsel objected to further questioning about the specific circumstances of her termination as beyond the scope, and the examination moved to the more critical question of whether Kerrigan had raised concerns about GRR reporting during her tenure.
On this point, Brecker provided testimony that is highly favorable to Verimark's position:
"She mentioned it once or twice, said she thought we should be including Suncoast numbers. I told her that was management's decision and not to worry about it."
Impeachment Point. This admission is significant for two reasons. First, it corroborates the testimony that Verimark anticipates from Kerrigan herself — whose deposition is scheduled for January 25, 2023, and is being prepared by Yuki Nakamura — that she was instructed by Brecker not to include Suncoast revenues in GRR reports and was terminated shortly after raising the issue internally. Second, the timeline of events is highly suggestive: Kerrigan raised concerns about GRR reporting, was told by Brecker to disregard those concerns, and was terminated in October 2021 — barely a month before she filed her whistleblower complaint with Verimark on November 8, 2021. This sequence of events provides additional context for the jury regarding both Brecker's state of mind and the retaliatory character of Kerrigan's termination.
F. Counterclaim — Brand-Standard Violations
On Day 2, defense counsel Nathan Whitfield conducted redirect examination covering Coastal Palms' $12 million counterclaim alleging that Verimark failed to maintain brand standards across the franchise system. The counterclaim alleges deferred maintenance at the corporate level, inadequate reservation-system uptime, and other unspecified brand-standard deficiencies.
On re-cross by Ms. Anand, Brecker was asked to identify specific instances of brand-standard failures by Verimark. His testimony on this point was notably vague and unsubstantiated. He cited "the reservation system going down a few times in 2019 and 2020" and "some issues with the loyalty-program website," but he could not provide specific dates, durations, or quantification of any impact. When asked to quantify the financial impact of these alleged failures on Coastal Palms' operations, Brecker was unable to do so with any degree of specificity. He offered no calculations, no lost-revenue analyses, and no documentation to support the $12 million figure asserted in the counterclaim.
Additionally, Brecker acknowledged that Coastal Palms never filed a formal complaint with Verimark's franchise-operations department regarding brand-standard violations during the relevant period. He further admitted that he never invoked any contractual remedy for brand-standard non-compliance under the FLAs. These admissions are significant because they undermine the counterclaim in two respects: they suggest both that the alleged brand-standard violations were not sufficiently serious to prompt a complaint at the time they allegedly occurred, and that Coastal Palms did not avail itself of the contractual remedies available to it, thereby potentially waiving any right to assert those claims now.
G. FY 2021 Revenue Figures and Underreporting Magnitude
The final substantive area of examination on Day 2 addressed the magnitude of the underreporting at issue in this case, with a focus on the most recent full fiscal year for which data is available.
Brecker was shown Coastal Palms' FY 2021 GRR as reported to Verimark, which totaled $112.4 million across all twenty-two (22) properties. He was then confronted with Verimark's forensic analysis — prepared by Ridgeline Forensic Advisory LLC and authored by Dr. Sharon Kettlewell — which estimates true FY 2021 GRR at $145.6 million. The discrepancy between the reported and actual figures is $33.2 million, representing approximately 29.5% underreporting for that single fiscal year.
Brecker disputed the magnitude of the discrepancy, stating "I don't think it was that much" and "some of those numbers include things that shouldn't count as room revenue." When pressed to identify which specific categories were improperly included in the Kettlewell analysis, Brecker cited "late-checkout fees" and "incidentals." However, these categories are not included in the Kettlewell analysis, which focuses solely on room-rental revenue. Brecker's inability to identify any actual error in the forensic analysis undermines his general objection to the magnitude of the underreporting.
Brecker did not dispute the general existence of a gap between reported GRR and actual revenue. He acknowledged that there was a difference but contested the 22%–31% underreporting range estimated by Verimark's experts across the 2013–2021 period. He offered no alternative analysis, no competing calculations, and no documentary evidence to support a different underreporting percentage.
V. KEY ADMISSIONS — SUMMARY TABLE
The following table summarizes the most significant admissions obtained during the Brecker deposition, organized by topic. Each admission is referenced to the day and approximate time of testimony; exact page-and-line references will be confirmed upon receipt of the final transcript.
VI. IMPEACHMENT POINTS — SUMMARY TABLE
The following table identifies the key impeachment points arising from the Brecker deposition, cross-referenced to the relevant exhibits and testimony. These points should be cataloged in the trial impeachment binder and incorporated into summary-judgment briefing.
VII. CRITICAL DOCUMENT REFERENCES
The following catalog lists the exhibits referenced during or relevant to Brecker's deposition. These documents should be compiled into a dedicated impeachment exhibit binder and cross-referenced with the deposition transcript upon its finalization.
Exhibit 14 — Quarterly Financial Summary Reports to Nolan Prescott. These reports were sent by Brecker or his staff to Prescott in his capacity as a 25% equity holder of CPFH. They include line items showing Suncoast revenue, demonstrating that Suncoast-collected revenues were tracked and reported internally even as they were excluded from GRR reports submitted to Verimark. These reports are relevant both to Brecker's knowledge and intent and to Prescott's anticipated claim of ignorance regarding Suncoast revenue flows.
Exhibit 22 — Suncoast Room Management Inc. Bank Statements. These bank statements reflect direct-booking revenue flows processed through Suncoast's accounts. At the six (6) Gulf Breeze Hospitality LLC properties in Southwest Florida alone, Suncoast collected over $14 million in direct-booking revenue in 2020. The bank statements corroborate the magnitude of the underreporting and provide an independent verification source for the Ridgeline Forensic Advisory reconciliation.
Exhibit 31 — March 12, 2016 Email from Brecker to Property Managers. This email contains the instruction to "push the direct site" and the statement that "[e]very booking we keep off the Verimark system saves us 7.5 cents on the dollar." The 7.5% figure matches the combined 5% royalty and 2.5% marketing-fund contribution under the FLAs. This is the single most powerful impeachment document in the case, as it directly evidences Brecker's awareness that diverting bookings from the Verimark system would reduce his franchise-fee obligations.
Exhibit 35 — Verimark Franchise Operations Manual, Section 7.3. This section of the manual — which Brecker acknowledged receiving — explicitly states that GRR includes the full rack rate or negotiated rate charged to the guest, regardless of the booking channel, and prohibits netting of commissions, fees, or charges paid to third-party intermediaries. This provision directly undermines Brecker's OTA netting practices and his claimed "reasonable interpretation" of the GRR definition.
Exhibit 41 — Suncoast General Ledger Summaries, 2013–2021. These summaries reflect the aggregate direct-booking revenue collected through Suncoast across all twenty-two (22) properties on a year-by-year basis. Brecker confirmed these were maintained in the ordinary course of business. Discrepancies between these summaries and the Ridgeline Forensic Advisory reconciliation (cross-referencing Suncoast bank deposits with PMS data) exceed $4 million in certain years.
Exhibit 48 — Property-Management Agreement, 2013 Savannah Franchise Application. This is the sole document Brecker identified in support of the awareness defense. It identifies Suncoast as the management company for a Savannah, Georgia property but does not disclose Suncoast's revenue-collection role or the exclusion of Suncoast revenues from GRR.
FLA Provisions. The following FLA provisions were referenced during the deposition and are central to the claims and defenses in this case:
•  § 4.1 — Definition of Gross Room Revenue; 5% royalty rate
•  § 4.2 — Marketing-fund contribution (2.5% of GRR)
•  § 4.3 — Technology fee ($12.50/room/month, CPI-adjusted, capped at 3%/year)
•  § 4.6 — Late-payment interest (1.5%/month, compounded)
•  § 8.2 — Audit rights (10 business days' written notice; franchisee bears costs if underpayment exceeds 2% of reported GRR)
•  § 14.1 — Thirty-day cure period
•  § 14.2(c) — Systematic underreporting as incurable material breach
•  § 15.3 — Liquidated damages (3× trailing-twelve-month royalties per property)
Ridgeline Forensic Advisory Reconciliation. The reconciliation prepared by Ridgeline Forensic Advisory LLC, referenced in Dr. Sharon Kettlewell's draft expert analysis, cross-references Suncoast bank deposits with PMS data from the individual hotel properties. This reconciliation was used during the deposition to confront Brecker with discrepancies in reported revenue figures and forms the evidentiary basis for Verimark's cumulative underreported GRR calculation of $197.8 million.
VIII. ASSESSMENT OF WITNESS CREDIBILITY
Overall, Brecker was a combative but ultimately damaging witness for the defense. His demeanor throughout both days of testimony alternated between confidence on topics he had clearly prepared for and evasiveness on topics where the documentary record contradicted his positions. Several observations regarding his credibility are warranted:
Central Admission. Brecker's admission that he personally directed property-level controllers to exclude Suncoast revenues from GRR is unambiguous and devastating to Coastal Palms' defense. It was made in clear and direct language — "Yes, I told them not to include Suncoast numbers in the Verimark reports" — and was not qualified, hedged, or retracted. This admission eliminates any argument that the underreporting was inadvertent, the product of lower-level error, or the result of an ambiguous contractual provision reasonably susceptible to competing interpretations.
"Reasonable Interpretation" Defense. Brecker's assertion that his interpretation of FLA § 4.1 was "reasonable" is contradicted by the plain language of the provision, which encompasses revenues collected "regardless of the entity collecting such revenue." His interpretation — that GRR included only revenues processed through the Verimark system — requires reading into the provision a limitation that does not appear in the text. Furthermore, his interpretation is belied by Exhibit 31 (the "7.5 cents" email), which strongly implies that Brecker was aware that diverting bookings from the Verimark system would result in reduced franchise-fee payments. If Brecker truly believed that Suncoast revenues were not subject to franchise fees, there would have been no "savings" to reference.
Awareness Defense. The awareness defense is thin. As discussed in Section IV.D above, Brecker identified only one document (Exhibit 48) referencing Suncoast in the franchise-application process, and that document does not disclose the revenue-collection or GRR-exclusion practices. Brecker could not identify any Verimark representative who approved or acquiesced in the exclusion, could not produce any communication disclosing the practice, and admitted he never sought written approval or a waiver. At most, the record establishes that Verimark may have known Suncoast existed as a management entity — a fact far removed from knowledge of or acquiescence in the systematic exclusion of revenues from GRR.
Claimed Reliance on Accountant's Advice. Brecker's vague testimony that he "talked to my accountant" before deciding to exclude Suncoast revenues from GRR is unsupported by any documentation. He could not name the accountant, identify the firm, recall the date of the conversation, or describe the substance of the advice allegedly received. This claim may be subject to waiver if defense counsel ultimately asserts an advice-of-counsel defense, and it should be the subject of further discovery if warranted.
Demeanor. Brecker's demeanor was occasionally evasive, particularly on questions regarding the gulfcoastrooms.com website and the OTA netting methodology. On several occasions, he provided non-responsive or tangential answers that required follow-up questioning to pin down. His attempt to recharacterize the "7.5 cents on the dollar" reference as pertaining to "reservation-system fees" — rather than franchise fees — was visibly unconvincing, as he was unable to identify any such fee when challenged. These moments could be effective for impeachment purposes at trial if selected clips from the video deposition are designated for playback.
IX. RECOMMENDATIONS AND NEXT STEPS
Based on the testimony obtained during the Brecker deposition, the following actions are recommended:
1. Expert Coordination. This deposition summary should be forwarded promptly to Dr. Sharon Kettlewell at Ridgeline Forensic Advisory LLC for incorporation into her expert analysis. Brecker's admission that he personally directed property-level controllers to exclude Suncoast-collected revenues from GRR confirms the intentional and systematic nature of the underreporting. This confirmation supports the application of the $197.8 million cumulative underreported GRR figure across all twenty-two (22) properties for the full 2013–2021 period, which forms the basis for Dr. Kettlewell's damages calculations, including unpaid royalties (5%), marketing-fund contributions (2.5%), technology-fee shortfalls, and late-payment interest (1.5%/month, compounded).
2. Kerrigan Deposition Preparation. The deposition of Janet Kerrigan, former Regional Controller for Coastal Palms, is scheduled for January 25, 2023, and is being prepared by Yuki Nakamura. Kerrigan's examination should specifically address Brecker's admission that he told Kerrigan "not to worry about" GRR reporting concerns. The examination should also explore in detail the timeline of her termination (October 2021) relative to her raising these concerns internally, and should probe whether there were additional instances in which she or other employees raised concerns about the exclusion of Suncoast revenues from GRR.
3. Prescott Deposition Preparation. The deposition of Nolan Prescott, the 25% equity holder in CPFH, is scheduled for February 2023 and is being prepared by Carlos Espinoza. Prescott's examination should focus on his receipt and review of Exhibit 14 (quarterly financial summaries containing Suncoast revenue line items) to test his anticipated claim of lack of knowledge regarding Suncoast revenue flows and the GRR reporting methodology. The examination should also explore the extent of Prescott's involvement in financial decision-making and his communications with Brecker regarding franchise-fee obligations.
4. Summary Judgment Briefing. Brecker's key admissions — particularly the directive to exclude Suncoast revenues from GRR and his inability to support the awareness defense — should be central to Verimark's anticipated Motion for Partial Summary Judgment. The admissions are directly relevant to at least the following counts: Count I (Breach of Contract — Royalties), Count II (Breach of Contract — Marketing Fund), and potentially Count III (Breach of Contract — Technology Fees) to the extent of the unreported room additions. The awareness defense, as developed in Brecker's testimony, does not create a genuine issue of material fact sufficient to preclude summary judgment. His testimony establishes, at most, that Verimark may have known Suncoast existed as a management entity — not that Verimark knew or approved of the specific practice of excluding Suncoast-collected revenues from GRR.
5. Impeachment Exhibit Binder. Compile Exhibits 14, 22, 31, 35, 41, and 48 into a dedicated impeachment binder for potential use in cross-examination at trial or in deposition-designation proceedings. Each exhibit should be tabbed and cross-referenced to the specific testimony it contradicts, with the relevant deposition transcript excerpts attached.
6. Counterclaim Assessment. Brecker's inability to quantify the financial impact of alleged brand-standard violations by Verimark, combined with his admission that Coastal Palms never filed a formal complaint with Verimark's franchise-operations department regarding such violations and never invoked any contractual remedy for brand-standard non-compliance, significantly weakens the $12 million counterclaim. We recommend flagging this issue for potential summary judgment on the counterclaim. At a minimum, a motion in limine may be appropriate to exclude any damages testimony on the counterclaim that is not supported by expert analysis or documentary evidence.
7. Privilege Follow-Up. The litigation team should monitor whether defense counsel at Whitfield, Barrow & Crane LLP ultimately asserts an advice-of-counsel defense based on Brecker's reference to an unnamed accountant. If such a defense is formally asserted, it would constitute a waiver of any applicable accountant-client or attorney-client privilege, and we should immediately pursue further discovery, including identification of the accountant, production of any communications or memoranda reflecting the advice, and deposition of the accountant.
X. APPENDIX — DEPOSITION TRANSCRIPT REFERENCES
The following table provides specific transcript citations keyed to each key admission and impeachment point identified in this memorandum. Day and approximate time references are provided below; exact page-and-line citations will be confirmed and inserted upon receipt of the final certified transcript from the reporting service.
Note on Transcript Availability. The certified court reporter transcript is expected from the reporting service within fourteen (14) business days of the deposition conclusion (i.e., on or about January 31, 2023). Upon receipt, the page-and-line references in the table above will be confirmed and updated. The video recording of the deposition is available through Nexagen Document Solutions LLC and has been requested for purposes of identifying clips suitable for trial designation and impeachment use.
This memorandum was prepared by Carlos Espinoza, Working Associate, Litigation (General), Calderwood & Harkness LLP. Please direct any questions or comments to the undersigned or to Priya Anand, Responsible Partner.
CALDERWOOD & HARKNESS LLP
By: ________
Carlos Espinoza Working Associate, Litigation (General)
Date: January 25, 2023
No. | Admission | Day/Time
1 | Brecker personally directed property-level controllers to exclude Suncoast-collected revenues from monthly GRR reports submitted to Verimark. He testified: "I told them Suncoast was a different bucket. Yes, I told them not to include Suncoast numbers in the Verimark reports." | Day 2, ~9:35 AM
2 | Brecker created Suncoast Room Management Inc. specifically to handle revenues from bookings outside Verimark's central reservation system, including walk-ins, corporate-direct contracts, and bookings through gulfcoastrooms.com, beginning approximately January 2013. | Day 1, ~1:45 PM
3 | Brecker directed creation of the unbranded website gulfcoastrooms.com to capture direct bookings without use of Verimark branding, trademarks, or logos, even though all listed properties were Verimark Suites or Verimark Select hotels. | Day 1
4 | Brecker acknowledged that Suncoast retained a 12% management fee on direct-booking revenues, and that neither the fee nor the underlying gross revenue was reported in GRR to Verimark. | Day 2
5 | Brecker acknowledged awareness of FLA § 4.1's GRR definition but testified he interpreted it as limited to revenues "through the Verimark system," contradicting the provision's plain language ("regardless of the entity collecting such revenue"). | Day 1, ~10:42 AM
6 | Brecker never sought written approval or a waiver from Verimark to exclude Suncoast revenues from GRR. He testified: "No, I didn't think I needed to." | Day 2
7 | Brecker could not identify any specific Verimark employee who told him it was acceptable to exclude Suncoast revenues from GRR. | Day 2
8 | Brecker confirmed 214 rooms were added at 4 properties (Fort Myers (2), Savannah, Jacksonville) without notification to Verimark, resulting in underpaid technology fees estimated at approximately $1.26 million. | Day 2
9 | Brecker confirmed that former Regional Controller Janet Kerrigan raised concerns about the GRR reporting methodology, and he told her it was "management's decision" and to "not worry about it." | Day 2
10 | Brecker's March 12, 2016 email (Exhibit 31) to property managers references savings of "7.5 cents on the dollar" from pushing bookings to the direct site — a figure precisely matching the combined 5% royalty + 2.5% marketing-fund contribution under the FLAs. | Day 1
No. | Impeachment Point | Exhibit / Source | Analysis
1 | March 12, 2016 email: "Every booking we keep off the Verimark system saves us 7.5 cents on the dollar." Brecker claimed this referred to "reservation-system fees," not royalties/marketing contributions. | Exhibit 31 | Brecker could not identify any Verimark reservation-system fee of 7.5%. The 7.5% figure precisely matches the combined FLA royalty (5%) plus marketing-fund contribution (2.5%). This email is strong evidence of consciousness that the booking-diversion scheme was designed to reduce franchise-fee obligations.
2 | Franchise Operations Manual, Section 7.3: Explicitly requires GRR to include full rack or negotiated rate and prohibits netting of OTA commissions against GRR. Brecker claimed he "didn't recall" this provision. | Exhibit 35 | Brecker acknowledged receiving the Franchise Operations Manual. His claimed lack of recall regarding a provision directly relevant to his reporting practices is not credible.
3 | FLA § 4.1 language: "regardless of the entity collecting such revenue." Brecker testified he understood GRR to mean only revenues "through the Verimark system." | FLA § 4.1 | The contractual language is unambiguous and directly contradicts Brecker's self-serving interpretation. This contradiction is the foundation for the breach-of-contract claim.
4 | FLA § 14.2(c): "systematic underreporting of Gross Room Revenue shall constitute a material breach that is incapable of cure." Brecker claimed he "never really focused on" this provision. | FLA § 14.2(c) | Brecker signed 22 FLAs containing identical language. His claimed lack of awareness of a key breach provision is implausible and undermines his credibility generally.
5 | Property-management agreement for Savannah property: The sole document Brecker cited in support of the "awareness" defense identifies Suncoast as management company but does not disclose revenue-collection role or GRR exclusion. | Exhibit 48 | This document fails to bridge the gap between Verimark's potential knowledge that Suncoast existed and knowledge that Suncoast was collecting revenues excluded from GRR. The awareness defense is unsupported.
6 | Quarterly financial summaries to Nolan Prescott: Include Suncoast revenue line items, undermining Prescott's anticipated claim of ignorance regarding Suncoast revenue flows. | Exhibit 14 | These reports demonstrate that Suncoast revenue was tracked and reported internally even as it was excluded from external GRR reports to Verimark. Relevant to Prescott deposition preparation.
7 | Kerrigan termination timeline: Kerrigan raised GRR reporting concerns; Brecker told her "not to worry about it"; Kerrigan was terminated October 2021; Kerrigan filed whistleblower complaint with Verimark November 8, 2021. | Brecker testimony; Kerrigan whistleblower complaint | The temporal proximity between Kerrigan's raising concerns, her termination, and her whistleblower complaint is highly suggestive and will be explored in Kerrigan's upcoming deposition.
Reference No. | Topic | Day | Approx. Time | Transcript Page:Line
Adm. 1 | Directive to controllers to exclude Suncoast revenues from GRR | Day 2 | ~9:35 AM | To be confirmed
Adm. 2 | Creation of Suncoast to collect non-Verimark revenues | Day 1 | ~1:45 PM | To be confirmed
Adm. 3 | Direction to create unbranded website gulfcoastrooms.com | Day 1 | Afternoon session | To be confirmed
Adm. 4 | Suncoast 12% management fee; neither fee nor revenue reported in GRR | Day 2 | Morning session | To be confirmed
Adm. 5 | Interpretation of FLA § 4.1 as limited to Verimark-system revenues | Day 1 | ~10:42 AM | To be confirmed
Adm. 6 | No written approval or waiver sought from Verimark | Day 2 | Afternoon session | To be confirmed
Adm. 7 | Unable to identify any Verimark employee who approved exclusion | Day 2 | Afternoon session | To be confirmed
Adm. 8 | 214 unreported rooms at 4 properties; underpaid technology fees | Day 2 | Mid-morning session | To be confirmed
Adm. 9 | Kerrigan raised concerns; told "not to worry about it" | Day 2 | Afternoon session | To be confirmed
Adm. 10 | Exhibit 31 — "7.5 cents on the dollar" email | Day 1 | Afternoon session | To be confirmed
Imp. 1 | Exhibit 31 vs. claimed "reservation-system fees" explanation | Day 1 | Afternoon session | To be confirmed
Imp. 2 | Exhibit 35 (Franchise Operations Manual § 7.3) — "didn't recall" | Day 1 | Late afternoon | To be confirmed
Imp. 3

PRIVILEGED & CONFIDENTIAL — ATTORNEY WORK PRODUCT

MEMORANDUM

I. EXECUTIVE SUMMARY

VII. CRITICAL DOCUMENT REFERENCES

VIII. ASSESSMENT OF WITNESS CREDIBILITY

IX. RECOMMENDATIONS AND NEXT STEPS

CALDERWOOD & HARKNESS LLP

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