PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT
This memorandum is protected by the attorney-client privilege and the work product doctrine. It has been prepared by counsel in anticipation of litigation and in connection with the provision of legal advice. This memorandum and its contents are not to be disclosed to any third party without the prior written consent of Calderwood & Harkness LLP. Any inadvertent disclosure does not constitute a waiver of any applicable privilege.
August 18, 2023
MEMORANDUM
FROM: Monica Reyes, Associate Calderwood & Harkness LLP 1200 K Street NW, Suite 900 Washington, D.C. 20005
TO: Elaine Forsythe, Responsible Partner, Calderwood & Harkness LLP Aaron Liu, Lead Associate, Calderwood & Harkness LLP
CC: Catherine Ng, U.S. Deputy General Counsel, Northgate Networks America Inc.
RE: Litigation Hold Compliance Audit — Ridgepoint Communications Inc. v. Northgate Networks America Inc. et al., Case No. 1:22-cv-01487-CMW (E.D. Va.) / FCC Docket No. WC-23-0042
ENGAGEMENT REFERENCE NO.: C&H-2022-ATR-00419
CLASSIFICATION: Attorney-Client Privilege / Work Product Doctrine — Do Not Distribute
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I. Purpose and Scope of Audit
This memorandum documents the results of the third periodic litigation hold compliance audit conducted by Calderwood & Harkness LLP ("C&H" or the "Firm") in connection with the defense of Northgate Networks America Inc. ("NNA") and Northgate Telecommunications PLC ("NTP" or "NTP Group," and together with NNA, "Northgate" or the "Company") in the matter of Ridgepoint Communications Inc. v. Northgate Networks America Inc. et al., Case No. 1:22-cv-01487-CMW (E.D. Va.) (the "District Court Action"), and the related administrative proceeding before the Federal Communications Commission, FCC Docket No. WC-23-0042 (the "FCC Proceeding," and together with the District Court Action, the "Ridgepoint Matter" or the "Matter").
The initial litigation hold notice (the "Hold Notice" or the "Hold") was issued by Calderwood & Harkness LLP on September 21, 2022, two days after Ridgepoint Communications Inc. ("Ridgepoint") filed its antitrust complaint in the United States District Court for the Eastern District of Virginia on September 19, 2022. The Hold Notice was addressed to Catherine Ng, U.S. Deputy General Counsel of NNA, and Diane Okoro, U.S. President of NNA, and directed the comprehensive preservation of all documents and electronically stored information ("ESI") related to Ridgepoint's interconnection and colocation requests, the Wholesale Access Policy ("WAP"), the fourteen (14) disputed facilities in the Philadelphia–Baltimore–Washington, D.C. corridor, and communications with Ridgepoint, among other categories of information specified in detail in Section III below.
This third audit covers the period from approximately February 2023 (the date of the second periodic compliance audit) through August 2023. During this audit period, the District Court Action has been stayed pursuant to an order entered by the Honorable Judge Claudia M. Wentworth on March 14, 2023, pending resolution of FCC Docket No. WC-23-0042 before Administrative Law Judge Robert Fenwick. As a consequence of the stay, formal discovery in the District Court Action has not yet commenced. However, it is essential to emphasize that the stay does not in any way diminish or suspend the Company's preservation obligations under Federal Rule of Civil Procedure 37(e), applicable Fourth Circuit and Eastern District of Virginia precedent, or the FCC's own document preservation requirements. All preservation obligations remain in full force and effect, and this audit has been conducted to confirm continued compliance with those obligations.
The prior audits were completed in approximately November 2022 (Audit 1) and February 2023 (Audit 2). No material preservation failures were identified in either of the prior audits. This memorandum provides a comprehensive update on the status of the litigation hold, identifies custodian changes that have occurred since the Hold was implemented, describes remediation measures taken, and sets forth recommendations for continuing compliance during the pendency of the stay and the FCC Proceeding.
II. Summary of Key Findings
The principal findings of this third periodic compliance audit are as follows:
1. Overall Compliance Confirmed. All twenty-three (23) custodians identified in the original Hold Notice (or their successors and designees, as applicable) have been re-confirmed as subject to the litigation hold. Each custodian or successor has acknowledged receipt of a hold reminder notice issued in connection with this audit cycle.
2. Document Collection Volume. Total documents collected to date from all twenty-three (23) custodian sources amount to approximately 1.2 million documents and associated ESI. All collected materials have been processed and are hosted by Candela discovery Solutions Inc. ("Candela"), located at 200 Park Avenue South, 14th Floor, New York, New York 10003, under the supervision of project manager Kenji Takahashi.
3. Potentially Responsive Documents. Approximately 87,000 documents have been identified as potentially responsive to anticipated discovery requests, based on preliminary keyword searches, date-range filtering, and custodian prioritization analysis. No full-scale document review has been initiated given the stayed posture of the District Court Action.
4. Custodian Changes. Two custodian changes have been identified since the litigation hold was initially implemented:
(a) The Regional Director of Colocation Services (Mid-Atlantic) departed NNA in May 2023. All data associated with this custodian has been imaged and preserved, and a successor has been added to the custodian list. Detailed remediation steps are documented in Section V.A below.
(b) The VP of Regulatory Compliance transferred from NNA's Washington, D.C. office to NTP Group's London headquarters in June 2023 as part of an internal rotation. This custodian retains involvement in the FCC Proceeding, and appropriate steps have been taken to ensure continued preservation. Detailed remediation steps are documented in Section V.B below.
5. No Material Preservation Failures. No material preservation failures have been identified during the audit period. Minor remediation actions have been noted and are described in the body of this memorandum.
6. Document Processing and Hosting. Document processing and hosting on Candela's Concordia Review™ platform continues. The platform is maintained in a ready state for activation of full document review workflows upon the lifting of the stay in the District Court Action or as otherwise required by the FCC Proceeding.
7. Candela Fees. Total fees paid or accrued to Candela discovery Solutions Inc. through August 2023 are $294,000, inclusive of initial processing, platform hosting, and incremental collections.
III. Litigation Hold — Original Parameters
A. Hold Notice Details
The original litigation hold notice was issued by Calderwood & Harkness LLP on September 21, 2022, two days after Ridgepoint Communications Inc. filed its complaint initiating the District Court Action on September 19, 2022. The Hold Notice was issued to Northgate Networks America Inc. and Northgate Telecommunications PLC, and was directed to Catherine Ng, U.S. Deputy General Counsel of NNA, and Diane Okoro, U.S. President of NNA, for dissemination and implementation across the relevant Northgate entities and personnel.
The Hold Notice directed the preservation of all documents and ESI, in any format or medium, relating to the following categories:
1. Ridgepoint Interconnection and Colocation Requests. All documents and ESI relating to Ridgepoint Communications Inc.'s interconnection and colocation requests for the following fourteen (14) facilities located in the Philadelphia–Baltimore–Washington, D.C. corridor (the "Disputed Facilities"):
2. Wholesale Access Policy. All documents and ESI relating to the Wholesale Access Policy ("WAP"), adopted in January 2020, including but not limited to all drafts of the WAP, internal deliberations concerning the development, adoption, and implementation of the WAP, board or management committee presentations or approvals, internal memoranda analyzing the competitive or regulatory implications of the WAP, and all records documenting the application of the WAP to Ridgepoint's requests or the requests of other similarly situated competitive carriers.
3. Master Interconnection Agreement. All documents and ESI relating to the Master Interconnection Agreement ("MIA") between Northgate Networks America Inc. and Ridgepoint Communications Inc., originally executed on June 15, 2015, which expired by its terms on June 14, 2020, and the subsequent month-to-month holdover arrangement under which certain services continued to be provided following the expiration of the MIA. This category includes all amendments, supplements, side letters, and internal analyses of the MIA and the terms of the holdover arrangement.
4. Capacity Utilization Data. All documents and ESI relating to capacity utilization data for the fourteen (14) Disputed Facilities, including but not limited to NorthgateOS™ platform records, engineering assessments, utilization reports, capacity planning models, and internal analyses. Northgate's position in the litigation is that each of the Disputed Facilities operates at or above eighty-five percent (85%) capacity utilization, rendering colocation requests impracticable under the WAP. All data supporting, undermining, or otherwise bearing upon this position is subject to the Hold.
5. Communications with Ridgepoint. All communications with Ridgepoint Communications Inc., including communications with its officers Gregory Trent (CEO), Samira Hashemi (General Counsel), and Theodore Braun (VP of Network Engineering), as well as communications with Ridgepoint's outside counsel, Hargrove, Winslow & Burke LLP.
6. FCC Communications. All communications with the Federal Communications Commission, including but not limited to formal filings, informal inquiries, ex parte notices, and correspondence relating to FCC Docket No. WC-23-0042.
7. Market Data and Competitive Analysis. All market data, competitive analysis, pricing information, and strategic assessments relating to enterprise fiber-optic transport services in the Mid-Atlantic region, including internal market studies, pricing models, competitor analyses, and assessments of the competitive landscape in the relevant geographic and product markets at issue in the Ridgepoint Matter.
The Hold Notice further directed that all custodians refrain from destroying, altering, concealing, or otherwise modifying any documents or ESI falling within the foregoing categories, and that all automatic deletion, retention, and recycling policies applicable to custodian data sources be immediately suspended.
B. Custodian Identification — Original 23 Custodians
The Hold Notice identified twenty-three (23) individuals as custodians whose documents and ESI are subject to preservation. These custodians were identified based on their roles and involvement in the matters at issue in the Ridgepoint litigation and FCC Proceeding. The custodians are organized by entity as follows:
Northgate Networks America Inc. (NNA) — 16 Custodians
Northgate Telecommunications PLC (NTP Group) — 7 Custodians
A detailed custodian list reflecting current status, hold acknowledgment dates, and any changes is attached as Appendix A.
C. Data Sources Subject to Hold
The Hold encompasses the following categories of data sources, each of which has been subject to preservation measures since the date of the Hold Notice:
1. Email Systems. All email communications maintained on Strathmore Data Systems and Larkspur Health IT (O365) platforms, including sent and received messages, attachments, calendar entries, and archived mailbox contents for all identified custodians.
2. Network Shared Drives and Document Management Systems. All files, folders, and documents stored on Northgate's network shared drives and enterprise document management systems, including Aldermere Systems repositories and any departmental or project-specific file shares accessible to identified custodians.
3. Individual Workstation Data and Laptops. All locally stored files, documents, and ESI residing on individual workstations, laptops, and other computing devices assigned to or used by identified custodians.
4. Mobile Devices and Messaging Applications. All data stored on company-issued or personally owned mobile devices used for business purposes by identified custodians, including text messages (SMS/MMS), messaging application data (including but not limited to Northgate Data Systems, Meridian Solutions, and Meridian Services Inc. Business), and any other mobile communications platforms used in connection with Company business.
5. Enterprise Resource Planning (ERP) and CRM Systems. Relevant data from Northgate's ERP and customer relationship management systems to the extent such data relates to the categories of information specified in the Hold Notice.
6. NorthgateOS™ Platform Administration Records. All administration records, logs, utilization data, configuration files, and system reports generated by or maintained within the NorthgateOS™ platform, which is Northgate's proprietary network operations and management system used to monitor and administer the Disputed Facilities.
7. Physical Paper Files. All physical paper documents, files, notebooks, and records maintained at relevant Northgate offices, including the Tysons Corner, Virginia headquarters and regional offices in the Mid-Atlantic corridor.
8. Backup Tapes and Archived Data. All backup tapes, disaster recovery media, and archived data that may contain documents or ESI relevant to the Matter. The rotation and recycling of backup tapes has been suspended since the issuance of the Hold Notice, and all tapes from September 2022 forward have been sequestered.
IV. Audit Methodology
This third periodic compliance audit was conducted using a three-step process consistent with the methodology employed in the prior two audits. The three steps are described below.
Step 1: Custodian Acknowledgment Re-Confirmation
During the first two weeks of August 2023, each of the twenty-three (23) custodians (or their successors, as applicable) received a litigation hold reminder notice. The reminder notice reiterated the scope and importance of the preservation obligations, reminded custodians of the categories of documents and ESI subject to the Hold, and required each custodian to acknowledge receipt and confirm continued compliance. A template of the hold reminder notice circulated during this audit cycle is attached as Appendix D.
Acknowledgment of receipt was tracked by the C&H litigation support team. All twenty-three (23) custodians (or their successors/designees) returned signed acknowledgments. One custodian — the VP of Regulatory Compliance, who transferred to NTP Group's London headquarters in June 2023 — acknowledged receipt via the updated London mailing and email address. No custodian failed to respond, and no responses indicated any concern regarding compliance.
Step 2: IT Systems Verification
Calderwood & Harkness LLP coordinated with the NNA Information Technology department and with Candela discovery Solutions Inc. to verify that all automatic deletion policies, backup tape rotation schedules, and document retention schedules remain suspended for each of the data sources identified in the Hold Notice. Specifically, the following verifications were performed:
(a) Confirmation that email retention policies — which, in the ordinary course, automatically delete emails older than two (2) years from custodian mailboxes — remain suspended for all twenty-three (23) custodians.
(b) Confirmation that the backup tape rotation schedule remains suspended and that all tapes from September 2022 forward remain sequestered and accessible.
(c) Confirmation that Aldermere Systems and shared drive auto-archival processes remain paused for all repositories identified as containing potentially relevant materials.
(d) Confirmation that NorthgateOS™ platform logs and administration records continue to be retained without automatic purging.
(e) Confirmation that no system migrations, platform upgrades, or data center relocations have occurred during the audit period that could have affected the integrity or accessibility of preserved data.
An audit confirmation letter was received from the NNA IT department on August 10, 2023, confirming the continued suspension of all relevant automatic deletion and retention policies. No exceptions or anomalies were reported.
Step 3: Custodian Interview / Questionnaire
A brief written questionnaire was circulated to each custodian in connection with this audit cycle. The questionnaire addressed the following topics:
(a) Any changes to the custodian's data storage practices since the last audit, including the adoption of new communication channels, the use of new devices, or the creation of new file repositories.
(b) The custodian's awareness of and compliance with the litigation hold obligations, including confirmation that no responsive documents or ESI have been destroyed, altered, or relocated.
(c) Any departures from or additions to relevant communication channels, including the use of personal devices or messaging applications for Company business.
(d) Any potentially responsive materials not previously identified, including documents that may have come to the custodian's attention since the last audit that fall within the scope of the Hold Notice.
All twenty-three (23) questionnaires were returned. No responses identified any material concerns. Two custodians (the Director of Network Operations (Mid-Atlantic) and the Network Capacity Planning Manager) reported the generation of updated capacity utilization reports for the Disputed Facilities during the audit period; these reports are being collected as part of the ongoing incremental collection process described in Section VI.C below.
V. Custodian Changes and Remediation
Two custodian changes were identified during the audit period and have been fully remediated as described below.
A. Custodian Departure — Regional Director of Colocation Services (Mid-Atlantic)
One of the original twenty-three (23) custodians, the Regional Director of Colocation Services (Mid-Atlantic) (Custodian No. 7 on the original custodian list), departed Northgate Networks America Inc. in May 2023. This individual had been employed by NNA since 2017 and had direct, substantial involvement in processing Ridgepoint Communications Inc.'s colocation requests at several of the fourteen (14) Disputed Facilities during the period from approximately March 2021 through August 2022. This custodian's files and communications are expected to be among the most significant sources of responsive documents in the Matter.
The following remediation steps were taken promptly upon notification of the impending departure:
1. Data Preservation Imaging. Upon receiving notice of the custodian's planned departure, Candela discovery Solutions Inc. was engaged to perform a comprehensive forensic image of the departing custodian's data. The imaging encompassed the custodian's email archive (including sent, received, deleted, and archived messages), all contents of shared drives to which the custodian had access, and all locally stored data on the custodian's assigned workstation and laptop. The preservation image was completed on May 12, 2023, prior to the custodian's last day of employment.
2. Exit Interview. An exit interview was conducted jointly by Catherine Ng, U.S. Deputy General Counsel of NNA, and Monica Reyes of Calderwood & Harkness LLP. The purpose of the exit interview was to confirm that no additional data sources existed that had not previously been identified, including any personal devices, external storage media, or cloud-based storage accounts used for Company business. The departing custodian confirmed that no such additional data sources existed and that all Company-related documents and ESI were maintained on Company-issued devices and systems.
3. Successor Added. A successor was appointed to the Regional Director of Colocation Services (Mid-Atlantic) role. The successor was immediately added to the custodian list and issued a litigation hold notice. The successor acknowledged receipt of the Hold Notice on May 22, 2023. The successor has been informed of the preservation obligations and has confirmed understanding and compliance.
4. Custodian Count. As a result of these remediation steps, the total custodian count remains at twenty-three (23). The departed custodian's data has been fully preserved and remains accessible on the Concordia Review™ platform. The successor has been added as a replacement custodian and is subject to ongoing hold obligations and incremental data collection.
B. Custodian Role Change — VP of Regulatory Compliance
One custodian, the VP of Regulatory Compliance (Custodian No. 8 on the original custodian list), transferred from NNA's Washington, D.C. regulatory affairs office to Northgate Telecommunications PLC's London headquarters in June 2023. The transfer was effected as part of a planned internal rotation within the Northgate group of companies. Notably, this individual retains access to U.S. regulatory files maintained on NNA's systems and continues to be actively involved in the FCC Proceeding (Docket No. WC-23-0042), including participation in hearing preparation and coordination with the Firm and with Northgate's regulatory expert, Dr. Anton Berger of the Torrence Policy Group LLC.
The following remediation steps were taken:
1. Preservation of U.S. Data. It was confirmed with the NNA IT department that the custodian's U.S. email archive and shared drive access remain intact and continue to be subject to the litigation hold. No data was migrated, deleted, or otherwise altered in connection with the role change.
2. Re-Issuance of Hold Notice. A hold reminder notice was re-issued to the custodian at the updated London mailing and email address. The custodian acknowledged receipt of the re-issued notice on July 3, 2023, and confirmed continued understanding of and compliance with the preservation obligations.
3. Coordination with NTP Group IT. Calderwood & Harkness LLP coordinated with NTP Group's IT department in London to ensure that any new documents or ESI generated by the custodian in the London role that relate to the Ridgepoint Matter, the FCC Proceeding, or the fourteen (14) Disputed Facilities are preserved and subject to the Hold. NTP Group IT confirmed that appropriate preservation measures are in place for the custodian's London-based email account and file access.
4. Continued Involvement. The custodian remains on the active custodian list and continues to be subject to quarterly hold reminders and incremental data collection. No change to the total custodian count has resulted from this role change.
VI. Document Collection and Processing Status
A. Collection Summary
As of the date of this memorandum, a total of approximately 1.2 million documents and associated ESI have been collected from all twenty-three (23) custodians. Collection has been conducted in two principal waves, supplemented by ongoing incremental collections:
Wave 1 (October–November 2022). The initial collection wave was conducted in October and November 2022, covering the primary date range of January 2019 through September 2022. This wave encompassed all data sources identified in the Hold Notice for each of the twenty-three (23) custodians, including email archives, shared drive contents, local workstation data, mobile device data, and relevant ERP and CRM system records. Wave 1 collected approximately 980,000 documents.
Wave 2 (March–April 2023). A supplemental collection wave was conducted in March and April 2023 to capture documents generated between September 2022 and March 2023. This wave was necessitated by the continued generation of responsive materials during the pendency of the litigation, including correspondence and filings related to the FCC Proceeding following the filing of the FCC complaint on February 7, 2023. Wave 2 collected approximately 190,000 additional documents.
Incremental Collections (Ongoing). As described in Section VI.C below, Candela continues to perform monthly incremental collections from active custodians' email accounts and shared drives. These incremental collections capture any newly generated materials relevant to the Matter and are processed and added to the Concordia Review™ platform on a rolling basis. Incremental collections from April through August 2023 have yielded approximately 30,000 additional documents.
All collected data has been processed by Candela discovery Solutions Inc. using the Concordia Review™ platform. Processing included de-duplication across all custodians, near-duplicate identification, exception file handling (including resolution of password-protected files, corrupted files, and unsupported file formats), and metadata extraction. Candela has confirmed that processing is current and that no material exceptions remain unresolved.
B. Preliminary Review Metrics
Approximately 87,000 documents have been identified as potentially responsive to anticipated discovery requests. This identification was based on the application of preliminary keyword searches developed by the C&H litigation team in consultation with Candela, date-range filters corresponding to the relevant time periods at issue in the litigation, and custodian prioritization analysis that weighted documents from the most directly involved custodians (e.g., the Regional Director of Colocation Services, the VP of Wholesale Sales, the Director of Network Operations, and Catherine Ng).
It is important to note that no full-scale document review has commenced. The stayed posture of the District Court Action since March 14, 2023 means that formal discovery has not been initiated, and no discovery requests have been served or received. Accordingly, the identification of potentially responsive documents is preliminary in nature and is intended to support readiness for review activation when the stay is lifted, rather than to constitute a final responsiveness determination.
Review Readiness. The Concordia Review™ platform remains fully provisioned and accessible. Review workflows — including privilege review protocols, responsiveness coding schemes, redaction protocols, and quality control checkpoints — have been designed by the C&H document review team in coordination with Candela and are ready for activation upon the lifting of the stay or as otherwise required. The review team staffing plan (including potential use of contract attorneys under C&H supervision) has been outlined in a separate memorandum and can be implemented on approximately two weeks' notice.
C. Ongoing Preservation During Stay
Notwithstanding the stay of the District Court Action, Calderwood & Harkness LLP and Candela discovery Solutions Inc. continue to take affirmative steps to ensure that all relevant documents and ESI generated during the stay period are preserved and collected:
1. Platform Maintenance. Candela continues to maintain all previously collected data on the Concordia Review™ platform in a secure, accessible state. Platform hosting, data integrity checks, and access controls are maintained on an ongoing basis.
2. Monthly Incremental Collections. Automatic email and document collection from all active custodians' accounts continues on a rolling monthly basis. These incremental collections capture any newly generated materials relevant to the Matter, including correspondence and documents relating to the FCC Proceeding. Each incremental collection is processed, de-duplicated, and loaded to the Concordia Review™ platform.
3. FCC Hearing Preparation Materials. The FCC evidentiary hearing before ALJ Robert Fenwick was initially scheduled for September 2023 but has been postponed to January 2024 due to FCC staffing constraints. The postponement was announced on August 28, 2023. As hearing preparation intensifies in the coming months, additional documents related to hearing preparation — including expert reports, witness outlines, exhibit preparation materials, and correspondence with the Firm's regulatory expert, Dr. Anton Berger of the Torrence Policy Group LLC — are expected to be generated and will be collected through the monthly incremental collection process and any supplemental targeted collections that may be warranted.
4. Candela Fees. Total Candela discovery Solutions Inc. fees to date are $294,000. This amount is inclusive of initial processing (Waves 1 and 2), platform hosting charges, and incremental collection fees through August 2023. A detailed breakdown of collection and processing fees is provided in Appendix C.
VII. Systems and IT Compliance Verification
As part of this audit, Calderwood & Harkness LLP conducted a comprehensive verification of all IT systems and infrastructure to confirm that automatic deletion and retention policies remain suspended for all data sources subject to the Hold. The results of this verification are as follows:
1. Email Retention Policies. NNA's standard email retention policy provides for the automatic deletion of emails older than two (2) years from custodian mailboxes. This auto-delete policy has been suspended for all twenty-three (23) custodians since the issuance of the Hold Notice on September 21, 2022. The NNA IT department confirmed, as of August 10, 2023, that this suspension remains in effect and that no custodian email data has been subject to automatic deletion during the audit period.
2. Backup Tape Rotation. NNA's standard backup tape rotation schedule, which provides for the periodic overwriting and recycling of backup media, has been suspended for all tapes from September 2022 forward. All such tapes have been sequestered and are maintained in a secure offsite storage facility. The NNA IT department confirmed that no sequestered tapes have been overwritten, recycled, or otherwise altered during the audit period.
3. Aldermere Systems and Shared Drive Auto-Archival. Automatic archival processes that would ordinarily move inactive files from Aldermere Systems sites and shared drives to cold storage or offline archives have been paused for all repositories identified as containing potentially relevant materials. The NNA IT department confirmed that these processes remain paused and that no relevant files have been moved or rendered inaccessible during the audit period.
4. NorthgateOS™ Platform Logs. NorthgateOS™ platform administration logs and utilization data, which are critical to Northgate's defense regarding the 85% capacity utilization threshold, continue to be retained without automatic purging. The NNA IT department confirmed that no purging or overwriting of NorthgateOS™ data has occurred during the audit period.
5. IT Audit Confirmation. A formal audit confirmation letter was received from the NNA IT department on August 10, 2023. The letter confirms the continued suspension of all relevant automatic deletion and retention policies across all data sources identified in the Hold Notice, and certifies that no instances of inadvertent data destruction were identified during the audit period.
Conclusion. No instances of inadvertent data destruction, system migration affecting preserved data, or unauthorized modification of retention policies have been identified during the audit period. IT systems compliance with the litigation hold is confirmed as of the date of this memorandum.
VIII. Risks and Recommendations
A. Extended Dormancy Risk
The stay of the District Court Action has been in effect since March 14, 2023 — approximately five (5) months as of the date of this memorandum. The FCC Proceeding timeline has already experienced slippage: the evidentiary hearing before ALJ Fenwick, initially scheduled for September 2023, has been postponed to January 2024 due to FCC staffing constraints. Following the hearing, the parties will submit post-hearing briefs (typically on a 30–60 day schedule), after which ALJ Fenwick will issue an initial decision. The initial decision may then be subject to review by the full Commission. This sequence of events suggests that the stay of the District Court Action could remain in effect for an extended period, potentially well into the second half of 2024 or beyond.
Risk. Prolonged dormancy of the litigation hold presents several interrelated risks:
(a) Custodian Turnover. The longer the hold remains in effect, the greater the likelihood of additional custodian departures, transfers, or role changes. Each such change requires prompt identification, remediation, and data preservation. Failure to timely identify and remediate custodian changes could result in the loss of relevant data.
(b) System Migrations and Technology Changes. Over an extended period, Northgate may undertake IT system migrations, platform upgrades, or data center consolidations in the ordinary course of business. Any such changes carry the risk of inadvertent data loss or alteration if preservation measures are not properly coordinated with the migration process.
(c) Institutional Memory Loss. As time passes, custodians' recollection of relevant events, communications, and document locations may fade. This can complicate the review process and reduce the effectiveness of custodian interviews and questionnaires.
(d) Compliance Fatigue. Extended litigation holds can lead to "hold fatigue," in which custodians become less attentive to preservation obligations over time. Regular hold reminders and periodic audits are essential to mitigate this risk.
Recommendation. Calderwood & Harkness LLP recommends the continuation of quarterly hold reminder notices to all custodians for the duration of the stay. The next periodic compliance audit should be scheduled for approximately February 2024, timed to follow the rescheduled FCC evidentiary hearing (currently set for January 2024) and to capture any documents generated in connection with hearing preparation. If additional slippage in the FCC timeline occurs, the audit schedule should be adjusted accordingly to ensure that no more than six (6) months elapse between audits.
B. Potential Additional Custodians
As the FCC Proceeding progresses and evidentiary hearing preparation intensifies, additional Northgate personnel may become involved in generating materials that are responsive to the Hold or that bear upon issues at the center of the Ridgepoint Matter. In particular, Northgate's engagement with its regulatory expert, Dr. Anton Berger of the Torrence Policy Group LLC, and its internal preparation of witness testimony and exhibits for the FCC hearing may involve individuals not currently on the custodian list.
Recommendation. Calderwood & Harkness LLP recommends that the Firm coordinate with Dr. Anton Berger and Patrick Salazar (Chief Regulatory Officer) to identify any additional individuals at Northgate who may generate relevant documents or ESI in connection with FCC hearing preparation. Any such individuals should be promptly added to the custodian list and issued litigation hold notices. This assessment should be completed prior to the January 2024 evidentiary hearing.
C. Budget Considerations
The following is a summary of the current cost posture for the Ridgepoint Matter, with particular attention to e-discovery and vendor costs:
Candela discovery Solutions Inc.
• Fees to date: $294,000 (inclusive of initial processing, platform hosting through August 2023, and incremental collections)
• Anticipated incremental hosting and collection costs during continued dormancy: approximately $8,000–$12,000 per month
• Full document review (when triggered): estimated additional cost of $150,000–$250,000, depending on the scope of discovery propounded after the stay lifts and the volume of documents ultimately requiring full review
Total Legal Spend Across All Vendors (Through August 2023)
These figures underscore the importance of effective cost management during the dormancy period. The Firm will continue to monitor Candela's monthly charges and will advise the client promptly if costs materially exceed the anticipated $8,000–$12,000 monthly range. Upon the triggering of a reactivation event, the Firm will provide a detailed budget estimate for the full document review phase.
D. Reactivation Triggers
A separate Dormancy Management Memorandum, previously circulated to the defense team, identifies the full list of events that would trigger reactivation of the defense in the District Court Action and, correspondingly, the escalation of document review and discovery preparation activities. The principal reactivation triggers include the following:
(a) Issuance of ALJ Robert Fenwick's initial decision in FCC Docket No. WC-23-0042.
(b) Issuance of a final order by the Federal Communications Commission on Ridgepoint's complaint.
(c) Filing of a motion by either party to lift the stay in Case No. 1:22-cv-01487-CMW (E.D. Va.).
(d) Any sua sponte order by Judge Claudia M. Wentworth regarding the status of the stayed case, including an order to show cause, a status conference scheduling order, or an order lifting the stay.
(e) Any material development in the FCC Proceeding that may affect the scope or timing of the District Court Action, including a settlement initiative, a change in the hearing schedule, or the withdrawal of the FCC complaint.
Immediate Steps Upon Reactivation. Upon the occurrence of any reactivation trigger, the following steps will be taken promptly:
1. A refresh collection will be conducted from all active custodians to capture any documents and ESI generated since the most recent incremental collection.
2. Full document review will be initiated on the Concordia Review™ platform, employing the pre-designed review workflows for privilege review, responsiveness coding, and redaction.
3. The Proposed discovery Plan and Scheduling Order, currently held in draft form, will be finalized and prepared for submission to the Court.
4. The litigation team will convene to assess the implications of the triggering event and to develop an updated case strategy and timeline.
IX. Conclusion
Based on the third periodic compliance audit conducted by Calderwood & Harkness LLP, the overall finding is that Northgate Networks America Inc. and Northgate Telecommunications PLC are in compliance with their litigation hold obligations as of August 18, 2023, in connection with Ridgepoint Communications Inc. v. Northgate Networks America Inc. et al., Case No. 1:22-cv-01487-CMW (E.D. Va.), and FCC Docket No. WC-23-0042.
The key findings of this audit are summarized as follows:
1. All twenty-three (23) custodian positions are accounted for. One custodian departure (Regional Director of Colocation Services, Mid-Atlantic) and one custodian role change (VP of Regulatory Compliance, transferred to London) have been identified and fully remediated. Data preservation for the departed custodian is complete, a successor has been added, and the transferred custodian continues to be subject to the Hold with appropriate cross-border coordination in place.
2. Approximately 1.2 million documents have been collected, processed, and preserved on the Concordia Review™ platform maintained by Candela discovery Solutions Inc. Approximately 87,000 documents have been identified as potentially responsive to anticipated discovery based on preliminary keyword and date-range filtering.
3. No material preservation failures have been identified. All automatic deletion policies, backup tape rotation schedules, and document retention processes remain suspended for all custodian data sources, as confirmed by the NNA IT department.
4. The Concordia Review™ platform remains provisioned and in a ready state for full document review activation upon the lifting of the stay or other reactivation event.
5. The next periodic compliance audit is recommended for approximately February 2024, timed to follow the rescheduled FCC evidentiary hearing.
We respectfully request that Catherine Ng, U.S. Deputy General Counsel of Northgate Networks America Inc., confirm receipt of this memorandum and advise Calderwood & Harkness LLP of any additional custodian changes, data source modifications, or other developments that may affect the Company's preservation obligations. Prompt notification of any such developments will enable the Firm to take timely remediation measures and to ensure the continued integrity of Northgate's litigation hold compliance posture.
Please do not hesitate to contact me, Elaine Forsythe, or Aaron Liu with any questions regarding this memorandum or the litigation hold compliance program.
Monica Reyes Associate Calderwood & Harkness LLP 1200 K Street NW, Suite 900 Washington, D.C. 20005 Telephone: (202) 555-4100
Email: m.reyes@calderwoodharkness.com
APPENDIX A: Custodian List (Current as of August 18, 2023)
The following table sets forth the complete custodian list as of the date of this memorandum, including each custodian's name (or title, where identified by position), entity affiliation, department, date of most recent hold acknowledgment, and current status.
Total Active Custodians: 23 (including one successor replacing one departed custodian)
APPENDIX B: Audit Timeline
The following table summarizes the dates and scope of all periodic litigation hold compliance audits conducted to date, along with the next scheduled audit.
APPENDIX C: Document Collection and Processing Summary
The following table summarizes the document collection and processing activities conducted by Candela discovery Solutions Inc. in connection with the Ridgepoint Matter.
Notes:
(a) "Potentially Responsive" figures reflect documents identified through preliminary keyword searches, date-range filtering, and custodian prioritization. These figures are preliminary and do not reflect a full responsiveness review.
(b) Exception files include password-protected files, corrupted files, and files in unsupported formats. All exception files have been resolved through coordination with custodians and the NNA IT department, or have been flagged for manual review upon activation of the full document review.
(c) Candela fees include processing, de-duplication, platform hosting, incremental collection, and project management charges. Fees do not include anticipated full document review costs, which are estimated at $150,000–$250,000 upon reactivation.
APPENDIX D: Hold Reminder Notice (Template)
The following is the template of the hold reminder notice circulated to all custodians during the August 2023 audit cycle.
LITIGATION HOLD REMINDER NOTICE PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT COMMUNICATION
Date: August 1, 2023
To: [Custodian Name]
From: Calderwood & Harkness LLP, outside counsel to Northgate Networks America Inc. and Northgate Telecommunications PLC
Re: Ongoing Litigation Hold — Ridgepoint Communications Inc. v. Northgate Networks America Inc. et al., Case No. 1:22-cv-01487-CMW (E.D. Va.) / FCC Docket No. WC-23-0042
This is a reminder of your ongoing obligation to preserve documents and electronically stored information in connection with the above-referenced legal proceedings.
You were previously notified of a litigation hold in connection with the lawsuit and administrative proceeding referenced above. Although the federal court case is currently stayed, your obligation to preserve all relevant documents and electronically stored information ("ESI") remains in full force and effect. This reminder notice is being issued as part of a periodic compliance audit.
What You Must Continue to Do:
1. Do not destroy, delete, alter, or discard any documents or ESI that may relate to the matters described in the original litigation hold notice, including but not limited to:
• Documents relating to Ridgepoint Communications Inc.'s interconnection and colocation requests
• Documents relating to the Wholesale Access Policy (WAP)
• Documents relating to the Master Interconnection Agreement with Ridgepoint
• Capacity utilization data for the 14 facilities identified in the hold notice
• Communications with Ridgepoint, its officers, or its counsel
• Communications with the FCC relating to Docket WC-23-0042
• Market data, competitive analysis, and pricing information for enterprise fiber-optic transport services in the Mid-Atlantic region
2. Continue to preserve all emails, files, documents, text messages, instant messages, voicemails, handwritten notes, and any other records that fall within the scope of the hold, regardless of the format or location of such materials.
3. Notify Calderwood & Harkness LLP immediately if you become aware of any documents or ESI that may be relevant to the matter but have not previously been identified or collected, or if you experience any changes in your data storage practices, communication channels, or device usage.
4. Do not move, transfer, or alter the organization of files, folders, or repositories that may contain relevant materials without first consulting Calderwood & Harkness LLP.
Acknowledgment Required:
Please sign and return this notice to confirm that you have read and understood your continuing preservation obligations. Your signed acknowledgment should be returned to Monica Reyes at Calderwood & Harkness LLP (m.reyes@calderwoodharkness.com) no later than August 15, 2023.
ACKNOWLEDGMENT
I, the undersigned, hereby acknowledge receipt of this Litigation Hold Reminder Notice. I confirm that I understand my continuing obligation to preserve all documents and ESI as described above, and I confirm that I am in compliance with the litigation hold.
Name: ________
Title: ________
Date: ________
Signature: ________
If you have any questions regarding this notice or your preservation obligations, please contact Monica Reyes (m.reyes@calderwoodharkness.com; (202) 555-4100), Aaron Liu (a.liu@calderwoodharkness.com; (202) 555-4112), or Elaine Forsythe (e.forsythe@calderwoodharkness.com; (202) 555-4001) at Calderwood & Harkness LLP.