PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
CALDERWOOD & HARKNESS LLP 425 Park Avenue, 33rd Floor New York, NY 10022
CROSS-EXAMINATION OUTLINE — DEPOSITION OF VICTOR SANDOVAL
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I. EXAMINATION OBJECTIVES — OVERVIEW
A. Primary Objectives
The deposition of Victor Sandoval is the centerpiece of the discovery program in this matter. As Managing Member and CEO of Meridian Infrastructure Partners LLC ("Meridian"), Sandoval is the single most important fact witness on the defense side of this litigation. He is the individual who signed the Master Construction Agreement ("MCA"), dated March 15, 2020, between Northgate Fiber Americas Inc. ("NFA" or "Northgate") and Meridian, and he personally directed Meridian's responses to both Cure Notices and the subsequent termination. Our primary examination objectives are as follows:
1. Personal Knowledge and Involvement. Establish the full scope of Sandoval's personal knowledge of and involvement in all material decisions regarding the Northgate fiber build-out program under the MCA. This includes his participation in the negotiation and execution of the MCA, his ongoing oversight of the project, and his role as the ultimate decision-maker on Meridian's side. We must demonstrate that Sandoval cannot credibly distance himself from the operational failures that led to termination.
2. Schedule Delays and Quality Failures. Obtain admissions from Sandoval regarding Meridian's persistent and worsening schedule delays across all three phases of the project, its systemic quality failures (reflected in 287 non-conformance reports, of which 43 were classified as critical), and its inability to cure the material breaches identified in Cure Notices Nos. 1 and 2. Each admission should be tied to specific contract provisions, milestone dates, and documentary evidence.
3. Ridgepoint Capital Group LP Influence. Explore Meridian's financial condition, its overwhelming dependence on the Northgate contract (which represented approximately 45% of remaining backlog at the time of termination), and the influence exercised by Ridgepoint Capital Group LP ("Ridgepoint"), Meridian's 55% equity owner, on Meridian's operational decisions, its decision to initiate this litigation, and the parameters of its litigation strategy. This line of examination is essential for establishing bias, motive, and the financial pressure underlying Meridian's claims.
4. Undermine the Pretext Theory. Meridian's central theory of the case is that Northgate's termination for cause on April 1, 2024, was pretextual and motivated by a desire to bring fiber construction in-house or to re-procure at a lower cost following allegedly favorable market shifts. This theory must be systematically dismantled. We must demonstrate that (a) Northgate in fact contracted with a third-party replacement contractor, Crestline Construction Group Inc. ("Crestline"), at a price of $712 million — $81.7 million more than the remaining unperformed value under the MCA — and (b) the termination followed months of documented cure notices, escalating quality failures, and failure to cure, all of which are independently sufficient to support termination for cause.
5. Lock Sandoval into Contract Positions. Lock Sandoval into specific positions on key contract provisions — MCA §§ 8.2 (Milestone Schedule), 9.1 (Liquidated Damages), 12.4 (Quality Standards), 14.1 (Termination for Cause), 14.3 (Termination for Convenience), 14.5 (Consequences of Termination for Cause), 16.1 (Change Orders), and 20.1 (Consequential Damages Waiver) — that support Northgate's defenses and counterclaims. The goal is to foreclose Meridian's ability to shift its contractual interpretation at trial.
6. Develop Counterclaim Record. Develop the evidentiary record supporting Northgate's counterclaims totaling $149 million:
• Counterclaim I: $49,000,000 in liquidated damages for milestone delays (MCA § 9.1);
• Counterclaim II: $81,700,000 in excess completion costs (the differential between the Crestline contract price of $712M and the remaining unperformed MCA value of $630.3M) (MCA § 14.5);
• Counterclaim III: $18,300,000 in remediation costs for defective work (43 critical NCRs at approximately $275,000 average remediation cost and 244 non-critical NCRs at approximately $26,500 average remediation cost).
7. Trial Impeachment Foundation. Lay a comprehensive foundation for impeachment at trial should Sandoval's testimony change between deposition and trial. Every key admission should be precisely stated, confirmed, and tied to documentary exhibits so that it can be used effectively in cross-examination at trial.
B. Secondary Objectives
In addition to the primary objectives set forth above, the examining attorney should pursue the following secondary objectives as time and circumstances permit:
1. Corrective Action Plan Credibility. Explore Sandoval's credibility regarding the Corrective Action Plan submitted March 5, 2024, and whether it was genuinely feasible or was instead a tactical delay mechanism designed to forestall termination. The plan proposed additional crews, a nine-month schedule extension, and $87 million in additional compensation. Twelve additional critical NCRs issued in February 2024 — after the plan was being developed — undermine any contention that Meridian was on a path to cure.
2. Ridgepoint and Common Interest Privilege. Probe the role of Ridgepoint Capital Group LP (55% equity owner; Graham Latimer, Managing Partner) in Meridian's decision-making, the extent to which Ridgepoint is funding this litigation (estimated at approximately $12 million in a litigation war chest), and whether the common interest privilege claimed by Meridian over 187 Meridian-Ridgepoint documents is legally and factually supportable. This line of questioning directly supports our Cross-Motion for Protective Order, filed December 6, 2024, challenging the assertion of common interest privilege.
3. Constructive Change Order and Force Majeure Defenses. Examine Meridian's two principal substantive defenses: (a) the alleged constructive change order defense, under which Meridian claims 14 instances of Owner-directed scope changes that were never formalized as Change Orders under MCA § 16.1; and (b) the force majeure defense based on COVID-19-related labor shortages and supply chain disruptions. Both defenses suffer from serious procedural and factual deficiencies that should be exposed.
4. Dralvecen Commercial Finance Relationship. Test Sandoval's knowledge of Meridian's communications with Dralvecen Commercial Finance LLC (the lender on Meridian's $150 million revolving credit facility; Daniel Kwon, Relationship Manager) regarding the impact of the termination on Meridian's borrowing capacity, covenant compliance, and liquidity. These communications are relevant to both motive and damages.
5. Count IV Damages Assessment. Assess Sandoval's testimony regarding the calculation of the $200 million claim, particularly the Count IV claim for $34,133,333 in consequential damages for alleged loss of bonding capacity and reputational harm. This figure appears to be a "plug" number — the residual needed to reach the $200 million headline figure — and Sandoval should be pressed to explain its derivation with specificity.
C. Tone and Approach
The examining attorney should maintain a controlled, methodical tone throughout the two-day deposition. The following tactical guidance should govern the examination:
• Leading Questions with Document Anchors. The examination should be conducted predominantly through leading questions, each tied to a specific document or prior statement. Open-ended questions should be used sparingly and only where it is strategically advantageous to allow Sandoval to explain a position that we can subsequently impeach with documentary evidence or prior deposition testimony.
• Progressive Building. The examination should build progressively from foundational and less contentious topics on the morning of Day 1 to the most damaging lines of inquiry on Day 2. This sequencing is designed to establish a factual foundation before confronting Sandoval with the most problematic evidence, and to allow the examining attorney to assess Sandoval's candor and style before pressing the most critical areas.
• Coordination with Prior Depositions. The examining attorney should be prepared to draw upon and, where appropriate, confront Sandoval with testimony from depositions already completed in this matter: Renata Voss (November 12–13, 2024), Sean Calloway (November 19, 2024), and Marcus Henley (December 3–4, 2024). Henley's deposition testimony is particularly important, as he made significant admissions regarding crew shortages, NCR root causes, and the pace of Phase 3 mobilization. If Sandoval's testimony is inconsistent with Henley's admissions, the examining attorney should be prepared to confront him with specific Henley transcript excerpts.
• Patience and Discipline. Sandoval is an experienced executive who has likely been thoroughly prepared by Thomas Deluca and Miriam Vasquez. The examining attorney should not engage in argumentative exchanges, should not allow Sandoval to filibuster, and should maintain control of the record through short, precise questions that demand specific answers. Where Sandoval provides a non-responsive answer, the examining attorney should note the non-responsiveness on the record and re-ask the question.
II. WITNESS BACKGROUND AND FOUNDATION
A. Personal Background
The examination should begin by establishing Sandoval's background and credentials. This serves the dual purpose of settling Sandoval into the deposition and building the foundation for later argument that Sandoval was a sophisticated industry executive who understood the contractual obligations he undertook.
Proposed examination topics:
1. Confirm Sandoval's full legal name, his current title (Managing Member and Chief Executive Officer of Meridian Infrastructure Partners LLC), and his business address at 1800 Post Oak Boulevard, Suite 1200, Houston, Texas 77056.
2. Elicit Sandoval's educational background, including any undergraduate and graduate degrees, professional certifications, or industry credentials relevant to the telecommunications construction industry.
3. Establish the length and nature of Sandoval's career in the fiber-optic and telecommunications construction industry. Determine the number of years he has worked in the industry, the positions he has held at prior companies, and the types and scale of projects he has managed or overseen.
4. Confirm that Sandoval founded Meridian Infrastructure Partners LLC in 2011. Establish the circumstances of Meridian's founding, including whether Sandoval formed the company specifically to pursue fiber-optic construction opportunities and what initial capitalization was involved.
5. Establish that Sandoval currently holds a 30% equity interest in Meridian, down from a larger ownership stake prior to Ridgepoint's 2018 acquisition of a 55% stake.
6. Inquire whether Sandoval holds any other positions, board memberships, or material business interests outside of Meridian. This may reveal additional areas of inquiry or potential conflicts.
B. Meridian's Corporate Structure and Governance
This section establishes the corporate structure within which Sandoval operates, with particular emphasis on the role of Ridgepoint Capital Group LP in Meridian's governance. The goal is to set up the detailed Ridgepoint examination in Section III while also confirming the chain of authority and reporting within Meridian.
Proposed examination topics:
1. Confirm that Meridian Infrastructure Partners LLC is organized as a Delaware limited liability company, with Delaware Secretary of State File Number 6439821. Establish when the entity was formed and whether it has been in continuous good standing.
2. Confirm the ownership structure as of the relevant period: 55% Ridgepoint Capital Group LP; 30% Victor Sandoval; 15% allocated to a senior management equity pool. Identify the members of the senior management pool who hold equity and determine whether those individuals have any governance rights.
3. Establish Sandoval's authority as Managing Member under Meridian's LLC Agreement. Determine what decisions Sandoval can make unilaterally, what decisions require the approval of the members or the board/advisory committee, and what decisions are subject to Ridgepoint's consent or veto rights.
4. Identify the key members of Meridian's management team and their reporting relationships to Sandoval:
• Bridget Yeung, Chief Operating Officer — responsible for day-to-day operations;
• Randall Obrecht, Chief Financial Officer — responsible for financial management, reporting, and lender relations;
• Marcus Henley, Vice President of Field Operations, Northeast Division — responsible for field operations on the Northgate project and similar engagements in the Northeast region.
5. Determine the composition and role of any board of directors, advisory committee, or similar governance body. Specifically, identify how many seats Ridgepoint holds, whether Ridgepoint has consent rights or veto rights over material contracts (including the MCA), capital expenditures, litigation decisions, or settlements, and how frequently the board or advisory committee meets.
6. Establish the approximate size and scale of Meridian as a company: approximately $620 million in annual revenue for fiscal year 2023, approximately 2,400 employees at peak staffing levels. This establishes that Meridian is a substantial enterprise with the resources and infrastructure to have performed the Northgate contract properly.
C. Sandoval's Role on the Northgate Project
This subsection focuses specifically on Sandoval's involvement in the Northgate fiber build-out program. The objective is to establish that Sandoval was not a remote executive with attenuated knowledge of the project; rather, he was personally involved in key decisions and was the ultimate authority on Meridian's side.
Proposed examination topics:
1. Establish that Sandoval personally participated in the negotiation of the MCA between NFA and Meridian. Determine who else at Meridian participated in the negotiations, whether Sandoval reviewed successive drafts of the MCA, and whether Sandoval was involved in negotiating specific provisions such as the milestone schedule (§ 8.2), the liquidated damages provision (§ 9.1), the termination provisions (§§ 14.1, 14.3, 14.5), the change order procedure (§ 16.1), and the consequential damages waiver (§ 20.1).
2. Confirm that Sandoval executed the MCA on behalf of Meridian on March 15, 2020. If he signed, obtain his confirmation that he read and understood the agreement before signing it. If he did not personally sign, determine who did and on what authority.
3. Determine the frequency and nature of Sandoval's communications with key NFA personnel during the life of the project. Specifically, determine how often Sandoval communicated with Renata Voss (NFA's Senior Vice President of Network Infrastructure and the individual who issued Cure Notice No. 1) and Sean Calloway (NFA's Director of Construction Management, who oversaw day-to-day project administration and milestone certification).
4. Establish whether Sandoval attended milestone review meetings, project progress meetings, or escalation calls. Determine how frequently he attended, whether his attendance increased as delays worsened, and what role he played in those meetings.
5. Probe the distinction between Sandoval's claimed knowledge of day-to-day operations versus his high-level oversight role. If Sandoval attempts to distance himself from operational details, establish that his role as CEO and Managing Member nonetheless made him the ultimate decision-maker responsible for ensuring Meridian's contractual performance.
6. Confirm explicitly that Sandoval was the ultimate decision-maker on Meridian's side for the Northgate program, including decisions regarding resource allocation, personnel assignments, responses to Northgate's correspondence, and the decision to contest the termination and initiate litigation.
III. THE RIDGEPOINT CAPITAL GROUP RELATIONSHIP
A. Ridgepoint's Acquisition and Investment Thesis
Ridgepoint Capital Group LP's role in Meridian's decision-making is central to understanding both the financial pressures driving this litigation and the propriety of Meridian's assertion of common interest privilege over 187 documents. This section establishes the foundational facts regarding Ridgepoint's investment in Meridian and the importance of the Northgate contract to that investment.
Proposed examination topics:
1. Confirm that Ridgepoint Capital Group LP acquired a 55% equity stake in Meridian in 2018. Determine the approximate purchase price — our information indicates approximately $285 million — and the structure of the transaction (leveraged buyout, growth equity investment, or other).
2. Identify Graham Latimer as the Managing Partner of Ridgepoint and as Ridgepoint's primary point of contact with Sandoval and Meridian management. Establish the nature and frequency of Sandoval's communications with Latimer.
3. Establish that the Northgate MCA — with a total contract value of $1.2 billion over a five-year term — was an anchor program in Ridgepoint's investment thesis for the Meridian acquisition. Confirm Sandoval's awareness that the Northgate contract was a central component of the valuation at which Ridgepoint acquired its 55% stake. Probe whether the Northgate opportunity was discussed during the acquisition process and whether the prospect of the NFA relationship was a material factor in Ridgepoint's decision to invest.
4. Determine whether Sandoval or other Meridian management made any representations to Ridgepoint during the acquisition process regarding Meridian's capacity to perform large-scale fiber-optic construction programs at the scale contemplated by the Northgate MCA (18,500 route miles across seven states over five years). If representations were made, establish their content and the extent to which subsequent events bore them out.
B. Ridgepoint's Influence on Meridian's Operations
This subsection probes the degree to which Ridgepoint exercised operational influence over Meridian, particularly with respect to the Northgate project. The objective is to establish that Ridgepoint had meaningful governance authority and visibility into the project's problems, which in turn supports the argument that Ridgepoint's litigation funding is driven by investment protection rather than a genuine legal interest.
Proposed examination topics:
1. Determine the scope of Ridgepoint's consent rights or approval authority over material business decisions. Specifically, establish whether Ridgepoint had approval or veto rights over: (a) entry into material contracts (including the MCA); (b) capital expenditures above a specified threshold; (c) annual budgets and operating plans; (d) hiring and termination of senior management; (e) initiation of litigation or arbitration; and (f) settlement of disputes above a specified dollar threshold.
2. Establish whether Ridgepoint required Meridian to provide regular reporting, including monthly or quarterly financial statements, project-level performance reports, and backlog analyses. Determine whether Northgate project performance was specifically reported to Ridgepoint and at what level of detail.
3. Determine whether Ridgepoint representatives were present at, or received minutes or summaries of, Northgate project progress meetings, milestone review meetings, or escalation calls. If Ridgepoint was receiving project-level information, this undermines any claim that Ridgepoint's interest in the Northgate matters was purely financial rather than operational.
4. Probe whether Ridgepoint expressed concerns about the schedule delays or quality issues on the Northgate project at any point during the life of the contract. If Ridgepoint raised concerns, what was the substance of those concerns, when were they raised, and what response did Sandoval provide?
5. Determine whether there were any communications between Sandoval and Latimer (or other Ridgepoint personnel) specifically regarding Northgate's Cure Notices (No. 1 dated January 18, 2024; No. 2 dated February 19, 2024) or the Notice of Termination for Cause dated April 1, 2024. If such communications occurred, establish their timing, participants, and general substance (to the extent not privileged).
C. Ridgepoint's Funding of Litigation
This is a critical area for several purposes: (1) establishing the financial dynamics driving Meridian's litigation posture; (2) probing whether the common interest privilege is properly asserted; and (3) demonstrating that Ridgepoint's interest is fundamentally financial rather than legal.
Proposed examination topics:
1. Confirm that Ridgepoint has funded Meridian's litigation costs in this matter. Meridian's discovery responses indicate an estimated litigation war chest of approximately $12 million. Determine the accuracy of that figure and whether it has increased since the initial disclosure.
2. Establish the nature of Ridgepoint's funding arrangement. Is the funding structured as a direct equity contribution to Meridian, a loan from Ridgepoint to Meridian, an advancement under the LLC Agreement, or some other mechanism? Determine whether Ridgepoint has any right of recovery or repayment if Meridian is unsuccessful in the litigation.
3. Probe whether Ridgepoint directed or influenced the decision to file suit against Northgate, or whether the decision was Sandoval's independent judgment as Managing Member. Determine the sequence of events: did Sandoval decide to contest the termination and then seek Ridgepoint's financial support, or did Ridgepoint direct that the termination be contested?
4. Determine the extent of Ridgepoint's involvement in litigation strategy. Has Ridgepoint communicated with Meridian or Meridian's counsel regarding litigation strategy, settlement authority, or acceptable settlement outcomes? If so, what is the nature of those communications?
5. Lay foundation for our Cross-Motion for Protective Order, filed December 6, 2024, challenging Meridian's assertion of common interest privilege over 187 Meridian-Ridgepoint documents. Specifically probe:
• Whether there is a formal, written joint defense agreement or common interest agreement between Meridian and Ridgepoint;
• If so, when it was executed, by whom, and what its terms provide;
• If not, on what basis Meridian asserts that Ridgepoint shares a common legal interest (as opposed to a common financial or investment interest);
• Whether Ridgepoint has its own legal counsel in this matter separate from Hargrove, Deluca & Stein;
• Whether Ridgepoint faces any independent legal exposure related to the Northgate contract termination;
• Whether the 187 withheld documents include business communications relating to Ridgepoint's investment return, valuation analysis, or financial reporting — matters that are financial in nature and not properly within the scope of a common interest privilege.
D. Key Documents to Use
The following documents should be prepared as exhibits and used during this section of the examination:
1. Ridgepoint investment memorandum or term sheet from the 2018 acquisition (to the extent produced in discovery — if withheld, note the withholding on the record);
2. Meridian board or advisory committee meeting minutes that reference the Northgate project, particularly any minutes reflecting discussion of project delays, quality issues, cure notices, or the termination;
3. Produced correspondence between Sandoval and Graham Latimer or other Ridgepoint representatives (note that 187 documents have been withheld under common interest privilege — use whatever has been produced to probe the scope and nature of the withheld communications);
4. Meridian's privilege log entries for the 187 withheld documents (use to question Sandoval about the general subject matter of the communications without invading privilege).
IV. MERIDIAN'S FINANCIAL CONDITION AND CONTRACT DEPENDENCE
A. Meridian's Revenue and Profitability
This section establishes the financial context in which Meridian's claims and litigation posture must be evaluated. The Northgate contract was by far the largest contract in Meridian's portfolio, and its loss had a devastating impact on Meridian's financial position. This context supports the argument that Meridian's litigation is financially motivated rather than grounded in a genuine belief that the termination was wrongful.
Proposed examination topics:
1. Establish Meridian's key financial metrics for fiscal year 2023: approximately $620 million in annual revenue and approximately $58.9 million in EBITDA, representing a 9.5% EBITDA margin. Compare these figures to prior years if possible to establish the trend line.
2. Determine the Northgate contract's contribution to Meridian's overall revenue and backlog. Establish what percentage of Meridian's FY2023 revenue was attributable to the Northgate contract and what percentage of Meridian's total backlog the Northgate contract represented at various points during the life of the contract.
3. Confirm that Meridian's total backlog at the time of termination was approximately $1.4 billion, of which the Northgate contract represented approximately $630.3 million in remaining unperformed value. Establish that following the termination, Meridian's backlog dropped to approximately $770 million — a decline of approximately 45%.
4. Probe the impact of the contract loss on Meridian's financial projections and workforce. Did Meridian have to lay off employees following the termination? Did Meridian revise its revenue or profitability projections? Were any internal financial analyses prepared that quantified the impact of losing the Northgate contract?
B. Dralvecen Commercial Finance Revolving Credit Facility
Meridian's credit facility is relevant to both motive (financial pressure) and damages (the impact of termination on borrowing capacity).
Proposed examination topics:
1. Confirm that Meridian maintains a $150 million revolving credit facility from Dralvecen Commercial Finance LLC, with Daniel Kwon serving as the Relationship Manager.
2. Determine whether the Northgate contract or receivables thereunder were used as collateral or as part of the borrowing base calculation for the revolving credit facility. If the Northgate contract was a component of the borrowing base, establish the magnitude of the reduction in borrowing capacity caused by the termination.
3. Establish whether Dralvecen asserted lien interests in Meridian's receivables from the Northgate contract and, if so, how that affected the parties' rights with respect to disputed invoices and retainage.
4. Determine whether Dralvecen communicated with Meridian regarding the termination's impact on the credit facility. Did Dralvecen send any notices, demand letters, or default notices following the termination?
5. Probe whether Meridian was in breach of any financial covenants (leverage ratios, EBITDA coverage ratios, minimum liquidity requirements) following the termination. If so, did Meridian obtain a waiver or amendment, and on what terms?
6. Determine whether Meridian drew down on the revolving credit facility following the termination and whether the company experienced any liquidity stress or difficulty meeting its obligations as a result of the loss of the Northgate contract.
C. Bonding Capacity
The impact of the termination on Meridian's bonding relationships is directly relevant to Meridian's Count IV claim for $34,133,333 in consequential damages for loss of bonding capacity and reputational harm.
Proposed examination topics:
1. Confirm that Ironclad Surety Group Inc. issued Performance Bond No. ISG-2020-NE-04417 in the amount of $120 million in connection with the Northgate MCA. Establish the terms of the bond and Sandoval's understanding of the circumstances under which the bond could be called.
2. Determine Sandoval's understanding of how the termination for cause affected Meridian's surety relationships and overall bonding capacity. Did Ironclad or any other surety company reduce Meridian's bonding capacity, decline to issue new bonds, or impose additional underwriting requirements following the termination?
3. This line of examination is directly relevant to Meridian's Count IV claim. The examining attorney should establish that any reduction in bonding capacity was caused by Meridian's own performance failures on the Northgate project — the schedule delays, quality failures, and failure to cure — rather than by the termination itself. A surety that learns of a contractor's persistent performance failures will naturally reassess its risk appetite regardless of whether a formal termination occurs.
4. Determine whether Meridian filed a demand on the Ironclad performance bond on or about April 15, 2024. If so, establish Sandoval's involvement in that decision and the basis for Meridian's claim that it was an obligee under a subcontractor protection endorsement to the bond. Northgate and Ironclad both dispute this characterization.
D. Motive — Financial Pressure and Litigation as Strategy
This subsection ties together the financial evidence to support the argument that Meridian's decision to pursue $200 million in claims was driven not by a genuine belief in wrongful termination, but by financial necessity and Ridgepoint's need to protect its $285 million investment.
Proposed examination topics:
1. Explore whether Meridian's decision to litigate rather than accept the termination was driven by financial necessity. Given the 45% drop in backlog, the potential impact on the Dralvecen credit facility, and the loss of Ridgepoint's anchor investment asset, was there any realistic alternative to litigation?
2. Determine whether Sandoval had specific conversations with Ridgepoint representatives — particularly Graham Latimer — about the valuation impact of losing the Northgate contract. Did Ridgepoint conduct any valuation analyses or write-down assessments following the termination?
3. Establish that Meridian's pretext theory is, in effect, projection. It is Meridian, not Northgate, that had compelling financial motives driving its litigation posture. Northgate's decision to terminate for cause followed months of documented performance failures, cure notices, and failure to cure. By contrast, Meridian's decision to pursue $200 million in claims was made in the shadow of a potential financial crisis triggered by the loss of its largest contract.
V. THE MASTER CONSTRUCTION AGREEMENT — KEY PROVISIONS
A. Contract Execution and Scope
This section walks Sandoval through the key provisions of the MCA, confirming his understanding of each and locking him into positions that support Northgate's defenses and counterclaims. The examining attorney should have a clean copy of the MCA available and should direct Sandoval to specific provisions during the examination.
Proposed examination topics:
1. Confirm that Sandoval reviewed, understood, and approved the terms of the MCA prior to its execution on March 15, 2020.
2. Confirm the parties: Northgate Fiber Americas Inc. as Owner and Meridian Infrastructure Partners LLC as Contractor.
3. Establish the scope of work: design, engineering, permitting, and construction of approximately 18,500 route miles of fiber-optic cable across seven states — New York, New Jersey, Connecticut, Massachusetts, Pennsylvania, Maryland, and Virginia.
4. Confirm the contract price of $1.2 billion, structured as 65% fixed-price milestones ($780 million) and 35% unit-rate work ($420 million). Establish Sandoval's understanding of the risk allocation embedded in this pricing structure — specifically, that Meridian bore the risk of cost overruns on the fixed-price milestone work.
5. Confirm the contract term: five years from the Notice to Proceed, i.e., April 1, 2020, through March 31, 2025.
6. Confirm that the MCA is governed by New York law (MCA § 22.1) and that the parties agreed to a jury trial waiver (MCA § 22.4). Establish Sandoval's understanding of and assent to these provisions.
B. Milestone Schedule (MCA § 8.2)
The milestone schedule is the backbone of Northgate's delay damages claims and a critical element of its termination-for-cause defense.
Proposed examination topics:
1. Confirm that the MCA, at Section 8.2, establishes 14 defined milestones with interim completion certificates required for each phase. These milestones represent specific work scopes with defined completion dates.
2. Establish Sandoval's understanding that Meridian had a contractual obligation to meet each milestone deadline and that failure to meet a deadline, absent an excused delay event, would trigger the liquidated damages provisions of MCA § 9.1.
3. Determine whether Sandoval personally monitored milestone performance or whether he delegated that responsibility to Bridget Yeung, Marcus Henley, or others. If delegated, establish the reporting he received regarding milestone status.
4. Confirm that the milestone deadlines were negotiated between the parties — they were not unilaterally imposed by Northgate. Establish that Sandoval agreed to each timeline as part of the MCA negotiation process and that Meridian had the opportunity to propose different deadlines or to decline the contract if it believed the milestones were unachievable.
C. Liquidated Damages (MCA § 9.1)
Proposed examination topics:
1. Confirm the liquidated damages rate of $175,000 per day per milestone for each day of unexcused delay beyond the applicable milestone completion date.
2. Confirm the caps on liquidated damages: 10% of milestone value per individual milestone and an aggregate cap of 5% of the total Contract Price, which equals $60 million.
3. Establish Sandoval's understanding of the LD provision at the time of contract signing. Did Sandoval negotiate the LD rate? Did he consult with financial or legal advisors about the reasonableness of the LD provision?
4. Determine whether Sandoval considered the LD provision to be a reasonable pre-estimate of Northgate's delay damages at the time the MCA was executed. This is relevant to any argument that the LDs constitute an unenforceable penalty.
5. Establish the total liquidated damages assessed against Meridian: $49 million, broken down as follows:
• Phase 1: Milestone 3 — 47 days × $175,000 = $8,225,000
• Phase 2: Milestone 5 — 22 days × $175,000 = $3,850,000
• Phase 2: Milestone 6 — 68 days × $175,000 = $11,900,000
• Phase 2: Milestone 7 — 91 days × $175,000 = $15,925,000
• Phase 2: Milestone 8 — 134 days accrued as of termination, capped at 10% of $91 million milestone value = $9,100,000
6. Establish that Sandoval was aware of each LD assessment as it was made and that Meridian did not challenge the assessments through the dispute resolution procedures of the MCA at the time they were imposed.
D. Quality Standards (MCA § 12.4)
Proposed examination topics:
1. Confirm that MCA § 12.4 obligated Meridian to perform all work in conformance with Northgate Technical Specification NS-FIBER-2020, the applicable ANSI/TIA-568 standard, and BICSI (Building Industry Consulting Service International) guidelines.
2. Determine Sandoval's level of familiarity with NS-FIBER-2020 and the applicable industry standards. Did he review these specifications? Did he understand their requirements?
3. Establish that Sandoval was aware of the non-conformance report (NCR) process established under the MCA, under which NFA's quality assurance team documented and issued reports regarding work that did not conform to the applicable standards.
4. Confirm Sandoval's awareness that 287 NCRs were issued during the life of the project, of which 43 were classified as critical and 244 were classified as non-critical.
E. Termination for Cause (MCA § 14.1) vs. Termination for Convenience (MCA § 14.3)
This is one of the most critical areas of the examination, as Meridian's central contention is that the termination was effectively a termination for convenience disguised as a termination for cause.
Proposed examination topics:
1. Have Sandoval read aloud MCA § 14.1 (Termination for Cause) and confirm his understanding that it permits the Owner to terminate the contract for material breach upon 30 days' written notice and the Contractor's failure to cure within the noticed period.
2. Have Sandoval read aloud MCA § 14.3 (Termination for Convenience) and confirm his understanding that it requires 60 days' notice and entitles the Contractor to a termination fee equal to 8% of the remaining unperformed contract value.
3. Confirm Sandoval's understanding of the consequences of termination for cause under MCA § 14.5: forfeiture of any termination fee; the Owner's right to complete the remaining work using substitute contractors and to charge any excess completion costs to the Contractor; and the Owner's right to draw on the performance bond.
4. Lock Sandoval into his position on which termination provision applies. Does he contend that the April 1, 2024 termination was actually a termination for convenience disguised as a termination for cause? If so, what is his factual basis for that contention? Is he contending that there was no material breach, that the cure period was insufficient, or that Northgate's motive was improper?
5. Establish that the procedural requirements of MCA § 14.1 were satisfied: Northgate issued written notice identifying the material breaches (Cure Notice No. 1, January 18, 2024), afforded Meridian 30 calendar days to cure, issued a second notice upon failure to cure (Cure Notice No. 2, February 19, 2024), and ultimately terminated the contract on April 1, 2024 — more than 72 days after the initial cure notice.
F. Change Orders (MCA § 16.1)
Proposed examination topics:
1. Have Sandoval confirm the MCA § 16.1 change order procedure: any change to the scope of work or the milestone schedule requires a written Change Order signed by authorized representatives of both parties.
2. Establish that Sandoval understood this requirement at the time the MCA was executed and throughout the life of the contract.
3. Determine how many formal, written Change Orders were executed during the life of the MCA. Our expectation is that very few, if any, of the 14 scope changes that Meridian now characterizes as "Owner-directed" were formalized through the contractual Change Order process.
4. If few or no Change Orders were executed, probe why Meridian did not insist on written Change Orders at the time the alleged scope changes were directed. Did Meridian submit Change Order requests that Northgate declined to execute? Or did Meridian simply never follow the contractual procedure?
5. Establish that under New York law, a contractor's failure to follow contractual change order procedures may bar recovery on claims for additional compensation or time extensions arising from alleged scope changes, particularly where the contract contains a no-oral-modification clause.
G. Consequential Damages Waiver (MCA § 20.1)
Proposed examination topics:
1. Have Sandoval read aloud MCA § 20.1 and confirm his understanding that neither party is liable to the other for consequential, indirect, incidental, special, or punitive damages, except in three narrowly defined circumstances: (a) willful misconduct; (b) intellectual property indemnification obligations; and (c) breaches of confidentiality obligations.
2. Confirm that Sandoval understood this mutual waiver at the time the MCA was executed and that Meridian received the benefit of this waiver (i.e., Northgate was likewise barred from claiming consequential damages from Meridian, except within the carve-outs).
3. Directly confront Sandoval with the question of whether Count IV of Meridian's complaint ($34,133,333 for loss of bonding capacity and reputational harm) constitutes consequential damages barred by MCA § 20.1. Allow Sandoval to state his position, but ensure the question and answer are clearly on the record for use in summary judgment briefing.
4. Ask whether Meridian's counsel advised Sandoval on the applicability of MCA § 20.1 to the Count IV claim before the verified complaint was filed. The examining attorney should expect and note a privilege objection from Deluca, but the question itself — and the fact of the objection — will be useful in the record. If the objection is not asserted, any answer will be valuable.
VI. SCHEDULE PERFORMANCE — PHASE-BY-PHASE EXAMINATION
A. Phase 1: New York Metro & Northern New Jersey (Milestones 1–4)
Phase 1 represents the earliest portion of the work and provides an important baseline for evaluating Meridian's performance trajectory. While Phase 1 was completed, Milestone 3 was achieved 47 days late, resulting in the first LD assessment. This delay was an early warning sign of systemic problems.
Proposed examination topics:
1. Confirm the Phase 1 scope: approximately 3,200 route miles of fiber-optic cable in the New York metropolitan area and Northern New Jersey, with a total milestone value of approximately $208 million.
2. Confirm the planned dates for Phase 1: commencement following the Notice to Proceed (April 1, 2020) through a targeted completion by September 2021.
3. Establish that Phase 1 was completed, but that Milestone 3 was achieved 47 days later than the contractual target date. The target date for Milestone 3 was August 28, 2021; actual achievement was October 14, 2021.
4. Confirm that Northgate assessed liquidated damages of $8,225,000 for the Milestone 3 delay, via a letter dated November 5, 2021. The LD amount was deducted from Meridian's subsequent payment application.
5. Determine whether Sandoval disputed the Phase 1 LD assessment at the time it was made. If he did dispute it, on what contractual or factual basis? If he did not dispute it, why not?
6. Probe the cause of the Milestone 3 delay. Does Sandoval attribute it to force majeure (COVID-19 effects in 2020–2021), municipal permitting delays, or Meridian's own workforce issues? If Sandoval claims force majeure or permitting causes, probe the specifics.
7. Establish that the Phase 1 delays constituted an early warning sign that should have prompted Sandoval to take corrective action to prevent further delays in subsequent phases. Did Sandoval implement any changes to Meridian's operations, staffing, or subcontractor management following the Phase 1 delays?
B. Phase 2: Connecticut, Western Massachusetts, Southern Pennsylvania (Milestones 5–8)
Phase 2 is the critical phase for Northgate's defense. It is during Phase 2 that Meridian's performance deteriorated dramatically, with escalating delays, a cascade of quality failures, and ultimately the triggering of the cure and termination process.
Proposed examination topics:
1. Confirm the Phase 2 scope: approximately 5,600 route miles across Connecticut, Western Massachusetts, and Southern Pennsylvania, with a total milestone value of approximately $363 million.
2. Confirm the planned dates for Phase 2: commencement in October 2021, with a targeted completion by June 2023.