MEMORANDUM
PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT This memorandum is protected by the attorney-client privilege and the work product doctrine. It is intended solely for use by attorneys and authorized personnel of Drummond & Fenwick LLP and the client in connection with the above-referenced litigation. Any unauthorized disclosure, reproduction, or distribution is strictly prohibited.
TO: Linda Osei, Responsible Partner
FROM: Jeffrey Park, Lead Associate
CC: Yuki Nakamura, Working Associate; Priya Anand, Billing Partner
DATE: January 15, 2025
RE: Expert Report Work Plan and Timeline — Meridian Infrastructure Partners LLC v. Northgate Fiber Americas Inc., Index No. 654321/2024 (N.Y. Sup. Ct., N.Y. County, Commercial Division)
MATTER NO.: 1022-00005
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I. Purpose and Overview
This memorandum sets out the coordinated work plan for preparing and finalizing the expert reports for our two defense experts: Dr. Elinor Chazen of Lakeview Consulting Group LLC (construction and delay expert) and Professor Gordon Whitfield of Pinnacle Economics LLC (damages expert). The purpose of this work plan is to ensure that both expert reports are completed on time, are internally consistent, and are positioned to withstand cross-examination and any anticipated admissibility challenges, while also serving as the foundation for summary judgment briefing and trial preparation.
As set forth in the discovery schedule established by Justice Eleanor M. Ricci at the October 1, 2024 Preliminary Conference, the relevant deadlines are as follows:
• Opening expert reports: due March 31, 2025
• Rebuttal expert reports: due May 15, 2025
• Expert depositions: anticipated in June 2025 (specific dates to be determined following service of rebuttal reports)
• Trial window: six weeks beginning November 2025
These deadlines are firm and were set by the court after extensive conferral among the parties. There is no indication that Justice Ricci would be amenable to extensions absent extraordinary circumstances.
This work plan addresses the following principal areas:
(a) remaining fact discovery needed to support the expert analyses, including third-party subpoena returns, upcoming depositions, and the pending privilege motion;
(b) coordination between the two defense experts' overlapping subject areas, particularly the nexus between Dr. Chazen's delay causation analysis and Professor Whitfield's damages quantification;
(c) milestone deadlines for internal drafts, C&H team review, client review, and final expert sign-off, structured to ensure that the March 31, 2025 and May 15, 2025 service deadlines are met with adequate margin;
(d) coordination with and preparation for plaintiff's anticipated expert reports from James Ochoa, PE of Keystone Project Advisory LLC and Dr. Natalie Forster of Westbrook Valuation Services Inc.; and
(e) budget considerations, including estimated expert fees, C&H attorney time, and coordination with Ironclad Surety Group Inc. regarding its defense cost contribution.
The sections that follow describe each element in detail. I recommend that we discuss this work plan at our next team meeting and seek your approval to proceed on the timeline set forth herein.
II. Defense Expert Team — Engagement Summary
A. Dr. Elinor Chazen — Construction / Delay Expert
Firm: Lakeview Consulting Group LLC 200 South Wacker Drive, Suite 1400 Chicago, IL 60606
Specialty: Construction delay analysis, critical path methodology, and fiber-optic infrastructure projects. Dr. Chazen holds a Ph.D. in Civil Engineering from the University of Illinois at Urbana-Champaign and has over twenty-five years of experience analyzing delay causation on large-scale infrastructure projects, including seven prior fiber-optic and telecommunications buildout engagements. She has been qualified as an expert in federal and state courts across twelve jurisdictions and has submitted expert reports in over forty construction disputes.
Engagement Date: October 15, 2024
Scope of Engagement: Dr. Chazen has been retained to provide the following opinions and analyses:
• Critical path analysis of the fourteen-milestone schedule established under MCA § 8.2, utilizing the as-planned versus as-built methodology implemented through Tarrant Data Systems scheduling software;
• Delay causation analysis attributing delays to Contractor-caused factors, Owner-caused factors, and concurrent delay, with specific attention to each milestone at which liquidated damages accrued;
• Evaluation of the 287 Non-Conformance Reports ("NCRs"), consisting of 43 critical NCRs and 244 non-critical NCRs, and their impact on both the project schedule and the quality of Meridian's work product;
• Assessment of Meridian's force majeure defense, specifically its claims regarding COVID-19 aftereffects on labor supply and fiber cable supply chain disruptions, and the extent to which those conditions excused performance;
• Evaluation of permitting responsibility allocation under MCA § 5.3, which establishes a shared-responsibility framework for municipal and state permitting, and analysis of whether Northgate Fiber Americas Inc. ("NFA" or "Northgate") caused permitting delays attributable to the Owner;
• Opinion on whether Meridian's alleged fourteen unformalized scope changes constitute constructive change orders that impacted the critical path, with reference to the MCA § 16.1 requirements for formal Change Order execution; and
• Opinion on the adequacy of Meridian's cure and remediation efforts following receipt of Cure Notice Nos. 1 and 2, including the sufficiency of Meridian's Corrective Action Plan dated March 5, 2024.
Preliminary Findings: Dr. Chazen delivered a privileged preliminary findings memorandum to Linda Osei on December 20, 2024. That memorandum, which remains subject to attorney work product protection, identified the following key preliminary conclusions:
Meridian's delays were predominantly Contractor-caused, driven principally by persistent crew shortages on Phase 2 and Phase 3 construction fronts, subcontractor management failures (including the loss of two key subcontractors — Pinnacle Underground Solutions and Coreline Fiber Services — in Q3 2023 due to non-payment disputes), and deficient quality control practices. The 43 critical NCRs — encompassing splice loss exceeding specification thresholds (NS-FIBER-2020 § 4.3.2), improper conduit depth in violation of state DOT permits, and unauthorized route deviations from the approved engineering design — required substantial rework that compounded schedule slippage across Milestones 5 through 8. Preliminary analysis indicates that the Owner-caused permitting delays identified by Meridian account for no more than 17 to 22 days of delay against the critical path, a fraction of the total delays accrued.
Dr. Chazen's team at Lakeview currently includes two senior consultants and one junior analyst assigned full-time to this engagement. Lakeview's principal point of contact for day-to-day coordination is Daniel Reeves, Senior Managing Consultant.
B. Professor Gordon Whitfield — Damages Expert
Firm: Pinnacle Economics LLC 1700 Broadway, Suite 2200 New York, NY 10019
Specialty: Lost-profits analysis, contract damages quantification, and telecommunications industry economics. Professor Whitfield is a tenured professor of Economics at Columbia University and serves as a Senior Advisor at Pinnacle Economics LLC. He has published extensively on damages methodology in construction and infrastructure litigation, including two frequently cited articles in the Journal of Legal Economics on the evidentiary standards for lost-profits claims in complex construction disputes. Professor Whitfield has been retained as a damages expert in over sixty matters, with a particular concentration in the telecommunications and energy infrastructure sectors.
Engagement Date: November 1, 2024
Scope of Engagement: Professor Whitfield has been retained to provide the following opinions and analyses:
• Rebuttal of Meridian's lost-profits claim, which constitutes the $41.976 million component of Count I (Wrongful Termination) as well as Count IV's $34,133,333 consequential damages claim for loss of bonding capacity and reputational harm;
• Critique of Meridian's damages model, which we anticipate will be presented in the expert report of Dr. Natalie Forster of Westbrook Valuation Services Inc.;
• Affirmative quantification of Northgate's counterclaim damages, specifically:
• Counterclaim I — Liquidated Damages: $49 million, representing the aggregate liquidated damages accrued across five milestones (47 days at MS3, 22 days at MS5, 68 days at MS6, 91 days at MS7, and 134 days at MS8, with MS8 capped at $9.1 million pursuant to MCA § 14.2(c));
• Counterclaim II — Excess Completion Costs: $81.7 million, being the difference between the $712 million replacement contract with Crestline Construction Group Inc. and the $630.3 million remaining unperformed value under the MCA at the time of termination;
• Counterclaim III — Remediation Costs: $18.3 million for remediation of defective work documented in the 287 NCRs, broken down as 43 critical NCRs at an average remediation cost of approximately $275,000 each ($11.825 million) and 244 non-critical NCRs at an average remediation cost of approximately $26,500 each ($6.466 million);
• Total Counterclaim Damages: $149 million.
Preliminary Findings: Professor Whitfield delivered a privileged preliminary findings memorandum to Linda Osei on January 6, 2025. Key preliminary conclusions include:
Meridian's lost-profits methodology is likely flawed and would not survive scrutiny under applicable admissibility standards. Meridian's claimed margin on unperformed work appears to rest on speculative assumptions that extrapolate company-wide profitability metrics (including Meridian's 9.5% EBITDA margin on FY2023 revenue of $620 million, yielding EBITDA of $58.9 million) to the specific Northgate contract without accounting for the project-specific cost overruns, quality deficiencies, and operational inefficiencies that characterized Meridian's performance. Furthermore, the MCA § 20.1 consequential damages waiver bars the damages claimed in Count IV (loss of bonding capacity and reputational harm, totaling $34,133,333) and likely bars the lost-profits component of Count I as well, to the extent those profits are properly characterized as consequential rather than direct damages. Finally, the hypothetical termination-for-convenience fee of $50,424,000 (calculated as 8% of the $630.3 million remaining MCA value pursuant to MCA § 14.5(b)) is inapplicable because termination was for cause under MCA § 14.3, not for convenience under MCA § 14.5.
Professor Whitfield's team at Pinnacle currently includes one managing director, one senior associate, and two analysts assigned to this matter. Pinnacle's principal point of contact for day-to-day coordination is Dr. Sarah Lindberg, Managing Director.
III. Plaintiff's Expected Expert Opinions
Anticipating the substance of Meridian's expert opinions is critical to crafting defense expert reports that proactively address — and undermine — the opposing experts' likely conclusions. Based on our review of Meridian's complaint, interrogatory responses, and the deposition testimony obtained to date, we anticipate the following expert opinions from plaintiff's side.
A. James Ochoa, PE — Keystone Project Advisory LLC
Address: 1500 Market Street, Suite 1200, Philadelphia, PA 19102
James Ochoa is a licensed Professional Engineer with approximately thirty years of experience in fiber-optic network construction and project management. He is a former Vice President of Engineering at AtlasTel Communications and has served as a construction expert in approximately fifteen prior litigations.
Anticipated Opinions: Based on Meridian's interrogatory responses and the contentions advanced in its complaint and opposition to our motion for summary judgment on the counterclaims, we anticipate that Ochoa will offer opinions on the following subjects:
• Owner-caused delay, specifically NFA's alleged failure to timely obtain municipal permits in accordance with MCA § 5.3, which establishes a shared-responsibility permitting framework under which Northgate bore primary responsibility for securing rights-of-way and franchise agreements while Meridian was responsible for construction permits and environmental clearances;
• The fourteen unformalized scope changes identified in Meridian's Interrogatory Response No. 14, which Ochoa is expected to characterize as constructive change orders that extended the critical path and for which Meridian is entitled to equitable schedule relief;
• Force majeure, specifically the contention that COVID-19-related labor shortages and fiber cable supply chain disruptions constituted force majeure events under MCA § 15.1 that excused Meridian's delay at Milestones 5 through 8; and
• An overarching opinion that Meridian's delays were excusable and did not constitute material breach of the MCA, such that NFA's termination for cause was wrongful.
Reference: Yuki Nakamura is preparing an internal preliminary analysis memorandum (anticipated delivery January 20, 2025) that will anticipate Ochoa's opinions in detail and develop counter-arguments for incorporation into Dr. Chazen's report. That memorandum will be circulated to the team and to Dr. Chazen upon completion.
Key Vulnerabilities to Target: In preparing Dr. Chazen's report and our eventual cross-examination of Ochoa, we should focus on the following weaknesses in Ochoa's anticipated testimony:
• Marcus Henley's deposition admissions (December 3–4, 2024) are devastating to the Owner-delay theory. Henley, who served as Meridian's Project Director for Phases 2 and 3, testified that crew shortages on the Phase 2 construction fronts were attributable to Meridian's inability to retain subcontractors due to payment disputes — not to any action or inaction by Northgate. Specifically, Henley admitted that Pinnacle Underground Solutions terminated its subcontract with Meridian in August 2023 after Meridian failed to pay approximately $4.2 million in outstanding invoices, and that Coreline Fiber Services followed suit in September 2023 for similar reasons (Henley Dep. Tr. at 187:4–189:22, 214:8–216:3). Ochoa will need to explain away these admissions if he is to sustain the Owner-delay narrative.
• Sean Calloway's deposition testimony (November 19, 2024) regarding the NCR documentation process undermines the contention that the 287 NCRs were attributable to overly stringent Owner inspection standards rather than genuine quality defects. Calloway, Northgate's Director of Quality Assurance, testified in detail about the multi-step NCR verification process, including third-party OTDR testing by independent testing firm Lightpath Testing Services LLC, which confirmed splice loss exceedances and conduit depth violations on an objective, instrument-verified basis (Calloway Dep. Tr. at 92:11–94:19, 127:3–131:8).
B. Dr. Natalie Forster — Westbrook Valuation Services Inc.
Address: 100 Park Avenue, Suite 800, New York, NY 10017
Dr. Forster holds a Ph.D. in Finance from the Wharton School and is the founding principal of Westbrook Valuation Services Inc. She has served as a damages expert in over seventy commercial litigation matters, with a particular focus on lost-profits analysis in construction, real estate, and infrastructure disputes.
Anticipated Opinions: Based on Meridian's complaint and interrogatory responses, we anticipate that Dr. Forster will offer opinions quantifying damages across all four counts of Meridian's complaint:
• Count I — Wrongful Termination ($92.4 million): Calculation of lost profits on unperformed work ($41.976 million) and the termination-for-convenience fee ($50,424,000, calculated as 8% of the $630.3 million remaining MCA value under MCA § 14.5(b));
• Count II — Disputed Invoices ($16.5 million): Quantification of unpaid Phase 3 disputed invoices, which Meridian contends represent work properly performed and for which payment was wrongfully withheld;
• Count III — Retainage ($56,966,667): Quantification of retainage withheld by Northgate under MCA § 18.1, which Meridian contends was required to be released upon substantial completion of each phase;
• Count IV — Consequential Damages ($34,133,333): Quantification of consequential damages for loss of bonding capacity and reputational harm, including lost future contract opportunities allegedly resulting from Northgate's wrongful termination.
Reference: Yuki Nakamura's internal preliminary analysis memorandum (anticipated January 20, 2025) will also identify potential Daubert/Frye challenges to Dr. Forster's lost-profits methodology and consequential damages analysis. New York state courts apply the Frye standard for expert admissibility, which requires that the expert's methodology be "generally accepted" within the relevant scientific or professional community. To the extent Forster employs a novel or untested methodology for extrapolating contract-specific margins from company-wide financial data, a Frye challenge may be warranted.
Key Vulnerabilities: The following weaknesses in Forster's anticipated damages analysis should be exploited:
• Forster's model must survive scrutiny on Meridian's actual margin. Meridian's FY2023 financials reflect revenue of $620 million and EBITDA of $58.9 million, yielding an EBITDA margin of approximately 9.5%. However, extrapolating this company-wide margin to the Northgate contract is speculative for several reasons: (i) the Northgate contract represented approximately 40% of Meridian's backlog and was experiencing significant cost overruns at the time of termination; (ii) Meridian's internal project cost reports (produced in discovery) suggest that the Northgate contract was operating at a substantially lower margin than Meridian's overall portfolio; and (iii) the cost overruns associated with the 287 NCRs, rework requirements, and subcontractor replacement would have further eroded margins on the unperformed work.
• The MCA § 20.1 consequential damages waiver is broadly drafted and, under New York law, should be enforced according to its terms. The waiver provides that "[n]either party shall be liable to the other for any indirect, incidental, consequential, special, or punitive damages arising out of or relating to this Agreement, including without limitation loss of profits, loss of revenue, loss of bonding capacity, loss of business opportunity, or damage to reputation." This provision squarely precludes the damages categories asserted in Count IV and arguably precludes the lost-profits component of Count I as well.
IV. Coordination Between Defense Experts
A. Overlapping Subject Areas
Effective coordination between Dr. Chazen and Professor Whitfield is essential because their respective analyses are deeply intertwined. The key areas of overlap are as follows:
Delay Causation and Damages Entitlement. Dr. Chazen's delay causation analysis feeds directly into Professor Whitfield's damages opinions on both the affirmative counterclaims and the rebuttal of Meridian's claims. If Dr. Chazen establishes that Meridian's delays were predominantly Contractor-caused — as her preliminary analysis indicates — then Meridian's entitlement to lost profits and the termination-for-convenience fee evaporates entirely. Conversely, if Ochoa's Owner-delay theory gains any traction, it could complicate Whitfield's quantification of counterclaim damages. The two experts' opinions must be carefully aligned on delay causation to avoid any inconsistency that opposing counsel could exploit at deposition or trial.
NCR Schedule Impact and Remediation Costs. Dr. Chazen's analysis of the schedule impact of the 287 NCRs — particularly the 43 critical NCRs that required rework on the critical path — connects directly to Professor Whitfield's Counterclaim III analysis quantifying the $18.3 million in remediation costs. Chazen must identify which NCRs caused rework delays, and Whitfield must quantify the cost of that rework. The two experts must use consistent NCR categorizations and cost data to ensure that their respective analyses are reconcilable.
Milestone Delay Calculations and Liquidated Damages. Dr. Chazen's milestone delay calculations — specifically, the number of days of delay attributable to each milestone — underpin Professor Whitfield's Counterclaim I assessment of $49 million in liquidated damages. The calculation for each milestone is as follows: MS3 (47 days of delay), MS5 (22 days), MS6 (68 days), MS7 (91 days), and MS8 (134 days of delay accrued at the time of termination, capped at the per-milestone maximum of $9.1 million). Whitfield's liquidated damages calculations must precisely match Chazen's delay attribution. Any discrepancy will be immediately targeted by opposing counsel.
Excess Completion Costs and Scope Comparability. Professor Whitfield's Counterclaim II analysis of excess completion costs ($81.7 million, being the difference between Crestline Construction Group Inc.'s $712 million replacement contract and the $630.3 million remaining unperformed MCA value) requires Dr. Chazen to confirm the scope comparability between the original MCA remaining work and Crestline's contracted scope. Meridian will undoubtedly argue that Crestline's scope is broader or includes enhancements not contemplated by the original MCA, thereby inflating the excess cost figure. Chazen must be prepared to opine on scope equivalence, and Whitfield must account for any legitimate scope differences in his cost differential analysis.
B. Coordination Protocol
To manage these interdependencies effectively, we will implement the following coordination protocol:
Bi-Weekly Joint Expert Coordination Calls. Beginning February 1, 2025, I will lead bi-weekly joint coordination calls with Dr. Chazen, Professor Whitfield, and their respective support teams. Yuki Nakamura will prepare materials for each call and circulate agendas at least two business days in advance. The calls will address progress on analyses, data needs, cross-referencing issues, and any emerging challenges. The call schedule is as follows: February 1, February 15, March 1, March 8 (accelerated cadence as the deadline approaches), and additional calls as needed during the rebuttal phase.
Cross-Referencing Without Joint Opinions. Dr. Chazen's and Professor Whitfield's reports should cross-reference each other's conclusions where appropriate — for example, Whitfield's damages report should cite Chazen's delay attribution tables as the basis for the liquidated damages calculation. However, the experts should avoid rendering joint opinions or co-authoring any sections of their reports. Joint opinions would create unnecessary discovery exposure, as a joint opinion could be characterized as a product of collaboration rather than independent expert judgment, potentially undermining the credibility of each expert's independent conclusions.
C&H as Document Clearinghouse. All documents provided to either expert must be routed through Greaves & Castellan LLP. No documents should be transmitted directly from Northgate or any other source to the experts without first passing through our review. This protocol serves two purposes: it ensures that all materials provided to the experts are properly tracked for inclusion in the experts' respective "materials considered" lists (as required by CPLR 3101(d) and the court's standing orders), and it maintains work product protection over attorney-directed communications with the experts.
Delay Attribution Table Handoff. Dr. Chazen will provide Professor Whitfield with finalized delay attribution tables no later than March 7, 2025, to ensure that Whitfield has sufficient time to incorporate those tables into his damages model before the March 31, 2025 report deadline. This handoff is a critical-path item in our internal work plan; any slippage in Chazen's delivery of the delay tables will directly compress Whitfield's timeline.
V. Key Data Sources and Outstanding discovery Needs
A. Documents Already Available to Experts
Both experts have been provided access to, or are in the process of receiving, the following key data sources:
• Northgate's Document Production: Approximately 1.4 million documents (3.2 TB) produced from ten custodians, including Renata Voss (CEO), Sean Calloway (Director of Quality Assurance), Helena Bright (CFO), Dominic Hale (General Counsel), James Porter (VP of Network Engineering), Catherine Liu (Director of Permitting), and four additional custodians identified in the ESI Protocol Order.
• Meridian's Document Production: Approximately 890,000 documents (1.8 TB) produced from eight custodians, including Victor Sandoval (CEO), Bridget Yeung (COO), Marcus Henley (Project Director, Phases 2–3), Richard Fong (CFO), Angela Morales (VP of Quality), and three additional custodians.
• Master Construction Agreement ("MCA") and all exhibits, schedules, and amendments, including Exhibit B (milestone values and schedule), Exhibit C (Technical Specification NS-FIBER-2020), Exhibit D (insurance requirements), and Exhibit E (key personnel).
• All 287 NCRs, cataloged in the NCR Summary and Analysis spreadsheet prepared by Yuki Nakamura, which categorizes each NCR by type (splice loss, conduit depth, route deviation, material non-conformance, or other), severity (critical or non-critical), date issued, cure status, and estimated remediation cost.
• Milestone Delay Timeline and Liquidated Damages Calculation spreadsheet, prepared by C&H based on contemporaneous project schedule updates, monthly progress reports, and milestone certification correspondence.
• Payment History and Retainage Analysis spreadsheet, reflecting total payments of $512.7 million made to Meridian over the life of the contract and retainage withheld of $56,966,667 (representing approximately 10% of earned contract value, consistent with MCA § 18.1).
• Excess Completion Costs Analysis spreadsheet, comparing the Crestline Construction Group Inc. replacement contract price of $712 million against the $630.3 million remaining unperformed MCA value, with line-item breakdowns by scope category.
• Cure Notice Nos. 1 and 2, Meridian's written responses thereto, Meridian's Corrective Action Plan dated March 5, 2024, Northgate's rejection of the Corrective Action Plan dated April 2, 2024, and the Notice of Termination for Cause dated May 15, 2024.
• Deposition Transcripts: Renata Voss (November 12–13, 2024), Sean Calloway (November 19, 2024), Marcus Henley (December 3–4, 2024), and Victor Sandoval (December 10–11, 2024), together with all deposition exhibits.
B. Outstanding discovery Items Needed for Expert Work
The following outstanding discovery items are critical to the expert analyses and must be obtained and incorporated on the timeline set forth in this work plan:
1. Third-Party Subpoena Returns. We have served subpoenas on seven subcontractors (including Pinnacle Underground Solutions LLC, Coreline Fiber Services Inc., Great Plains Boring & Trenching LLC, and four others) and three municipal permitting authorities (City of Columbus Department of Public Service, Indiana Department of Transportation, and the Ohio Department of Transportation). Productions from these entities are critical for Dr. Chazen's analysis of the permitting timeline and the question of whether permitting delays were attributable to Owner inaction or Contractor failure to submit timely and complete permit applications. As of the date of this memorandum, returns have been received from only two of the seven subcontractors and none of the three permitting authorities. Yuki Nakamura will follow up with opposing counsel and the third parties to obtain status updates and, if necessary, we will seek judicial intervention to compel compliance.
2. Privilege Motion Outcome. Two hundred fourteen Northgate documents designated as privileged are the subject of Meridian's Motion to Compel (Mot. Seq. No. 004), which is set for oral argument before Justice Ricci on January 27, 2025. If the court orders production of some or all of these documents, they could affect the substance of expert opinions, as several of the documents on the privilege log relate to internal Northgate discussions about the termination decision and the assessment of Meridian's performance. Conversely, if Northgate prevails on its Cross-Motion for Protective Order (Mot. Seq. No. 005), the 187 Meridian-Ridgepoint Capital communications currently withheld by Meridian may be ordered produced. Those communications are relevant to Professor Whitfield's analysis of Meridian's financial condition, as they may shed light on the approximately $12 million in litigation funding that Ridgepoint Capital has provided to Meridian and the terms under which that funding was extended — information that could be material to Meridian's ability to perform the remaining contract work and to its claimed consequential damages.
3. Upcoming Depositions. Several depositions scheduled for the coming weeks will generate testimony material to the expert reports:
• Bridget Yeung (Meridian COO) — February 4, 2025: Yeung is expected to provide key testimony on Meridian's operational decisions during Phases 2 and 3, including subcontractor oversight, the decision to self-perform certain work scopes after losing Pinnacle Underground and Coreline Fiber, and the factual basis for Meridian's fourteen alleged unformalized scope changes. This testimony will be incorporated into Dr. Chazen's analysis of Contractor-caused delay and Professor Whitfield's critique of Meridian's cost and margin assumptions.
• Helena Bright (Northgate CFO) — February 18, 2025 (by commission, London, England): Bright's testimony will address Northgate's financial and budgetary treatment of the project, including internal budget-to-actual analyses, the financial impact of Meridian's delays on Northgate's capital expenditure planning, and the circumstances surrounding the engagement of Crestline Construction Group. This testimony is relevant to Meridian's pretext theory — i.e., Meridian's contention that Northgate terminated the MCA not because of Meridian's performance failures but because of internal budget pressure and a desire to restructure the project — and Professor Whitfield will need to address it in his report.
• Dominic Hale (Northgate General Counsel) — February 25, 2025 (noticed by Meridian; privilege objection pending): Meridian has noticed the deposition of Northgate's General Counsel, and we have interposed a privilege objection on the ground that Hale's testimony would inevitably invade the attorney-client privilege. Our objection letter was sent on January 10, 2025, and we are awaiting a response from Hargrove, Deluca & Stein LLP ("HDS"). If the deposition proceeds, Hale's testimony regarding the termination decision-making process could bear on both experts' analyses, and we should be prepared to incorporate or address it accordingly.
• Frank DiBello (CEO, Crestline Construction Group Inc.) — March 4, 2025 (non-party deposition): DiBello's testimony is essential for Professor Whitfield's excess-completion-costs opinion. We need DiBello to testify regarding the scope comparability between the remaining MCA work and Crestline's contracted scope, Crestline's pricing methodology, the terms of Crestline's $712 million replacement contract, and whether Crestline's scope includes any enhancements, additions, or modifications not contemplated by the original MCA. Dr. Chazen may also draw upon DiBello's testimony regarding scope comparability.
4. Meridian's Financial Records. Professor Whitfield requires additional granularity on Meridian's financial condition to support his critique of the lost-profits model. Specifically, we need project-level margin data (as opposed to company-wide EBITDA), overhead allocation methodologies, and detailed backlog information showing the composition and status of Meridian's $1.4 billion pre-termination backlog and the reduced approximately $770 million post-termination backlog. Meridian has produced company-wide financial statements and tax returns, but project-level cost reports and job-cost detail remain incomplete. We served a supplemental document request (RFP Set 3, Request Nos. 42–48) on December 20, 2024, and Meridian's responses are due January 30, 2025.
5. Crestline Contract Documents. The full executed Crestline replacement contract, including all exhibits, scope documents, schedules, pricing exhibits, and any change orders executed since the contract's inception in August 2024, must be obtained for both experts. We served a non-party subpoena on Crestline on November 15, 2024; the return date was extended by stipulation to February 1, 2025. Yuki Nakamura will follow up to ensure timely compliance.
VI. Work Plan Timeline — Opening Expert Reports (Due March 31, 2025)
The work plan for the opening expert reports is divided into three phases, each with detailed milestones and assignments. The timeline has been designed to provide adequate review time at each stage while accommodating the upcoming depositions and the compressed final week before the March 31 deadline.
Phase 1: Data Compilation and Analysis (January 15 – February 14, 2025)
This phase focuses on assembling complete document sets for each expert, building the foundational analytical models, and incorporating testimony from the February depositions.
During this phase, Yuki Nakamura will also prepare deposition digest memoranda for the Yeung, Bright, and DiBello transcripts, identifying testimony relevant to each expert's analysis and flagging any testimony that is inconsistent with, or supportive of, our experts' preliminary conclusions.
Phase 2: Draft Expert Reports (February 15 – March 14, 2025)
This phase covers the preparation, submission, and review of first-draft expert reports, with an emphasis on ensuring consistency between the two reports and obtaining client input on factual accuracy.
It is critical that the February 28 first-draft deadline be treated as firm. Any slippage in this deadline will cascade through the review process and jeopardize the March 31 service deadline. I will communicate this expectation clearly to both expert teams during the February 1 coordination call.
Phase 3: Finalization and Service (March 15 – March 31, 2025)
This phase covers the incorporation of comments, final review for legal sufficiency and admissibility, expert sign-off, and timely service on opposing counsel.
The three-day buffer between expert sign-off (March 27) and service (March 31) is intentionally included to account for any last-minute formatting, citation, or exhibit issues that may arise during the finalization process. This buffer should not be treated as available time for substantive revisions.
VII. Work Plan Timeline — Rebuttal Expert Reports (Due May 15, 2025)
Phase 4: Review of Plaintiff's Expert Reports (April 1 – April 18, 2025)
Under the discovery schedule, Meridian's opening expert reports from Ochoa and Forster are due on March 31, 2025 — the same date as our opening reports. We anticipate receiving them on or about that date, and the rebuttal work will commence immediately.
The compressed six-and-a-half-week rebuttal timeline (March 31 to May 15) requires particularly efficient execution. The C&H analysis memoranda on the Ochoa and Forster reports will be critical tools for focusing the experts' rebuttal efforts on the most impactful areas. We should prioritize identifying opinions that are both vulnerable to challenge and material to the outcome of the case.
Phase 5: Draft and Finalize Rebuttal Reports (April 18 – May 15, 2025)
The rebuttal timeline allows only two weeks from first draft to service — significantly compressed compared to the four-week finalization period for the opening reports. This underscores the importance of the April 10 C&H analysis memoranda, which will enable the experts to begin drafting rebuttal opinions even before the April 11 coordination call.
VIII. Expert Depositions — Preparation Plan (June 2025)
Exact deposition dates are to be determined. Under the discovery schedule, expert depositions are to be completed within thirty days of the service of rebuttal reports. We therefore anticipate that Meridian's counsel at HDS will notice depositions of both Dr. Chazen and Professor Whitfield for dates in June 2025, likely during the weeks of June 2 and June 16. We should likewise expect to schedule depositions of Ochoa and Forster during the same period.
Defense Expert Deposition Preparation. For each of our defense experts, we will conduct at least two full-day preparation sessions:
• Session 1 (approximately one week before each deposition): Full review of the expert's opening report and rebuttal report, including all exhibits and supporting materials. Focus on anticipated areas of cross-examination, including: the expert's methodology, the sufficiency of the factual basis for each opinion, any prior inconsistent testimony or publications, potential bias issues (including fee arrangements and the percentage of the expert's practice devoted to defense-side retention), and areas of vulnerability identified during the C&H report review process.
• Session 2 (one to two days before each deposition): Intensive preparation session including mock cross-examination. Linda Osei will lead both sessions, with Jeffrey Park and Yuki Nakamura assisting.
Deposition Preparation Binders. C&H will prepare comprehensive deposition preparation binders for each expert, containing the following materials:
(a) the expert's opening report, all exhibits, and the "materials considered" list;
(b) the expert's rebuttal report and all exhibits;
(c) all documents relied upon or considered by the expert in forming opinions;
(d) deposition transcripts of all fact witnesses, with relevant testimony highlighted and indexed;
(e) a detailed memorandum identifying anticipated lines of cross-examination, organized by topic area, with suggested responses and potential pitfalls;
(f) prior testimony by the expert in other matters (including deposition and trial transcripts), with any potentially inconsistent statements flagged; and
(g) a compilation of the expert's publications, articles, and presentations, with particular attention to any statements that could be used to impeach the expert's opinions in this case.
Plaintiff's Expert Depositions. Conversely, C&H will take the depositions of Plaintiff's experts Ochoa and Forster. Jeffrey Park and Yuki Nakamura will prepare detailed cross-examination outlines following receipt and analysis of Plaintiff's opening and rebuttal expert reports. The cross-examination outlines will focus on the factual errors, methodological weaknesses, and Frye vulnerabilities identified in the C&H analysis memoranda described in Section VII above. Linda Osei will conduct the depositions, with Jeffrey Park serving as second chair.
IX. Key Subject-Matter Areas for Each Expert Report
This section provides an outline of the anticipated structure and content of each expert report, which will serve as a roadmap for the experts and the C&H review team.
A. Dr. Chazen's Report — Anticipated Sections
Dr. Chazen's opening expert report is expected to contain the following sections, the precise organization and titling of which will be finalized in consultation with Dr. Chazen and her team:
1. Qualifications and Experience. Summary of Dr. Chazen's education, professional experience, and specific expertise in fiber-optic construction delay analysis, including a listing of prior expert engagements and publications. Curriculum vitae to be appended as Exhibit A to the report.
2. Summary of Opinions. Concise statement of Dr. Chazen's principal opinions, suitable for reference by the court and opposing counsel and consistent with CPLR 3101(d) disclosure requirements.
3. Background and Scope of the MCA. Overview of the Master Construction Agreement, including the contract value ($1.2 billion), the geographic scope (18,500 route miles across a seven-state footprint), the three-phase construction plan, the fourteen-milestone schedule established under MCA § 8.2, and the Notice to Proceed date of April 1, 2020, with original contract completion set for March 31, 2025.
4. Critical Path Methodology and Software Tools. Description of the critical path method ("CPM") delay analysis methodology employed by Dr. Chazen, including the use of Ridgeline Industries's Tarrant Data Systems scheduling software to model the as-planned and as-built project schedules. Discussion of the reliability and general acceptance of CPM methodology in the construction industry and in litigation.
5. Baseline Schedule Analysis. Detailed analysis of the baseline project schedule established under MCA § 8.2, including the fourteen milestones, their respective planned completion dates, milestone values, and interdependencies. Identification of the critical path through the baseline schedule.
6. As-Built Schedule Analysis — Phase 1. Analysis of actual project performance during Phase 1 (3,200 route miles), with particular attention to the 47-day delay at Milestone 3 and the factors contributing to that delay. Assessment of whether Phase 1 delays were harbingers of the more severe Phase 2 delays.
7. As-Built Schedule Analysis — Phase 2. Analysis of actual project performance during Phase 2 (5,600 route miles), including the progressive deterioration reflected in Milestone 5 (22 days late), Milestone 6 (68 days late), Milestone 7 (91 days late), and Milestone 8 (134 days of delay accrued at the time of termination). Identification of the root causes of the accelerating delay trend.
8. As-Built Schedule Analysis — Phase 3. Analysis of Phase 3 performance (9,700 planned route miles), noting that only 340 route miles — approximately 3.5% of the planned Phase 3 scope — had been constructed at the time of termination. Assessment of the implications of this negligible progress for Meridian's ability to complete the project within the contractual timeframe.
9. Delay Causation Analysis — Contractor-Caused Factors. Attribution of project delays to Contractor-caused factors, including: persistent crew shortages arising from Meridian's failure to maintain adequate labor resources; subcontractor management failures, including the loss of two key subcontractors (Pinnacle Underground Solutions and Coreline Fiber Services) in Q3 2023; and quality defects documented in the 287 NCRs that required rework on the critical path.
10. Evaluation of Meridian's Owner-Delay Claims. Analysis of Meridian's contention that NFA caused permitting delays in violation of MCA § 5.3. Review of actual permitting timelines from municipal records (as obtained through third-party subpoenas) to determine whether permitting delays were attributable to NFA's failure to act or to Meridian's submission of incomplete or deficient permit applications.
11. Evaluation of Fourteen Alleged Unformalized Scope Changes. Analysis of whether Meridian's fourteen claimed unformalized scope changes constituted constructive change orders that impacted the critical path, with reference to MCA § 16.1, which requires that all Change Orders be executed in writing by both parties and sets forth specific procedures for Change Order requests, evaluation, and pricing.
12. Evaluation of Force Majeure Defense. Analysis of Meridian's contention that COVID-19-related labor shortages and fiber cable supply chain disruptions constituted force majeure events under MCA § 15.1. Assessment of the temporal scope of the claimed force majeure conditions and whether those conditions persisted during the critical delay periods in 2023 and 2024, as opposed to the earlier 2020–2021 timeframe when the pandemic's operational impacts were most acute.
13. Quality Analysis — 287 NCRs. Detailed analysis of the 287 NCRs, categorized as 43 critical and 244 non-critical. Assessment of the schedule impact of the critical NCRs, including the rework requirements and the extent to which rework activities consumed resources that would otherwise have been deployed on new construction. Evaluation of whether the NCRs reflect systemic quality control deficiencies rather than isolated incidents.
14. Cure Notice Compliance. Analysis of Meridian's response to Cure Notice Nos. 1 and 2, including the adequacy of the Corrective Action Plan submitted on March 5, 2024, and the significance of the twelve additional critical NCRs issued in February 2024 — during the cure period — which demonstrated that Meridian's quality deficiencies were continuing unabated even after being formally noticed.
15. Conclusions. Statement of Dr. Chazen's overall conclusions: that Meridian's delays were predominantly Contractor-caused; that Meridian's performance constituted a material breach of the MCA; and that NFA's termination for cause under MCA § 14.3 was justified by the factual record.
B. Professor Whitfield's Report — Anticipated Sections
Professor Whitfield's opening expert report is expected to contain the following sections:
1. Qualifications and Experience. Summary of Professor Whitfield's education, academic position, professional experience, and specific expertise in contract damages quantification and telecommunications economics, including a listing of prior expert engagements and publications. Curriculum vitae to be appended as Exhibit A to the report.
2. Summary of Opinions. Concise statement of Professor Whitfield's principal opinions.
3. Overview of MCA Pricing Structure. Description of the MCA's hybrid pricing structure, consisting of 65% fixed-price milestone payments and 35% unit-rate payments, with a total contract value of $1.2 billion. Discussion of how this pricing structure affects the analysis of claimed damages.
4. Analysis of Meridian's Claimed Damages. This section will address each of Meridian's four counts:
• Count I — Wrongful Termination ($92.4 million): Critique of the termination-for-convenience fee calculation ($50,424,000, equal to 8% of the $630.3 million remaining MCA value), which is inapplicable because termination was for cause under MCA § 14.3, not for convenience under MCA § 14.5. Critique of the lost-profits claim ($41.976 million), demonstrating that Meridian's margin assumptions are speculative and unsupported by the project-level financial data, inconsistent with Meridian's actual EBITDA margin of 9.5% on FY2023 revenue of $620 million, and that any lost-profits model that extrapolates company-wide margins to a specific project experiencing significant cost overruns and quality deficiencies fails to satisfy the reasonable certainty standard under New York law.
• Count II — Disputed Phase 3 Invoices ($16.5 million): Analysis of the basis for NFA's non-payment, including defective work documentation and inflated unit counts on Meridian's Phase 3 invoice submissions. NFA's construction manager verified fewer unit quantities than Meridian claimed, and a portion of the invoiced work was subject to open critical NCRs at the time of invoice submission, justifying withholding under MCA § 18.2.
• Count III — Retainage ($56,966,667): Analysis of NFA's contractual right to withhold retainage under MCA § 18.1 pending final completion, and the forfeiture provision of MCA § 14.5, which provides that retainage is not payable in the event of a termination for cause.
• Count IV — Consequential Damages ($34,133,333): Analysis demonstrating that the claimed damages for loss of bonding capacity and reputational harm are barred by the MCA § 20.1 consequential damages waiver.
5. Enforceability of MCA § 20.1 Consequential Damages Waiver. Legal and economic analysis of the enforceability of the mutual consequential damages waiver under New York law, including discussion of applicable precedent and the waiver's application to the specific damages categories claimed by Meridian.
6. Quantification of Northgate's Counterclaim Damages. This section will quantify each counterclaim:
• Counterclaim I — Liquidated Damages ($49 million total): Calculation based on Dr. Chazen's delay attribution tables: MS3 ($8.225 million), MS5 ($3.85 million), MS6 ($11.9 million), MS7 ($15.925 million), and MS8 ($9.1 million, capped at the per-milestone maximum pursuant to MCA § 14.2(c)). Aggregate total of $49 million, which falls below the MCA's aggregate liquidated damages cap of $60 million (5% of the $1.2 billion contract value). Analysis of enforceability under New York law — i.e., that the liquidated damages represent a reasonable estimate of anticipated harm and are not an unenforceable penalty.
• Counterclaim II — Excess Completion Costs ($81.7 million): Calculation of the differential between Crestline Construction Group Inc.'s $712 million replacement contract price and the $630.3 million remaining unperformed MCA value. Scope comparability analysis demonstrating that Crestline's scope is substantially equivalent to the remaining MCA work. Market pricing analysis supporting the reasonableness of Crestline's pricing in the context of the prevailing market for fiber-optic construction services in the seven-state footprint.
• Counterclaim III — Remediation Costs ($18.3 million): Quantification based on NCR remediation cost estimates: 43 critical NCRs at an average cost of $275,000 each ($11.825 million) and 244 non-critical NCRs at an average cost of $26,500 each ($6.466 million), for a total of $18.291 million (rounded to $18.3 million). Methodology for deriving average remediation costs, including reference to third-party remediation estimates obtained by NFA.
• Total Counterclaim Damages: $149 million.
7. Meridian's Financial Condition. Analysis of Meridian's financial condition, including FY2023 revenue of $620 million, EBITDA of $58.9 million (9.5% margin), and the significant reduction in backlog from approximately $1.4 billion pre-termination to approximately $770 million post-termination. Discussion of the relevance of Meridian's financial condition to mitigation, ability to perform, and the credibility of its lost-profits projections.
8. Conclusions. Statement of Professor Whitfield's overall conclusions regarding the invalidity of Meridian's damages claims and the well-supported basis for Northgate's $149 million in counterclaim damages.
X. Budget and Resource Allocation
A. Expert Fees
The combined expert costs for Dr. Chazen and Professor Whitfield through trial are estimated at $2.4 million to $3.1 million, consistent with the engagement letters executed with each firm and the prior budget estimate communicated to Dominic Hale, Northgate's General Counsel, in November 2024.
The breakdown by expert is as follows:
• Dr. Elinor Chazen / Lakeview Consulting Group LLC: Estimated $1.2 million to $1.5 million through trial. This estimate encompasses the preparation of the opening expert report, the rebuttal expert report, deposition preparation and testimony, trial preparation, and trial testimony (estimated at three to four days of direct and cross-examination). Lakeview's blended hourly rate for the engagement is approximately $650/hour (reflecting Dr. Chazen's personal rate of $850/hour and lower rates for her supporting consultants and analysts). The estimate assumes approximately 1,600 to 1,900 hours of total engagement time across the Lakeview team.
• Professor Gordon Whitfield / Pinnacle Economics LLC: Estimated $1.2 million to $1.6 million through trial. This estimate encompasses the same scope of work as described above for Dr. Chazen. Professor Whitfield's personal rate is $975/hour, with lower rates for supporting personnel. The estimate assumes approximately 1,400 to 1,800 hours of total Pinnacle team time. The higher end of the range accounts for the possibility that Meridian's damages model is more complex than anticipated, which could require additional analytical work.
Budget should be tracked on a monthly basis, with invoices from both expert firms reviewed by Jeffrey Park and reported to Priya Anand for inclusion in the overall matter budget. Any material variance from the estimated range should be promptly communicated to Dominic Hale and to Ironclad Surety Group.
B. C&H Attorney Time — Expert Phase
Estimated C&H attorney time for the expert work phase (January 15 through May 15, 2025) is as follows:
• Linda Osei (Responsible Partner, $1,650/hour): Approximately 80 to 100 hours, encompassing strategic oversight of the expert engagement, review and comment on draft expert reports, expert deposition preparation, and coordination calls with the client and Ironclad. Estimated fees: $132,000 to $165,000.
• Jeffrey Park (Lead Associate, $975/hour): Approximately 250 to 300 hours, encompassing day-to-day expert coordination, detailed review and comment on draft expert reports, data compilation and document delivery management, preparation of C&H analysis memoranda on Plaintiff's expert reports, cross-examination outline preparation for Plaintiff's expert depositions, and participation in all coordination calls. Estimated fees: $243,750 to $292,500.
• Yuki Nakamura (Working Associate, $825/hour): Approximately 200 to 250 hours, encompassing document assembly and delivery via the Vantage platform, legal research on admissibility standards and New York damages law, preparation of deposition transcript digests, preliminary rebuttal analyses, third-party subpoena follow-up, and CPLR 3101(d) disclosure preparation. Estimated fees: $165,000 to $206,250.
Estimated total C&H fees for the expert work phase: approximately $550,000 to $700,000, exclusive of expert costs. When combined with expert fees, the total estimated cost of the expert phase (through service of rebuttal reports) is approximately $2.95 million to $3.8 million. This does not include the additional attorney time and expert time that will be incurred during the June 2025 expert deposition phase or subsequent trial preparation.
C. Ironclad Surety Group Contribution
Ironclad Surety Group Inc. ("Ironclad"), Meridian's performance bond surety on the MCA, has agreed to contribute up to $2 million toward Northgate's defense costs under a reservation of rights. Ironclad's contribution is governed by the terms of a Defense Cost Sharing Agreement dated September 30, 2024, between Northgate and Ironclad. The following coordination items are required: