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SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: COMMERCIAL DIVISION

MERIDIAN INFRASTRUCTURE PARTNERS LLC,

Plaintiff,

— against —

NORTHGATE FIBER AMERICAS INC.,

Defendant.

Index No. 654321/2024 Part 49 Hon. Eleanor M. Ricci

DEFENDANT NORTHGATE FIBER AMERICAS INC.'S MEMORANDUM OF LAW IN OPPOSITION TO PLAINTIFF'S MOTION TO COMPEL PRODUCTION OF PRIVILEGED DOCUMENTS

Filed: December 2, 2024

CALDERWOOD & HARKNESS LLP 425 Park Avenue, 33rd Floor New York, NY 10022 Telephone: (212) 558-4000 Facsimile: (212) 558-3588

Linda Osei, Responsible Partner Priya Anand Jeffrey Park Yuki Nakamura

Attorneys for Defendant Northgate Fiber Americas Inc.

C&H Matter No. 1022-00005

PRELIMINARY STATEMENT

Defendant Northgate Fiber Americas Inc. ("NFA" or "Defendant") respectfully opposes the motion to compel filed by Plaintiff Meridian Infrastructure Partners LLC ("Meridian" or "Plaintiff") on November 22, 2024, seeking production of 214 documents withheld by Defendant on the basis of attorney-client privilege and/or the work product doctrine. The motion should be denied in its entirety.

The 214 documents at issue consist of internal legal advice provided by Northgate Telecommunications PLC's General Counsel, Dominic Hale, Esq., and outside counsel to NFA's senior management regarding the termination strategy under the Master Construction Agreement dated March 15, 2020 (the "MCA"), as well as attorney-supervised analysis of the potential for in-house fiber construction as an alternative following termination. These communications also include privileged presentations and memoranda prepared by or at the direction of counsel for NFA's parent company's board of directors and senior leadership team, summarizing legal advice regarding NFA's termination rights, litigation risk exposure, and strategic legal alternatives available in connection with the MCA.

These documents are quintessential privileged communications. They reflect legal advice sought and rendered in confidence between client personnel and their attorneys regarding the exercise of contractual rights, potential litigation exposure, and strategic legal options in anticipation of the very dispute now before this Court. The attorney-client privilege and work product doctrine exist precisely to protect communications of this nature — candid legal assessments of contractual rights and obligations, litigation risk analyses, and strategy memoranda prepared to guide corporate decision-making in legally fraught circumstances. Without the assurance of confidentiality, corporate clients would be unable to engage in the frank and open dialogue with their attorneys that the privilege is designed to foster, and the quality of legal advice — and the quality of the decisions informed by that advice — would inevitably suffer.

Meridian's motion is a transparent attempt to pierce the attorney-client privilege to obtain NFA's internal legal strategy and thought processes in connection with the termination of the MCA for cause on April 1, 2024. Meridian's argument is ultimately grounded in its so-called "pretext" theory — namely, that NFA terminated the MCA not because of Meridian's well-documented material breach of the agreement, but rather to bring fiber construction in-house or to re-procure construction services at lower market prices. The premise of Meridian's argument is that the 214 withheld documents are "relevant" to this theory and therefore must be produced.

But relevance has never been the test for overcoming the attorney-client privilege, and Meridian identifies no applicable exception to the privilege that would warrant production. If anything, the heightened relevance that Meridian attributes to these documents underscores their quintessentially privileged character: they contain precisely the kind of candid legal analysis — regarding termination rights, litigation risk, and post-termination alternatives — that the privilege is designed to protect from disclosure in adversarial proceedings. To hold otherwise would eviscerate the privilege whenever a plaintiff characterizes a defendant's exercise of a contractual right as "pretextual" and demands access to counsel's advice regarding that exercise.

The 214 documents were properly withheld, properly identified and described on Defendant's privilege log served on October 31, 2024, and the motion should be denied in its entirety. In the alternative, if this Court determines that further inquiry is warranted, Defendant respectfully requests that any in camera review be limited to a representative sample of documents from each category rather than the full universe of 214 entries.

STATEMENT OF FACTS

A. The Parties and the Underlying Dispute

NFA is a Delaware corporation (File No. 7182934) and wholly owned subsidiary of Northgate Telecommunications PLC ("NTP"), a United Kingdom-headquartered, publicly traded telecommunications and software-as-a-service company listed on the London Stock Exchange (LSE: NTP), with American Depositary Receipts trading on the Nasdaq Global Select Market under the ticker symbol NTPLF. NFA maintains its principal office at 600 Lexington Avenue, 28th Floor, New York, New York 10022, and serves as NTP's primary United States operating entity for the deployment and operation of fiber-optic telecommunications infrastructure.

Meridian Infrastructure Partners LLC is a Delaware limited liability company (File No. 6439821) headquartered in Houston, Texas, with regional offices in Atlanta, Georgia, and Trenton, New Jersey. Meridian is a portfolio company of Ridgepoint Capital Group LP, a private equity firm. Meridian served as the general contractor for NFA's fiber-optic build-out program under the MCA, and the NFA engagement was by far Meridian's largest project, representing approximately sixty-five percent of Meridian's total annual revenue during the years the MCA was in effect.

On March 15, 2020, NFA and Meridian executed the MCA for the design, engineering, permitting, and construction of approximately 18,500 route miles of fiber-optic cable across a seven-state footprint encompassing New York, New Jersey, Connecticut, Massachusetts, Pennsylvania, Maryland, and Virginia. The total contract price under the MCA was $1.2 billion over a five-year term, payable in milestone-based installments tied to the achievement of specified construction deliverables. The MCA was a complex, heavily negotiated agreement running to over 230 pages, including detailed technical specifications, quality standards, milestone schedules, and termination provisions. The parties were represented by sophisticated counsel throughout the negotiation process.

From the inception of the project, Meridian experienced persistent and worsening schedule delays and quality failures. During Phase 1 of the construction program, Milestone 3 — which required the completion of conduit installation and fiber placement across the initial 2,800 route miles in the New York metropolitan area — was completed 47 days late, well beyond the contractual cure period. NFA raised these concerns with Meridian's project management team at the time but elected, in the interest of maintaining the construction schedule, to work cooperatively with Meridian to attempt to address the delays rather than immediately exercising its termination rights.

During Phase 2, the schedule delays dramatically worsened. Milestone 5 was completed 22 days late. Milestone 6, which required the completion of fiber splicing and testing across the New Jersey corridor, was completed 68 days late. Milestone 7, encompassing the Connecticut and Massachusetts segments, was completed 91 days late — more than three months behind schedule. Most significantly, Milestone 8, covering the Pennsylvania, Maryland, and Virginia segments, was never completed before termination; as of the date of termination on April 1, 2024, Meridian had accrued 134 days of delay on Milestone 8 with no credible plan for completion.

In addition to the schedule delays, Meridian's work was plagued by substandard workmanship and quality failures. NFA's quality assurance team, led by Director of Construction Management Sean Calloway, issued a total of 287 non-conformance reports ("NCRs") over the course of the project. Of these, 43 were classified as "critical" — the most severe classification — for defects including splice loss exceeding specification limits (which directly impacts network performance and reliability), improper conduit depth in violation of applicable state and local utility codes, failure to maintain proper bend radius during fiber cable installation, and unauthorized route deviations from the approved engineering plans. Multiple NCRs identified the same recurring defects at different construction sites, indicating systemic quality control failures rather than isolated incidents.

On January 18, 2024, NFA issued Cure Notice No. 1 pursuant to MCA § 14.1, which permits termination for cause upon a material breach that remains uncured for thirty (30) calendar days after written notice. Cure Notice No. 1 identified the persistent schedule delays across Milestones 5 through 8, the accumulation of critical NCRs, and Meridian's failure to implement an adequate corrective action plan, and demanded that Meridian cure these material breaches within the thirty-day period prescribed by Section 14.1. Meridian responded with a letter dated February 1, 2024, disputing the characterization of its performance as a material breach and proposing a revised construction schedule that NFA's project management team determined to be both unrealistic and insufficiently responsive to the identified quality defects.

On February 19, 2024, NFA issued Cure Notice No. 2, noting that Meridian had failed to cure the material breaches identified in Cure Notice No. 1, that additional NCRs had been issued in the intervening period, and that the Milestone 8 delay had now grown to over 120 days. Cure Notice No. 2 placed Meridian on final notice that NFA intended to exercise its termination rights under MCA § 14.1 if the identified breaches were not cured within the applicable cure period.

On April 1, 2024, having determined that Meridian's material breaches remained uncured, NFA terminated the MCA for cause pursuant to MCA § 14.1. The termination notice specifically identified the grounds for termination: persistent schedule delays across multiple milestones, substandard workmanship as evidenced by 287 NCRs (including 43 critical NCRs), and Meridian's failure to cure these deficiencies within the contractually mandated cure periods following two separate cure notices.

On July 15, 2024, Meridian filed its Verified Complaint in this action, asserting claims for breach of contract, breach of the implied covenant of good faith and fair dealing, and unjust enrichment, and seeking damages in excess of $200 million. Meridian's central allegation is that NFA's termination for cause was "pretextual" — that NFA terminated the MCA not because of Meridian's alleged material breach, but rather because NFA wished to bring fiber construction in-house or re-procure construction services from a lower-cost contractor. Meridian further alleges that NFA's true motivation was to capture cost savings resulting from declining construction labor and materials costs in the post-pandemic marketplace.

On September 3, 2024, NFA filed its Answer with Affirmative Defenses and Counterclaims, denying Meridian's allegations in their entirety and asserting counterclaims totaling approximately $149 million. NFA's counterclaims seek: (a) $49 million in liquidated damages for Meridian's schedule delays under MCA § 12.3; (b) $81.7 million in excess completion costs, representing the difference between the cost of completing the remaining work under NFA's replacement contract with Crestline Construction Group Inc. (executed June 15, 2024) and the price that would have been payable to Meridian under the MCA for the same scope of work; and (c) $18.3 million in remediation costs incurred to correct defective work performed by Meridian, including splice rework, conduit re-installation to proper depth, and route realignment.

B. The discovery Process and the Privilege Log

Following the October 1, 2024 Preliminary Conference before Justice Ricci, during which the Court entered a discovery schedule and the parties agreed upon a Stipulated E-discovery Protocol (filed the same date), the parties engaged in extensive document discovery. The discovery schedule established November 1, 2024 as the deadline for substantial completion of document production and privilege log service.

NFA undertook a comprehensive document collection and review process. NFA collected documents from ten (10) custodians, including Renata Voss (Vice President, US Network Infrastructure), Sean Calloway (Director, Construction Management), Helena Bright (Chief Financial Officer of NTP), Dominic Hale (General Counsel of NTP), Marcus Redford (Senior Vice President, Network Engineering), Julia Chen (Vice President, Procurement), Robert Ashworth (Associate General Counsel, US Commercial), Andrea Simmons (Director, Quality Assurance), Kevin Li (Project Manager, Phase 2), and Cynthia Drayden (Director, Finance, NFA). NFA also collected relevant documents from its corporate files, shared drives, and project management databases, including Meridian's own submissions, milestone deliverables, and NCR files.

NFA engaged Vantage Litigation Support LLC, a nationally recognized e-discovery service provider, to host, process, and facilitate the review of the collected documents. NFA produced approximately 1.4 million documents comprising approximately 3.2 terabytes of data. These productions included project files, construction records, correspondence between NFA and Meridian personnel, internal NFA emails regarding construction progress and quality issues, financial records, milestone tracking data, NCR files and supporting documentation, cure notices and related correspondence, and numerous other categories of documents responsive to Meridian's document requests.

Meridian, for its part, produced approximately 890,000 documents from eight custodians, comprising approximately 1.8 terabytes of data.

On October 31, 2024 — in full compliance with the Court's discovery schedule — NFA served its privilege log identifying the 214 documents withheld from production on the basis of attorney-client privilege and/or work product protection. The privilege log was prepared by Calderwood & Harkness LLP with the assistance of Vantage Litigation Support LLC and identifies each document by: (a) document control number or Bates range; (b) date of the communication or document; (c) author; (d) recipient(s) and persons copied; (e) type of document (e.g., email, email chain, memorandum, presentation, spreadsheet with attorney annotations); and (f) a description of the subject matter of the communication sufficient to allow assessment of the privilege claim without disclosing the privileged content.

On November 15, 2024, defense counsel Linda Osei of Calderwood & Harkness LLP sent a detailed meet-and-confer letter to Meridian's lead counsel, Thomas Deluca of Hargrove, Deluca & Stein LLP, explaining the basis for each category of privilege assertion and specifically offering to discuss any individual log entries that Meridian believed to be insufficiently described. The letter was eight pages in length and addressed each of the three categories of withheld documents in detail. Ms. Osei further offered to schedule a telephone conference or in-person meeting to address Meridian's concerns. Meridian's counsel responded with a two-paragraph letter dated November 19, 2024, stating that Meridian considered NFA's privilege assertions to be "overbroad and unsupported" and that Meridian intended to move to compel. Meridian declined to identify any specific log entries it wished to discuss, declined the offer of a telephonic or in-person meet-and-confer, and filed its motion to compel just three days later, on November 22, 2024.

C. The 214 Privileged Documents

The 214 documents withheld by NFA fall into three principal categories, each of which is described below.

Category 1 — Legal Advice Regarding Termination Strategy (Approximately 126 Documents). The largest category of withheld documents consists of communications between NFA's General Counsel, Dominic Hale, and NFA personnel — including Renata Voss (VP, US Network Infrastructure), Sean Calloway (Director, Construction Management), and other employees involved in construction management and oversight of the MCA — as well as communications between Dominic Hale and outside counsel at Calderwood & Harkness LLP. These communications sought and provided legal advice regarding the interpretation and application of MCA § 14.1, the contractual provision governing termination for cause. Specifically, the communications addressed: the contractual definition and legal standard for "material breach"; the sufficiency of the factual record (schedule delays, NCRs, and failure to cure) to support a termination for cause; the procedural adequacy of Cure Notice No. 1 (January 18, 2024) and Cure Notice No. 2 (February 19, 2024); the legal risks of electing termination for cause under MCA § 14.1 as compared with termination for convenience under MCA § 14.3, including the different consequences for each party's rights and obligations; the potential litigation consequences of each course of action; and the anticipated claims that Meridian might assert following a termination for cause. These communications span from approximately December 2023 through April 2024 — the period during which the cure-and-termination process unfolded — and they constitute the kind of privileged legal advice that the attorney-client privilege exists to protect.

Category 2 — Legal Analysis of In-House Fiber Construction Alternative (Approximately 52 Documents). The second category consists of attorney-supervised memoranda, analytical summaries, and presentations analyzing the legal, regulatory, and contractual implications of NFA's options following a potential termination of the MCA. These documents were prepared at the direction of Dominic Hale for the purpose of providing comprehensive legal advice regarding the universe of alternatives available to NFA in the event the MCA was terminated. The analyses addressed, among other things: NFA's rights under MCA § 14.5, which provides that upon a termination for cause, NFA has the right to complete the remaining work using substitute contractors and to charge the excess cost of completion to Meridian; the legal and regulatory considerations associated with NFA potentially establishing an in-house construction capability, including permitting and licensing requirements in each of the seven states in the project footprint; the contractual and legal risks of engaging a replacement general contractor; and the potential impact of post-termination decisions on NFA's ability to recover excess completion costs from Meridian in litigation. These documents were prepared in anticipation of litigation and for the purpose of providing legal advice to NFA's management and board of directors regarding the legal consequences of their post-termination decisions.

Category 3 — Privileged Board and Management Presentations (Approximately 36 Documents). The third category consists of presentations, board memoranda, and executive summaries prepared by or at the direction of counsel for the board of directors of NTP (chaired by Dame Catherine Elsworth) and senior management of NTP and NFA (including Sir Malcolm Ashford, CEO; Helena Bright, CFO; and other members of the executive team). These documents summarize legal advice regarding the termination decision, the litigation risk profile associated with a termination for cause, the quantum of potential claims exposure (both affirmative claims and defensive exposure), and the strategic alternatives available to NFA. The documents were prepared for the purpose of enabling the board and senior management to make informed decisions in light of counsel's legal assessment. They were circulated only to individuals with a need to know, were marked "Privileged and Confidential — Attorney-Client Communication," and were treated as confidential at all times.

ARGUMENT

I. THE ATTORNEY-CLIENT PRIVILEGE PROTECTS THE 214 DOCUMENTS FROM DISCLOSURE

A. Legal Standard for Attorney-Client Privilege Under New York Law. In New York, the attorney-client privilege shields from disclosure confidential communications between an attorney and a client, made for the purpose of obtaining or providing legal advice. CPLR § 4503(a). The privilege is "the oldest of the privileges for confidential communications known to the common law," Upjohn Co. v. United States, 449 U.S. 383, 389 (1981), and serves the vital public interest in promoting "the open development between lawyer and client [that] is essential to sound legal advice." Alice Ames, 78 N.Y.2d 371, 377 (1991). New York courts have long recognized the attorney-client privilege as "a shield, and not a sword," and have given it broad application where its elements are established. See Rossi v. Kestrel Insurance & Westvale Assurance of Greater N.Y., 73 N.Y.2d 588, 593 (1989).

The elements of the attorney-client privilege under New York law are well established. The party asserting the privilege must demonstrate that the communication was: (1) between a client (or the client's agent) and an attorney (or the attorney's agent); (2) made in confidence; and (3) for the purpose of obtaining or providing legal advice. Spectrum Sys., 78 N.Y.2d at 377; see also Larkspur Holdings, 27 N.Y.3d 616, 623-24 (2016). Once the party asserting the privilege has made a prima facie showing that the communication satisfies these elements, the burden shifts to the party seeking to overcome the privilege to establish a recognized exception. Priest v. Hennessy, 51 N.Y.2d 62, 68-69 (1980).

The privilege extends with equal force to communications with in-house counsel, provided that the predominant purpose of the communication is to obtain or render legal advice, as distinguished from business advice. Rossi, 73 N.Y.2d at 593-94. New York courts apply a "predominant purpose" test, asking whether the primary purpose of the communication was the rendition of legal services. See Spectrum Sys., 78 N.Y.2d at 378-79. This test recognizes the practical reality that in-house counsel frequently participate in business discussions, but holds that communications remain privileged so long as their predominant purpose is the provision of legal advice. The fact that a privileged communication also touches upon business considerations does not strip it of privilege protection where the primary impetus for the communication was the need for legal guidance. See MBIA Inc. v. Sterling Reach Industries, 2012 N.Y. Slip Op. 33230(U), at *4-5 (Sup. Ct. N.Y. Cty. 2012) (applying predominant purpose test and upholding privilege for in-house counsel communications that also addressed business matters).

In the corporate context, the attorney-client privilege extends to communications between the corporation's counsel and those employees who have authority to act on the corporation's behalf or who communicate with counsel at the direction of management for the purpose of obtaining legal advice relevant to corporate decision-making. See Rossi, 73 N.Y.2d at 592-93; see also Upjohn, 449 U.S. at 394-95 (rejecting narrow "control group" test in favor of broader protection for communications between counsel and employees necessary for the provision of legal advice). New York courts have adopted this broad formulation, recognizing that corporate counsel must be able to communicate with employees at all levels of the organization in order to provide fully informed legal advice. See People v. Osorio, 75 N.Y.2d 80, 84 (1989).

The work product doctrine, codified in New York at CPLR § 3101(c) (attorney work product) and CPLR § 3101(d)(2) (trial preparation materials), provides additional, independent protection for documents prepared by an attorney in anticipation of litigation. Attorney work product under CPLR § 3101(c) is afforded near-absolute protection — it is discoverable only in the rarest of circumstances, if at all. Spectrum Sys., 78 N.Y.2d at 380-81. Trial preparation materials prepared in anticipation of litigation under CPLR § 3101(d)(2) are conditionally protected and may be disclosed only upon a showing that the party seeking discovery has a substantial need for the materials and is unable without undue hardship to obtain the substantial equivalent by other means. Id. at 381.

A document may be protected simultaneously by the attorney-client privilege and the work product doctrine, and the party opposing production is entitled to invoke both protections. See Beaumont Group v. Superior Court, 60 N.Y.2d 418, 424 (1983). The two doctrines serve related but distinct purposes: the attorney-client privilege protects the confidentiality of communications between attorney and client, while the work product doctrine protects the attorney's mental processes, impressions, and litigation strategy from disclosure to an adversary.

B. The Category 1 Documents (Termination Strategy) Are Quintessential Privileged Legal Advice. The approximately 126 documents in Category 1 consist of communications between NFA's General Counsel, Dominic Hale, and NFA employees — including Renata Voss (VP, US Network Infrastructure), Sean Calloway (Director, Construction Management), and other personnel directly involved in the management of the MCA — as well as communications between Dominic Hale and outside counsel at Calderwood & Harkness LLP. In these communications, NFA personnel sought legal advice from counsel regarding their contractual rights under the MCA, and counsel provided that advice. These are precisely the type of communications that the attorney-client privilege exists to protect, and they should not be compelled.

The substance of these communications falls squarely within the heartland of attorney-client privilege protection. The documents address: the interpretation and application of MCA § 14.1, including the contractual requirements for a valid termination for cause; the legal definition of "material breach" and whether Meridian's documented schedule delays and quality failures — including 287 NCRs, 43 of which were classified as critical — constituted material breach under the MCA and under governing New York law; the procedural adequacy of Cure Notice No. 1 (issued January 18, 2024) and Cure Notice No. 2 (issued February 19, 2024), including whether the notices complied with the formal requirements of Section 14.1 and provided sufficiently specific identification of the alleged breaches; the legal risks and consequences of electing termination for cause under MCA § 14.1 as compared with termination for convenience under MCA § 14.3, including the dramatically different financial consequences of each election for NFA's ability to recover damages and excess completion costs; and the anticipated litigation consequences of a termination for cause, including the potential claims Meridian might assert and the defenses available to NFA.

Each of these subjects is inherently legal in nature. The interpretation of a complex commercial contract is quintessentially legal work. The assessment of whether a pattern of conduct constitutes "material breach" requires analysis of both the contractual provisions and applicable legal standards. The evaluation of litigation risk and the formulation of litigation strategy are among the most sensitive and privileged subjects of attorney-client communication.

Meridian argues that the Category 1 documents reflect "business decisions" rather than "legal advice" and therefore are not privileged. This argument is meritless. The decision to terminate a multi-billion-dollar construction contract for cause is not a purely business decision — it is a decision that carries profound legal consequences, that requires the careful application of legal standards to a complex factual record, and that was made upon the advice of counsel regarding NFA's contractual rights and obligations. The fact that the termination decision also has significant business implications does not strip the underlying legal advice of its privileged character. See Spectrum Sys., 78 N.Y.2d at 378-79 (privilege applies where predominant purpose of communication is legal advice, even if communication also addresses business matters); see also In re Grand Jury Subpoena Duces Tecum, 731 F.2d 1032, 1037 (2d Cir. 1984) ("The fact that corporate counsel may have given mixed advice, partly legal and partly business, does not vitiate the attorney-client privilege.").

Under the predominant purpose test, the critical inquiry is whether the primary reason for the communication was the rendition of legal advice. Here, the answer is unambiguous. The communications in Category 1 were initiated because NFA's management needed legal advice regarding its contractual termination rights. They were directed to and from Dominic Hale in his capacity as General Counsel. They sought and provided analysis of legal standards, contractual provisions, procedural requirements, and litigation risks. The fact that NFA's management used this legal advice to inform a business decision — whether to terminate the MCA — does not transform the underlying legal advice into non-privileged business communications. See Stenovich v. Crane & Ames LLP, 195 Misc. 2d 99, 106 (Sup. Ct. N.Y. Cty. 2003) (holding that legal advice regarding the exercise of contractual rights is privileged even where it informs a subsequent business decision).

Meridian further argues that Dominic Hale was acting in a "business capacity" rather than a "legal capacity" in connection with the termination decision, and therefore his communications are not privileged. This argument rests on a fundamental misunderstanding of both Mr. Hale's role and the governing legal standard. Dominic Hale's title is General Counsel of NTP. He is a qualified solicitor admitted to practice in England and Wales and a member of the New York bar, admitted to practice law in the State of New York. The communications at issue on their face seek and provide legal advice — they discuss contractual interpretation, the legal standard for material breach, the sufficiency of cure notices, and litigation risk. The privilege log descriptions make clear the legal nature of each communication.

Where in-house counsel's primary role in a communication is to provide legal advice, the privilege attaches even if counsel also holds a management title or participates in business decision-making in other contexts. See Rossi, 73 N.Y.2d at 593 ("[T]he critical inquiry is whether, viewing the lawyer's communication in its full content and context, it was made in order to render legal advice or services to the client."). Meridian's argument would, if accepted, effectively strip in-house counsel of the ability to provide privileged legal advice to their clients — a result that New York courts have consistently rejected. See, e.g., Stenovich, 195 Misc. 2d at 105-06; see also ABN AMRO Bank, N.V. v. Olayan, 2005 N.Y. Slip Op. 50960(U), at *3-4 (Sup. Ct. N.Y. Cty. 2005) (upholding privilege for in-house counsel communications regarding the exercise of contractual remedies).

The temporal scope of the Category 1 documents — spanning December 2023 through April 2024 — further underscores their privileged character. This period corresponds precisely to the cure-and-termination process: the period during which NFA was evaluating whether Meridian's performance deficiencies constituted material breach, formulating and issuing cure notices, monitoring Meridian's response (or lack thereof), and ultimately deciding to exercise its termination right. Throughout this period, NFA's management was actively seeking legal advice from counsel regarding each step in the process. The communications are contemporaneous records of that privileged consultation, and they deserve the full protection of the attorney-client privilege.

C. The Category 2 Documents (In-House Fiber Analysis) Are Protected Attorney Work Product and/or Attorney-Client Privilege. The approximately 52 documents in Category 2 consist of legal memoranda, analytical summaries, and presentations prepared at the direction of NFA's General Counsel, Dominic Hale, analyzing the legal, regulatory, and contractual implications of NFA's post-termination alternatives. These documents are protected both as attorney-client privileged communications and as work product prepared in anticipation of litigation.

As an initial matter, the Category 2 documents satisfy all of the elements of the attorney-client privilege. They were prepared by or at the direction of counsel — specifically, Dominic Hale and, in certain instances, outside counsel at Calderwood & Harkness LLP — for the purpose of providing legal advice to NFA's management and board of directors regarding the legal consequences of post-termination decisions. The documents analyze, among other things: NFA's right under MCA § 14.5 to complete the remaining work using substitute contractors and to charge the excess cost of completion to Meridian; the legal and regulatory requirements for establishing an in-house fiber construction capability in each of the seven states in the project footprint, including permitting, licensing, and bonding requirements; the contractual and legal risks associated with various replacement strategies, including the risk that certain post-termination actions could be argued to constitute a failure to mitigate damages; and the potential impact of NFA's post-termination decisions on the calculation and recoverability of excess completion costs in any subsequent litigation. These are quintessentially legal analyses, prepared for the purpose of enabling NFA's decision-makers to evaluate their options with the benefit of legal counsel's assessment of the risks and consequences associated with each alternative.

The Category 2 documents are also independently protected as work product under CPLR § 3101(c) and (d)(2). The work product doctrine protects materials prepared in anticipation of litigation, and these documents were unquestionably prepared with litigation in mind. By December 2023, well before the first cure notice was issued on January 18, 2024, it was evident to NFA's counsel that Meridian's persistent schedule delays and quality failures were approaching the threshold of material breach. Given the magnitude of the contract ($1.2 billion), the severity of Meridian's performance failures (287 NCRs, chronic schedule delays across multiple milestones), Meridian's financial dependence on the NFA contract as its anchor engagement, and the substantial investment by Ridgepoint Capital Group LP in Meridian, NFA's counsel reasonably anticipated that any termination of the MCA — whether for cause or for convenience — would result in significant litigation.

The anticipation of litigation was not speculative or hypothetical; it was a reasonable, indeed inevitable, conclusion based on objective circumstances. New York courts have consistently held that litigation need not be "imminent" for the work product doctrine to apply; rather, the doctrine applies whenever litigation is "reasonably anticipated." See Bombard v. Amica Mut. Ins. Co., 11 A.D.3d 647, 648 (2d Dep't 2004); see also Spectrum Sys., 78 N.Y.2d at 381 (work product protection applies to materials prepared "in anticipation of litigation"). Here, by December 2023, counsel's anticipation of litigation was well founded: a $1.2 billion contract termination involving a financially dependent counterparty with private equity backing would inevitably generate litigation, and it did.

Because the Category 2 documents reflect attorney analysis and mental impressions regarding NFA's legal options and litigation exposure, many of them constitute "opinion" work product — the type of work product that enjoys near-absolute protection under both New York and federal law. See Upjohn, 449 U.S. at 400-01 (opinion work product "is accorded the highest level of protection"); Spectrum Sys., 78 N.Y.2d at 380-81 (attorney work product under CPLR § 3101(c) is entitled to near-absolute protection). Even the subset of Category 2 documents that might be characterized as "fact" work product — for example, analyses of regulatory requirements in specific states — are entitled to at least conditional protection under CPLR § 3101(d)(2), and Meridian has made no showing of substantial need or inability to obtain the substantial equivalent of these materials by other means. The underlying regulatory requirements are publicly available; Meridian can conduct its own regulatory analysis if it wishes to do so.

Meridian contends that the Category 2 documents constitute evidence that NFA's "true motivation" for the termination was to bring fiber construction in-house, and therefore that the termination was "pretextual." This argument is flawed in multiple respects.

First, as a substantive matter, a party's motive for exercising a contractual right is not relevant where the contractual requirements for that exercise have been met. Under New York law, a party that has the contractual right to terminate for cause based on the other party's material breach may exercise that right regardless of any concurrent motivation it may have had. See Bramwell & Co. v. Herald Sq. Loft Corp., 67 A.D.2d 442, 446 (1st Dep't 1979) (holding that where grounds for termination exist, the terminating party's motivation is irrelevant). NFA has asserted, and will prove at trial, that Meridian materially breached the MCA through persistent schedule delays across multiple milestones and 287 NCRs, 43 of which were classified as critical — and that Meridian failed to cure these breaches despite two cure notices and extended cure periods. If NFA establishes these facts, the termination was justified under MCA § 14.1, regardless of whatever else NFA may have been thinking or considering at the time.

Second, even if Meridian's "pretext" theory were cognizable — and NFA contends it is not — the relevance of the Category 2 documents to that theory does not override the attorney-client privilege or work product doctrine. The attorney-client privilege is not overcome by a party's assertion of relevance, no matter how strong that assertion may be. See Spectrum Sys., 78 N.Y.2d at 377 ("The privilege has never been conditional upon relevance or the importance of the information sought."); Matter of Priest v. Hennessy, 51 N.Y.2d at 69 (privilege applies "regardless of the relevance of the communication"). If anything, the heightened relevance that Meridian attributes to these documents — describing them as the "smoking gun" evidence of NFA's alleged pretext — underscores their quintessentially privileged character. They contain precisely the type of candid legal analysis that NFA's counsel was duty-bound to provide and that the privilege exists to protect. To hold that the attorney-client privilege gives way whenever an adversary characterizes privileged communications as "relevant" would eviscerate the privilege in every case where it matters most.

Meridian also appears to suggest that NFA has waived the privilege over the Category 2 documents by placing their contents "at issue" in this litigation. This argument fails. The "at issue" waiver doctrine is narrow and applies only where a party "has asserted a claim or defense that [it] intends to prove by use of the privileged materials." Halcyon Securities Tr. Co. of Americas v. Tri-Links Inv. Tr., 43 A.D.3d 56, 64 (1st Dep't 2007). NFA has done no such thing. NFA has not asserted an advice-of-counsel defense. NFA has not claimed that it relied on counsel's advice in deciding to terminate the MCA, nor has NFA placed the content of any privileged communication at issue as an element of any claim or defense. NFA's defense is straightforward: Meridian materially breached the MCA, NFA provided the required cure notices, Meridian failed to cure, and NFA exercised its contractual right to terminate for cause. This defense rests entirely on the factual record — schedule delays, NCRs, cure notices, and failure to cure — and does not depend on, or even reference, the content of privileged communications. Mere reliance on a contractual right does not place counsel's advice regarding that right "at issue." See Halcyon Securities, 43 A.D.3d at 64-65; see also Jakobleff v. Cerrato, Sweeney & Cohn, 97 A.D.2d 834, 835 (2d Dep't 1983).

D. The Category 3 Documents (Board/Management Presentations) Are Protected. The approximately 36 documents in Category 3 are presentations, board memoranda, and executive summaries prepared by or at the direction of counsel for the board of directors of NTP and the senior management teams of NTP and NFA. These documents summarize legal advice provided by Dominic Hale and outside counsel regarding NFA's termination rights under the MCA, the litigation risk profile associated with a termination for cause, the quantum of potential damages exposure on both affirmative and defensive claims, and the strategic legal alternatives available to NFA. They are protected by the attorney-client privilege, and Meridian has identified no basis for their production.

The corporate attorney-client privilege extends fully to communications with directors and officers made for the purpose of obtaining legal advice for the corporation's benefit. See Rossi, 73 N.Y.2d at 593. The fact that the Category 3 documents were delivered to the full board of directors or to members of the C-suite — including Sir Malcolm Ashford (CEO), Helena Bright (CFO), and Dame Catherine Elsworth (Board Chair) — does not destroy the privilege. To the contrary, it is entirely appropriate, and indeed expected, that a corporation's board of directors and senior management would receive legal advice from counsel before authorizing a significant decision such as the termination of a $1.2 billion construction contract. Corporate decision-makers must be able to receive legal advice in a boardroom setting without fear that the confidentiality of that advice will be compromised in subsequent litigation. See Upjohn, 449 U.S. at 389-90 ("[T]he privilege exists to protect not only the giving of professional advice to those who can act on it but also the giving of information to the lawyer to enable him to give sound and informed advice.").

Meridian may argue that the Category 3 documents contain "mixed" business and legal content, and that they should be produced to the extent they address business strategy rather than legal advice. But the predominant purpose of these documents was to convey legal advice — specifically, counsel's assessment of NFA's legal rights under the MCA, the legal risks of various courses of action, and the litigation exposure associated with each alternative. The fact that the board and management also used this legal advice to inform their business decisions does not transform the privileged legal advice into non-privileged business communications. See Spectrum Sys., 78 N.Y.2d at 378-79.

Moreover, confidentiality has been maintained at all times with respect to the Category 3 documents. The documents were not disclosed outside the corporation or to any third party. Each document was marked "Privileged and Confidential — Attorney-Client Communication" or with substantially similar language. The documents were circulated only to individuals within the NTP/NFA corporate family who had a need to know for the purpose of acting on counsel's legal advice — specifically, board members and senior executives with decision-making authority over the termination of the MCA and the prosecution and defense of the resulting litigation. There has been no dissemination outside this limited circle, and no waiver of the privilege.

The Category 3 documents are also protected, in whole or in part, as attorney work product to the extent they were prepared in anticipation of litigation. As discussed above, by the time these presentations were prepared, NFA's counsel reasonably anticipated that the termination of the MCA would result in litigation. The presentations reflect counsel's mental impressions, conclusions, and strategic assessments regarding the litigation risk profile and the optimal course of action — precisely the type of opinion work product that is entitled to the strongest protection under the law.

II. MERIDIAN HAS FAILED TO ESTABLISH ANY EXCEPTION TO THE PRIVILEGE

Having established that the 214 documents are properly within the scope of the attorney-client privilege and/or work product doctrine, the burden falls on Meridian to demonstrate that a recognized exception applies. Meridian has not done so, and its motion should be denied.

A. The Crime-Fraud Exception Does Not Apply. To the extent Meridian argues or implies that NFA's termination of the MCA was in bad faith and that the communications facilitating that termination fall within the crime-fraud exception to the attorney-client privilege, this argument fails as a matter of law.

The crime-fraud exception is narrow. It applies only where the party seeking to invoke it demonstrates that the communications at issue were made in furtherance of a crime or fraud. See Clark v. United States, 289 U.S. 1, 15 (1933); In re Grand Jury Proceedings, 219 F.3d 175, 182 (2d Cir. 2000). The exception requires a prima facie showing — based on evidence independent of the privileged communications themselves — that (1) the client was engaged in, or planning, a crime or fraud, and (2) the attorney-client communications at issue were in furtherance of that criminal or fraudulent activity. See In re John Doe, Inc., 13 F.3d 633, 637 (2d Cir. 1994); Jacobs v. Lababedi, 2019 N.Y. Slip Op. 32765(U), at *5-6 (Sup. Ct. N.Y. Cty. 2019).

Meridian has made no such showing and cannot do so. NFA terminated the MCA for cause based on Meridian's well-documented schedule delays across five milestones and 287 NCRs, 43 of which were classified as critical. Two cure notices were issued, affording Meridian the full contractual cure period under MCA § 14.1. Meridian failed to cure. The termination was a lawful exercise of NFA's contractual rights — not a crime or fraud.

Meridian's characterization of the termination as "pretextual" is a litigation position, not evidence of fraud. Disagreeing with NFA's exercise of its contractual rights does not transform a contractual dispute into a fraud. If the crime-fraud exception could be triggered merely by a plaintiff's allegation that a defendant's contractual conduct was motivated by improper considerations, the exception would swallow the rule, and the attorney-client privilege would offer no protection in any case involving a contested termination or other disputed exercise of contractual rights. New York courts have consistently rejected such an expansive application of the crime-fraud exception. See, e.g., Adriatic Specialty Insurance v. Certain Underwriters at Lloyd's London, 176 Misc. 2d 605, 611 (Sup. Ct. N.Y. Cty. 1998) (declining to apply crime-fraud exception absent independent evidence of fraudulent conduct).

Because Meridian has failed to make the requisite prima facie showing of crime or fraud based on evidence independent of the privileged communications themselves, the crime-fraud exception does not apply, and in camera review under this exception is not warranted.

B. There Has Been No Waiver of Privilege. NFA has taken consistent and affirmative steps to preserve the attorney-client privilege and work product protections over the 214 withheld documents, and there has been no waiver — voluntary, inadvertent, or implied.

A litigation hold was implemented by Calderwood & Harkness LLP on August 21, 2024 — the date the firm was retained to represent NFA in this matter. The litigation hold instructed all relevant custodians to preserve all documents potentially relevant to the dispute, including privileged communications, and reminded them of their obligation to maintain the confidentiality of attorney-client communications. The hold was circulated to all ten custodians from whom documents were collected, as well as to NTP's IT department, which was responsible for ensuring the preservation of electronically stored information.

The privilege log was served on October 31, 2024, in full compliance with the Court's discovery schedule. The log identifies each of the 214 withheld documents with sufficient specificity to allow assessment of the privilege claim, as discussed in further detail in Section III below.

NFA has not voluntarily disclosed any of the 214 privileged documents to any third party. The documents have been maintained in confidence within the NTP/NFA corporate family and have been shared only with individuals who had a need to know for the purpose of obtaining or acting on legal advice, or with outside counsel retained to represent NFA in this matter.

The Stipulated E-discovery Protocol filed October 1, 2024 includes a clawback provision — Section 8(d) — which provides that the inadvertent production of privileged documents does not constitute a waiver of privilege, provided the producing party gives prompt written notice of the inadvertent production and the receiving party returns or destroys the inadvertently produced documents. This clawback provision, agreed to by both parties, provides an additional safeguard against inadvertent waiver and reflects the parties' shared recognition that the preservation of privilege is an important interest in the conduct of complex commercial litigation.

Most significantly, NFA has not asserted an advice-of-counsel defense and has not otherwise placed the content of any privileged communication "at issue" in this litigation. As discussed above, NFA's defense rests entirely on the factual record of Meridian's material breach — schedule delays, 287 NCRs, two cure notices, and Meridian's failure to cure. NFA does not contend that it relied on counsel's advice in deciding to terminate the MCA, nor does NFA invoke the content of any privileged communication as an element of any claim or defense. The "at issue" waiver doctrine is therefore inapplicable. See Halcyon Securities, 43 A.D.3d at 64-65.

In sum, there has been no waiver of privilege — not by voluntary disclosure, not by inadvertent production, and not by placing privileged communications at issue. Meridian has identified no basis for finding a waiver, and its motion should be denied on this ground as well.

C. Meridian's "Relevance" Argument Is Insufficient to Overcome Privilege. Stripped of its rhetorical embellishments, Meridian's primary argument in support of its motion to compel is that the 214 documents are "highly relevant" to its pretext theory and therefore must be produced. This argument fundamentally misapprehends the relationship between relevance and privilege.

Relevance is not an exception to the attorney-client privilege. The privilege operates precisely to protect confidential attorney-client communications from compelled disclosure, regardless of how relevant those communications may be to the opposing party's claims or defenses. See Spectrum Sys., 78 N.Y.2d at 377 (privilege "is not conditioned on the relevance or importance of the information sought"); see also Priest v. Hennessy, 51 N.Y.2d at 69 (same). Indeed, the privilege typically becomes most important — and must be most vigorously enforced — in precisely those cases where the privileged communications are most relevant to the opposing party's litigation position. If the privilege could be overcome by a showing of relevance, it would provide no protection at all, because a party seeking to compel production would always argue (and could almost always plausibly argue) that the withheld communications are relevant.

The New York Court of Appeals has been unequivocal on this point. In Spectrum Systems, the Court held that the attorney-client privilege applies "regardless of the relevance of the communication" and that "the fact that the information is necessary to the opposing party's preparation of his case does not vitiate the privilege." 78 N.Y.2d at 377 (internal quotation marks omitted). The First Department has likewise confirmed that "the test for the applicability of the privilege is not whether the information sought is relevant or material to the issues in the lawsuit, but whether the communication was made for the purpose of facilitating the rendition of legal advice or services." Chase Manhattan Bank, N.A. v. Perla, 65 A.D.2d 207, 210 (1st Dep't 1978).

If anything, the heightened relevance that Meridian attributes to the 214 documents — characterizing them as evidence of NFA's "true motivation" and the "real story" behind the termination — underscores their quintessentially privileged character. These documents contain NFA's candid legal assessments of its contractual rights, litigation risks, and strategic options. They were prepared for the very purpose of enabling NFA to navigate a complex legal landscape with the benefit of counsel's professional judgment. To order their production because they are "relevant" to Meridian's theory of the case would be to punish NFA for having sought and obtained the legal advice that the privilege is designed to encourage.

Meridian is not without recourse. The factual record of Meridian's performance under the MCA — including the schedule delays, NCRs, cure notices, and related project documentation — has been produced in full. Meridian's own documents, including its internal communications regarding its own performance failures, are available to it. If Meridian wishes to argue at trial that NFA's termination was "pretextual," it may attempt to do so based on the extensive factual record that has been produced, including NFA's non-privileged business documents regarding the termination. But Meridian may not breach the attorney-client privilege to obtain counsel's confidential legal advice for use in support of its litigation theory.

III. THE PRIVILEGE LOG IS ADEQUATE

Although Meridian has challenged the sufficiency of NFA's privilege log in its motion papers, these challenges are without merit. The privilege log served on October 31, 2024 fully complies with the requirements of CPLR § 3122 and the Commercial Division Rules, and provides Meridian and the Court with sufficient information to assess the validity of each privilege assertion.

Under CPLR § 3122, a party withholding documents on the basis of privilege is required to "state with reasonable particularity the reason such documents are not produced." The Commercial Division Rules, including Rule 11-b, further require that privilege logs include, for each document withheld, the type of document, the general subject matter, the date, the author, the addressee(s), and the relationship of the author and addressee(s) to each other. The purpose of these requirements is to provide the requesting party with enough information to assess the facial validity of the privilege claim and to facilitate a meaningful meet-and-confer process.

NFA's privilege log meets or exceeds these requirements. The log identifies each of the 214 withheld documents by: (a) document control number or Bates range assigned by Vantage Litigation Support LLC; (b) the date of the communication or document; (c) the author of the communication or document; (d) all recipients and persons copied; (e) the type of document (e.g., email, email chain, memorandum, presentation, spreadsheet with attorney annotations); and (f) a description of the subject matter of the communication sufficient to support the privilege claim without disclosing the privileged content. Each entry also identifies the specific privilege or protection asserted — attorney-client privilege, attorney work product, or both — and, where applicable, identifies the attorney or attorneys involved in the communication.

For example, a typical entry on the log reads: "Email from Dominic Hale (General Counsel, NTP) to Renata Voss (VP, US Network Infrastructure, NFA) and Robert Ashworth (Assoc. General Counsel, NFA), dated January 22, 2024, re: Legal analysis of material breach standard under MCA § 14.1 and assessment of sufficiency of factual basis for Cure Notice No. 1. Privilege asserted: Attorney-client privilege." This level of detail is more than sufficient to allow Meridian and the Court to assess whether the privilege is properly asserted.

Furthermore, NFA offered to engage in a meaningful meet-and-confer process regarding any specific log entries that Meridian believed to be insufficiently described. Defense counsel Linda Osei's November 15, 2024 letter specifically invited Meridian's counsel to identify particular entries of concern and offered to supplement descriptions or provide additional information as appropriate. Meridian declined this invitation, choosing instead to file its motion to compel just three days after its perfunctory response declining to engage. The Commercial Division's emphasis on cooperative discovery and meaningful meet-and-confer efforts, as reflected in Rule 14 and the Court's own standing order, counsels against rewarding Meridian's refusal to engage in the good-faith process that the rules contemplate.

Courts in the Commercial Division have consistently upheld privilege logs that provide the level of detail contained in NFA's log. See, e.g., Larkspur Holdings, 2014 N.Y. Slip Op. 30792(U), at 6-7 (Sup. Ct. N.Y. Cty. 2014) (upholding privilege log that identified author, recipient, date, type of document, and general subject matter); see also Koen Book Distribs., Inc. v. Powell, Trachtman, Logan, Carrle & Lombardo, P.C.*, 212 F.R.D. 283, 286 (E.D. Pa. 2002) (holding that a privilege log is adequate where it provides "enough information to permit the court to determine whether the privilege is properly asserted"). NFA's log provides at least this level of detail and, in many instances, substantially more.

IV. IN THE ALTERNATIVE, IN CAMERA REVIEW SHOULD BE LIMITED

If, notwithstanding the foregoing, the Court is inclined to conduct an in camera review of the withheld documents, NFA respectfully requests that such review be limited in scope. In camera review of all 214 documents would impose a substantial burden on the Court without corresponding benefit, particularly given the detailed privilege log that NFA has provided and the clear applicability of the privilege to each category of documents.

NFA respectfully proposes that any in camera review be limited to a representative sample of documents from each of the three categories identified in the privilege log. NFA suggests a sample of ten (10) documents from Category 1 (Termination Strategy), five (5) documents from Category 2 (In-House Fiber Analysis), and five (5) documents from Category 3 (Board/Management Presentations), for a total of twenty (20) documents. This sample would be sufficient to allow the Court to evaluate the nature and character of the withheld documents and to determine whether the privilege has been properly asserted, without requiring the Court to undertake the burdensome task of reviewing all 214 entries individually.

NFA will cooperate fully with the Court in identifying a representative sample that is manageable and illustrative of the full universe of withheld documents. If the Court prefers to select the sample itself, NFA will promptly provide the documents designated by the Court for in camera review.

NFA further requests that, if the Court determines upon in camera review that any particular documents were improperly withheld, the Court's ruling be limited to those specific do

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: COMMERCIAL DIVISION
MERIDIAN INFRASTRUCTURE PARTNERS LLC,
Plaintiff,
— against —
NORTHGATE FIBER AMERICAS INC.,
Defendant.
Index No. 654321/2024 Part 49 Hon. Eleanor M. Ricci
DEFENDANT NORTHGATE FIBER AMERICAS INC.'S MEMORANDUM OF LAW IN OPPOSITION TO PLAINTIFF'S MOTION TO COMPEL PRODUCTION OF PRIVILEGED DOCUMENTS
Filed: December 2, 2024
CALDERWOOD & HARKNESS LLP 425 Park Avenue, 33rd Floor New York, NY 10022 Telephone: (212) 558-4000 Facsimile: (212) 558-3588
Linda Osei, Responsible Partner Priya Anand Jeffrey Park Yuki Nakamura
Attorneys for Defendant Northgate Fiber Americas Inc.
C&H Matter No. 1022-00005
TABLE OF CONTENTS
PRELIMINARY STATEMENT
Defendant Northgate Fiber Americas Inc. ("NFA" or "Defendant") respectfully opposes the motion to compel filed by Plaintiff Meridian Infrastructure Partners LLC ("Meridian" or "Plaintiff") on November 22, 2024, seeking production of 214 documents withheld by Defendant on the basis of attorney-client privilege and/or the work product doctrine. The motion should be denied in its entirety.
The 214 documents at issue consist of internal legal advice provided by Northgate Telecommunications PLC's General Counsel, Dominic Hale, Esq., and outside counsel to NFA's senior management regarding the termination strategy under the Master Construction Agreement dated March 15, 2020 (the "MCA"), as well as attorney-supervised analysis of the potential for in-house fiber construction as an alternative following termination. These communications also include privileged presentations and memoranda prepared by or at the direction of counsel for NFA's parent company's board of directors and senior leadership team, summarizing legal advice regarding NFA's termination rights, litigation risk exposure, and strategic legal alternatives available in connection with the MCA.
These documents are quintessential privileged communications. They reflect legal advice sought and rendered in confidence between client personnel and their attorneys regarding the exercise of contractual rights, potential litigation exposure, and strategic legal options in anticipation of the very dispute now before this Court. The attorney-client privilege and work product doctrine exist precisely to protect communications of this nature — candid legal assessments of contractual rights and obligations, litigation risk analyses, and strategy memoranda prepared to guide corporate decision-making in legally fraught circumstances. Without the assurance of confidentiality, corporate clients would be unable to engage in the frank and open dialogue with their attorneys that the privilege is designed to foster, and the quality of legal advice — and the quality of the decisions informed by that advice — would inevitably suffer.
Meridian's motion is a transparent attempt to pierce the attorney-client privilege to obtain NFA's internal legal strategy and thought processes in connection with the termination of the MCA for cause on April 1, 2024. Meridian's argument is ultimately grounded in its so-called "pretext" theory — namely, that NFA terminated the MCA not because of Meridian's well-documented material breach of the agreement, but rather to bring fiber construction in-house or to re-procure construction services at lower market prices. The premise of Meridian's argument is that the 214 withheld documents are "relevant" to this theory and therefore must be produced.
But relevance has never been the test for overcoming the attorney-client privilege, and Meridian identifies no applicable exception to the privilege that would warrant production. If anything, the heightened relevance that Meridian attributes to these documents underscores their quintessentially privileged character: they contain precisely the kind of candid legal analysis — regarding termination rights, litigation risk, and post-termination alternatives — that the privilege is designed to protect from disclosure in adversarial proceedings. To hold otherwise would eviscerate the privilege whenever a plaintiff characterizes a defendant's exercise of a contractual right as "pretextual" and demands access to counsel's advice regarding that exercise.
The 214 documents were properly withheld, properly identified and described on Defendant's privilege log served on October 31, 2024, and the motion should be denied in its entirety. In the alternative, if this Court determines that further inquiry is warranted, Defendant respectfully requests that any in camera review be limited to a representative sample of documents from each category rather than the full universe of 214 entries.
STATEMENT OF FACTS
A. The Parties and the Underlying Dispute
NFA is a Delaware corporation (File No. 7182934) and wholly owned subsidiary of Northgate Telecommunications PLC ("NTP"), a United Kingdom-headquartered, publicly traded telecommunications and software-as-a-service company listed on the London Stock Exchange (LSE: NTP), with American Depositary Receipts trading on the Nasdaq Global Select Market under the ticker symbol NTPLF. NFA maintains its principal office at 600 Lexington Avenue, 28th Floor, New York, New York 10022, and serves as NTP's primary United States operating entity for the deployment and operation of fiber-optic telecommunications infrastructure.
Meridian Infrastructure Partners LLC is a Delaware limited liability company (File No. 6439821) headquartered in Houston, Texas, with regional offices in Atlanta, Georgia, and Trenton, New Jersey. Meridian is a portfolio company of Ridgepoint Capital Group LP, a private equity firm. Meridian served as the general contractor for NFA's fiber-optic build-out program under the MCA, and the NFA engagement was by far Meridian's largest project, representing approximately sixty-five percent of Meridian's total annual revenue during the years the MCA was in effect.
On March 15, 2020, NFA and Meridian executed the MCA for the design, engineering, permitting, and construction of approximately 18,500 route miles of fiber-optic cable across a seven-state footprint encompassing New York, New Jersey, Connecticut, Massachusetts, Pennsylvania, Maryland, and Virginia. The total contract price under the MCA was $1.2 billion over a five-year term, payable in milestone-based installments tied to the achievement of specified construction deliverables. The MCA was a complex, heavily negotiated agreement running to over 230 pages, including detailed technical specifications, quality standards, milestone schedules, and termination provisions. The parties were represented by sophisticated counsel throughout the negotiation process.
From the inception of the project, Meridian experienced persistent and worsening schedule delays and quality failures. During Phase 1 of the construction program, Milestone 3 — which required the completion of conduit installation and fiber placement across the initial 2,800 route miles in the New York metropolitan area — was completed 47 days late, well beyond the contractual cure period. NFA raised these concerns with Meridian's project management team at the time but elected, in the interest of maintaining the construction schedule, to work cooperatively with Meridian to attempt to address the delays rather than immediately exercising its termination rights.
During Phase 2, the schedule delays dramatically worsened. Milestone 5 was completed 22 days late. Milestone 6, which required the completion of fiber splicing and testing across the New Jersey corridor, was completed 68 days late. Milestone 7, encompassing the Connecticut and Massachusetts segments, was completed 91 days late — more than three months behind schedule. Most significantly, Milestone 8, covering the Pennsylvania, Maryland, and Virginia segments, was never completed before termination; as of the date of termination on April 1, 2024, Meridian had accrued 134 days of delay on Milestone 8 with no credible plan for completion.
In addition to the schedule delays, Meridian's work was plagued by substandard workmanship and quality failures. NFA's quality assurance team, led by Director of Construction Management Sean Calloway, issued a total of 287 non-conformance reports ("NCRs") over the course of the project. Of these, 43 were classified as "critical" — the most severe classification — for defects including splice loss exceeding specification limits (which directly impacts network performance and reliability), improper conduit depth in violation of applicable state and local utility codes, failure to maintain proper bend radius during fiber cable installation, and unauthorized route deviations from the approved engineering plans. Multiple NCRs identified the same recurring defects at different construction sites, indicating systemic quality control failures rather than isolated incidents.
On January 18, 2024, NFA issued Cure Notice No. 1 pursuant to MCA § 14.1, which permits termination for cause upon a material breach that remains uncured for thirty (30) calendar days after written notice. Cure Notice No. 1 identified the persistent schedule delays across Milestones 5 through 8, the accumulation of critical NCRs, and Meridian's failure to implement an adequate corrective action plan, and demanded that Meridian cure these material breaches within the thirty-day period prescribed by Section 14.1. Meridian responded with a letter dated February 1, 2024, disputing the characterization of its performance as a material breach and proposing a revised construction schedule that NFA's project management team determined to be both unrealistic and insufficiently responsive to the identified quality defects.
On February 19, 2024, NFA issued Cure Notice No. 2, noting that Meridian had failed to cure the material breaches identified in Cure Notice No. 1, that additional NCRs had been issued in the intervening period, and that the Milestone 8 delay had now grown to over 120 days. Cure Notice No. 2 placed Meridian on final notice that NFA intended to exercise its termination rights under MCA § 14.1 if the identified breaches were not cured within the applicable cure period.
On April 1, 2024, having determined that Meridian's material breaches remained uncured, NFA terminated the MCA for cause pursuant to MCA § 14.1. The termination notice specifically identified the grounds for termination: persistent schedule delays across multiple milestones, substandard workmanship as evidenced by 287 NCRs (including 43 critical NCRs), and Meridian's failure to cure these deficiencies within the contractually mandated cure periods following two separate cure notices.
On July 15, 2024, Meridian filed its Verified Complaint in this action, asserting claims for breach of contract, breach of the implied covenant of good faith and fair dealing, and unjust enrichment, and seeking damages in excess of $200 million. Meridian's central allegation is that NFA's termination for cause was "pretextual" — that NFA terminated the MCA not because of Meridian's alleged material breach, but rather because NFA wished to bring fiber construction in-house or re-procure construction services from a lower-cost contractor. Meridian further alleges that NFA's true motivation was to capture cost savings resulting from declining construction labor and materials costs in the post-pandemic marketplace.
On September 3, 2024, NFA filed its Answer with Affirmative Defenses and Counterclaims, denying Meridian's allegations in their entirety and asserting counterclaims totaling approximately $149 million. NFA's counterclaims seek: (a) $49 million in liquidated damages for Meridian's schedule delays under MCA § 12.3; (b) $81.7 million in excess completion costs, representing the difference between the cost of completing the remaining work under NFA's replacement contract with Crestline Construction Group Inc. (executed June 15, 2024) and the price that would have been payable to Meridian under the MCA for the same scope of work; and (c) $18.3 million in remediation costs incurred to correct defective work performed by Meridian, including splice rework, conduit re-installation to proper depth, and route realignment.
B. The discovery Process and the Privilege Log
Following the October 1, 2024 Preliminary Conference before Justice Ricci, during which the Court entered a discovery schedule and the parties agreed upon a Stipulated E-discovery Protocol (filed the same date), the parties engaged in extensive document discovery. The discovery schedule established November 1, 2024 as the deadline for substantial completion of document production and privilege log service.
NFA undertook a comprehensive document collection and review process. NFA collected documents from ten (10) custodians, including Renata Voss (Vice President, US Network Infrastructure), Sean Calloway (Director, Construction Management), Helena Bright (Chief Financial Officer of NTP), Dominic Hale (General Counsel of NTP), Marcus Redford (Senior Vice President, Network Engineering), Julia Chen (Vice President, Procurement), Robert Ashworth (Associate General Counsel, US Commercial), Andrea Simmons (Director, Quality Assurance), Kevin Li (Project Manager, Phase 2), and Cynthia Drayden (Director, Finance, NFA). NFA also collected relevant documents from its corporate files, shared drives, and project management databases, including Meridian's own submissions, milestone deliverables, and NCR files.
NFA engaged Vantage Litigation Support LLC, a nationally recognized e-discovery service provider, to host, process, and facilitate the review of the collected documents. NFA produced approximately 1.4 million documents comprising approximately 3.2 terabytes of data. These productions included project files, construction records, correspondence between NFA and Meridian personnel, internal NFA emails regarding construction progress and quality issues, financial records, milestone tracking data, NCR files and supporting documentation, cure notices and related correspondence, and numerous other categories of documents responsive to Meridian's document requests.
Meridian, for its part, produced approximately 890,000 documents from eight custodians, comprising approximately 1.8 terabytes of data.
On October 31, 2024 — in full compliance with the Court's discovery schedule — NFA served its privilege log identifying the 214 documents withheld from production on the basis of attorney-client privilege and/or work product protection. The privilege log was prepared by Calderwood & Harkness LLP with the assistance of Vantage Litigation Support LLC and identifies each document by: (a) document control number or Bates range; (b) date of the communication or document; (c) author; (d) recipient(s) and persons copied; (e) type of document (e.g., email, email chain, memorandum, presentation, spreadsheet with attorney annotations); and (f) a description of the subject matter of the communication sufficient to allow assessment of the privilege claim without disclosing the privileged content.
On November 15, 2024, defense counsel Linda Osei of Calderwood & Harkness LLP sent a detailed meet-and-confer letter to Meridian's lead counsel, Thomas Deluca of Hargrove, Deluca & Stein LLP, explaining the basis for each category of privilege assertion and specifically offering to discuss any individual log entries that Meridian believed to be insufficiently described. The letter was eight pages in length and addressed each of the three categories of withheld documents in detail. Ms. Osei further offered to schedule a telephone conference or in-person meeting to address Meridian's concerns. Meridian's counsel responded with a two-paragraph letter dated November 19, 2024, stating that Meridian considered NFA's privilege assertions to be "overbroad and unsupported" and that Meridian intended to move to compel. Meridian declined to identify any specific log entries it wished to discuss, declined the offer of a telephonic or in-person meet-and-confer, and filed its motion to compel just three days later, on November 22, 2024.
C. The 214 Privileged Documents
The 214 documents withheld by NFA fall into three principal categories, each of which is described below.
Category 1 — Legal Advice Regarding Termination Strategy (Approximately 126 Documents). The largest category of withheld documents consists of communications between NFA's General Counsel, Dominic Hale, and NFA personnel — including Renata Voss (VP, US Network Infrastructure), Sean Calloway (Director, Construction Management), and other employees involved in construction management and oversight of the MCA — as well as communications between Dominic Hale and outside counsel at Calderwood & Harkness LLP. These communications sought and provided legal advice regarding the interpretation and application of MCA § 14.1, the contractual provision governing termination for cause. Specifically, the communications addressed: the contractual definition and legal standard for "material breach"; the sufficiency of the factual record (schedule delays, NCRs, and failure to cure) to support a termination for cause; the procedural adequacy of Cure Notice No. 1 (January 18, 2024) and Cure Notice No. 2 (February 19, 2024); the legal risks of electing termination for cause under MCA § 14.1 as compared with termination for convenience under MCA § 14.3, including the different consequences for each party's rights and obligations; the potential litigation consequences of each course of action; and the anticipated claims that Meridian might assert following a termination for cause. These communications span from approximately December 2023 through April 2024 — the period during which the cure-and-termination process unfolded — and they constitute the kind of privileged legal advice that the attorney-client privilege exists to protect.
Category 2 — Legal Analysis of In-House Fiber Construction Alternative (Approximately 52 Documents). The second category consists of attorney-supervised memoranda, analytical summaries, and presentations analyzing the legal, regulatory, and contractual implications of NFA's options following a potential termination of the MCA. These documents were prepared at the direction of Dominic Hale for the purpose of providing comprehensive legal advice regarding the universe of alternatives available to NFA in the event the MCA was terminated. The analyses addressed, among other things: NFA's rights under MCA § 14.5, which provides that upon a termination for cause, NFA has the right to complete the remaining work using substitute contractors and to charge the excess cost of completion to Meridian; the legal and regulatory considerations associated with NFA potentially establishing an in-house construction capability, including permitting and licensing requirements in each of the seven states in the project footprint; the contractual and legal risks of engaging a replacement general contractor; and the potential impact of post-termination decisions on NFA's ability to recover excess completion costs from Meridian in litigation. These documents were prepared in anticipation of litigation and for the purpose of providing legal advice to NFA's management and board of directors regarding the legal consequences of their post-termination decisions.
Category 3 — Privileged Board and Management Presentations (Approximately 36 Documents). The third category consists of presentations, board memoranda, and executive summaries prepared by or at the direction of counsel for the board of directors of NTP (chaired by Dame Catherine Elsworth) and senior management of NTP and NFA (including Sir Malcolm Ashford, CEO; Helena Bright, CFO; and other members of the executive team). These documents summarize legal advice regarding the termination decision, the litigation risk profile associated with a termination for cause, the quantum of potential claims exposure (both affirmative claims and defensive exposure), and the strategic alternatives available to NFA. The documents were prepared for the purpose of enabling the board and senior management to make informed decisions in light of counsel's legal assessment. They were circulated only to individuals with a need to know, were marked "Privileged and Confidential — Attorney-Client Communication," and were treated as confidential at all times.
ARGUMENT
I. THE ATTORNEY-CLIENT PRIVILEGE PROTECTS THE 214 DOCUMENTS FROM DISCLOSURE
A. Legal Standard for Attorney-Client Privilege Under New York Law. In New York, the attorney-client privilege shields from disclosure confidential communications between an attorney and a client, made for the purpose of obtaining or providing legal advice. CPLR § 4503(a). The privilege is "the oldest of the privileges for confidential communications known to the common law," Upjohn Co. v. United States, 449 U.S. 383, 389 (1981), and serves the vital public interest in promoting "the open development between lawyer and client [that] is essential to sound legal advice." Alice Ames, 78 N.Y.2d 371, 377 (1991). New York courts have long recognized the attorney-client privilege as "a shield, and not a sword," and have given it broad application where its elements are established. See Rossi v. Kestrel Insurance & Westvale Assurance of Greater N.Y., 73 N.Y.2d 588, 593 (1989).
The elements of the attorney-client privilege under New York law are well established. The party asserting the privilege must demonstrate that the communication was: (1) between a client (or the client's agent) and an attorney (or the attorney's agent); (2) made in confidence; and (3) for the purpose of obtaining or providing legal advice. Spectrum Sys., 78 N.Y.2d at 377; see also Larkspur Holdings, 27 N.Y.3d 616, 623-24 (2016). Once the party asserting the privilege has made a prima facie showing that the communication satisfies these elements, the burden shifts to the party seeking to overcome the privilege to establish a recognized exception. Priest v. Hennessy, 51 N.Y.2d 62, 68-69 (1980).
The privilege extends with equal force to communications with in-house counsel, provided that the predominant purpose of the communication is to obtain or render legal advice, as distinguished from business advice. Rossi, 73 N.Y.2d at 593-94. New York courts apply a "predominant purpose" test, asking whether the primary purpose of the communication was the rendition of legal services. See Spectrum Sys., 78 N.Y.2d at 378-79. This test recognizes the practical reality that in-house counsel frequently participate in business discussions, but holds that communications remain privileged so long as their predominant purpose is the provision of legal advice. The fact that a privileged communication also touches upon business considerations does not strip it of privilege protection where the primary impetus for the communication was the need for legal guidance. See MBIA Inc. v. Sterling Reach Industries, 2012 N.Y. Slip Op. 33230(U), at *4-5 (Sup. Ct. N.Y. Cty. 2012) (applying predominant purpose test and upholding privilege for in-house counsel communications that also addressed business matters).
In the corporate context, the attorney-client privilege extends to communications between the corporation's counsel and those employees who have authority to act on the corporation's behalf or who communicate with counsel at the direction of management for the purpose of obtaining legal advice relevant to corporate decision-making. See Rossi, 73 N.Y.2d at 592-93; see also Upjohn, 449 U.S. at 394-95 (rejecting narrow "control group" test in favor of broader protection for communications between counsel and employees necessary for the provision of legal advice). New York courts have adopted this broad formulation, recognizing that corporate counsel must be able to communicate with employees at all levels of the organization in order to provide fully informed legal advice. See People v. Osorio, 75 N.Y.2d 80, 84 (1989).
The work product doctrine, codified in New York at CPLR § 3101(c) (attorney work product) and CPLR § 3101(d)(2) (trial preparation materials), provides additional, independent protection for documents prepared by an attorney in anticipation of litigation. Attorney work product under CPLR § 3101(c) is afforded near-absolute protection — it is discoverable only in the rarest of circumstances, if at all. Spectrum Sys., 78 N.Y.2d at 380-81. Trial preparation materials prepared in anticipation of litigation under CPLR § 3101(d)(2) are conditionally protected and may be disclosed only upon a showing that the party seeking discovery has a substantial need for the materials and is unable without undue hardship to obtain the substantial equivalent by other means. Id. at 381.
A document may be protected simultaneously by the attorney-client privilege and the work product doctrine, and the party opposing production is entitled to invoke both protections. See Beaumont Group v. Superior Court, 60 N.Y.2d 418, 424 (1983). The two doctrines serve related but distinct purposes: the attorney-client privilege protects the confidentiality of communications between attorney and client, while the work product doctrine protects the attorney's mental processes, impressions, and litigation strategy from disclosure to an adversary.
B. The Category 1 Documents (Termination Strategy) Are Quintessential Privileged Legal Advice. The approximately 126 documents in Category 1 consist of communications between NFA's General Counsel, Dominic Hale, and NFA employees — including Renata Voss (VP, US Network Infrastructure), Sean Calloway (Director, Construction Management), and other personnel directly involved in the management of the MCA — as well as communications between Dominic Hale and outside counsel at Calderwood & Harkness LLP. In these communications, NFA personnel sought legal advice from counsel regarding their contractual rights under the MCA, and counsel provided that advice. These are precisely the type of communications that the attorney-client privilege exists to protect, and they should not be compelled.
The substance of these communications falls squarely within the heartland of attorney-client privilege protection. The documents address: the interpretation and application of MCA § 14.1, including the contractual requirements for a valid termination for cause; the legal definition of "material breach" and whether Meridian's documented schedule delays and quality failures — including 287 NCRs, 43 of which were classified as critical — constituted material breach under the MCA and under governing New York law; the procedural adequacy of Cure Notice No. 1 (issued January 18, 2024) and Cure Notice No. 2 (issued February 19, 2024), including whether the notices complied with the formal requirements of Section 14.1 and provided sufficiently specific identification of the alleged breaches; the legal risks and consequences of electing termination for cause under MCA § 14.1 as compared with termination for convenience under MCA § 14.3, including the dramatically different financial consequences of each election for NFA's ability to recover damages and excess completion costs; and the anticipated litigation consequences of a termination for cause, including the potential claims Meridian might assert and the defenses available to NFA.
Each of these subjects is inherently legal in nature. The interpretation of a complex commercial contract is quintessentially legal work. The assessment of whether a pattern of conduct constitutes "material breach" requires analysis of both the contractual provisions and applicable legal standards. The evaluation of litigation risk and the formulation of litigation strategy are among the most sensitive and privileged subjects of attorney-client communication.
Meridian argues that the Category 1 documents reflect "business decisions" rather than "legal advice" and therefore are not privileged. This argument is meritless. The decision to terminate a multi-billion-dollar construction contract for cause is not a purely business decision — it is a decision that carries profound legal consequences, that requires the careful application of legal standards to a complex factual record, and that was made upon the advice of counsel regarding NFA's contractual rights and obligations. The fact that the termination decision also has significant business implications does not strip the underlying legal advice of its privileged character. See Spectrum Sys., 78 N.Y.2d at 378-79 (privilege applies where predominant purpose of communication is legal advice, even if communication also addresses business matters); see also In re Grand Jury Subpoena Duces Tecum, 731 F.2d 1032, 1037 (2d Cir. 1984) ("The fact that corporate counsel may have given mixed advice, partly legal and partly business, does not vitiate the attorney-client privilege.").
Under the predominant purpose test, the critical inquiry is whether the primary reason for the communication was the rendition of legal advice. Here, the answer is unambiguous. The communications in Category 1 were initiated because NFA's management needed legal advice regarding its contractual termination rights. They were directed to and from Dominic Hale in his capacity as General Counsel. They sought and provided analysis of legal standards, contractual provisions, procedural requirements, and litigation risks. The fact that NFA's management used this legal advice to inform a business decision — whether to terminate the MCA — does not transform the underlying legal advice into non-privileged business communications. See Stenovich v. Crane & Ames LLP, 195 Misc. 2d 99, 106 (Sup. Ct. N.Y. Cty. 2003) (holding that legal advice regarding the exercise of contractual rights is privileged even where it informs a subsequent business decision).
Meridian further argues that Dominic Hale was acting in a "business capacity" rather than a "legal capacity" in connection with the termination decision, and therefore his communications are not privileged. This argument rests on a fundamental misunderstanding of both Mr. Hale's role and the governing legal standard. Dominic Hale's title is General Counsel of NTP. He is a qualified solicitor admitted to practice in England and Wales and a member of the New York bar, admitted to practice law in the State of New York. The communications at issue on their face seek and provide legal advice — they discuss contractual interpretation, the legal standard for material breach, the sufficiency of cure notices, and litigation risk. The privilege log descriptions make clear the legal nature of each communication.
Where in-house counsel's primary role in a communication is to provide legal advice, the privilege attaches even if counsel also holds a management title or participates in business decision-making in other contexts. See Rossi, 73 N.Y.2d at 593 ("[T]he critical inquiry is whether, viewing the lawyer's communication in its full content and context, it was made in order to render legal advice or services to the client."). Meridian's argument would, if accepted, effectively strip in-house counsel of the ability to provide privileged legal advice to their clients — a result that New York courts have consistently rejected. See, e.g., Stenovich, 195 Misc. 2d at 105-06; see also ABN AMRO Bank, N.V. v. Olayan, 2005 N.Y. Slip Op. 50960(U), at *3-4 (Sup. Ct. N.Y. Cty. 2005) (upholding privilege for in-house counsel communications regarding the exercise of contractual remedies).
The temporal scope of the Category 1 documents — spanning December 2023 through April 2024 — further underscores their privileged character. This period corresponds precisely to the cure-and-termination process: the period during which NFA was evaluating whether Meridian's performance deficiencies constituted material breach, formulating and issuing cure notices, monitoring Meridian's response (or lack thereof), and ultimately deciding to exercise its termination right. Throughout this period, NFA's management was actively seeking legal advice from counsel regarding each step in the process. The communications are contemporaneous records of that privileged consultation, and they deserve the full protection of the attorney-client privilege.
C. The Category 2 Documents (In-House Fiber Analysis) Are Protected Attorney Work Product and/or Attorney-Client Privilege. The approximately 52 documents in Category 2 consist of legal memoranda, analytical summaries, and presentations prepared at the direction of NFA's General Counsel, Dominic Hale, analyzing the legal, regulatory, and contractual implications of NFA's post-termination alternatives. These documents are protected both as attorney-client privileged communications and as work product prepared in anticipation of litigation.
As an initial matter, the Category 2 documents satisfy all of the elements of the attorney-client privilege. They were prepared by or at the direction of counsel — specifically, Dominic Hale and, in certain instances, outside counsel at Calderwood & Harkness LLP — for the purpose of providing legal advice to NFA's management and board of directors regarding the legal consequences of post-termination decisions. The documents analyze, among other things: NFA's right under MCA § 14.5 to complete the remaining work using substitute contractors and to charge the excess cost of completion to Meridian; the legal and regulatory requirements for establishing an in-house fiber construction capability in each of the seven states in the project footprint, including permitting, licensing, and bonding requirements; the contractual and legal risks associated with various replacement strategies, including the risk that certain post-termination actions could be argued to constitute a failure to mitigate damages; and the potential impact of NFA's post-termination decisions on the calculation and recoverability of excess completion costs in any subsequent litigation. These are quintessentially legal analyses, prepared for the purpose of enabling NFA's decision-makers to evaluate their options with the benefit of legal counsel's assessment of the risks and consequences associated with each alternative.
The Category 2 documents are also independently protected as work product under CPLR § 3101(c) and (d)(2). The work product doctrine protects materials prepared in anticipation of litigation, and these documents were unquestionably prepared with litigation in mind. By December 2023, well before the first cure notice was issued on January 18, 2024, it was evident to NFA's counsel that Meridian's persistent schedule delays and quality failures were approaching the threshold of material breach. Given the magnitude of the contract ($1.2 billion), the severity of Meridian's performance failures (287 NCRs, chronic schedule delays across multiple milestones), Meridian's financial dependence on the NFA contract as its anchor engagement, and the substantial investment by Ridgepoint Capital Group LP in Meridian, NFA's counsel reasonably anticipated that any termination of the MCA — whether for cause or for convenience — would result in significant litigation.
The anticipation of litigation was not speculative or hypothetical; it was a reasonable, indeed inevitable, conclusion based on objective circumstances. New York courts have consistently held that litigation need not be "imminent" for the work product doctrine to apply; rather, the doctrine applies whenever litigation is "reasonably anticipated." See Bombard v. Amica Mut. Ins. Co., 11 A.D.3d 647, 648 (2d Dep't 2004); see also Spectrum Sys., 78 N.Y.2d at 381 (work product protection applies to materials prepared "in anticipation of litigation"). Here, by December 2023, counsel's anticipation of litigation was well founded: a $1.2 billion contract termination involving a financially dependent counterparty with private equity backing would inevitably generate litigation, and it did.
Because the Category 2 documents reflect attorney analysis and mental impressions regarding NFA's legal options and litigation exposure, many of them constitute "opinion" work product — the type of work product that enjoys near-absolute protection under both New York and federal law. See Upjohn, 449 U.S. at 400-01 (opinion work product "is accorded the highest level of protection"); Spectrum Sys., 78 N.Y.2d at 380-81 (attorney work product under CPLR § 3101(c) is entitled to near-absolute protection). Even the subset of Category 2 documents that might be characterized as "fact" work product — for example, analyses of regulatory requirements in specific states — are entitled to at least conditional protection under CPLR § 3101(d)(2), and Meridian has made no showing of substantial need or inability to obtain the substantial equivalent of these materials by other means. The underlying regulatory requirements are publicly available; Meridian can conduct its own regulatory analysis if it wishes to do so.
Meridian contends that the Category 2 documents constitute evidence that NFA's "true motivation" for the termination was to bring fiber construction in-house, and therefore that the termination was "pretextual." This argument is flawed in multiple respects.
First, as a substantive matter, a party's motive for exercising a contractual right is not relevant where the contractual requirements for that exercise have been met. Under New York law, a party that has the contractual right to terminate for cause based on the other party's material breach may exercise that right regardless of any concurrent motivation it may have had. See Bramwell & Co. v. Herald Sq. Loft Corp., 67 A.D.2d 442, 446 (1st Dep't 1979) (holding that where grounds for termination exist, the terminating party's motivation is irrelevant). NFA has asserted, and will prove at trial, that Meridian materially breached the MCA through persistent schedule delays across multiple milestones and 287 NCRs, 43 of which were classified as critical — and that Meridian failed to cure these breaches despite two cure notices and extended cure periods. If NFA establishes these facts, the termination was justified under MCA § 14.1, regardless of whatever else NFA may have been thinking or considering at the time.
Second, even if Meridian's "pretext" theory were cognizable — and NFA contends it is not — the relevance of the Category 2 documents to that theory does not override the attorney-client privilege or work product doctrine. The attorney-client privilege is not overcome by a party's assertion of relevance, no matter how strong that assertion may be. See Spectrum Sys., 78 N.Y.2d at 377 ("The privilege has never been conditional upon relevance or the importance of the information sought."); Matter of Priest v. Hennessy, 51 N.Y.2d at 69 (privilege applies "regardless of the relevance of the communication"). If anything, the heightened relevance that Meridian attributes to these documents — describing them as the "smoking gun" evidence of NFA's alleged pretext — underscores their quintessentially privileged character. They contain precisely the type of candid legal analysis that NFA's counsel was duty-bound to provide and that the privilege exists to protect. To hold that the attorney-client privilege gives way whenever an adversary characterizes privileged communications as "relevant" would eviscerate the privilege in every case where it matters most.
Meridian also appears to suggest that NFA has waived the privilege over the Category 2 documents by placing their contents "at issue" in this litigation. This argument fails. The "at issue" waiver doctrine is narrow and applies only where a party "has asserted a claim or defense that [it] intends to prove by use of the privileged materials." Halcyon Securities Tr. Co. of Americas v. Tri-Links Inv. Tr., 43 A.D.3d 56, 64 (1st Dep't 2007). NFA has done no such thing. NFA has not asserted an advice-of-counsel defense. NFA has not claimed that it relied on counsel's advice in deciding to terminate the MCA, nor has NFA placed the content of any privileged communication at issue as an element of any claim or defense. NFA's defense is straightforward: Meridian materially breached the MCA, NFA provided the required cure notices, Meridian failed to cure, and NFA exercised its contractual right to terminate for cause. This defense rests entirely on the factual record — schedule delays, NCRs, cure notices, and failure to cure — and does not depend on, or even reference, the content of privileged communications. Mere reliance on a contractual right does not place counsel's advice regarding that right "at issue." See Halcyon Securities, 43 A.D.3d at 64-65; see also Jakobleff v. Cerrato, Sweeney & Cohn, 97 A.D.2d 834, 835 (2d Dep't 1983).
D. The Category 3 Documents (Board/Management Presentations) Are Protected. The approximately 36 documents in Category 3 are presentations, board memoranda, and executive summaries prepared by or at the direction of counsel for the board of directors of NTP and the senior management teams of NTP and NFA. These documents summarize legal advice provided by Dominic Hale and outside counsel regarding NFA's termination rights under the MCA, the litigation risk profile associated with a termination for cause, the quantum of potential damages exposure on both affirmative and defensive claims, and the strategic legal alternatives available to NFA. They are protected by the attorney-client privilege, and Meridian has identified no basis for their production.
The corporate attorney-client privilege extends fully to communications with directors and officers made for the purpose of obtaining legal advice for the corporation's benefit. See Rossi, 73 N.Y.2d at 593. The fact that the Category 3 documents were delivered to the full board of directors or to members of the C-suite — including Sir Malcolm Ashford (CEO), Helena Bright (CFO), and Dame Catherine Elsworth (Board Chair) — does not destroy the privilege. To the contrary, it is entirely appropriate, and indeed expected, that a corporation's board of directors and senior management would receive legal advice from counsel before authorizing a significant decision such as the termination of a $1.2 billion construction contract. Corporate decision-makers must be able to receive legal advice in a boardroom setting without fear that the confidentiality of that advice will be compromised in subsequent litigation. See Upjohn, 449 U.S. at 389-90 ("[T]he privilege exists to protect not only the giving of professional advice to those who can act on it but also the giving of information to the lawyer to enable him to give sound and informed advice.").
Meridian may argue that the Category 3 documents contain "mixed" business and legal content, and that they should be produced to the extent they address business strategy rather than legal advice. But the predominant purpose of these documents was to convey legal advice — specifically, counsel's assessment of NFA's legal rights under the MCA, the legal risks of various courses of action, and the litigation exposure associated with each alternative. The fact that the board and management also used this legal advice to inform their business decisions does not transform the privileged legal advice into non-privileged business communications. See Spectrum Sys., 78 N.Y.2d at 378-79.
Moreover, confidentiality has been maintained at all times with respect to the Category 3 documents. The documents were not disclosed outside the corporation or to any third party. Each document was marked "Privileged and Confidential — Attorney-Client Communication" or with substantially similar language. The documents were circulated only to individuals within the NTP/NFA corporate family who had a need to know for the purpose of acting on counsel's legal advice — specifically, board members and senior executives with decision-making authority over the termination of the MCA and the prosecution and defense of the resulting litigation. There has been no dissemination outside this limited circle, and no waiver of the privilege.
The Category 3 documents are also protected, in whole or in part, as attorney work product to the extent they were prepared in anticipation of litigation. As discussed above, by the time these presentations were prepared, NFA's counsel reasonably anticipated that the termination of the MCA would result in litigation. The presentations reflect counsel's mental impressions, conclusions, and strategic assessments regarding the litigation risk profile and the optimal course of action — precisely the type of opinion work product that is entitled to the strongest protection under the law.
II. MERIDIAN HAS FAILED TO ESTABLISH ANY EXCEPTION TO THE PRIVILEGE
Having established that the 214 documents are properly within the scope of the attorney-client privilege and/or work product doctrine, the burden falls on Meridian to demonstrate that a recognized exception applies. Meridian has not done so, and its motion should be denied.
A. The Crime-Fraud Exception Does Not Apply. To the extent Meridian argues or implies that NFA's termination of the MCA was in bad faith and that the communications facilitating that termination fall within the crime-fraud exception to the attorney-client privilege, this argument fails as a matter of law.
The crime-fraud exception is narrow. It applies only where the party seeking to invoke it demonstrates that the communications at issue were made in furtherance of a crime or fraud. See Clark v. United States, 289 U.S. 1, 15 (1933); In re Grand Jury Proceedings, 219 F.3d 175, 182 (2d Cir. 2000). The exception requires a prima facie showing — based on evidence independent of the privileged communications themselves — that (1) the client was engaged in, or planning, a crime or fraud, and (2) the attorney-client communications at issue were in furtherance of that criminal or fraudulent activity. See In re John Doe, Inc., 13 F.3d 633, 637 (2d Cir. 1994); Jacobs v. Lababedi, 2019 N.Y. Slip Op. 32765(U), at *5-6 (Sup. Ct. N.Y. Cty. 2019).
Meridian has made no such showing and cannot do so. NFA terminated the MCA for cause based on Meridian's well-documented schedule delays across five milestones and 287 NCRs, 43 of which were classified as critical. Two cure notices were issued, affording Meridian the full contractual cure period under MCA § 14.1. Meridian failed to cure. The termination was a lawful exercise of NFA's contractual rights — not a crime or fraud.
Meridian's characterization of the termination as "pretextual" is a litigation position, not evidence of fraud. Disagreeing with NFA's exercise of its contractual rights does not transform a contractual dispute into a fraud. If the crime-fraud exception could be triggered merely by a plaintiff's allegation that a defendant's contractual conduct was motivated by improper considerations, the exception would swallow the rule, and the attorney-client privilege would offer no protection in any case involving a contested termination or other disputed exercise of contractual rights. New York courts have consistently rejected such an expansive application of the crime-fraud exception. See, e.g., Adriatic Specialty Insurance v. Certain Underwriters at Lloyd's London, 176 Misc. 2d 605, 611 (Sup. Ct. N.Y. Cty. 1998) (declining to apply crime-fraud exception absent independent evidence of fraudulent conduct).
Because Meridian has failed to make the requisite prima facie showing of crime or fraud based on evidence independent of the privileged communications themselves, the crime-fraud exception does not apply, and in camera review under this exception is not warranted.
B. There Has Been No Waiver of Privilege. NFA has taken consistent and affirmative steps to preserve the attorney-client privilege and work product protections over the 214 withheld documents, and there has been no waiver — voluntary, inadvertent, or implied.
A litigation hold was implemented by Calderwood & Harkness LLP on August 21, 2024 — the date the firm was retained to represent NFA in this matter. The litigation hold instructed all relevant custodians to preserve all documents potentially relevant to the dispute, including privileged communications, and reminded them of their obligation to maintain the confidentiality of attorney-client communications. The hold was circulated to all ten custodians from whom documents were collected, as well as to NTP's IT department, which was responsible for ensuring the preservation of electronically stored information.
The privilege log was served on October 31, 2024, in full compliance with the Court's discovery schedule. The log identifies each of the 214 withheld documents with sufficient specificity to allow assessment of the privilege claim, as discussed in further detail in Section III below.
NFA has not voluntarily disclosed any of the 214 privileged documents to any third party. The documents have been maintained in confidence within the NTP/NFA corporate family and have been shared only with individuals who had a need to know for the purpose of obtaining or acting on legal advice, or with outside counsel retained to represent NFA in this matter.
The Stipulated E-discovery Protocol filed October 1, 2024 includes a clawback provision — Section 8(d) — which provides that the inadvertent production of privileged documents does not constitute a waiver of privilege, provided the producing party gives prompt written notice of the inadvertent production and the receiving party returns or destroys the inadvertently produced documents. This clawback provision, agreed to by both parties, provides an additional safeguard against inadvertent waiver and reflects the parties' shared recognition that the preservation of privilege is an important interest in the conduct of complex commercial litigation.
Most significantly, NFA has not asserted an advice-of-counsel defense and has not otherwise placed the content of any privileged communication "at issue" in this litigation. As discussed above, NFA's defense rests entirely on the factual record of Meridian's material breach — schedule delays, 287 NCRs, two cure notices, and Meridian's failure to cure. NFA does not contend that it relied on counsel's advice in deciding to terminate the MCA, nor does NFA invoke the content of any privileged communication as an element of any claim or defense. The "at issue" waiver doctrine is therefore inapplicable. See Halcyon Securities, 43 A.D.3d at 64-65.
In sum, there has been no waiver of privilege — not by voluntary disclosure, not by inadvertent production, and not by placing privileged communications at issue. Meridian has identified no basis for finding a waiver, and its motion should be denied on this ground as well.
C. Meridian's "Relevance" Argument Is Insufficient to Overcome Privilege. Stripped of its rhetorical embellishments, Meridian's primary argument in support of its motion to compel is that the 214 documents are "highly relevant" to its pretext theory and therefore must be produced. This argument fundamentally misapprehends the relationship between relevance and privilege.
Relevance is not an exception to the attorney-client privilege. The privilege operates precisely to protect confidential attorney-client communications from compelled disclosure, regardless of how relevant those communications may be to the opposing party's claims or defenses. See Spectrum Sys., 78 N.Y.2d at 377 (privilege "is not conditioned on the relevance or importance of the information sought"); see also Priest v. Hennessy, 51 N.Y.2d at 69 (same). Indeed, the privilege typically becomes most important — and must be most vigorously enforced — in precisely those cases where the privileged communications are most relevant to the opposing party's litigation position. If the privilege could be overcome by a showing of relevance, it would provide no protection at all, because a party seeking to compel production would always argue (and could almost always plausibly argue) that the withheld communications are relevant.
The New York Court of Appeals has been unequivocal on this point. In Spectrum Systems, the Court held that the attorney-client privilege applies "regardless of the relevance of the communication" and that "the fact that the information is necessary to the opposing party's preparation of his case does not vitiate the privilege." 78 N.Y.2d at 377 (internal quotation marks omitted). The First Department has likewise confirmed that "the test for the applicability of the privilege is not whether the information sought is relevant or material to the issues in the lawsuit, but whether the communication was made for the purpose of facilitating the rendition of legal advice or services." Chase Manhattan Bank, N.A. v. Perla, 65 A.D.2d 207, 210 (1st Dep't 1978).
If anything, the heightened relevance that Meridian attributes to the 214 documents — characterizing them as evidence of NFA's "true motivation" and the "real story" behind the termination — underscores their quintessentially privileged character. These documents contain NFA's candid legal assessments of its contractual rights, litigation risks, and strategic options. They were prepared for the very purpose of enabling NFA to navigate a complex legal landscape with the benefit of counsel's professional judgment. To order their production because they are "relevant" to Meridian's theory of the case would be to punish NFA for having sought and obtained the legal advice that the privilege is designed to encourage.
Meridian is not without recourse. The factual record of Meridian's performance under the MCA — including the schedule delays, NCRs, cure notices, and related project documentation — has been produced in full. Meridian's own documents, including its internal communications regarding its own performance failures, are available to it. If Meridian wishes to argue at trial that NFA's termination was "pretextual," it may attempt to do so based on the extensive factual record that has been produced, including NFA's non-privileged business documents regarding the termination. But Meridian may not breach the attorney-client privilege to obtain counsel's confidential legal advice for use in support of its litigation theory.
III. THE PRIVILEGE LOG IS ADEQUATE
Although Meridian has challenged the sufficiency of NFA's privilege log in its motion papers, these challenges are without merit. The privilege log served on October 31, 2024 fully complies with the requirements of CPLR § 3122 and the Commercial Division Rules, and provides Meridian and the Court with sufficient information to assess the validity of each privilege assertion.
Under CPLR § 3122, a party withholding documents on the basis of privilege is required to "state with reasonable particularity the reason such documents are not produced." The Commercial Division Rules, including Rule 11-b, further require that privilege logs include, for each document withheld, the type of document, the general subject matter, the date, the author, the addressee(s), and the relationship of the author and addressee(s) to each other. The purpose of these requirements is to provide the requesting party with enough information to assess the facial validity of the privilege claim and to facilitate a meaningful meet-and-confer process.
NFA's privilege log meets or exceeds these requirements. The log identifies each of the 214 withheld documents by: (a) document control number or Bates range assigned by Vantage Litigation Support LLC; (b) the date of the communication or document; (c) the author of the communication or document; (d) all recipients and persons copied; (e) the type of document (e.g., email, email chain, memorandum, presentation, spreadsheet with attorney annotations); and (f) a description of the subject matter of the communication sufficient to support the privilege claim without disclosing the privileged content. Each entry also identifies the specific privilege or protection asserted — attorney-client privilege, attorney work product, or both — and, where applicable, identifies the attorney or attorneys involved in the communication.
For example, a typical entry on the log reads: "Email from Dominic Hale (General Counsel, NTP) to Renata Voss (VP, US Network Infrastructure, NFA) and Robert Ashworth (Assoc. General Counsel, NFA), dated January 22, 2024, re: Legal analysis of material breach standard under MCA § 14.1 and assessment of sufficiency of factual basis for Cure Notice No. 1. Privilege asserted: Attorney-client privilege." This level of detail is more than sufficient to allow Meridian and the Court to assess whether the privilege is properly asserted.
Furthermore, NFA offered to engage in a meaningful meet-and-confer process regarding any specific log entries that Meridian believed to be insufficiently described. Defense counsel Linda Osei's November 15, 2024 letter specifically invited Meridian's counsel to identify particular entries of concern and offered to supplement descriptions or provide additional information as appropriate. Meridian declined this invitation, choosing instead to file its motion to compel just three days after its perfunctory response declining to engage. The Commercial Division's emphasis on cooperative discovery and meaningful meet-and-confer efforts, as reflected in Rule 14 and the Court's own standing order, counsels against rewarding Meridian's refusal to engage in the good-faith process that the rules contemplate.
Courts in the Commercial Division have consistently upheld privilege logs that provide the level of detail contained in NFA's log. See, e.g., Larkspur Holdings, 2014 N.Y. Slip Op. 30792(U), at 6-7 (Sup. Ct. N.Y. Cty. 2014) (upholding privilege log that identified author, recipient, date, type of document, and general subject matter); see also Koen Book Distribs., Inc. v. Powell, Trachtman, Logan, Carrle & Lombardo, P.C.*, 212 F.R.D. 283, 286 (E.D. Pa. 2002) (holding that a privilege log is adequate where it provides "enough information to permit the court to determine whether the privilege is properly asserted"). NFA's log provides at least this level of detail and, in many instances, substantially more.
IV. IN THE ALTERNATIVE, IN CAMERA REVIEW SHOULD BE LIMITED
If, notwithstanding the foregoing, the Court is inclined to conduct an in camera review of the withheld documents, NFA respectfully requests that such review be limited in scope. In camera review of all 214 documents would impose a substantial burden on the Court without corresponding benefit, particularly given the detailed privilege log that NFA has provided and the clear applicability of the privilege to each category of documents.
NFA respectfully proposes that any in camera review be limited to a representative sample of documents from each of the three categories identified in the privilege log. NFA suggests a sample of ten (10) documents from Category 1 (Termination Strategy), five (5) documents from Category 2 (In-House Fiber Analysis), and five (5) documents from Category 3 (Board/Management Presentations), for a total of twenty (20) documents. This sample would be sufficient to allow the Court to evaluate the nature and character of the withheld documents and to determine whether the privilege has been properly asserted, without requiring the Court to undertake the burdensome task of reviewing all 214 entries individually.
NFA will cooperate fully with the Court in identifying a representative sample that is manageable and illustrative of the full universe of withheld documents. If the Court prefers to select the sample itself, NFA will promptly provide the documents designated by the Court for in camera review.
NFA further requests that, if the Court determines upon in camera review that any particular documents were improperly withheld, the Court's ruling be limited to those specific do

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: COMMERCIAL DIVISION

MERIDIAN INFRASTRUCTURE PARTNERS LLC,

NORTHGATE FIBER AMERICAS INC.,

TABLE OF CONTENTS

PRELIMINARY STATEMENT

STATEMENT OF FACTS

ARGUMENT

I. THE ATTORNEY-CLIENT PRIVILEGE PROTECTS THE 214 DOCUMENTS FROM DISCLOSURE

II. MERIDIAN HAS FAILED TO ESTABLISH ANY EXCEPTION TO THE PRIVILEGE

III. THE PRIVILEGE LOG IS ADEQUATE

IV. IN THE ALTERNATIVE, IN CAMERA REVIEW SHOULD BE LIMITED

Record

Parties

Dates

Amounts