1022-00005 · Hargrove, Deluca & Stein LLP · Pleadings

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PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT

This memorandum is protected by the attorney-client privilege and the work product doctrine. It is intended solely for the use of Calderwood & Harkness LLP attorneys and staff working on the referenced matter. Any unauthorized disclosure, copying, or distribution is strictly prohibited.

CALDERWOOD & HARKNESS LLP 425 Park Avenue, 33rd Floor New York, NY 10022

MEMORANDUM

TO: Linda Osei, Responsible Partner

FROM: Jeffrey Park, Lead Associate

DATE: September 27, 2024

RE: Preparation for Preliminary Conference — Meridian Infrastructure Partners LLC v. Northgate Fiber Americas Inc., Index No. 654321/2024, Supreme Court of the State of New York, New York County, Commercial Division, Part 49

MATTER NO.: 1022-00005

CONFERENCE DATE: October 1, 2024, before Hon. Eleanor M. Ricci

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I. PURPOSE AND SUMMARY

This memorandum is prepared to assist you in preparing for the preliminary conference before the Honorable Eleanor M. Ricci, scheduled for October 1, 2024, in the above-captioned matter. The conference will address the discovery schedule, case management procedures, anticipated discovery disputes, and the path toward trial. This memorandum provides a comprehensive overview of the case, our recommended positions on all issues likely to arise at the conference, and detailed logistical information to ensure our team is fully prepared.

By way of background, Meridian Infrastructure Partners LLC ("Meridian" or "Plaintiff") filed its Verified Complaint on July 15, 2024, asserting four causes of action arising from the termination for cause of the Master Construction Agreement dated March 15, 2020 (the "MCA"). Service was effected on Northgate Fiber Americas Inc. ("NFA" or "Northgate" or "Defendant") on August 5, 2024. Calderwood & Harkness LLP was formally engaged by Northgate on August 19, 2024, following an initial consultation with Northgate's General Counsel, Dominic Hale, and its outside coverage counsel at Pemberton Fox LLP. Our firm filed the Answer with Affirmative Defenses and Counterclaims on September 3, 2024, and Meridian filed its Reply to the Counterclaims on September 18, 2024.

The pleadings are now closed. The case is ripe for discovery scheduling, and the preliminary conference will serve as the primary vehicle for establishing the framework within which this litigation will proceed through discovery to trial.

Opposing counsel in this matter is Thomas Deluca and Miriam Vasquez of Hargrove, Deluca & Stein LLP ("HDS"), located at 51 West 52nd Street, 40th Floor, New York, NY 10019. We have had brief introductory communications with Mr. Deluca regarding scheduling and procedural matters, though substantive discussions regarding the scope and timing of discovery have not yet occurred.

The total amount in controversy is substantial. Meridian's Verified Complaint seeks approximately $200 million in damages across its four causes of action. Northgate's counterclaims total approximately $149 million, encompassing liquidated damages, excess completion costs, and remediation expenses. This case thus involves total claims and counterclaims in excess of $349 million.

As a general matter, we anticipate that HDS may press for an aggressive discovery schedule at the conference. This approach would be consistent with Mr. Deluca's reputation as a litigator who favors early depositions and compressed timelines. Our position should balance thoroughness with avoiding unnecessary delay. We want to demonstrate to Justice Ricci that Northgate is prepared to litigate this case efficiently and in a manner fully consistent with the Commercial Division's expectations for efficient case management under Rule 8 of the Rules of the Commercial Division and the Part 49 practice rules. At the same time, the scale and complexity of this matter — a $1.2 billion multi-state construction program generating millions of pages of documents — requires a realistic schedule that allows for meaningful discovery.

II. CASE OVERVIEW FOR THE COURT

The following sections provide a concise summary of the case, the claims and defenses, and the key factual context. This material will be useful both for framing our oral presentation at the conference and for responding to any questions from Justice Ricci about the nature and complexity of the dispute.

A. Nature of the Action

This is a breach-of-contract dispute arising from NFA's termination for cause, effective April 1, 2024, of the Master Construction Agreement dated March 15, 2020 (the "MCA") between NFA and Meridian. The MCA governed a $1.2 billion fiber-optic build-out program across seven northeastern states: New York, New Jersey, Connecticut, Massachusetts, Pennsylvania, Maryland, and Virginia.

The scope of work under the MCA encompassed the design, engineering, permitting, and construction of approximately 18,500 route miles of underground and aerial fiber-optic cable infrastructure. This was one of the largest privately funded fiber-optic infrastructure programs in the northeastern United States and represented a critical component of Northgate's commercial broadband strategy.

The contract term was five years from the Notice to Proceed, which was issued on April 1, 2020. The original completion date under the MCA was March 31, 2025. The MCA was structured in multiple phases, with each phase corresponding to defined geographic regions and distinct milestone schedules.

The governing law provision at MCA § 22.1 designates New York law as controlling. Importantly, the parties' jury trial waiver at MCA § 22.4 means that this case will proceed to a bench trial before Justice Ricci (or such other justice as may be assigned). This has implications for both our trial preparation strategy and the nature of the factual presentations we will need to make.

B. Plaintiff's Claims ($200 Million)

Meridian's Verified Complaint asserts four causes of action, which collectively seek approximately $200 million in damages:

Count I: Breach of Contract — Wrongful Termination ($92.4 million). Meridian alleges that NFA's termination for cause on April 1, 2024 was wrongful and that the purported grounds for termination — schedule delays and non-conforming work — were pretextual. Meridian asserts that any delays were attributable to NFA's own conduct, including alleged failures to secure or facilitate right-of-way access, changes in project specifications, and interference with Meridian's permitting efforts. Meridian seeks a termination fee of $50,424,000 under MCA § 14.3, which it contends would apply in the event of a wrongful termination for cause (i.e., effectively converting the termination into a termination for convenience). Meridian also seeks lost profits of $41,976,000, representing the anticipated profit margin on the unperformed balance of the MCA.

Count II: Breach of Contract — Unpaid Invoices ($16.5 million). Meridian alleges that NFA failed to pay Phase 3 payment applications submitted between January and March 2024 in the aggregate amount of $16.5 million. NFA disputes these invoices on the grounds that the underlying work was deficient and subject to pending non-conformance reports, and that NFA was contractually entitled to withhold payment under MCA § 9.4 pending resolution of non-conforming work.

Count III: Breach of Contract — Wrongful Withholding of Retainage ($56,966,667). Meridian alleges that NFA has wrongfully withheld retainage in the amount of $56,966,667. Under MCA § 9.6, retainage of ten percent (10%) was withheld from each progress payment. Meridian contends that it is entitled to full release of retainage. NFA's position is that retainage is subject to set-off under the counterclaims and that the conditions for release of retainage under MCA § 9.6(c) — including satisfactory completion of work and resolution of all outstanding non-conformance reports — have not been met.

Count IV: Breach of Implied Covenant of Good Faith and Fair Dealing ($34,133,333). Meridian alleges that NFA's course of conduct — including alleged interference with Meridian's operations, bad-faith issuance of non-conformance reports, and pretextual termination — constituted a breach of the implied covenant of good faith and fair dealing. Meridian seeks damages for loss of bonding capacity, reputational harm in the construction industry, and consequential economic losses. NFA's position is that this claim is duplicative of the breach of contract claims and is independently barred by the consequential damages waiver at MCA § 20.1.

C. Defendant's Defenses and Counterclaims ($149 Million)

NFA has asserted the following affirmative defenses and counterclaims:

Affirmative Defenses. NFA's Answer pleads the following affirmative defenses, among others: (1) the termination for cause was justified under MCA § 14.1 based on Meridian's material breach of the MCA through persistent schedule delays and non-conforming work; (2) the consequential damages waiver at MCA § 20.1 bars Meridian's claims for lost profits, loss of bonding capacity, and reputational harm; (3) Meridian failed to mitigate its damages by, among other things, failing to pursue available work with other clients following the termination; (4) comparative fault, to the extent Meridian's own acts and omissions contributed to the delays and defects; and (5) set-off of any amounts owed to Meridian against the amounts owed to NFA under the counterclaims.

Counterclaims. Counterclaim I: Liquidated Damages — $49 million. Under MCA § 13.2, Meridian agreed to liquidated damages for failure to achieve contractual milestones on time. NFA seeks liquidated damages of $8,225,000 for Phase 1 delays and $40,775,000 for Phase 2 delays, for a total of $49,000,000. This total falls below the aggregate liquidated damages cap of $60,000,000 set forth in MCA § 13.2(d). The liquidated damages provision was negotiated at arm's length and reflects a genuine pre-estimate of damages that would be difficult to quantify precisely — we believe it is enforceable under New York law.

Counterclaim II: Excess Completion Costs — $81.7 million. Following the termination for cause, NFA engaged Crestline Construction Group Inc. ("Crestline") as the replacement contractor to complete the remaining scope of work under a new contract with a value of $712 million. The remaining unperformed value of the MCA at the time of termination was $630.3 million. NFA seeks the difference — $81.7 million — as excess completion costs. Under MCA § 14.2(b), the terminated contractor is liable for all costs incurred by the Owner in excess of what would have been paid under the original contract to complete the work.

Counterclaim III: Cost of Remediation of Defective Work — $18.3 million. NFA seeks the cost to remediate defective work identified in 287 non-conformance reports ("NCRs") issued during the course of Meridian's performance. Of these 287 NCRs, 43 were classified as "critical" deficiencies, with an average remediation cost of approximately $275,000 per NCR, and 244 were classified as "non-critical" deficiencies, with an average remediation cost of approximately $26,500 per NCR. The total remediation cost is estimated at $18.3 million. This estimate has been developed by our construction management team and will be supported by expert testimony at trial.

D. Key Factual Context for the Court

The following factual summary provides the essential context for understanding both the claims and the anticipated discovery needs:

At the time of termination on April 1, 2024, approximately 9,140 of the 18,500 route miles contemplated under the MCA (49.4%) had been constructed. Total payments made by NFA to Meridian over the life of the contract amounted to $512.7 million. Retainage held by NFA totaled $56,966,667.

Meridian's schedule performance deteriorated progressively over the life of the contract. Milestone 3 was achieved 47 days late. Milestone 5 was achieved 22 days late. Milestone 6 was achieved 68 days late. Milestone 7 was achieved 91 days late. Milestone 8, which was never completed, had accrued delays in excess of 134 days at the time of termination. This pattern of accelerating delay was a central factor in NFA's decision to terminate.

In addition to the schedule delays, the quality of Meridian's work was a significant concern. A total of 287 non-conformance reports were issued over the life of the contract, including 43 NCRs classified as "critical" — meaning they identified defects that posed a risk to the structural integrity or operational capacity of the fiber-optic infrastructure.

NFA followed the contractual cure process before exercising its termination right. Cure Notice No. 1 was issued on January 18, 2024, identifying specific schedule and quality deficiencies and providing Meridian with a 30-day cure period. When Meridian failed to cure, Cure Notice No. 2 was issued on February 19, 2024, providing an additional cure period and requesting submission of a comprehensive corrective action plan. Meridian submitted a Corrective Action Plan on March 5, 2024. NFA reviewed the plan, determined that it was inadequate to address the identified deficiencies, and rejected it on March 12, 2024. The Termination for Cause was issued on April 1, 2024, effective immediately.

The sufficiency of the cure notices, the reasonableness of NFA's rejection of the Corrective Action Plan, and the bona fides of NFA's termination decision will be central factual issues at trial. These factual issues will also drive the scope and focus of discovery.

III. PROPOSED DISCOVERY SCHEDULE — OUR POSITION

A. Recommended Timeline

Set forth below is our proposed discovery schedule, which we recommend presenting to the court as NFA's position. We should be prepared to negotiate around HDS's likely counter-proposals, and I have addressed our anticipated areas of disagreement and fallback positions in Section III.C below.

This proposed schedule contemplates approximately thirteen months from the preliminary conference to the commencement of trial. While this may appear to be a long timeline on its face, we believe it is warranted by the scale and complexity of the dispute, and is consistent with the timelines typically adopted in Commercial Division construction cases of this magnitude.

B. Rationale for Our Proposed Timeline

Several factors support the reasonableness of our proposed schedule and should be communicated to the court:

Volume of documents. This case will involve massive document discovery. Based on our preliminary assessment, Northgate's document collection is estimated at approximately 1.4 million documents, comprising approximately 3.2 terabytes of data, drawn from 10 identified custodians. Meridian's document collection is expected to be of a similar order of magnitude — we estimate approximately 890,000 documents comprising 1.8 terabytes from at least 8 custodians, as later confirmed in pre-conference communications with HDS. The documents include construction drawings, engineering specifications, daily construction reports, project management correspondence, change order requests, non-conformance reports, scheduling files (including Tarrant Data Systems project files), payment applications, financial records, and corporate governance materials. The sheer volume necessitates a structured rolling production schedule with realistic deadlines.

E-discovery vendor engagement. We have already taken steps to ensure that Northgate is prepared to proceed efficiently with document production. We engaged Vantage Litigation Support LLC, located at 300 Vesey Street, Suite 600, New York, NY 10282, as our e-discovery vendor. Vantage is currently processing and ingesting the data collected from Northgate's systems. Demonstrating that we have already engaged a vendor and commenced processing will help position Northgate as a proactive and cooperative litigant.

Complex technical subject matter. The underlying subject matter of this case — fiber-optic construction, critical path scheduling methodology, and analysis of non-conformance reports — is highly technical. Expert witnesses will play a critical role at trial, and meaningful expert preparation requires that the experts have the benefit of substantially completed fact discovery before preparing their opening reports. Our proposed schedule provides for opening expert reports on March 31, 2025, which allows the experts approximately two months following the close of fact depositions to review transcripts and exhibits and prepare their reports.

Expert engagement timeline. Our construction and delay expert, Dr. Elinor Chazen of Lakeview Consulting Group LLC in Chicago, has been retained as of October 15, 2024. Dr. Chazen's engagement includes a review of the Tarrant Data Systems scheduling files, an independent critical path analysis, and an assessment of the 43 critical NCRs. Our damages expert, Professor Gordon Whitfield of Pinnacle Economics LLC in New York, is expected to be formally engaged by November 1, 2024. Professor Whitfield will rebut Meridian's lost-profits model and quantify Northgate's counterclaim damages. Both experts will need adequate time to conduct their analyses, and our proposed schedule accounts for this.

International deposition logistics. Helena Bright, NFA's Chief Financial Officer, is based at Northgate's London headquarters at 14 Cavendish Square, London W1G 0BX. Her deposition will need to be taken by commission under CPLR 3108, which requires advance planning and coordination with London solicitors. We have proposed completing fact depositions by March 15, 2025, which provides sufficient time to arrange the commission in London.

Multi-jurisdictional third-party discovery. The project footprint spans seven states. We anticipate the need to issue third-party subpoenas to subcontractors and municipal permitting authorities across multiple jurisdictions. Some of these subpoenas may need to be domesticated through the Uniform Interstate Depositions and discovery Act or similar mechanisms, which adds time to the process. The proposed schedule allows adequate time for third-party compliance with subpoenas.

C. Anticipated HDS Position and Our Response

Based on our initial interactions with Mr. Deluca and our understanding of his litigation style, we anticipate the following positions from HDS at the conference and recommend the following responses:

Early deposition start. HDS is likely to push for depositions to begin as early as October 2024. We should resist this proposal as premature. Depositions taken before any meaningful document production has occurred are inefficient and often need to be supplemented or re-noticed. Our position is that fact depositions should begin in November 2024, after the initial rolling productions have commenced and the parties have had the opportunity to review at least a threshold set of key documents. This is consistent with the general practice in the Commercial Division, where depositions are typically scheduled to follow, not precede, the initial production of documents.

Compressed expert report schedule. HDS may seek to compress the expert report schedule — for example, by proposing opening reports in February 2025 rather than March 2025, or by shortening the rebuttal period from 45 days to 30 days. We should argue that the complexity of the technical issues in this case — including the critical path analysis, the NCR review, and the damages modeling — warrants a full expert preparation timeline. Thirty days is insufficient for a meaningful rebuttal in a case of this magnitude.

Earlier trial date. HDS may request a trial date in early fall 2025 or even summer 2025. Our position is that November 2025 is a reasonable and realistic trial date given the scope of the case. We should emphasize that an earlier trial date would risk compromising the quality of expert discovery and would leave insufficient time for any dispositive motion practice.

Fallback position. If Justice Ricci pushes for a faster pace than our proposed schedule — which is possible, given the Commercial Division's emphasis on efficient case management — our fallback position is as follows: agree to begin fact depositions in November 2024, provided that both parties commit to producing core documents (defined as documents responsive to the first set of document requests, from priority custodians) by mid-October on a rolling basis. We can agree to this provided that the rolling production obligation is reciprocal. We should not agree to a trial date earlier than September 2025 under any circumstances.

IV. ANTICIPATED DISCOVERY DISPUTES AND POSITIONS

A. Scope of Document discovery

The following are the principal areas where we anticipate disputes regarding the scope of document discovery. For each, I have set forth the likely HDS position and our recommended response.

1. Northgate's Internal Financial Models and Board Presentations

A central theme of Meridian's case is its "pretext theory" — the allegation that NFA's termination for cause was pretextual and that Northgate's true motivation was to bring fiber-optic construction in-house or to re-procure the work at a lower cost following favorable shifts in the construction materials market. Meridian alleges in its Verified Complaint (at ¶¶ 87-94) that construction input costs (including conduit, fiber, and labor) declined by approximately 15-20% between mid-2022 and early 2024, and that Northgate saw an opportunity to terminate the MCA and re-procure the work at these lower market rates.

In support of this theory, HDS will likely seek broad discovery of Northgate's internal financial models, strategic planning documents, capital expenditure analyses, and board-level presentations regarding in-house fiber construction capabilities, alternative contractor evaluations, and market pricing analyses. We expect HDS document requests to target materials created by Northgate's corporate strategy group, network planning team, and senior leadership, including presentations to Northgate's board of directors.

Our Position: We should resist overbroad requests for Northgate's internal strategic planning documents that are unrelated to the MCA or the termination decision. Documents reflecting internal discussions about the fiber build-out program generally may be relevant, but requests extending to Northgate's broader corporate strategy are disproportionate and unduly burdensome. More importantly, many of the key documents in this category are likely to be protected by the attorney-client privilege and/or the work product doctrine. Dominic Hale, Northgate's General Counsel, was closely involved in the termination analysis, and a significant number of the internal communications and memoranda regarding the termination decision reflect legal advice from Hale or from outside counsel (including our firm's predecessor counsel, Morton & Greenfield LLP). We anticipate logging a substantial number of privileged documents and should prepare a detailed privilege log to be produced concurrently with our document production.

It is important to note, however, that the distinction between legal advice and business communications will require careful review. Not all communications involving Hale will be privileged — only those in which Hale was providing or seeking legal advice in his capacity as counsel. Communications in which Hale was acting in a business capacity (e.g., participating in operational meetings about the construction program) may not be protected. We will need to conduct a thorough privilege review with appropriate guidance to the document review team.

We should propose at the conference that any privilege disputes be resolved through a structured meet-and-confer process in the first instance, followed by letter motion practice if the parties are unable to reach agreement. This approach is consistent with Justice Ricci's known preference for resolving discovery disputes without full-blown motion practice where possible.

2. Meridian-Ridgepoint Capital Communications

Ridgepoint Capital Group LP, a private equity fund based in Dallas, Texas (Managing Partner: Graham Latimer), holds a 55% equity interest in Meridian. Based on information obtained through Meridian's discovery responses to date and publicly available information, Ridgepoint is funding the litigation, with an estimated litigation budget of approximately $12 million.

Our Position: Communications between Meridian and Ridgepoint regarding the Northgate contract, Meridian's financial condition, and the litigation strategy are discoverable as relevant to Meridian's claims and defenses. Ridgepoint's involvement in key business decisions — including decisions related to the MCA, the cure process, the corrective action plan, and the decision to initiate litigation — is directly relevant to the issues in this case.

We anticipate that Meridian will assert common interest privilege over communications between Meridian and Ridgepoint, particularly those that post-date the termination and relate to the litigation. However, Ridgepoint's interest in these communications is fundamentally financial and investment-related, not legal. The common interest doctrine requires that the parties share a common legal interest, not merely a common commercial or financial interest. To our knowledge, no formal joint defense agreement or common interest agreement exists between Meridian and Ridgepoint. Absent such an agreement, and absent a showing that the communications were made for the purpose of obtaining or providing legal advice in connection with a shared legal interest, the common interest privilege should not apply.

We recommend including specific document requests targeting Ridgepoint communications in our first set of discovery demands and should be prepared to litigate this issue if Meridian resists production.

3. Subcontractor and Third-Party Documents

We anticipate issuing subpoenas duces tecum to at least seven of Meridian's subcontractors who performed work under the MCA. These subcontractors possess records that are relevant to the quality of work performed, the causes of delay, and the accuracy of Meridian's progress reporting. In addition, we anticipate issuing subpoenas to three municipal permitting authorities in jurisdictions where Meridian alleges that permitting delays contributed to schedule overruns. The identity of these authorities will be finalized after we have reviewed Meridian's document production, but we expect they will include authorities in New York, Connecticut, and Pennsylvania.

We should raise the issue of third-party subpoenas at the conference to ensure that adequate time is built into the discovery schedule for third-party compliance. Third-party witnesses and entities are not bound by the discovery schedule agreed upon between the parties, and their compliance timelines should be anticipated in the overall case management plan.

B. Electronically Stored Information (ESI) Protocol

Given the volume and complexity of the electronically stored information in this case, we should propose at the conference that the parties enter into a stipulated ESI protocol. Ideally, we would present a draft protocol at the conference and offer to finalize it within one week following the conference. The key positions we should advance in the ESI protocol are as follows:

• Production format: TIFF-plus-extracted-text format. This is the standard production format in the Commercial Division and provides the receiving party with both an image of the document and searchable text. We should resist any proposal by HDS for native-format production except with respect to specific categories of documents for which native format is necessary (e.g., spreadsheets, Tarrant Data Systems scheduling files, and databases).

• De-duplication: De-duplication at the custodian level, meaning that exact duplicate documents within a single custodian's collection will be removed, but the same document appearing in multiple custodians' collections will be produced from each custodian. This preserves the context of each custodian's file organization while avoiding the production of true duplicates.

• Clawback provision: A standard clawback provision consistent with CPLR 3103 and the parties' agreement, providing that the inadvertent production of privileged documents shall not constitute a waiver of privilege, provided that the producing party promptly notifies the receiving party upon discovery of the inadvertent production.

• Shared hosting platform: We should offer to discuss the use of Vantage Litigation Support LLC as a neutral vendor for hosting a shared review platform. This could streamline the review process and reduce costs for both parties, though we should not insist on this point if HDS has a strong preference for a different arrangement.

We recommend raising the ESI protocol at the conference and offering to circulate a proposed draft within one week for HDS's review and comment.

C. Confidentiality Stipulation

Both parties will likely seek a confidentiality order given the commercially sensitive nature of much of the information that will be exchanged in discovery. The documents at issue include Northgate's capital expenditure budgets, internal financial models, and board-level strategic planning materials; Meridian's financial condition and operating results; Ridgepoint Capital's investment data and financial analyses; and the terms of the Crestline Construction Group Inc. replacement contract. Disclosure of this information to competitors or the public could cause commercial harm to both parties.

We propose a two-tier confidentiality designation system:

• "Confidential": Information that a party in good faith believes is commercially sensitive and the disclosure of which to non-parties could cause competitive harm. Confidential information may be disclosed to the parties, their counsel, and their retained experts and consultants, but may not be disclosed to the public or to third parties not involved in the litigation.

• "Highly Confidential — Attorneys' Eyes Only" ("AEO"): Information that a party in good faith believes is extraordinarily sensitive and the disclosure of which to the opposing party's business personnel could cause significant competitive harm. AEO information may be disclosed only to outside counsel, their staff, and retained experts and consultants, but may not be disclosed to the parties' in-house personnel (with limited exceptions for designated in-house counsel who are not involved in competitive decision-making).

A draft Confidentiality Stipulation and Proposed Order has been prepared and is attached to this memorandum as Attachment B. We recommend circulating it to HDS at or shortly after the conference, with the goal of finalizing and filing the stipulation within one week.

D. Depositions

1. Number of Depositions

The Commercial Division rules do not impose an automatic limit on the number of depositions. The number and scope of depositions are within the discretion of the presiding justice. Given the complexity of this case and the number of parties and witnesses involved, we estimate that 10 to 14 fact depositions will be necessary. This is a reasonable number for a case of this scale and should not be controversial.

Our proposed witness list for fact depositions is as follows:

Northgate witnesses (to be defended):

• Renata Voss — Vice President, US Network Infrastructure. Ms. Voss was the senior Northgate executive with primary oversight responsibility for the fiber-optic build-out program. She was the principal point of contact between Northgate and Meridian at the management level and was directly involved in the issuance of the cure notices and the termination decision. She is our most important fact witness.

• Sean Calloway — Director, Construction Management. Mr. Calloway managed the day-to-day contract administration of the MCA, including the review and approval of payment applications, the issuance and tracking of non-conformance reports, and the coordination of milestone schedule reviews. He has detailed knowledge of the specific delays and quality deficiencies that formed the basis for the termination.

• Helena Bright — Chief Financial Officer. Ms. Bright was involved in financial and budget decisions related to the MCA, including the approval of capital expenditure allocations and the review of the financial analysis supporting the termination and replacement contractor selection. Her deposition will need to be taken by commission in London, as discussed in Section IV.D.2 below.

• Dominic Hale — General Counsel. We anticipate that Meridian will seek to depose Mr. Hale. Our position is to object on attorney-client privilege grounds, as discussed in Section IV.D.3 below.

Meridian witnesses (to be taken by Northgate):

• Victor Sandoval — CEO and Managing Member of Meridian. Mr. Sandoval is the principal of Meridian and was involved in all significant decisions regarding Meridian's performance under the MCA, including the response to the cure notices and the decision to file suit.

• Bridget Yeung — Chief Operating Officer. Ms. Yeung had operational oversight of Meridian's construction activities and is expected to have knowledge of the scheduling and resource allocation decisions that contributed to the delays.

• Marcus Henley — Vice President, Field Operations, Northeast Division. Mr. Henley directly supervised the field crews performing work on the Northgate project. He has first-hand knowledge of construction conditions, permitting issues, and the circumstances surrounding the non-conformance reports.

• Randall Obrecht — Chief Financial Officer. Mr. Obrecht is the appropriate witness to testify regarding Meridian's damages claims, financial condition, and the financial data underlying the lost-profits analysis.

Non-party witnesses:

• Frank DiBello — CEO, Crestline Construction Group Inc. Mr. DiBello can testify regarding the terms of the Crestline replacement contract, the scope of work assumed by Crestline, and the costs incurred to date in completing the fiber-optic build-out. His testimony is essential to supporting Northgate's excess completion costs counterclaim.

• Subcontractor witnesses: Depending on the issues that emerge during document discovery, we may seek to depose one or more of the seven subcontractors who performed work under the MCA.

• Municipal permitting officials: If Meridian's permitting-delay defense gains traction, we may need to depose officials from the relevant municipal permitting authorities to establish that any permitting delays were attributable to Meridian's own failures rather than government action.

In total, we estimate 10 to 14 fact depositions. We should present this estimate to the court at the conference and seek agreement from HDS on a reasonable deposition schedule.

2. Deposition by Commission — Helena Bright

Helena Bright is based at Northgate's London headquarters, located at 14 Cavendish Square, London W1G 0BX. Because Ms. Bright resides outside the United States, her deposition cannot be compelled by subpoena. We will need to arrange her deposition by commission under CPLR 3108, which authorizes the court to issue a commission for the taking of a deposition outside the State of New York.

We should raise this issue at the preliminary conference to ensure that the court is aware of the logistical requirements and that the discovery schedule accommodates the time needed to arrange the commission. The process typically requires coordination with London solicitors, engagement of a London venue, and compliance with any applicable requirements under the Hague Convention on the Taking of Evidence Abroad (although, as between the United States and the United Kingdom, letters rogatory are generally not required for voluntary depositions with the consent of the witness).

Our proposed date for Ms. Bright's deposition is February 2025. We should note this at the conference and secure the court's agreement that the deposition schedule will accommodate this timeline.

3. Deposition of Dominic Hale (GC) — Privilege Objection

We anticipate that Meridian will seek to notice the deposition of Dominic Hale, Northgate's General Counsel, in connection with its pretext theory. Meridian is likely to contend that Mr. Hale's involvement in the termination decision makes him a fact witness whose testimony is necessary to establish the true motivations behind the termination.

Our Position: We should object to the deposition of Mr. Hale on attorney-client privilege grounds. Mr. Hale was acting in his capacity as legal counsel in advising Northgate on the termination decision. His analysis of the contractual grounds for termination, his assessment of the legal risks associated with the termination, and his communications with Northgate's business personnel regarding the termination all constitute privileged attorney-client communications and attorney work product.

The controlling authority is the Shelton v. American Motors Corp., 805 F.2d 1323 (8th Cir. 1986), line of cases, which holds that the deposition of opposing party's counsel is disfavored absent exceptional circumstances. Under Shelton and its progeny, a party seeking to depose opposing counsel must demonstrate that: (1) no other means exist to obtain the information; (2) the information sought is relevant and non-privileged; and (3) the information is crucial to the preparation of the case. New York courts have adopted similar principles. See, e.g., Hodes & Nauser v. Nexus Anesthesia Management, 2019 WL 4197385 (Sup. Ct. N.Y. Cty. 2019).

We should raise this issue at the conference if HDS has already signaled its intent to depose Mr. Hale. If HDS has not yet raised the issue, we should reserve our objection for when the deposition is formally noticed, but we should be prepared to address it at the conference if it arises.

V. EXPERT DISCOVERY POSITIONS

A. Our Expert Team

We have retained or are in the process of retaining two testifying experts for this matter:

Dr. Elinor Chazen — Lakeview Consulting Group LLC, 200 South Wacker Drive, Suite 1400, Chicago, Illinois 60606. Dr. Chazen is our construction and delay expert. She specializes in critical path methodology analysis for large-scale infrastructure projects, with particular expertise in fiber-optic and telecommunications infrastructure. Dr. Chazen has been formally retained as of October 15, 2024. She will opine on the causes of Meridian's contractor-caused delays, the validity and significance of the 43 critical non-conformance reports, and the reasonableness of NFA's termination decision from a construction management perspective. Dr. Chazen has testified in more than 30 construction disputes in federal and state courts and before arbitration panels, and her testimony has been accepted and credited by courts in every case in which it has been offered.

Professor Gordon Whitfield — Pinnacle Economics LLC, 1700 Broadway, Suite 2200, New York, New York 10019. Professor Whitfield is our damages expert. He is a professor of applied economics at Columbia University and specializes in lost-profits analysis and telecommunications industry economics. His engagement is expected to be finalized by November 1, 2024. Professor Whitfield will rebut Meridian's lost-profits model and quantify Northgate's counterclaim damages, including liquidated damages, excess completion costs, and remediation costs. Professor Whitfield's analysis will draw on industry data regarding fiber-optic construction costs, market pricing trends, and contractor performance benchmarks.

B. Known Plaintiff Experts

Based on information obtained through pre-conference communications and publicly available engagement records, we are aware of the following experts retained or expected to be retained by Meridian:

James Ochoa, PE — Keystone Project Advisory LLC, 1500 Market Street, Suite 1200, Philadelphia, Pennsylvania 19102. Mr. Ochoa is a licensed professional engineer and construction expert. We expect him to opine on Owner-caused delay — that is, delays attributable to NFA rather than Meridian — as well as NFA's alleged responsibility for permitting delays and constructive change orders. Mr. Ochoa has significant experience in fiber-optic and telecommunications construction disputes, and his opinions are typically well-supported, though we believe our factual record will undermine his conclusions on causation.

Dr. Natalie Forster — Westbrook Valuation Services Inc., 100 Park Avenue, Suite 800, New York, New York 10017. Dr. Forster is a damages expert who specializes in lost-profits analysis and business valuation. We expect her to present the financial model supporting Meridian's $200 million claim, including the lost-profits component and the retainage and unpaid invoice claims. Dr. Forster's lost-profits methodology will likely rely on Meridian's projected profit margins on the unperformed work, which we believe are inflated and unsupported by Meridian's actual historical performance.

C. Expert discovery Schedule Positions

Our proposed expert discovery schedule is as follows:

• Opening reports: March 31, 2025. Both sides would exchange opening expert reports simultaneously on this date.

• Rebuttal reports: May 15, 2025. Both sides would exchange rebuttal expert reports simultaneously, 45 days after the opening reports.

• Expert depositions: June 2025. Expert depositions would be scheduled by agreement of the parties following service of the rebuttal reports.

We recommend simultaneous exchange of reports rather than sequential exchange (plaintiff first, defense second). Simultaneous exchange is the standard practice in the Commercial Division and prevents gamesmanship. If HDS proposes sequential reports — with Meridian serving its opening reports first and NFA serving responsive reports thereafter — we should resist. Sequential exchange would give Meridian the advantage of framing the expert issues and would allow Meridian's experts to tailor their opening reports in response to information obtained during discovery without revealing their analytical approach until after NFA's experts have committed to their opinions. Simultaneous exchange ensures a level playing field and is the more efficient approach.

If the court is inclined to order sequential reports, our fallback position is to accept sequential exchange only if NFA (as the party asserting counterclaims) is treated as the "plaintiff" on its counterclaims and is permitted to serve its counterclaim expert reports first, with Meridian responding. This would be logistically complex and further supports the argument for simultaneous exchange.

VI. SURETY AND INSURANCE CONSIDERATIONS TO NOTE

The following surety and insurance considerations are provided for background purposes. We do not anticipate the need to raise insurance issues at the preliminary conference, but these matters are relevant to overall case strategy and may arise in discovery.

Performance Bond. Ironclad Surety Group Inc. (Indianapolis, Indiana; VP Claims: Patricia Dwyer) issued Performance Bond No. ISG-2020-NE-04417 in the amount of $120 million covering Meridian's obligations under the MCA. Following the termination, Meridian filed a demand on the Ironclad bond on April 15, 2024, asserting a claimed subcontractor protection endorsement. Both Northgate and Ironclad dispute the validity of Meridian's claim under the bond. Ironclad has agreed to contribute up to $2 million toward NFA's defense costs under a reservation of rights. A tender letter from Linda Osei to Patricia Dwyer was sent on September 5, 2024, formally tendering the defense of the claims asserted by Meridian to Ironclad under the terms of the performance bond.

D&O Coverage. NFA maintains directors' and officers' liability coverage through Albion Specialty Insurance Ltd. under Policy No. ALB-DO-2023-4782. While the claims in this action are directed at NFA as an entity rather than individual officers or directors, the D&O policy may provide coverage for certain defense costs depending on the specific allegations and the policy terms.

CGL Coverage. NFA maintains commercial general liability coverage through Keystone National Insurance Company under Policy No. KNIC-CGL-2022-99301. Coverage counsel at Pemberton Fox LLP (Rachel Solomons) has been retained by the carriers and is coordinating with Calderwood & Harkness regarding coverage positions and defense cost allocation.

discovery Implications. HDS may seek discovery regarding Northgate's insurance coverage and the existence and terms of the performance bond. Our standard position is that insurance coverage is not relevant to liability and that such requests are objectionable. However, the performance bond is arguably relevant to the extent it relates to the contractual relationship between the parties and the available remedies. We should be prepared to address this issue if it arises in discovery, though we do not recommend raising it at the conference.

VII. KEY TALKING POINTS FOR THE CONFERENCE

A. Opening Statement to the Court

When Justice Ricci opens the conference, we should be prepared to deliver a concise opening statement that frames the case for the court without revealing our defense strategy in detail. The following talking points are recommended:

• This is a substantial construction dispute involving a $1.2 billion fiber-optic build-out contract — the Master Construction Agreement dated March 15, 2020 — covering approximately 18,500 route miles of underground and aerial fiber-optic cable infrastructure across seven northeastern states.

• Northgate Fiber Americas Inc. terminated Meridian Infrastructure Partners LLC for cause on April 1, 2024 after persistent and accelerating schedule delays — with individual milestones ranging from 47 to 134-plus days late — and 287 non-conformance reports, including 43 classified as critical deficiencies. The termination followed a contractual cure process that included two formal cure notices and the rejection of an inadequate corrective action plan.

• Meridian claims approximately $200 million in damages; Northgate asserts counterclaims totaling approximately $149 million.

• The case is document-intensive. Both parties anticipate producing millions of documents. The case will require two sets of testifying experts — one in construction and delay analysis, and one in damages and economics.

• This is a bench trial. The parties waived their right to a jury trial under MCA § 22.4.

• Northgate is fully prepared to proceed with discovery efficiently and proposes the schedule set forth in our Proposed Preliminary Conference Order.

B. Proposed Stipulations to Present

We should propose the filing of the following stipulations with or promptly after the conference:

1. ESI Protocol and Stipulation. To be finalized within one week of the conference. A draft has been prepared and is attached to this memorandum as Attachment C. We should offer to circulate the draft to HDS at the conference for their review and comment.

2. Confidentiality Stipulation and Proposed Order. A two-tier confidentiality designation system (Confidential and Highly Confidential — Attorneys' Eyes Only). A draft has been prepared and is attached as Attachment B. We recommend circulating it at the conference and seeking agreement to file within one week.

3. Agreed discovery Schedule. If consensus is reached at the conference, we should offer to prepare and circulate a stipulated discovery schedule for filing within 48 hours. If consensus cannot be reached on all points, we should identify the areas of agreement and present the disputed points for the court's resolution.

Presenting these materials at the conference will demonstrate to Justice Ricci that Northgate has taken the case management obligations seriously and is prepared to litigate efficiently.

C. Tone and Approach

Our overall tone and approach at the conference should be cooperative, organized, and professional. The following guidelines should be observed:

• Present as cooperative and organized at all times. Demonstrate readiness to proceed efficiently with discovery and express a genuine willingness to work with opposing counsel on procedural matters.

• Avoid telegraphing our defense theory in detail. Our factual representations to the court should be neutral and limited to what is necessary to frame the discovery issues. We should not, for example, volunteer our views on the strength of Meridian's pretext theory or our assessment of the enforceability of the liquidated damages provision. Those issues will be addressed at the appropriate time.

• Emphasize Northgate's willingness to engage in good-faith meet-and-confer on any discovery disputes before seeking court intervention. Justice Ricci has a known preference for parties to resolve discovery disputes informally before resorting to motion practice, and we should align our approach with that preference.

• If Justice Ricci asks about settlement: state that the parties have not yet engaged in formal settlement discussions. Northgate is open to discussing resolution at an appropriate time but believes that meaningful settlement negotiations are premature until discovery has progressed sufficiently to allow both parties to evaluate the merits and the exposure. We should not close the door on settlement, but we should not appear eager or anxious.

VIII. LOGISTICS

The following logistical information is provided for the conference:

Conference Location: Supreme Court of the State of New York, New York County, Commercial Division, Part 49, 60 Centre Street, New York, NY 10007.

Date and Time: October 1, 2024. The specific time has not yet been confirmed by chambers. We should confirm the time with Justice Ricci's clerk no later than September 30, 2024. Part 49 typically schedules preliminary conferences at 9:30 a.m. or 2:15 p.m.

Appearing for Defendant Northgate Fiber Americas Inc.: Linda Osei, Responsible Partner (lead); Jeffrey Park, Lead Associate (second chair).

Appearing for Plaintiff Meridian Infrastructure Partners LLC (expected): Thomas Deluca and/or Miriam Vasquez of Hargrove, Deluca & Stein LLP, 51 West 52nd Street, 40th Floor, New York, NY 10019.

Materials to bring to the conference:

• Proposed Preliminary Conference Order — prepared and ready for filing. The draft is attached to this memorandum as Attachment A and incorporates our proposed discovery schedule and case management provisions.

• Draft ESI Protocol — for discussion with the court and opposing counsel. Attached as Attachment C.

• Draft Confidentiality Stipulation and Proposed Order — for discussion with the court and opposing counsel. Attached as Attachment B.

• Copy of the filed pleadings — including the Verified Complaint (filed July 15, 2024), the Answer with Affirmative Defenses and Counterclaims (filed September 3, 2024), and Meridian's Reply to Counterclaims (filed September 18, 2024). We should bring at least two copies: one working copy and one courtesy copy for the court if requested.

• Working copy of the Master Construction Agreement dated March 15, 2020 — in case the court requests additional factual background regarding the contractual provisions at issue. The MCA is a lengthy document (approximately 340 pages, including schedules and exhibits), and we should tab the key provisions for easy reference (§§ 9.4, 9.6, 13.2, 14.1, 14.2, 14.3, 20.1, 22.1, 22.4).

IX. ACTION ITEMS FOLLOWING THE CONFERENCE

The following action items should be addressed promptly following the preliminary conference, regardless of the specific outcome of the conference discussions:

1. Finalize and file Confidentiality Stipulation and Proposed Order. Incorporate any comments from HDS and file with the court. Target: within one week of the conference.

2. Finalize and file Stipulated ESI Protocol. Incorporate any comments from HDS and file with the court. Target: within one week of the conference.

3. Serve first set of document requests and interrogatories on Meridian. Target service date: by October 8, 2024. The first set of discovery demands is substantially drafted, comprising 56 document requests and 25 interrogatories. Final review and service should be completed promptly after the conference.

4. Issue litigation hold reminders to all Northgate custodians. The initial litigation hold notice was issued on August 21, 2024, following our engagement. Reminder notices should be sent to all custodians to reinforce the preservation obligation and to identify any additional sources of potentially relevant information that may have been overlooked in the initial hold.

5. Begin document collection from identified Northgate custodians. Collection should proceed from the 10 identified custodians, beginning with the priority custodians: Renata Voss, Sean Calloway, and Helena Bright. The remaining 7 custodians should be collected on a rolling basis. Coordinate with Vantage Litigation Support LLC on ingestion and processing timelines.

6. Coordinate with Vantage Litigation Support LLC on processing and review platform setup. Ensure that the review platform is configured and ready for first-level document review by mid-October 2024. Review protocols and coding guidelines should be finalized and distributed to the review team.

7. Prepare third-party subpoenas. Draft subpoenas duces tecum to the 7 identified subcontractors and 3 municipal permitting authorities. Target issuance: by October 20, 2024. For subcontractors located outside New York, determine whether domestication under the Uniform Interstate Depositions and discovery Act will be required.

8. Confirm expert engagements. Dr. Elinor Chazen has been retained as of October 15, 2024. Finalize the engagement of Professor Gordon Whitfield by November 1, 2024. Ensure that both experts are provided with the pleadings, the MCA, and initial sets of key documents as soon as practicable.

9. Send scheduling emails to HDS for fact depositions. Target: initial scheduling communications for the first tranche of fact depositions (November through December 2024), beginning with Meridian's witnesses Victor Sandoval, Bridget Yeung, Marcus Henley, and Randall Obrecht.

X. ATTACHMENTS

The following materials are attached to this memorandum for reference and use in connection with the preliminary conference:

• Attachment A: Draft Proposed Preliminary Conference Order

• Attachment B: Draft Confidentiality Stipulation and Proposed Order

• Attachment C: Draft ESI Protocol

• Attachment D: Proposed discovery Schedule (chart form)

• Attachment E: Current Case Docket Summary (Index No. 654321/2024)

This memorandum is privileged and confidential attorney work product prepared in anticipation of litigation. It is intended solely for the use of Calderwood & Harkness LLP personnel working on Matter No. 1022-00005. Do not distribute, copy, or forward without authorization from the Responsible Partner.

Phase	Proposed Date	Notes
Document demands and interrogatories served	Within 10 days of conference (by October 11, 2024)	We plan to serve on approximately October 8, 2024
Document production (initial)	December 15, 2024	Rolling productions to begin November 1, 2024
Document production (substantial completion)	January 31, 2025	Third-party subpoena responses expected on similar timeline
Fact depositions (begin)	November 2024	Propose November through early March window
Fact depositions (completion)	March 15, 2025	Must accommodate London commission for Helena Bright
Expert reports (opening)	March 31, 2025	Consistent with our expert engagement timeline
Expert rebuttal reports	May 15, 2025	Standard 45-day rebuttal period
Expert depositions	June 2025	To be scheduled after rebuttal reports are served
Dispositive motions	August 2025	If applicable
Trial	November 2025	6-week window

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
This memorandum is protected by the attorney-client privilege and the work product doctrine. It is intended solely for the use of Calderwood & Harkness LLP attorneys and staff working on the referenced matter. Any unauthorized disclosure, copying, or distribution is strictly prohibited.
CALDERWOOD & HARKNESS LLP 425 Park Avenue, 33rd Floor New York, NY 10022
MEMORANDUM
TO: Linda Osei, Responsible Partner
FROM: Jeffrey Park, Lead Associate
DATE: September 27, 2024
RE: Preparation for Preliminary Conference — Meridian Infrastructure Partners LLC v. Northgate Fiber Americas Inc., Index No. 654321/2024, Supreme Court of the State of New York, New York County, Commercial Division, Part 49
MATTER NO.: 1022-00005
CONFERENCE DATE: October 1, 2024, before Hon. Eleanor M. Ricci
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I. PURPOSE AND SUMMARY
This memorandum is prepared to assist you in preparing for the preliminary conference before the Honorable Eleanor M. Ricci, scheduled for October 1, 2024, in the above-captioned matter. The conference will address the discovery schedule, case management procedures, anticipated discovery disputes, and the path toward trial. This memorandum provides a comprehensive overview of the case, our recommended positions on all issues likely to arise at the conference, and detailed logistical information to ensure our team is fully prepared.
By way of background, Meridian Infrastructure Partners LLC ("Meridian" or "Plaintiff") filed its Verified Complaint on July 15, 2024, asserting four causes of action arising from the termination for cause of the Master Construction Agreement dated March 15, 2020 (the "MCA"). Service was effected on Northgate Fiber Americas Inc. ("NFA" or "Northgate" or "Defendant") on August 5, 2024. Calderwood & Harkness LLP was formally engaged by Northgate on August 19, 2024, following an initial consultation with Northgate's General Counsel, Dominic Hale, and its outside coverage counsel at Pemberton Fox LLP. Our firm filed the Answer with Affirmative Defenses and Counterclaims on September 3, 2024, and Meridian filed its Reply to the Counterclaims on September 18, 2024.
The pleadings are now closed. The case is ripe for discovery scheduling, and the preliminary conference will serve as the primary vehicle for establishing the framework within which this litigation will proceed through discovery to trial.
Opposing counsel in this matter is Thomas Deluca and Miriam Vasquez of Hargrove, Deluca & Stein LLP ("HDS"), located at 51 West 52nd Street, 40th Floor, New York, NY 10019. We have had brief introductory communications with Mr. Deluca regarding scheduling and procedural matters, though substantive discussions regarding the scope and timing of discovery have not yet occurred.
The total amount in controversy is substantial. Meridian's Verified Complaint seeks approximately $200 million in damages across its four causes of action. Northgate's counterclaims total approximately $149 million, encompassing liquidated damages, excess completion costs, and remediation expenses. This case thus involves total claims and counterclaims in excess of $349 million.
As a general matter, we anticipate that HDS may press for an aggressive discovery schedule at the conference. This approach would be consistent with Mr. Deluca's reputation as a litigator who favors early depositions and compressed timelines. Our position should balance thoroughness with avoiding unnecessary delay. We want to demonstrate to Justice Ricci that Northgate is prepared to litigate this case efficiently and in a manner fully consistent with the Commercial Division's expectations for efficient case management under Rule 8 of the Rules of the Commercial Division and the Part 49 practice rules. At the same time, the scale and complexity of this matter — a $1.2 billion multi-state construction program generating millions of pages of documents — requires a realistic schedule that allows for meaningful discovery.
II. CASE OVERVIEW FOR THE COURT
The following sections provide a concise summary of the case, the claims and defenses, and the key factual context. This material will be useful both for framing our oral presentation at the conference and for responding to any questions from Justice Ricci about the nature and complexity of the dispute.
A. Nature of the Action
This is a breach-of-contract dispute arising from NFA's termination for cause, effective April 1, 2024, of the Master Construction Agreement dated March 15, 2020 (the "MCA") between NFA and Meridian. The MCA governed a $1.2 billion fiber-optic build-out program across seven northeastern states: New York, New Jersey, Connecticut, Massachusetts, Pennsylvania, Maryland, and Virginia.
The scope of work under the MCA encompassed the design, engineering, permitting, and construction of approximately 18,500 route miles of underground and aerial fiber-optic cable infrastructure. This was one of the largest privately funded fiber-optic infrastructure programs in the northeastern United States and represented a critical component of Northgate's commercial broadband strategy.
The contract term was five years from the Notice to Proceed, which was issued on April 1, 2020. The original completion date under the MCA was March 31, 2025. The MCA was structured in multiple phases, with each phase corresponding to defined geographic regions and distinct milestone schedules.
The governing law provision at MCA § 22.1 designates New York law as controlling. Importantly, the parties' jury trial waiver at MCA § 22.4 means that this case will proceed to a bench trial before Justice Ricci (or such other justice as may be assigned). This has implications for both our trial preparation strategy and the nature of the factual presentations we will need to make.
B. Plaintiff's Claims ($200 Million)
Meridian's Verified Complaint asserts four causes of action, which collectively seek approximately $200 million in damages:
Count I: Breach of Contract — Wrongful Termination ($92.4 million). Meridian alleges that NFA's termination for cause on April 1, 2024 was wrongful and that the purported grounds for termination — schedule delays and non-conforming work — were pretextual. Meridian asserts that any delays were attributable to NFA's own conduct, including alleged failures to secure or facilitate right-of-way access, changes in project specifications, and interference with Meridian's permitting efforts. Meridian seeks a termination fee of $50,424,000 under MCA § 14.3, which it contends would apply in the event of a wrongful termination for cause (i.e., effectively converting the termination into a termination for convenience). Meridian also seeks lost profits of $41,976,000, representing the anticipated profit margin on the unperformed balance of the MCA.
Count II: Breach of Contract — Unpaid Invoices ($16.5 million). Meridian alleges that NFA failed to pay Phase 3 payment applications submitted between January and March 2024 in the aggregate amount of $16.5 million. NFA disputes these invoices on the grounds that the underlying work was deficient and subject to pending non-conformance reports, and that NFA was contractually entitled to withhold payment under MCA § 9.4 pending resolution of non-conforming work.
Count III: Breach of Contract — Wrongful Withholding of Retainage ($56,966,667). Meridian alleges that NFA has wrongfully withheld retainage in the amount of $56,966,667. Under MCA § 9.6, retainage of ten percent (10%) was withheld from each progress payment. Meridian contends that it is entitled to full release of retainage. NFA's position is that retainage is subject to set-off under the counterclaims and that the conditions for release of retainage under MCA § 9.6(c) — including satisfactory completion of work and resolution of all outstanding non-conformance reports — have not been met.
Count IV: Breach of Implied Covenant of Good Faith and Fair Dealing ($34,133,333). Meridian alleges that NFA's course of conduct — including alleged interference with Meridian's operations, bad-faith issuance of non-conformance reports, and pretextual termination — constituted a breach of the implied covenant of good faith and fair dealing. Meridian seeks damages for loss of bonding capacity, reputational harm in the construction industry, and consequential economic losses. NFA's position is that this claim is duplicative of the breach of contract claims and is independently barred by the consequential damages waiver at MCA § 20.1.
C. Defendant's Defenses and Counterclaims ($149 Million)
NFA has asserted the following affirmative defenses and counterclaims:
Affirmative Defenses. NFA's Answer pleads the following affirmative defenses, among others: (1) the termination for cause was justified under MCA § 14.1 based on Meridian's material breach of the MCA through persistent schedule delays and non-conforming work; (2) the consequential damages waiver at MCA § 20.1 bars Meridian's claims for lost profits, loss of bonding capacity, and reputational harm; (3) Meridian failed to mitigate its damages by, among other things, failing to pursue available work with other clients following the termination; (4) comparative fault, to the extent Meridian's own acts and omissions contributed to the delays and defects; and (5) set-off of any amounts owed to Meridian against the amounts owed to NFA under the counterclaims.
Counterclaims. Counterclaim I: Liquidated Damages — $49 million. Under MCA § 13.2, Meridian agreed to liquidated damages for failure to achieve contractual milestones on time. NFA seeks liquidated damages of $8,225,000 for Phase 1 delays and $40,775,000 for Phase 2 delays, for a total of $49,000,000. This total falls below the aggregate liquidated damages cap of $60,000,000 set forth in MCA § 13.2(d). The liquidated damages provision was negotiated at arm's length and reflects a genuine pre-estimate of damages that would be difficult to quantify precisely — we believe it is enforceable under New York law.
Counterclaim II: Excess Completion Costs — $81.7 million. Following the termination for cause, NFA engaged Crestline Construction Group Inc. ("Crestline") as the replacement contractor to complete the remaining scope of work under a new contract with a value of $712 million. The remaining unperformed value of the MCA at the time of termination was $630.3 million. NFA seeks the difference — $81.7 million — as excess completion costs. Under MCA § 14.2(b), the terminated contractor is liable for all costs incurred by the Owner in excess of what would have been paid under the original contract to complete the work.
Counterclaim III: Cost of Remediation of Defective Work — $18.3 million. NFA seeks the cost to remediate defective work identified in 287 non-conformance reports ("NCRs") issued during the course of Meridian's performance. Of these 287 NCRs, 43 were classified as "critical" deficiencies, with an average remediation cost of approximately $275,000 per NCR, and 244 were classified as "non-critical" deficiencies, with an average remediation cost of approximately $26,500 per NCR. The total remediation cost is estimated at $18.3 million. This estimate has been developed by our construction management team and will be supported by expert testimony at trial.
D. Key Factual Context for the Court
The following factual summary provides the essential context for understanding both the claims and the anticipated discovery needs:
At the time of termination on April 1, 2024, approximately 9,140 of the 18,500 route miles contemplated under the MCA (49.4%) had been constructed. Total payments made by NFA to Meridian over the life of the contract amounted to $512.7 million. Retainage held by NFA totaled $56,966,667.
Meridian's schedule performance deteriorated progressively over the life of the contract. Milestone 3 was achieved 47 days late. Milestone 5 was achieved 22 days late. Milestone 6 was achieved 68 days late. Milestone 7 was achieved 91 days late. Milestone 8, which was never completed, had accrued delays in excess of 134 days at the time of termination. This pattern of accelerating delay was a central factor in NFA's decision to terminate.
In addition to the schedule delays, the quality of Meridian's work was a significant concern. A total of 287 non-conformance reports were issued over the life of the contract, including 43 NCRs classified as "critical" — meaning they identified defects that posed a risk to the structural integrity or operational capacity of the fiber-optic infrastructure.
NFA followed the contractual cure process before exercising its termination right. Cure Notice No. 1 was issued on January 18, 2024, identifying specific schedule and quality deficiencies and providing Meridian with a 30-day cure period. When Meridian failed to cure, Cure Notice No. 2 was issued on February 19, 2024, providing an additional cure period and requesting submission of a comprehensive corrective action plan. Meridian submitted a Corrective Action Plan on March 5, 2024. NFA reviewed the plan, determined that it was inadequate to address the identified deficiencies, and rejected it on March 12, 2024. The Termination for Cause was issued on April 1, 2024, effective immediately.
The sufficiency of the cure notices, the reasonableness of NFA's rejection of the Corrective Action Plan, and the bona fides of NFA's termination decision will be central factual issues at trial. These factual issues will also drive the scope and focus of discovery.
III. PROPOSED DISCOVERY SCHEDULE — OUR POSITION
A. Recommended Timeline
Set forth below is our proposed discovery schedule, which we recommend presenting to the court as NFA's position. We should be prepared to negotiate around HDS's likely counter-proposals, and I have addressed our anticipated areas of disagreement and fallback positions in Section III.C below.
This proposed schedule contemplates approximately thirteen months from the preliminary conference to the commencement of trial. While this may appear to be a long timeline on its face, we believe it is warranted by the scale and complexity of the dispute, and is consistent with the timelines typically adopted in Commercial Division construction cases of this magnitude.
B. Rationale for Our Proposed Timeline
Several factors support the reasonableness of our proposed schedule and should be communicated to the court:
Volume of documents. This case will involve massive document discovery. Based on our preliminary assessment, Northgate's document collection is estimated at approximately 1.4 million documents, comprising approximately 3.2 terabytes of data, drawn from 10 identified custodians. Meridian's document collection is expected to be of a similar order of magnitude — we estimate approximately 890,000 documents comprising 1.8 terabytes from at least 8 custodians, as later confirmed in pre-conference communications with HDS. The documents include construction drawings, engineering specifications, daily construction reports, project management correspondence, change order requests, non-conformance reports, scheduling files (including Tarrant Data Systems project files), payment applications, financial records, and corporate governance materials. The sheer volume necessitates a structured rolling production schedule with realistic deadlines.
E-discovery vendor engagement. We have already taken steps to ensure that Northgate is prepared to proceed efficiently with document production. We engaged Vantage Litigation Support LLC, located at 300 Vesey Street, Suite 600, New York, NY 10282, as our e-discovery vendor. Vantage is currently processing and ingesting the data collected from Northgate's systems. Demonstrating that we have already engaged a vendor and commenced processing will help position Northgate as a proactive and cooperative litigant.
Complex technical subject matter. The underlying subject matter of this case — fiber-optic construction, critical path scheduling methodology, and analysis of non-conformance reports — is highly technical. Expert witnesses will play a critical role at trial, and meaningful expert preparation requires that the experts have the benefit of substantially completed fact discovery before preparing their opening reports. Our proposed schedule provides for opening expert reports on March 31, 2025, which allows the experts approximately two months following the close of fact depositions to review transcripts and exhibits and prepare their reports.
Expert engagement timeline. Our construction and delay expert, Dr. Elinor Chazen of Lakeview Consulting Group LLC in Chicago, has been retained as of October 15, 2024. Dr. Chazen's engagement includes a review of the Tarrant Data Systems scheduling files, an independent critical path analysis, and an assessment of the 43 critical NCRs. Our damages expert, Professor Gordon Whitfield of Pinnacle Economics LLC in New York, is expected to be formally engaged by November 1, 2024. Professor Whitfield will rebut Meridian's lost-profits model and quantify Northgate's counterclaim damages. Both experts will need adequate time to conduct their analyses, and our proposed schedule accounts for this.
International deposition logistics. Helena Bright, NFA's Chief Financial Officer, is based at Northgate's London headquarters at 14 Cavendish Square, London W1G 0BX. Her deposition will need to be taken by commission under CPLR 3108, which requires advance planning and coordination with London solicitors. We have proposed completing fact depositions by March 15, 2025, which provides sufficient time to arrange the commission in London.
Multi-jurisdictional third-party discovery. The project footprint spans seven states. We anticipate the need to issue third-party subpoenas to subcontractors and municipal permitting authorities across multiple jurisdictions. Some of these subpoenas may need to be domesticated through the Uniform Interstate Depositions and discovery Act or similar mechanisms, which adds time to the process. The proposed schedule allows adequate time for third-party compliance with subpoenas.
C. Anticipated HDS Position and Our Response
Based on our initial interactions with Mr. Deluca and our understanding of his litigation style, we anticipate the following positions from HDS at the conference and recommend the following responses:
Early deposition start. HDS is likely to push for depositions to begin as early as October 2024. We should resist this proposal as premature. Depositions taken before any meaningful document production has occurred are inefficient and often need to be supplemented or re-noticed. Our position is that fact depositions should begin in November 2024, after the initial rolling productions have commenced and the parties have had the opportunity to review at least a threshold set of key documents. This is consistent with the general practice in the Commercial Division, where depositions are typically scheduled to follow, not precede, the initial production of documents.
Compressed expert report schedule. HDS may seek to compress the expert report schedule — for example, by proposing opening reports in February 2025 rather than March 2025, or by shortening the rebuttal period from 45 days to 30 days. We should argue that the complexity of the technical issues in this case — including the critical path analysis, the NCR review, and the damages modeling — warrants a full expert preparation timeline. Thirty days is insufficient for a meaningful rebuttal in a case of this magnitude.
Earlier trial date. HDS may request a trial date in early fall 2025 or even summer 2025. Our position is that November 2025 is a reasonable and realistic trial date given the scope of the case. We should emphasize that an earlier trial date would risk compromising the quality of expert discovery and would leave insufficient time for any dispositive motion practice.
Fallback position. If Justice Ricci pushes for a faster pace than our proposed schedule — which is possible, given the Commercial Division's emphasis on efficient case management — our fallback position is as follows: agree to begin fact depositions in November 2024, provided that both parties commit to producing core documents (defined as documents responsive to the first set of document requests, from priority custodians) by mid-October on a rolling basis. We can agree to this provided that the rolling production obligation is reciprocal. We should not agree to a trial date earlier than September 2025 under any circumstances.
IV. ANTICIPATED DISCOVERY DISPUTES AND POSITIONS
A. Scope of Document discovery
The following are the principal areas where we anticipate disputes regarding the scope of document discovery. For each, I have set forth the likely HDS position and our recommended response.
1. Northgate's Internal Financial Models and Board Presentations
A central theme of Meridian's case is its "pretext theory" — the allegation that NFA's termination for cause was pretextual and that Northgate's true motivation was to bring fiber-optic construction in-house or to re-procure the work at a lower cost following favorable shifts in the construction materials market. Meridian alleges in its Verified Complaint (at ¶¶ 87-94) that construction input costs (including conduit, fiber, and labor) declined by approximately 15-20% between mid-2022 and early 2024, and that Northgate saw an opportunity to terminate the MCA and re-procure the work at these lower market rates.
In support of this theory, HDS will likely seek broad discovery of Northgate's internal financial models, strategic planning documents, capital expenditure analyses, and board-level presentations regarding in-house fiber construction capabilities, alternative contractor evaluations, and market pricing analyses. We expect HDS document requests to target materials created by Northgate's corporate strategy group, network planning team, and senior leadership, including presentations to Northgate's board of directors.
Our Position: We should resist overbroad requests for Northgate's internal strategic planning documents that are unrelated to the MCA or the termination decision. Documents reflecting internal discussions about the fiber build-out program generally may be relevant, but requests extending to Northgate's broader corporate strategy are disproportionate and unduly burdensome. More importantly, many of the key documents in this category are likely to be protected by the attorney-client privilege and/or the work product doctrine. Dominic Hale, Northgate's General Counsel, was closely involved in the termination analysis, and a significant number of the internal communications and memoranda regarding the termination decision reflect legal advice from Hale or from outside counsel (including our firm's predecessor counsel, Morton & Greenfield LLP). We anticipate logging a substantial number of privileged documents and should prepare a detailed privilege log to be produced concurrently with our document production.
It is important to note, however, that the distinction between legal advice and business communications will require careful review. Not all communications involving Hale will be privileged — only those in which Hale was providing or seeking legal advice in his capacity as counsel. Communications in which Hale was acting in a business capacity (e.g., participating in operational meetings about the construction program) may not be protected. We will need to conduct a thorough privilege review with appropriate guidance to the document review team.
We should propose at the conference that any privilege disputes be resolved through a structured meet-and-confer process in the first instance, followed by letter motion practice if the parties are unable to reach agreement. This approach is consistent with Justice Ricci's known preference for resolving discovery disputes without full-blown motion practice where possible.
2. Meridian-Ridgepoint Capital Communications
Ridgepoint Capital Group LP, a private equity fund based in Dallas, Texas (Managing Partner: Graham Latimer), holds a 55% equity interest in Meridian. Based on information obtained through Meridian's discovery responses to date and publicly available information, Ridgepoint is funding the litigation, with an estimated litigation budget of approximately $12 million.
Our Position: Communications between Meridian and Ridgepoint regarding the Northgate contract, Meridian's financial condition, and the litigation strategy are discoverable as relevant to Meridian's claims and defenses. Ridgepoint's involvement in key business decisions — including decisions related to the MCA, the cure process, the corrective action plan, and the decision to initiate litigation — is directly relevant to the issues in this case.
We anticipate that Meridian will assert common interest privilege over communications between Meridian and Ridgepoint, particularly those that post-date the termination and relate to the litigation. However, Ridgepoint's interest in these communications is fundamentally financial and investment-related, not legal. The common interest doctrine requires that the parties share a common legal interest, not merely a common commercial or financial interest. To our knowledge, no formal joint defense agreement or common interest agreement exists between Meridian and Ridgepoint. Absent such an agreement, and absent a showing that the communications were made for the purpose of obtaining or providing legal advice in connection with a shared legal interest, the common interest privilege should not apply.
We recommend including specific document requests targeting Ridgepoint communications in our first set of discovery demands and should be prepared to litigate this issue if Meridian resists production.
3. Subcontractor and Third-Party Documents
We anticipate issuing subpoenas duces tecum to at least seven of Meridian's subcontractors who performed work under the MCA. These subcontractors possess records that are relevant to the quality of work performed, the causes of delay, and the accuracy of Meridian's progress reporting. In addition, we anticipate issuing subpoenas to three municipal permitting authorities in jurisdictions where Meridian alleges that permitting delays contributed to schedule overruns. The identity of these authorities will be finalized after we have reviewed Meridian's document production, but we expect they will include authorities in New York, Connecticut, and Pennsylvania.
We should raise the issue of third-party subpoenas at the conference to ensure that adequate time is built into the discovery schedule for third-party compliance. Third-party witnesses and entities are not bound by the discovery schedule agreed upon between the parties, and their compliance timelines should be anticipated in the overall case management plan.
B. Electronically Stored Information (ESI) Protocol
Given the volume and complexity of the electronically stored information in this case, we should propose at the conference that the parties enter into a stipulated ESI protocol. Ideally, we would present a draft protocol at the conference and offer to finalize it within one week following the conference. The key positions we should advance in the ESI protocol are as follows:
• Production format: TIFF-plus-extracted-text format. This is the standard production format in the Commercial Division and provides the receiving party with both an image of the document and searchable text. We should resist any proposal by HDS for native-format production except with respect to specific categories of documents for which native format is necessary (e.g., spreadsheets, Tarrant Data Systems scheduling files, and databases).
• De-duplication: De-duplication at the custodian level, meaning that exact duplicate documents within a single custodian's collection will be removed, but the same document appearing in multiple custodians' collections will be produced from each custodian. This preserves the context of each custodian's file organization while avoiding the production of true duplicates.
• Clawback provision: A standard clawback provision consistent with CPLR 3103 and the parties' agreement, providing that the inadvertent production of privileged documents shall not constitute a waiver of privilege, provided that the producing party promptly notifies the receiving party upon discovery of the inadvertent production.
• Shared hosting platform: We should offer to discuss the use of Vantage Litigation Support LLC as a neutral vendor for hosting a shared review platform. This could streamline the review process and reduce costs for both parties, though we should not insist on this point if HDS has a strong preference for a different arrangement.
We recommend raising the ESI protocol at the conference and offering to circulate a proposed draft within one week for HDS's review and comment.
C. Confidentiality Stipulation
Both parties will likely seek a confidentiality order given the commercially sensitive nature of much of the information that will be exchanged in discovery. The documents at issue include Northgate's capital expenditure budgets, internal financial models, and board-level strategic planning materials; Meridian's financial condition and operating results; Ridgepoint Capital's investment data and financial analyses; and the terms of the Crestline Construction Group Inc. replacement contract. Disclosure of this information to competitors or the public could cause commercial harm to both parties.
We propose a two-tier confidentiality designation system:
• "Confidential": Information that a party in good faith believes is commercially sensitive and the disclosure of which to non-parties could cause competitive harm. Confidential information may be disclosed to the parties, their counsel, and their retained experts and consultants, but may not be disclosed to the public or to third parties not involved in the litigation.
• "Highly Confidential — Attorneys' Eyes Only" ("AEO"): Information that a party in good faith believes is extraordinarily sensitive and the disclosure of which to the opposing party's business personnel could cause significant competitive harm. AEO information may be disclosed only to outside counsel, their staff, and retained experts and consultants, but may not be disclosed to the parties' in-house personnel (with limited exceptions for designated in-house counsel who are not involved in competitive decision-making).
A draft Confidentiality Stipulation and Proposed Order has been prepared and is attached to this memorandum as Attachment B. We recommend circulating it to HDS at or shortly after the conference, with the goal of finalizing and filing the stipulation within one week.
D. Depositions
1. Number of Depositions
The Commercial Division rules do not impose an automatic limit on the number of depositions. The number and scope of depositions are within the discretion of the presiding justice. Given the complexity of this case and the number of parties and witnesses involved, we estimate that 10 to 14 fact depositions will be necessary. This is a reasonable number for a case of this scale and should not be controversial.
Our proposed witness list for fact depositions is as follows:
Northgate witnesses (to be defended):
• Renata Voss — Vice President, US Network Infrastructure. Ms. Voss was the senior Northgate executive with primary oversight responsibility for the fiber-optic build-out program. She was the principal point of contact between Northgate and Meridian at the management level and was directly involved in the issuance of the cure notices and the termination decision. She is our most important fact witness.
• Sean Calloway — Director, Construction Management. Mr. Calloway managed the day-to-day contract administration of the MCA, including the review and approval of payment applications, the issuance and tracking of non-conformance reports, and the coordination of milestone schedule reviews. He has detailed knowledge of the specific delays and quality deficiencies that formed the basis for the termination.
• Helena Bright — Chief Financial Officer. Ms. Bright was involved in financial and budget decisions related to the MCA, including the approval of capital expenditure allocations and the review of the financial analysis supporting the termination and replacement contractor selection. Her deposition will need to be taken by commission in London, as discussed in Section IV.D.2 below.
• Dominic Hale — General Counsel. We anticipate that Meridian will seek to depose Mr. Hale. Our position is to object on attorney-client privilege grounds, as discussed in Section IV.D.3 below.
Meridian witnesses (to be taken by Northgate):
• Victor Sandoval — CEO and Managing Member of Meridian. Mr. Sandoval is the principal of Meridian and was involved in all significant decisions regarding Meridian's performance under the MCA, including the response to the cure notices and the decision to file suit.
• Bridget Yeung — Chief Operating Officer. Ms. Yeung had operational oversight of Meridian's construction activities and is expected to have knowledge of the scheduling and resource allocation decisions that contributed to the delays.
• Marcus Henley — Vice President, Field Operations, Northeast Division. Mr. Henley directly supervised the field crews performing work on the Northgate project. He has first-hand knowledge of construction conditions, permitting issues, and the circumstances surrounding the non-conformance reports.
• Randall Obrecht — Chief Financial Officer. Mr. Obrecht is the appropriate witness to testify regarding Meridian's damages claims, financial condition, and the financial data underlying the lost-profits analysis.
Non-party witnesses:
• Frank DiBello — CEO, Crestline Construction Group Inc. Mr. DiBello can testify regarding the terms of the Crestline replacement contract, the scope of work assumed by Crestline, and the costs incurred to date in completing the fiber-optic build-out. His testimony is essential to supporting Northgate's excess completion costs counterclaim.
• Subcontractor witnesses: Depending on the issues that emerge during document discovery, we may seek to depose one or more of the seven subcontractors who performed work under the MCA.
• Municipal permitting officials: If Meridian's permitting-delay defense gains traction, we may need to depose officials from the relevant municipal permitting authorities to establish that any permitting delays were attributable to Meridian's own failures rather than government action.
In total, we estimate 10 to 14 fact depositions. We should present this estimate to the court at the conference and seek agreement from HDS on a reasonable deposition schedule.
2. Deposition by Commission — Helena Bright
Helena Bright is based at Northgate's London headquarters, located at 14 Cavendish Square, London W1G 0BX. Because Ms. Bright resides outside the United States, her deposition cannot be compelled by subpoena. We will need to arrange her deposition by commission under CPLR 3108, which authorizes the court to issue a commission for the taking of a deposition outside the State of New York.
We should raise this issue at the preliminary conference to ensure that the court is aware of the logistical requirements and that the discovery schedule accommodates the time needed to arrange the commission. The process typically requires coordination with London solicitors, engagement of a London venue, and compliance with any applicable requirements under the Hague Convention on the Taking of Evidence Abroad (although, as between the United States and the United Kingdom, letters rogatory are generally not required for voluntary depositions with the consent of the witness).
Our proposed date for Ms. Bright's deposition is February 2025. We should note this at the conference and secure the court's agreement that the deposition schedule will accommodate this timeline.
3. Deposition of Dominic Hale (GC) — Privilege Objection
We anticipate that Meridian will seek to notice the deposition of Dominic Hale, Northgate's General Counsel, in connection with its pretext theory. Meridian is likely to contend that Mr. Hale's involvement in the termination decision makes him a fact witness whose testimony is necessary to establish the true motivations behind the termination.
Our Position: We should object to the deposition of Mr. Hale on attorney-client privilege grounds. Mr. Hale was acting in his capacity as legal counsel in advising Northgate on the termination decision. His analysis of the contractual grounds for termination, his assessment of the legal risks associated with the termination, and his communications with Northgate's business personnel regarding the termination all constitute privileged attorney-client communications and attorney work product.
The controlling authority is the Shelton v. American Motors Corp., 805 F.2d 1323 (8th Cir. 1986), line of cases, which holds that the deposition of opposing party's counsel is disfavored absent exceptional circumstances. Under Shelton and its progeny, a party seeking to depose opposing counsel must demonstrate that: (1) no other means exist to obtain the information; (2) the information sought is relevant and non-privileged; and (3) the information is crucial to the preparation of the case. New York courts have adopted similar principles. See, e.g., Hodes & Nauser v. Nexus Anesthesia Management, 2019 WL 4197385 (Sup. Ct. N.Y. Cty. 2019).
We should raise this issue at the conference if HDS has already signaled its intent to depose Mr. Hale. If HDS has not yet raised the issue, we should reserve our objection for when the deposition is formally noticed, but we should be prepared to address it at the conference if it arises.
V. EXPERT DISCOVERY POSITIONS
A. Our Expert Team
We have retained or are in the process of retaining two testifying experts for this matter:
Dr. Elinor Chazen — Lakeview Consulting Group LLC, 200 South Wacker Drive, Suite 1400, Chicago, Illinois 60606. Dr. Chazen is our construction and delay expert. She specializes in critical path methodology analysis for large-scale infrastructure projects, with particular expertise in fiber-optic and telecommunications infrastructure. Dr. Chazen has been formally retained as of October 15, 2024. She will opine on the causes of Meridian's contractor-caused delays, the validity and significance of the 43 critical non-conformance reports, and the reasonableness of NFA's termination decision from a construction management perspective. Dr. Chazen has testified in more than 30 construction disputes in federal and state courts and before arbitration panels, and her testimony has been accepted and credited by courts in every case in which it has been offered.
Professor Gordon Whitfield — Pinnacle Economics LLC, 1700 Broadway, Suite 2200, New York, New York 10019. Professor Whitfield is our damages expert. He is a professor of applied economics at Columbia University and specializes in lost-profits analysis and telecommunications industry economics. His engagement is expected to be finalized by November 1, 2024. Professor Whitfield will rebut Meridian's lost-profits model and quantify Northgate's counterclaim damages, including liquidated damages, excess completion costs, and remediation costs. Professor Whitfield's analysis will draw on industry data regarding fiber-optic construction costs, market pricing trends, and contractor performance benchmarks.
B. Known Plaintiff Experts
Based on information obtained through pre-conference communications and publicly available engagement records, we are aware of the following experts retained or expected to be retained by Meridian:
James Ochoa, PE — Keystone Project Advisory LLC, 1500 Market Street, Suite 1200, Philadelphia, Pennsylvania 19102. Mr. Ochoa is a licensed professional engineer and construction expert. We expect him to opine on Owner-caused delay — that is, delays attributable to NFA rather than Meridian — as well as NFA's alleged responsibility for permitting delays and constructive change orders. Mr. Ochoa has significant experience in fiber-optic and telecommunications construction disputes, and his opinions are typically well-supported, though we believe our factual record will undermine his conclusions on causation.
Dr. Natalie Forster — Westbrook Valuation Services Inc., 100 Park Avenue, Suite 800, New York, New York 10017. Dr. Forster is a damages expert who specializes in lost-profits analysis and business valuation. We expect her to present the financial model supporting Meridian's $200 million claim, including the lost-profits component and the retainage and unpaid invoice claims. Dr. Forster's lost-profits methodology will likely rely on Meridian's projected profit margins on the unperformed work, which we believe are inflated and unsupported by Meridian's actual historical performance.
C. Expert discovery Schedule Positions
Our proposed expert discovery schedule is as follows:
• Opening reports: March 31, 2025. Both sides would exchange opening expert reports simultaneously on this date.
• Rebuttal reports: May 15, 2025. Both sides would exchange rebuttal expert reports simultaneously, 45 days after the opening reports.
• Expert depositions: June 2025. Expert depositions would be scheduled by agreement of the parties following service of the rebuttal reports.
We recommend simultaneous exchange of reports rather than sequential exchange (plaintiff first, defense second). Simultaneous exchange is the standard practice in the Commercial Division and prevents gamesmanship. If HDS proposes sequential reports — with Meridian serving its opening reports first and NFA serving responsive reports thereafter — we should resist. Sequential exchange would give Meridian the advantage of framing the expert issues and would allow Meridian's experts to tailor their opening reports in response to information obtained during discovery without revealing their analytical approach until after NFA's experts have committed to their opinions. Simultaneous exchange ensures a level playing field and is the more efficient approach.
If the court is inclined to order sequential reports, our fallback position is to accept sequential exchange only if NFA (as the party asserting counterclaims) is treated as the "plaintiff" on its counterclaims and is permitted to serve its counterclaim expert reports first, with Meridian responding. This would be logistically complex and further supports the argument for simultaneous exchange.
VI. SURETY AND INSURANCE CONSIDERATIONS TO NOTE
The following surety and insurance considerations are provided for background purposes. We do not anticipate the need to raise insurance issues at the preliminary conference, but these matters are relevant to overall case strategy and may arise in discovery.
Performance Bond. Ironclad Surety Group Inc. (Indianapolis, Indiana; VP Claims: Patricia Dwyer) issued Performance Bond No. ISG-2020-NE-04417 in the amount of $120 million covering Meridian's obligations under the MCA. Following the termination, Meridian filed a demand on the Ironclad bond on April 15, 2024, asserting a claimed subcontractor protection endorsement. Both Northgate and Ironclad dispute the validity of Meridian's claim under the bond. Ironclad has agreed to contribute up to $2 million toward NFA's defense costs under a reservation of rights. A tender letter from Linda Osei to Patricia Dwyer was sent on September 5, 2024, formally tendering the defense of the claims asserted by Meridian to Ironclad under the terms of the performance bond.
D&O Coverage. NFA maintains directors' and officers' liability coverage through Albion Specialty Insurance Ltd. under Policy No. ALB-DO-2023-4782. While the claims in this action are directed at NFA as an entity rather than individual officers or directors, the D&O policy may provide coverage for certain defense costs depending on the specific allegations and the policy terms.
CGL Coverage. NFA maintains commercial general liability coverage through Keystone National Insurance Company under Policy No. KNIC-CGL-2022-99301. Coverage counsel at Pemberton Fox LLP (Rachel Solomons) has been retained by the carriers and is coordinating with Calderwood & Harkness regarding coverage positions and defense cost allocation.
discovery Implications. HDS may seek discovery regarding Northgate's insurance coverage and the existence and terms of the performance bond. Our standard position is that insurance coverage is not relevant to liability and that such requests are objectionable. However, the performance bond is arguably relevant to the extent it relates to the contractual relationship between the parties and the available remedies. We should be prepared to address this issue if it arises in discovery, though we do not recommend raising it at the conference.
VII. KEY TALKING POINTS FOR THE CONFERENCE
A. Opening Statement to the Court
When Justice Ricci opens the conference, we should be prepared to deliver a concise opening statement that frames the case for the court without revealing our defense strategy in detail. The following talking points are recommended:
• This is a substantial construction dispute involving a $1.2 billion fiber-optic build-out contract — the Master Construction Agreement dated March 15, 2020 — covering approximately 18,500 route miles of underground and aerial fiber-optic cable infrastructure across seven northeastern states.
• Northgate Fiber Americas Inc. terminated Meridian Infrastructure Partners LLC for cause on April 1, 2024 after persistent and accelerating schedule delays — with individual milestones ranging from 47 to 134-plus days late — and 287 non-conformance reports, including 43 classified as critical deficiencies. The termination followed a contractual cure process that included two formal cure notices and the rejection of an inadequate corrective action plan.
• Meridian claims approximately $200 million in damages; Northgate asserts counterclaims totaling approximately $149 million.
• The case is document-intensive. Both parties anticipate producing millions of documents. The case will require two sets of testifying experts — one in construction and delay analysis, and one in damages and economics.
• This is a bench trial. The parties waived their right to a jury trial under MCA § 22.4.
• Northgate is fully prepared to proceed with discovery efficiently and proposes the schedule set forth in our Proposed Preliminary Conference Order.
B. Proposed Stipulations to Present
We should propose the filing of the following stipulations with or promptly after the conference:
1. ESI Protocol and Stipulation. To be finalized within one week of the conference. A draft has been prepared and is attached to this memorandum as Attachment C. We should offer to circulate the draft to HDS at the conference for their review and comment.
2. Confidentiality Stipulation and Proposed Order. A two-tier confidentiality designation system (Confidential and Highly Confidential — Attorneys' Eyes Only). A draft has been prepared and is attached as Attachment B. We recommend circulating it at the conference and seeking agreement to file within one week.
3. Agreed discovery Schedule. If consensus is reached at the conference, we should offer to prepare and circulate a stipulated discovery schedule for filing within 48 hours. If consensus cannot be reached on all points, we should identify the areas of agreement and present the disputed points for the court's resolution.
Presenting these materials at the conference will demonstrate to Justice Ricci that Northgate has taken the case management obligations seriously and is prepared to litigate efficiently.
C. Tone and Approach
Our overall tone and approach at the conference should be cooperative, organized, and professional. The following guidelines should be observed:
• Present as cooperative and organized at all times. Demonstrate readiness to proceed efficiently with discovery and express a genuine willingness to work with opposing counsel on procedural matters.
• Avoid telegraphing our defense theory in detail. Our factual representations to the court should be neutral and limited to what is necessary to frame the discovery issues. We should not, for example, volunteer our views on the strength of Meridian's pretext theory or our assessment of the enforceability of the liquidated damages provision. Those issues will be addressed at the appropriate time.
• Emphasize Northgate's willingness to engage in good-faith meet-and-confer on any discovery disputes before seeking court intervention. Justice Ricci has a known preference for parties to resolve discovery disputes informally before resorting to motion practice, and we should align our approach with that preference.
• If Justice Ricci asks about settlement: state that the parties have not yet engaged in formal settlement discussions. Northgate is open to discussing resolution at an appropriate time but believes that meaningful settlement negotiations are premature until discovery has progressed sufficiently to allow both parties to evaluate the merits and the exposure. We should not close the door on settlement, but we should not appear eager or anxious.
VIII. LOGISTICS
The following logistical information is provided for the conference:
Conference Location: Supreme Court of the State of New York, New York County, Commercial Division, Part 49, 60 Centre Street, New York, NY 10007.
Date and Time: October 1, 2024. The specific time has not yet been confirmed by chambers. We should confirm the time with Justice Ricci's clerk no later than September 30, 2024. Part 49 typically schedules preliminary conferences at 9:30 a.m. or 2:15 p.m.
Appearing for Defendant Northgate Fiber Americas Inc.: Linda Osei, Responsible Partner (lead); Jeffrey Park, Lead Associate (second chair).
Appearing for Plaintiff Meridian Infrastructure Partners LLC (expected): Thomas Deluca and/or Miriam Vasquez of Hargrove, Deluca & Stein LLP, 51 West 52nd Street, 40th Floor, New York, NY 10019.
Materials to bring to the conference:
• Proposed Preliminary Conference Order — prepared and ready for filing. The draft is attached to this memorandum as Attachment A and incorporates our proposed discovery schedule and case management provisions.
• Draft ESI Protocol — for discussion with the court and opposing counsel. Attached as Attachment C.
• Draft Confidentiality Stipulation and Proposed Order — for discussion with the court and opposing counsel. Attached as Attachment B.
• Copy of the filed pleadings — including the Verified Complaint (filed July 15, 2024), the Answer with Affirmative Defenses and Counterclaims (filed September 3, 2024), and Meridian's Reply to Counterclaims (filed September 18, 2024). We should bring at least two copies: one working copy and one courtesy copy for the court if requested.
• Working copy of the Master Construction Agreement dated March 15, 2020 — in case the court requests additional factual background regarding the contractual provisions at issue. The MCA is a lengthy document (approximately 340 pages, including schedules and exhibits), and we should tab the key provisions for easy reference (§§ 9.4, 9.6, 13.2, 14.1, 14.2, 14.3, 20.1, 22.1, 22.4).
IX. ACTION ITEMS FOLLOWING THE CONFERENCE
The following action items should be addressed promptly following the preliminary conference, regardless of the specific outcome of the conference discussions:
1. Finalize and file Confidentiality Stipulation and Proposed Order. Incorporate any comments from HDS and file with the court. Target: within one week of the conference.
2. Finalize and file Stipulated ESI Protocol. Incorporate any comments from HDS and file with the court. Target: within one week of the conference.
3. Serve first set of document requests and interrogatories on Meridian. Target service date: by October 8, 2024. The first set of discovery demands is substantially drafted, comprising 56 document requests and 25 interrogatories. Final review and service should be completed promptly after the conference.
4. Issue litigation hold reminders to all Northgate custodians. The initial litigation hold notice was issued on August 21, 2024, following our engagement. Reminder notices should be sent to all custodians to reinforce the preservation obligation and to identify any additional sources of potentially relevant information that may have been overlooked in the initial hold.
5. Begin document collection from identified Northgate custodians. Collection should proceed from the 10 identified custodians, beginning with the priority custodians: Renata Voss, Sean Calloway, and Helena Bright. The remaining 7 custodians should be collected on a rolling basis. Coordinate with Vantage Litigation Support LLC on ingestion and processing timelines.
6. Coordinate with Vantage Litigation Support LLC on processing and review platform setup. Ensure that the review platform is configured and ready for first-level document review by mid-October 2024. Review protocols and coding guidelines should be finalized and distributed to the review team.
7. Prepare third-party subpoenas. Draft subpoenas duces tecum to the 7 identified subcontractors and 3 municipal permitting authorities. Target issuance: by October 20, 2024. For subcontractors located outside New York, determine whether domestication under the Uniform Interstate Depositions and discovery Act will be required.
8. Confirm expert engagements. Dr. Elinor Chazen has been retained as of October 15, 2024. Finalize the engagement of Professor Gordon Whitfield by November 1, 2024. Ensure that both experts are provided with the pleadings, the MCA, and initial sets of key documents as soon as practicable.
9. Send scheduling emails to HDS for fact depositions. Target: initial scheduling communications for the first tranche of fact depositions (November through December 2024), beginning with Meridian's witnesses Victor Sandoval, Bridget Yeung, Marcus Henley, and Randall Obrecht.
X. ATTACHMENTS
The following materials are attached to this memorandum for reference and use in connection with the preliminary conference:
• Attachment A: Draft Proposed Preliminary Conference Order
• Attachment B: Draft Confidentiality Stipulation and Proposed Order
• Attachment C: Draft ESI Protocol
• Attachment D: Proposed discovery Schedule (chart form)
• Attachment E: Current Case Docket Summary (Index No. 654321/2024)
This memorandum is privileged and confidential attorney work product prepared in anticipation of litigation. It is intended solely for the use of Calderwood & Harkness LLP personnel working on Matter No. 1022-00005. Do not distribute, copy, or forward without authorization from the Responsible Partner.
Phase | Proposed Date | Notes
Document demands and interrogatories served | Within 10 days of conference (by October 11, 2024) | We plan to serve on approximately October 8, 2024
Document production (initial) | December 15, 2024 | Rolling productions to begin November 1, 2024
Document production (substantial completion) | January 31, 2025 | Third-party subpoena responses expected on similar timeline
Fact depositions (begin) | November 2024 | Propose November through early March window
Fact depositions (completion) | March 15, 2025 | Must accommodate London commission for Helena Bright
Expert reports (opening) | March 31, 2025 | Consistent with our expert engagement timeline
Expert rebuttal reports | May 15, 2025 | Standard 45-day rebuttal period
Expert depositions | June 2025 | To be scheduled after rebuttal reports are served
Dispositive motions | August 2025 | If applicable
Trial | November 2025 | 6-week window