1031-00001 · Kessler, Brandt & O'Neill LLP · documents

declination-letter-to-mtdc-final.docx DOCUMENT Labor & Employment

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CALDERWOOD & HARKNESS LLP

One North Wacker Drive, Suite 4200 Chicago, Illinois 60606

Telephone: (312) 555-7000 Facsimile: (312) 555-7001

The Chicago office of Calderwood & Harkness LLP, a limited liability partnership organized under the laws of the State of New York. Approximately 1,100 attorneys across 14 offices worldwide.

May 17, 2024

Via Email and U.S. Mail

Terrence Whitfield, Esq. General Counsel Metropolitan Transit Development Corp. 550 West Harrison Street, Suite 1400 Chicago, Illinois 60607

Re: Proposed Engagement — Calderwood & Harkness LLP Matter No. 1031-00001

Defense of Civil Investigative Demand (Illinois Attorney General, Bureau of Civil Rights, Ref. No. CRB-2024-0417); Putative Employee Class Action (Circuit Court of Cook County, Chancery Division, Case No. 2024-CH-04417); and Related Matters

Dear Mr. Whitfield:

Thank you for contacting Calderwood & Harkness LLP regarding the Metropolitan Transit Development Corp.'s ("MTDC") need for legal representation in connection with the matters referenced above. We are grateful for the confidence you and MTDC have placed in our firm, and we appreciate the time you took to discuss these matters with my partner, Rachel Bernstein, during your initial conversation on May 6, 2024. We also wish to acknowledge the kind referral from Constance Hargrove, Esq., of Hargrove, Tillman & Reese LLP, whose high regard for our practice in the areas of data privacy, regulatory enforcement, and employment litigation is a compliment we do not take lightly.

We recognize the seriousness and urgency of the challenges presently confronting MTDC. As we understand from our preliminary discussions, on April 22, 2024, the Illinois Attorney General's Bureau of Civil Rights issued a Civil Investigative Demand to MTDC bearing Reference Number CRB-2024-0417, raising questions concerning MTDC's collection, use, storage, and handling of biometric data pertaining to its employees. Thereafter, on April 29, 2024, a putative employee class action was filed in the Circuit Court of Cook County, Chancery Division, captioned as Case No. 2024-CH-04417, asserting claims on behalf of a class of current and former employees. As you conveyed, MTDC also requires advice on the remediation of its biometric-data practices and related employment counseling. In light of these circumstances, on May 9, 2024, the firm opened a new-matter intake under Calderwood & Harkness Matter No. 1031-00001 for the purpose of evaluating whether we would be in a position to accept the proposed engagement.

Summary of Proposed Scope of Engagement

During our preliminary discussions, the proposed scope of the engagement was outlined to include the following areas:

(a) Defense of the Civil Investigative Demand issued by the Illinois Attorney General's Bureau of Civil Rights (Ref. No. CRB-2024-0417) and any anticipated enforcement action under the Illinois Biometric Information Privacy Act, 740 ILCS 14/1 et seq. ("BIPA"), and the Illinois Personal Information Protection Act, 815 ILCS 530/1 et seq.;

(b) Defense of the putative employee class action pending in the Circuit Court of Cook County, Chancery Division, Case No. 2024-CH-04417, including all pre-trial, discovery, class-certification, trial, and appellate proceedings;

(c) Advisory services regarding the remediation of MTDC's biometric-data collection, storage, retention, and destruction practices to achieve compliance with BIPA and other applicable Illinois and federal data-privacy statutes and regulations;

(d) Evaluation and potential prosecution of cross-claims and indemnification proceedings against third-party technology vendors who supplied, installed, configured, or maintained the biometric-data systems at issue; and

(e) Related employment counseling concerning MTDC's workforce-monitoring policies, including timekeeping, facility-access, and security-screening protocols utilizing biometric identifiers or biometric information.

We understand the significance of these matters, including the scope of the putative class, which is estimated to encompass approximately 12,400 current and former MTDC employees. We appreciated the opportunity to learn about these issues during our intake evaluation and preliminary communications with you and your team.

Declination of Engagement

I write today, however, to inform you that, following a thorough internal conflicts review conducted between May 9, 2024 and May 14, 2024, Calderwood & Harkness LLP has determined that it is unable to accept the proposed engagement.

Our review encompassed a comprehensive examination of the firm's current and recent client relationships, matters, and obligations across all of our offices, in accordance with the firm's conflicts-clearance procedures and applicable professional-responsibility standards. On May 14, 2024, the firm's Conflicts Committee completed its formal determination and concluded that an existing client relationship maintained by the firm creates a conflict of interest that, in the Committee's judgment, is not waivable under the applicable provisions of the Illinois Rules of Professional Conduct. Specifically, after careful analysis under the framework established by Rules 1.7(a) and 1.7(b) of the Illinois Rules of Professional Conduct, the firm has concluded that the conflict is of a nature and degree that precludes the firm from providing competent and diligent representation to MTDC in connection with the proposed matters and that the conflict cannot be cured through the informed consent of the affected parties.

Out of respect for the firm's obligations of confidentiality to its existing clients, we are not in a position to disclose the identity of the client giving rise to the conflict, the nature of the existing engagement, or any other specifics concerning the conflicting representation. We trust that you will understand the constraints under which we operate in this regard, and we assure you that the firm has given this matter the most careful and conscientious attention.

We sincerely regret that we are unable to accept this engagement. We had looked forward to the prospect of working with MTDC and its legal team on these important and complex matters, and we recognize the inconvenience that this declination may cause, particularly given the pressing timelines you face.

Confirmation That No Attorney-Client Relationship Has Been Formed

We wish to state expressly that no attorney-client relationship has been formed between Calderwood & Harkness LLP and the Metropolitan Transit Development Corp. as a result of the intake process, the preliminary conversations on May 6, 2024, or any subsequent communications between our respective offices.

During the course of our intake evaluation, the firm did not receive any confidential documents, privileged materials, or work product from MTDC. No substantive legal advice was rendered by any attorney at Calderwood & Harkness to MTDC or to any officer, employee, or agent of MTDC at any time during the intake process. The preliminary conversations between Ms. Bernstein and you, together with any follow-up communications, were conducted solely for the purpose of evaluating whether the firm could accept the proposed engagement. These communications do not give rise to any duties beyond those owed to a prospective client under Rule 1.18 of the Illinois Rules of Professional Conduct, and the firm will discharge all such duties in accordance with that Rule.

To the extent that any general information about MTDC's situation was shared during our preliminary discussions, the firm will treat such information as confidential in accordance with its obligations under Rule 1.18 and will take appropriate measures to ensure that no attorney at the firm uses or discloses such information to the disadvantage of MTDC.

Referral to Alternative Counsel

We are keenly aware that MTDC faces pressing deadlines in connection with both the Civil Investigative Demand (Ref. No. CRB-2024-0417) and the putative class action (Case No. 2024-CH-04417), and that the prompt engagement of qualified counsel experienced in these areas is of critical importance to the protection of MTDC's interests.

To that end, we would be pleased to assist MTDC in identifying alternative counsel with substantial experience in BIPA defense and compliance, data-privacy regulatory enforcement proceedings, and employment class-action litigation in Illinois state and federal courts. The firm has identified a number of well-qualified law firms that, based on our knowledge of their practices and reputations, may be well-positioned to assist MTDC in these matters. If you wish, Ms. Bernstein will provide you with specific recommendations and contact information for those firms promptly upon your request. We anticipate being in a position to transmit a written referral letter with detailed information regarding recommended counsel shortly following receipt of your authorization.

Please note that any referral we provide is offered solely as a professional courtesy and does not constitute a recommendation, endorsement, or guarantee of any kind regarding the qualifications, competence, availability, or suitability of any referred firm. MTDC should conduct its own independent due diligence with respect to any law firm it considers engaging, including confirming that any prospective firm has conducted its own conflicts review and is free from any disqualifying conflicts of interest.

Time-Sensitivity Advisory

As a matter of professional courtesy — and expressly not as legal advice — we wish to bring to your attention that time-sensitive deadlines may be running in connection with the Civil Investigative Demand (Ref. No. CRB-2024-0417) and the putative class action (Case No. 2024-CH-04417). Failure to respond to a Civil Investigative Demand within the time prescribed by the Illinois Attorney General or to appear and respond in the class action within the applicable deadlines under the Illinois Code of Civil Procedure and the Rules of the Circuit Court of Cook County could have significant adverse consequences for MTDC. We strongly encourage MTDC to secure alternative representation as promptly as possible to ensure that its interests are fully protected.

In the interim, we respectfully suggest that MTDC consult with its existing outside litigation counsel, Hargrove, Tillman & Reese LLP, regarding any immediate or interim steps that may be necessary to preserve MTDC's rights, toll applicable deadlines, or respond to any court-ordered or regulatory-imposed time requirements pending the engagement of new counsel for these specific matters.

Contact Information

Should you wish to discuss the referral process, or should you have any questions regarding this letter or any related matter, please do not hesitate to contact Rachel Bernstein directly at the following:

Rachel Bernstein, Partner Direct Telephone: (312) 555-7048

Email: rbernstein@calderwoodharkness.com

Ms. Bernstein is available to speak with you by telephone at your convenience and would welcome the opportunity to assist you in any way that is consistent with the firm's professional obligations.

Closing

We reiterate our sincere regret at being unable to assist MTDC in this important matter. We have great respect for MTDC's vital mission as a governmental transit authority serving approximately 1.6 million daily riders across Cook County and the five collar counties, and we recognize the significance of the issues MTDC currently faces both for the organization and for the communities it serves. We are confident that MTDC will secure highly capable representation and we wish you every success in resolving the pending matters favorably.

Thank you again for the opportunity to be considered. We are honored by the trust you and Ms. Hargrove placed in our firm, and we are sorry that circumstances do not permit us to fulfill it on this occasion.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Rachel Bernstein Partner, Privacy & Data Security

Calderwood & Harkness LLP One North Wacker Drive, Suite 4200 Chicago, Illinois 60606 Direct: (312) 555-7048

Email: rbernstein@calderwoodharkness.com

cc: Constance Hargrove, Esq.

Hargrove, Tillman & Reese LLP 233 South Wacker Drive, Suite 5600 Chicago, Illinois 60606

Enclosures: None

CONFIDENTIALITY NOTICE: This letter and any attachments are confidential and intended solely for the use of the individual or entity to whom it is addressed. This communication may contain information that is privileged, confidential, or otherwise protected from disclosure under applicable law. If you are not the intended recipient, or an agent or employee responsible for delivering this communication to the intended recipient, you are hereby notified that any dissemination, distribution, copying, or use of this communication or any of its contents is strictly prohibited. If you have received this communication in error, please notify the sender immediately by telephone at (312) 555-7000 and destroy all copies of this communication and any attachments.

CALDERWOOD & HARKNESS LLP
One North Wacker Drive, Suite 4200 Chicago, Illinois 60606
Telephone: (312) 555-7000 Facsimile: (312) 555-7001
The Chicago office of Calderwood & Harkness LLP, a limited liability partnership organized under the laws of the State of New York. Approximately 1,100 attorneys across 14 offices worldwide.
May 17, 2024
Via Email and U.S. Mail
Terrence Whitfield, Esq. General Counsel Metropolitan Transit Development Corp. 550 West Harrison Street, Suite 1400 Chicago, Illinois 60607
Re: Proposed Engagement — Calderwood & Harkness LLP Matter No. 1031-00001
Defense of Civil Investigative Demand (Illinois Attorney General, Bureau of Civil Rights, Ref. No. CRB-2024-0417); Putative Employee Class Action (Circuit Court of Cook County, Chancery Division, Case No. 2024-CH-04417); and Related Matters
Dear Mr. Whitfield:
Thank you for contacting Calderwood & Harkness LLP regarding the Metropolitan Transit Development Corp.'s ("MTDC") need for legal representation in connection with the matters referenced above. We are grateful for the confidence you and MTDC have placed in our firm, and we appreciate the time you took to discuss these matters with my partner, Rachel Bernstein, during your initial conversation on May 6, 2024. We also wish to acknowledge the kind referral from Constance Hargrove, Esq., of Hargrove, Tillman & Reese LLP, whose high regard for our practice in the areas of data privacy, regulatory enforcement, and employment litigation is a compliment we do not take lightly.
We recognize the seriousness and urgency of the challenges presently confronting MTDC. As we understand from our preliminary discussions, on April 22, 2024, the Illinois Attorney General's Bureau of Civil Rights issued a Civil Investigative Demand to MTDC bearing Reference Number CRB-2024-0417, raising questions concerning MTDC's collection, use, storage, and handling of biometric data pertaining to its employees. Thereafter, on April 29, 2024, a putative employee class action was filed in the Circuit Court of Cook County, Chancery Division, captioned as Case No. 2024-CH-04417, asserting claims on behalf of a class of current and former employees. As you conveyed, MTDC also requires advice on the remediation of its biometric-data practices and related employment counseling. In light of these circumstances, on May 9, 2024, the firm opened a new-matter intake under Calderwood & Harkness Matter No. 1031-00001 for the purpose of evaluating whether we would be in a position to accept the proposed engagement.
Summary of Proposed Scope of Engagement
During our preliminary discussions, the proposed scope of the engagement was outlined to include the following areas:
(a) Defense of the Civil Investigative Demand issued by the Illinois Attorney General's Bureau of Civil Rights (Ref. No. CRB-2024-0417) and any anticipated enforcement action under the Illinois Biometric Information Privacy Act, 740 ILCS 14/1 et seq. ("BIPA"), and the Illinois Personal Information Protection Act, 815 ILCS 530/1 et seq.;
(b) Defense of the putative employee class action pending in the Circuit Court of Cook County, Chancery Division, Case No. 2024-CH-04417, including all pre-trial, discovery, class-certification, trial, and appellate proceedings;
(c) Advisory services regarding the remediation of MTDC's biometric-data collection, storage, retention, and destruction practices to achieve compliance with BIPA and other applicable Illinois and federal data-privacy statutes and regulations;
(d) Evaluation and potential prosecution of cross-claims and indemnification proceedings against third-party technology vendors who supplied, installed, configured, or maintained the biometric-data systems at issue; and
(e) Related employment counseling concerning MTDC's workforce-monitoring policies, including timekeeping, facility-access, and security-screening protocols utilizing biometric identifiers or biometric information.
We understand the significance of these matters, including the scope of the putative class, which is estimated to encompass approximately 12,400 current and former MTDC employees. We appreciated the opportunity to learn about these issues during our intake evaluation and preliminary communications with you and your team.
Declination of Engagement
I write today, however, to inform you that, following a thorough internal conflicts review conducted between May 9, 2024 and May 14, 2024, Calderwood & Harkness LLP has determined that it is unable to accept the proposed engagement.
Our review encompassed a comprehensive examination of the firm's current and recent client relationships, matters, and obligations across all of our offices, in accordance with the firm's conflicts-clearance procedures and applicable professional-responsibility standards. On May 14, 2024, the firm's Conflicts Committee completed its formal determination and concluded that an existing client relationship maintained by the firm creates a conflict of interest that, in the Committee's judgment, is not waivable under the applicable provisions of the Illinois Rules of Professional Conduct. Specifically, after careful analysis under the framework established by Rules 1.7(a) and 1.7(b) of the Illinois Rules of Professional Conduct, the firm has concluded that the conflict is of a nature and degree that precludes the firm from providing competent and diligent representation to MTDC in connection with the proposed matters and that the conflict cannot be cured through the informed consent of the affected parties.
Out of respect for the firm's obligations of confidentiality to its existing clients, we are not in a position to disclose the identity of the client giving rise to the conflict, the nature of the existing engagement, or any other specifics concerning the conflicting representation. We trust that you will understand the constraints under which we operate in this regard, and we assure you that the firm has given this matter the most careful and conscientious attention.
We sincerely regret that we are unable to accept this engagement. We had looked forward to the prospect of working with MTDC and its legal team on these important and complex matters, and we recognize the inconvenience that this declination may cause, particularly given the pressing timelines you face.
Confirmation That No Attorney-Client Relationship Has Been Formed
We wish to state expressly that no attorney-client relationship has been formed between Calderwood & Harkness LLP and the Metropolitan Transit Development Corp. as a result of the intake process, the preliminary conversations on May 6, 2024, or any subsequent communications between our respective offices.
During the course of our intake evaluation, the firm did not receive any confidential documents, privileged materials, or work product from MTDC. No substantive legal advice was rendered by any attorney at Calderwood & Harkness to MTDC or to any officer, employee, or agent of MTDC at any time during the intake process. The preliminary conversations between Ms. Bernstein and you, together with any follow-up communications, were conducted solely for the purpose of evaluating whether the firm could accept the proposed engagement. These communications do not give rise to any duties beyond those owed to a prospective client under Rule 1.18 of the Illinois Rules of Professional Conduct, and the firm will discharge all such duties in accordance with that Rule.
To the extent that any general information about MTDC's situation was shared during our preliminary discussions, the firm will treat such information as confidential in accordance with its obligations under Rule 1.18 and will take appropriate measures to ensure that no attorney at the firm uses or discloses such information to the disadvantage of MTDC.
Referral to Alternative Counsel
We are keenly aware that MTDC faces pressing deadlines in connection with both the Civil Investigative Demand (Ref. No. CRB-2024-0417) and the putative class action (Case No. 2024-CH-04417), and that the prompt engagement of qualified counsel experienced in these areas is of critical importance to the protection of MTDC's interests.
To that end, we would be pleased to assist MTDC in identifying alternative counsel with substantial experience in BIPA defense and compliance, data-privacy regulatory enforcement proceedings, and employment class-action litigation in Illinois state and federal courts. The firm has identified a number of well-qualified law firms that, based on our knowledge of their practices and reputations, may be well-positioned to assist MTDC in these matters. If you wish, Ms. Bernstein will provide you with specific recommendations and contact information for those firms promptly upon your request. We anticipate being in a position to transmit a written referral letter with detailed information regarding recommended counsel shortly following receipt of your authorization.
Please note that any referral we provide is offered solely as a professional courtesy and does not constitute a recommendation, endorsement, or guarantee of any kind regarding the qualifications, competence, availability, or suitability of any referred firm. MTDC should conduct its own independent due diligence with respect to any law firm it considers engaging, including confirming that any prospective firm has conducted its own conflicts review and is free from any disqualifying conflicts of interest.
Time-Sensitivity Advisory
As a matter of professional courtesy — and expressly not as legal advice — we wish to bring to your attention that time-sensitive deadlines may be running in connection with the Civil Investigative Demand (Ref. No. CRB-2024-0417) and the putative class action (Case No. 2024-CH-04417). Failure to respond to a Civil Investigative Demand within the time prescribed by the Illinois Attorney General or to appear and respond in the class action within the applicable deadlines under the Illinois Code of Civil Procedure and the Rules of the Circuit Court of Cook County could have significant adverse consequences for MTDC. We strongly encourage MTDC to secure alternative representation as promptly as possible to ensure that its interests are fully protected.
In the interim, we respectfully suggest that MTDC consult with its existing outside litigation counsel, Hargrove, Tillman & Reese LLP, regarding any immediate or interim steps that may be necessary to preserve MTDC's rights, toll applicable deadlines, or respond to any court-ordered or regulatory-imposed time requirements pending the engagement of new counsel for these specific matters.
Contact Information
Should you wish to discuss the referral process, or should you have any questions regarding this letter or any related matter, please do not hesitate to contact Rachel Bernstein directly at the following:
Rachel Bernstein, Partner Direct Telephone: (312) 555-7048
Email: rbernstein@calderwoodharkness.com
Ms. Bernstein is available to speak with you by telephone at your convenience and would welcome the opportunity to assist you in any way that is consistent with the firm's professional obligations.
Closing
We reiterate our sincere regret at being unable to assist MTDC in this important matter. We have great respect for MTDC's vital mission as a governmental transit authority serving approximately 1.6 million daily riders across Cook County and the five collar counties, and we recognize the significance of the issues MTDC currently faces both for the organization and for the communities it serves. We are confident that MTDC will secure highly capable representation and we wish you every success in resolving the pending matters favorably.
Thank you again for the opportunity to be considered. We are honored by the trust you and Ms. Hargrove placed in our firm, and we are sorry that circumstances do not permit us to fulfill it on this occasion.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Rachel Bernstein Partner, Privacy & Data Security
Calderwood & Harkness LLP One North Wacker Drive, Suite 4200 Chicago, Illinois 60606 Direct: (312) 555-7048
Email: rbernstein@calderwoodharkness.com
cc: Constance Hargrove, Esq.
Hargrove, Tillman & Reese LLP 233 South Wacker Drive, Suite 5600 Chicago, Illinois 60606
Enclosures: None
CONFIDENTIALITY NOTICE: This letter and any attachments are confidential and intended solely for the use of the individual or entity to whom it is addressed. This communication may contain information that is privileged, confidential, or otherwise protected from disclosure under applicable law. If you are not the intended recipient, or an agent or employee responsible for delivering this communication to the intended recipient, you are hereby notified that any dissemination, distribution, copying, or use of this communication or any of its contents is strictly prohibited. If you have received this communication in error, please notify the sender immediately by telephone at (312) 555-7000 and destroy all copies of this communication and any attachments.

CALDERWOOD & HARKNESS LLP

CALDERWOOD & HARKNESS LLP

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