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

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CONFIDENTIAL — ATTORNEY WORK PRODUCT / ADMINISTRATIVE

CALDERWOOD & HARKNESS LLP

600 Lexington Avenue, 38th Floor New York, NY 10022

MATTER CLOSURE FORM (C&H Form MC-1)

Form Version: MC-1 (Rev. 03/2023)

Processing Office: One North Wacker Drive, Suite 4200 Chicago, IL 60606

Classification: CONFIDENTIAL — ATTORNEY WORK PRODUCT / ADMINISTRATIVE. This form and all attachments constitute confidential internal administrative work product of Calderwood & Harkness LLP and are not to be disclosed outside the firm without the prior written authorization of the Conflicts Committee Chair or the Firm General Counsel.

Section 1: Matter Identification

Matter Number: 1031-00001

Matter Name: Metropolitan Transit Development Corp. — BIPA Enforcement Defense / Employee Class Action Defense

Date Opened: May 9, 2024

Date Closed: May 23, 2024

Office: Chicago (One North Wacker Drive, Suite 4200, Chicago, IL 60606)

Practice Group(s): Privacy & Data Security; Labor & Employment

Matter Status: Closed — Terminated (Conflicts Declination)

Description: This matter was opened on May 9, 2024, in connection with a prospective engagement by Metropolitan Transit Development Corp. ("MTDC") seeking representation in regulatory enforcement and class action defense proceedings arising from alleged violations of the Illinois Biometric Information Privacy Act ("BIPA") and related state privacy and employment statutes. The matter is being closed as of May 23, 2024, following a formal determination by the Firm's Conflicts Committee that acceptance of the proposed engagement would create an unwaivable conflict of interest with an existing firm client, Pinnacle Workforce Analytics, Inc. No attorney-client relationship was formed with MTDC. No substantive legal services were rendered. No fees were billed and no disbursements were incurred.

Section 2: Client Information

Prospective Client Full Legal Name: Metropolitan Transit Development Corp.

Short Name / Acronym: MTDC / Metro Transit

Entity Type: Unit of local government; special-purpose transit authority created and operating under the authority of the Illinois Local Mass Transit District Act, 70 ILCS 3610/1 et seq.

Jurisdiction of Organization: State of Illinois

Principal Office Address: 550 West Harrison Street, Suite 1400, Chicago, IL 60607

Client Employer Identification Number (EIN): 36-6041928

Primary Client Contact: Terrence Whitfield, General Counsel, Metropolitan Transit Development Corp., 550 West Harrison Street, Suite 1400, Chicago, IL 60607. Mr. Whitfield served as the principal point of contact for all communications related to the proposed engagement, including the initial intake inquiry and receipt of the declination letter.

Secondary Client Contact: Lucia Marchetti, Chief Information Security Officer, Metropolitan Transit Development Corp., 550 West Harrison Street, Suite 1400, Chicago, IL 60607. Ms. Marchetti was identified as the primary technical contact for purposes of the proposed engagement, with particular responsibility for matters relating to the TruScan 360 workforce-management platform and associated biometric-data practices.

Client Executive Director: Darnell Okafor, Executive Director, Metropolitan Transit Development Corp.

Referring Counsel: Constance Hargrove, Partner, Hargrove, Tillman & Reese LLP, 233 South Wacker Drive, Suite 5600, Chicago, IL 60606. Ms. Hargrove serves as MTDC's existing outside general counsel and referred the prospective engagement to Calderwood & Harkness for specialized BIPA defense capability. Ms. Hargrove was copied on all substantive communications with MTDC regarding the declination.

Client Relationship Status: Declined prospective client — no attorney-client relationship formed. MTDC has not previously retained Calderwood & Harkness LLP in any capacity, and no prior matter records exist in the firm's systems for MTDC or any of its predecessors, subsidiaries, or affiliated entities.

Section 3: Engagement Team

The following personnel were assigned to the intake and conflicts-screening process associated with Matter No. 1031-00001. As noted below, no substantive legal work was performed for the prospective client at any time.

Responsible Partner: Rachel Bernstein, Partner, Privacy & Data Security Practice Group, Chicago Office. Ms. Bernstein was designated as the responsible partner for purposes of the intake evaluation and was the primary point of contact with MTDC General Counsel Terrence Whitfield and referring counsel Constance Hargrove.

Billing Partner: Miriam Calloway, Partner, Healthcare & Life Sciences Practice Group, Chicago Office. Ms. Calloway was designated as billing partner in the firm's matter management system upon the opening of the matter, in accordance with standard firm intake procedures.

Lead Associate: Devon Archer, Associate (Class of 2019), Labor & Employment Practice Group, Chicago Office. Mr. Archer was assigned as lead associate for the proposed engagement and participated in the preliminary scope assessment and internal conflicts analysis.

Working Associate: Nadia Petrov, Associate (Class of 2021), Labor & Employment Practice Group, Chicago Office. Ms. Petrov was assigned as the working associate for the proposed engagement and assisted with the preliminary scope assessment.

Important Note Regarding Scope of Team Activities: No substantive legal work was performed for the prospective client. The engagement team's activities were strictly limited to intake screening, preliminary assessment of the proposed scope of engagement, and internal conflicts analysis. At no time did any member of the engagement team provide legal advice to MTDC, draft or review legal documents on MTDC's behalf, communicate legal strategy to MTDC, or otherwise undertake activities that would give rise to an attorney-client relationship. All time recorded by members of the engagement team in connection with this matter was entered as non-billable administrative time under the firm's standard intake and conflicts time codes.

Section 4: Description of Proposed Engagement

4.1 Scope of Proposed Representation

The proposed engagement, as described in communications from MTDC General Counsel Terrence Whitfield and referring counsel Constance Hargrove, encompassed the following categories of legal services:

(a) Regulatory Enforcement Defense — Illinois Attorney General CID. Defense of a Civil Investigative Demand ("CID") issued by the Illinois Attorney General's Bureau of Civil Rights, Reference No. CRB-2024-0417, dated April 22, 2024. The CID alleges that MTDC engaged in violations of the Illinois Biometric Information Privacy Act ("BIPA"), 740 ILCS 14/1 et seq., and the Illinois Personal Information Protection Act ("PIPA"), 815 ILCS 530/1 et seq., in connection with MTDC's deployment of a biometric-data-driven workforce-management platform used to collect, store, process, and disseminate the fingerprint scans, facial-geometry data, and hand-geometry data of MTDC employees. The CID demands production of documents and data relating to MTDC's biometric-data collection practices, employee consent procedures, data-retention and data-destruction schedules, vendor contracts, and data-sharing arrangements.

(b) Employee Class Action Defense — Cook County Circuit Court. Defense of a putative employee class action filed in the Circuit Court of Cook County, Chancery Division, Case No. 2024-CH-04417, filed April 29, 2024. The complaint was filed on behalf of a putative class of approximately 12,400 current and former MTDC employees, alleging violations of BIPA Sections 15(a), 15(b), 15(c), 15(d), and 15(e), as well as related state-law claims for invasion of privacy, negligence, and breach of implied contract. Plaintiffs seek statutory damages under BIPA Section 20 (liquidated damages of $1,000 per negligent violation and $5,000 per intentional or reckless violation), injunctive relief, and attorneys' fees. Plaintiffs' class counsel is identified as Kessler, Brandt & O'Neill LLP, 120 North LaSalle Street, Suite 2200, Chicago, IL 60602. Lead counsel: Martin Kessler. Co-counsel: Yolanda Brandt.

(c) Biometric-Data Practices Remediation Advice. General advisory services relating to the remediation of MTDC's biometric-data collection, storage, processing, dissemination, and destruction practices, with particular focus on practices implemented through the TruScan 360 workforce-management platform developed and licensed by Pinnacle Workforce Analytics, Inc. The proposed remediation advice would have encompassed review and revision of employee consent forms, data-retention schedules, data-destruction protocols, written biometric-data policies, and vendor data-processing agreements.

(d) Cross-Claims and Indemnification Proceedings Against Technology Vendors. Assessment and potential prosecution of cross-claims and indemnification demands against MTDC's technology vendors, including Pinnacle Workforce Analytics, Inc., under the Master Software License and Services Agreement ("MSLA") between MTDC and Pinnacle dated June 15, 2021. The MSLA, which has a total contract value of approximately $8,700,000 over a five-year term, contains indemnification provisions, warranties regarding regulatory compliance, and representations concerning BIPA compliance. MTDC indicated that it intended to assert that Pinnacle bears contractual responsibility for the design and implementation of the biometric-data practices at issue in the CID and the class action.

(e) Related Employment Counseling. General employment counseling concerning MTDC's workforce-monitoring policies, including review and revision of employee handbooks, acceptable-use policies, and collective bargaining agreement provisions relating to biometric data and electronic monitoring.

4.2 Anticipated Adverse Parties

The following parties were identified as actual or anticipated adverse parties in connection with the proposed engagement:

(a) Office of the Illinois Attorney General, Bureau of Civil Rights. The Bureau of Civil Rights issued the CID at the direction of the Deputy Attorney General for Civil Rights, Malcolm Jeffries. The Attorney General's office has retained outside special counsel for this matter: Ridgeway & Falk LLP (Diane Falk, lead counsel), 401 East Adams Street, Suite 300, Springfield, IL 62701.

(b) Putative Employee Class. A putative class of approximately 12,400 current and former MTDC employees, as identified in the class action complaint filed in Case No. 2024-CH-04417. The putative class is represented by Kessler, Brandt & O'Neill LLP, 120 North LaSalle Street, Suite 2200, Chicago, IL 60602. Lead counsel: Martin Kessler. Co-counsel: Yolanda Brandt.

(c) Pinnacle Workforce Analytics, Inc. Pinnacle was identified as a potential cross-claim and indemnification target under the MSLA dated June 15, 2021. Pinnacle is also a named responsible party in the Attorney General's CID. MTDC's proposed litigation strategy contemplated asserting affirmative claims against Pinnacle for breach of contract, breach of warranty, and contractual indemnification.

Section 5: Reason for Closure

5.1 Closure Category

Conflicts Declination — Unwaivable Current-Client Conflict.

5.2 Summary of Conflict

Calderwood & Harkness LLP currently represents Pinnacle Workforce Analytics, Inc. ("Pinnacle"), a Delaware corporation with its principal offices at 11900 Sunrise Valley Drive, Suite 500, Reston, VA 20191 (EIN: 54-2198437). The firm's existing engagement with Pinnacle is recorded under Matter No. 1031-00001, which was opened on March 14, 2022. The responsible partner for the Pinnacle engagement is Jonathan Mercer, Partner, intellectual Property / Patent Litigation Practice Group. The lead associate is Priya Subramaniam, Associate, intellectual Property / Patent Litigation Practice Group.

The existing Pinnacle engagement involves patent-enforcement litigation concerning the TruScan 360 biometric workforce-management platform. Specifically, Calderwood & Harkness represents Pinnacle as plaintiff in Pinnacle Workforce Analytics, Inc. v. Veritas Biometrics Corp., United States District Court for the Eastern District of Virginia, Case No. 1:22-cv-01533 (filed September 6, 2022). In that litigation, the firm has advanced arguments on behalf of Pinnacle asserting the novelty, technical sophistication, commercial value, and legitimate functionality of the TruScan 360 platform, including its biometric-data collection, processing, storage, and analysis capabilities.

The proposed MTDC engagement would have created a direct and irreconcilable conflict with the existing Pinnacle representation in the following respects:

(a) Direct Adversity. The proposed MTDC engagement would have required Calderwood & Harkness to argue — on behalf of MTDC and against the interests of Pinnacle — that the TruScan 360 platform's biometric-data collection, storage, and dissemination practices violated BIPA. This position is directly adverse to Pinnacle's interests and is diametrically opposed to the arguments the firm has advanced and continues to advance in the patent-enforcement litigation on Pinnacle's behalf regarding the legitimacy, innovation, and commercial value of TruScan 360.

(b) Adversity in Cross-Claims and Indemnification. MTDC's anticipated cross-claims and indemnification demands would be asserted directly against Pinnacle under the MSLA dated June 15, 2021 (total contract value: $8,700,000 over five years). The firm would have been required to prosecute affirmative claims against its own current client.

(c) Pinnacle as Co-Respondent in AG Enforcement Action. Pinnacle is a named responsible party in the Attorney General's CID (Ref. No. CRB-2024-0417). Defense of MTDC in the CID proceeding would necessarily entail shifting responsibility to Pinnacle for the design and implementation of the biometric-data practices under investigation.

(d) Possession of Pinnacle Confidential Information. Through the patent-enforcement litigation, the firm possesses significant quantities of Pinnacle's confidential and proprietary information that is directly relevant to the TruScan 360 platform, including technical specifications, source-code architecture summaries, data-flow diagrams, algorithmic design documentation, biometric-data retention and destruction policies, and related trade-secret materials. Use of this information in the proposed MTDC engagement would breach the firm's duties of confidentiality to Pinnacle.

5.3 Applicable Ethics Rules

The conflicts analysis was conducted under the following provisions of the Illinois Rules of Professional Conduct:

• Rule 1.7(a)(1) — Direct Adversity. The proposed engagement would involve representation of MTDC directly adverse to an existing client, Pinnacle, in the same or a substantially related matter. The TruScan 360 platform is the subject of both the existing Pinnacle representation and the proposed MTDC engagement. The firm would be required to take positions on behalf of MTDC that are directly contrary to positions it has taken and continues to take on behalf of Pinnacle.

• Rule 1.7(a)(2) — Material Limitation. Even absent direct adversity, the firm's obligations to Pinnacle would materially limit its ability to represent MTDC effectively. The firm's possession of Pinnacle's confidential information, its ongoing litigation strategy on Pinnacle's behalf, and its duties of loyalty to Pinnacle would constrain and compromise the firm's advocacy on behalf of MTDC.

• Rule 1.7(b) — Waivability Assessment. The Conflicts Committee determined that the conflict is not waivable under Rule 1.7(b). Specifically, the Conflicts Committee concluded that (i) it is not possible for the firm to provide competent and diligent representation to both MTDC and Pinnacle simultaneously given the directly opposing positions required, (ii) the representation of one client would involve the assertion of a claim by one client against another client represented by the firm in the same litigation or a substantially related proceeding, and (iii) the circumstances are such that informed consent, even if given by both clients, would not cure the conflict. The Conflicts Committee further noted that it did not seek Pinnacle's consent to the proposed dual representation because the conflict was determined to be structurally unwaivable.

• Rule 1.10 — Imputation. The Conflicts Committee analyzed whether screening mechanisms could be employed to address the conflict and determined that, under Illinois Rule 1.10, screening is not available to cure a concurrent-client conflict arising from a current firm partner's active representation of the conflicting client. Screening under Rule 1.10(a)(2) is limited to situations involving former-client conflicts attributable to lawyers who have changed firms and does not extend to the present circumstances.

Additionally, the Conflicts Committee considered Illinois Rule 1.9 (Duties to Former Clients) for the purpose of confirming that even if the Pinnacle engagement were to conclude in the future, the firm's duties to Pinnacle as a former client would independently preclude the MTDC engagement due to the substantial relationship between the matters and the confidential information possessed by the firm.

5.4 Conflicts Committee Determination

The Calderwood & Harkness Conflicts Committee convened on May 14, 2024, to consider the conflicts analysis prepared in connection with Matter No. 1031-00001. The Committee was chaired by Lawrence Keating, Senior Partner and Chair of the Conflicts Committee. After review of the Conflicts Search Reports (Rounds 1 and 2), the Conflicts Committee Analysis Memorandum, and the applicable ethics rules and authorities, the Committee unanimously determined that the conflict between the proposed MTDC engagement and the existing Pinnacle representation is unwaivable under Illinois Rule 1.7.

A Formal Conflicts Committee Resolution memorializing the declination determination was executed by Lawrence Keating on May 14, 2024. Firm General Counsel Helen Drazkowski reviewed the Conflicts Committee's analysis and concurred with the determination that the conflict is unwaivable and that the proposed engagement must be declined.

5.5 Reference Documents

The following documents were generated in connection with the conflicts analysis and are maintained in the matter file:

1. Conflicts Search Report — Round 1 (dated May 10, 2024)

2. Supplemental Conflicts Search Report — Round 2 (dated May 13, 2024)

3. Conflicts Committee Analysis Memorandum — Final (dated May 14, 2024)

4. Conflicts Committee Meeting Minutes (dated May 14, 2024)

5. Conflicts Committee Resolution — Formal Declination (dated May 14, 2024)

6. Ethics Analysis Memoranda addressing Illinois Rules 1.7, 1.7(b), 1.9, and 1.10

Section 6: Client Notification

6.1 Declination Notification

Date Prospective Client Notified of Declination: May 17, 2024

Method of Notification: Formal declination letter transmitted via email (encrypted) to Terrence Whitfield, General Counsel, Metropolitan Transit Development Corp. The declination letter explained that the firm was unable to accept the proposed engagement due to a conflict of interest with an existing client. Consistent with the firm's ethical obligations, the declination letter did not identify the conflicting client or disclose any details regarding the nature of the existing engagement.

Recipient: Terrence Whitfield, General Counsel, Metropolitan Transit Development Corp., 550 West Harrison Street, Suite 1400, Chicago, IL 60607

Copy to: Constance Hargrove, Partner, Hargrove, Tillman & Reese LLP, 233 South Wacker Drive, Suite 5600, Chicago, IL 60606 (MTDC's existing outside counsel and referring counsel). Ms. Hargrove was included on the declination communication at the request of Mr. Whitfield.

6.2 Referral to Alternative Counsel

Referral Provided: Yes

A referral letter dated May 20, 2024, was transmitted to Terrence Whitfield recommending two alternative firms with substantial BIPA defense experience:

(a) Aldridge, Paulson & Cho LLP — Victoria Aldridge, Partner and BIPA Practice Lead, 150 North Michigan Avenue, Suite 3500, Chicago, IL 60601. Ms. Aldridge has extensive experience defending BIPA class actions and regulatory enforcement proceedings on behalf of public-sector and quasi-governmental entities.

(b) Northfield McKay LLP — Damien Northfield, Partner and Data-Privacy Litigation Practice Lead, 311 South Wacker Drive, Suite 4800, Chicago, IL 60606. Mr. Northfield has significant experience with BIPA defense and vendor-indemnification disputes involving biometric-technology providers.

Courtesy heads-up emails were sent to both Victoria Aldridge and Damien Northfield on May 20, 2024, advising them that MTDC might be in contact regarding a potential engagement. No privileged information, confidential information, or details regarding the substance of the proposed engagement or the nature of the conflict were disclosed to either firm in these communications.

6.3 Return-of-Materials Confirmation

A return-of-materials confirmation letter was sent to Terrence Whitfield on May 23, 2024. The letter confirmed that no client documents, confidential information, or other materials were received from MTDC at any time during the intake process, and accordingly there are no materials to return.

6.4 Attorney-Client Relationship

Attorney-Client Relationship Formed: No. At no point during the intake and conflicts-screening process did Calderwood & Harkness LLP form an attorney-client relationship with Metropolitan Transit Development Corp. No legal advice was provided, no legal services were rendered, and no confidential information was received from the prospective client.

Section 7: Financial Summary

Estimated Foregone Fees (for Management Committee Reporting Purposes): $3,500,000 – $5,200,000. This estimate reflects an 18- to 24-month projection based on blended rates as follows: partner rate of $1,150 per hour; senior associate rate of $785 per hour; junior associate rate of $625 per hour. The estimate takes into account the anticipated scope and complexity of the CID defense, class action defense, vendor cross-claims, remediation advisory work, and related employment counseling. This estimate is provided for internal Management Committee reporting purposes only and does not represent a fee agreement, budget, or commitment.

Existing Client Annual Billings at Stake — Pinnacle Workforce Analytics, Inc. (FY 2023): $2,137,500. This figure represents the firm's total billings to Pinnacle under Matter No. 1031-00001 and related matters for the fiscal year ended December 31, 2023. This information is provided for Management Committee reporting purposes to contextualize the economic implications of the conflicts declination.

Note: All time entries recorded by members of the engagement team in connection with the intake and conflicts review for Matter No. 1031-00001 were recorded as non-billable administrative time under firm time codes ADM-INTAKE and ADM-CONFLICTS. No billable time was generated. No fees were charged to the prospective client or to any other client of the firm.

Section 8: Client Documents and Confidential Information

8.1 Prospective Client Materials

Client Documents Received from Prospective Client: None. No documents, files, data, or other materials were received from MTDC, from MTDC's General Counsel Terrence Whitfield, from MTDC's CISO Lucia Marchetti, from referring counsel Constance Hargrove, or from any other person or entity acting on MTDC's behalf.

Client Confidential Information Received: None. No confidential, privileged, proprietary, or otherwise sensitive information was received from MTDC or any person or entity acting on its behalf. Communications with MTDC during the intake process were limited to (i) identification of the prospective client and the general nature of the proposed engagement, (ii) identification of the anticipated adverse parties, and (iii) scheduling and logistical matters.

Prospective Client Materials to Be Returned: Not applicable. No materials were received from the prospective client, and accordingly no materials are required to be returned.

8.2 Confirmation by Responsible Partner

Rachel Bernstein, as the responsible partner for Matter No. 1031-00001, hereby confirms that no substantive client documents or confidential information were received from Metropolitan Transit Development Corp. at any point during the intake process. All communications with MTDC were limited to the intake screening described above, and no information received from MTDC during the intake process is of a nature that would create any duty of confidentiality or that could be used to the disadvantage of MTDC in any future matter.

8.3 Existing Client (Pinnacle) Information Disclosure

None of Pinnacle Workforce Analytics, Inc.'s confidential information was disclosed to the proposed MTDC engagement team at any time. Rachel Bernstein, Devon Archer, and Nadia Petrov did not access, review, or receive any of Pinnacle's confidential materials in connection with the intake and conflicts analysis for Matter No. 1031-00001. The conflicts analysis was conducted by the Conflicts & New Business Department based on information available in the firm's conflicts database and matter management system, without reference to substantive case files or confidential client information.

This has been confirmed by Colleen Farrow, Director, Conflicts & New Business, in a memorandum addressed to Jonathan Mercer (Pinnacle engagement partner) dated May 23, 2024. Mr. Mercer has acknowledged receipt of that memorandum.

Section 9: Document Retention

Retention Category: Declined Engagements — Conflicts (Category DE-C under the Calderwood & Harkness LLP Document Retention Policy, as amended January 2023)

Retention Period: Seven (7) years from the date of matter closure. All materials identified below shall be retained through May 23, 2031, at which time they will be eligible for destruction in accordance with the firm's standard document destruction procedures, subject to any applicable legal holds or regulatory requirements then in effect.

Materials to Be Retained: The following documents and materials are to be maintained in the matter file for Matter No. 1031-00001 for the duration of the seven-year retention period:

1. New-Matter Intake Request Form (C&H Form NM-1), dated May 9, 2024

2. Conflicts Search Request Memorandum, dated May 9, 2024

3. Conflicts Search Report — Round 1, dated May 10, 2024

4. Supplemental Conflicts Search Report — Round 2, dated May 13, 2024

5. All internal email correspondence related to the conflicts analysis (preserved in the firm's email archiving system and cross-referenced to Matter No. 1031-00001)

6. Conflicts Committee Meeting Agenda and Supporting Materials, dated May 14, 2024

7. Conflicts Committee Analysis Memorandum — Draft, dated May 13, 2024

8. Conflicts Committee Analysis Memorandum — Final, dated May 14, 2024

9. Conflicts Committee Meeting Minutes, dated May 14, 2024

10. Conflicts Committee Resolution — Formal Declination, dated May 14, 2024

11. Ethics Analysis Memoranda addressing Illinois Rules of Professional Conduct 1.7, 1.7(b), 1.9, and 1.10

12. Confidential Information Inventory — Pinnacle Workforce Analytics, Inc. (prepared by Conflicts & New Business in coordination with the Pinnacle engagement team)

13. Internal Declination Memorandum, dated May 16, 2024

14. Draft Declination Letter to MTDC, dated May 16, 2024

15. Final Declination Letter to MTDC, dated May 17, 2024

16. Referral Memorandum (internal), dated May 20, 2024

17. Referral Letter to MTDC, dated May 20, 2024

18. Return-of-Materials Confirmation Letter to MTDC, dated May 23, 2024

19. This Matter Closure Form (C&H Form MC-1), dated May 23, 2024

20. Document Retention and Destruction Memorandum for Matter No. 1031-00001, dated May 23, 2024

Responsible Custodian for Retained Files: Colleen Farrow, Director, Conflicts & New Business, Calderwood & Harkness LLP, One North Wacker Drive, Suite 4200, Chicago, IL 60606. Ms. Farrow is responsible for ensuring the secure maintenance, accessibility, and ultimate destruction (when eligible) of all materials retained under this matter.

Materials to Be Destroyed: None at this time. All materials identified above are subject to the seven-year retention period. No materials generated in connection with Matter No. 1031-00001 are eligible for immediate destruction.

Reference: Calderwood & Harkness LLP Document Retention and Destruction Memorandum for Matter No. 1031-00001, dated May 23, 2024, prepared by Colleen Farrow and approved by Rachel Bernstein.

Section 10: Conflicts Database Update

Database Updated: Yes — May 23, 2024

Entries Made: The following entries have been made in the firm's conflicts database (IntegriCheck™ Conflicts Management System, v. 8.4):

(a) Metropolitan Transit Development Corp. has been recorded as a declined prospective client. MTDC's status in the system is designated as "Declined — Prospective Client (No Relationship Formed)." MTDC is not recorded as a current client or former client of the firm.

(b) The nature of the conflict has been recorded as: unwaivable current-client conflict under Illinois Rule of Professional Conduct 1.7(a)(1) and 1.7(a)(2), with waivability analysis under Rule 1.7(b) resulting in a determination that the conflict is not waivable. The associated Conflicts Committee Resolution date (May 14, 2024) has been entered.

(c) A cross-reference has been created linking Matter No. 1031-00001 (MTDC — Declined) to Matter No. 1031-00001 (Pinnacle Workforce Analytics, Inc. — Active). The cross-reference identifies the nature of the relationship between the two matters and the basis for the conflict.

Future Search Implications: Future conflicts searches conducted by the firm involving either Metropolitan Transit Development Corp. (or any known aliases, affiliates, or successor entities) or Pinnacle Workforce Analytics, Inc. (or any known aliases, affiliates, or successor entities) will surface this record and the associated cross-reference. Any future intake involving either entity should be flagged for review by the Conflicts & New Business Department to ensure that the historical conflict is considered in connection with any new engagement evaluation.

Processed by: Colleen Farrow, Director, Conflicts & New Business

Reference: Conflicts Database Update Memorandum, dated May 23, 2024, prepared by Colleen Farrow

Section 11: Notifications Completed

The following notifications have been completed in connection with the closure of Matter No. 1031-00001:

All notifications listed above have been completed and copies have been placed in the matter file for Matter No. 1031-00001.

Section 12: Certifications and Signatures

12.1 Prepared By

Name: Rachel Bernstein Title: Partner, Privacy & Data Security Practice Group Date: May 23, 2024

Signature: ________

Rachel Bernstein

Certification: I certify that the information provided in this Matter Closure Form is accurate and complete to the best of my knowledge; that no attorney-client relationship was formed with Metropolitan Transit Development Corp.; that no substantive legal services were rendered; that no client documents or confidential information were received from the prospective client; and that no fees were billed or disbursements incurred. I further certify that I have reviewed the contents of this form and confirm that all statements herein are consistent with my personal knowledge and the records maintained in connection with Matter No. 1031-00001.

12.2 Processed and Approved By

Name: Colleen Farrow Title: Director, Conflicts & New Business Date: May 23, 2024

Signature: ________

Colleen Farrow

Certification: I confirm that this matter has been closed in the firm's matter management, billing, and conflicts systems; that the conflicts database has been updated as described herein; and that all applicable document retention procedures have been initiated. I further confirm that all notifications identified in Section 11 of this form have been completed, that the matter file has been assembled and secured in accordance with the firm's Document Retention Policy, and that the Conflicts Database Update Memorandum dated May 23, 2024, accurately reflects the entries made in the firm's conflicts system.

12.3 Reviewed By (Conflicts Committee Chair)

Name: Lawrence Keating Title: Senior Partner; Chair, Conflicts Committee Date: May 23, 2024

Signature: ________

Lawrence Keating

Notation: Closure consistent with Conflicts Committee Resolution dated May 14, 2024. I have reviewed this Matter Closure Form and confirm that the closure of Matter No. 1031-00001 is in accordance with the unanimous determination of the Conflicts Committee and the Formal Declination Resolution executed on May 14, 2024.

FORM REFERENCE AND DISTRIBUTION

Form Reference: C&H Form MC-1 (Rev. 03/2023)

Matter No.: 1031-00001

Confidentiality Notice: This form and all attachments constitute confidential internal administrative work product of Calderwood & Harkness LLP. This document is intended solely for use by authorized personnel of Calderwood & Harkness LLP and is not to be disclosed, disseminated, distributed, or copied outside the firm without the prior written authorization of the Conflicts Committee Chair or the Firm General Counsel. Unauthorized disclosure may result in disciplinary action and may implicate the firm's ethical obligations under the Illinois Rules of Professional Conduct.

Distribution:

• Conflicts & New Business Department (Colleen Farrow, Director)

• Firm Finance Department (Accounts Administration)

• Firm General Counsel (Helen Drazkowski)

• Management Committee (via Quarterly Conflicts Committee Report, Q2 2024)

Line Item	Amount
Total Fees Billed	$0.00
Total Disbursements Incurred	$0.00
Total Payments Received	$0.00
Outstanding Accounts Receivable	$0.00
Trust / Escrow Balances Held	$0.00
Retainer Received	None
Notification	Recipient	Date	Method
Declination letter	Terrence Whitfield, General Counsel, MTDC	May 17, 2024	Email with attachment (encrypted)
Copy of declination letter	Constance Hargrove, Partner, Hargrove, Tillman & Reese LLP	May 17, 2024	Email (cc)
Referral letter	Terrence Whitfield, General Counsel, MTDC	May 20, 2024	Email with attachment
Referral heads-up	Victoria Aldridge, Partner, Aldridge, Paulson & Cho LLP	May 20, 2024	Email
Referral heads-up	Damien Northfield, Partner, Northfield McKay LLP	May 20, 2024	Email
Return-of-materials confirmation	Terrence Whitfield, General Counsel, MTDC	May 23, 2024	Letter (via email and U.S. mail)
Matter closure notification — engagement team	Miriam Calloway, Devon Archer, Nadia Petrov	May 23, 2024	Email
Matter closure notification — finance	C&H Finance Department (Attn: Accounts Administration)	May 23, 2024	Email (sent by Colleen Farrow)
Confirmation to existing client partner	Jonathan Mercer, Partner (Pinnacle engagement partner)	May 23, 2024	Internal memorandum

CONFIDENTIAL — ATTORNEY WORK PRODUCT / ADMINISTRATIVE
CALDERWOOD & HARKNESS LLP
600 Lexington Avenue, 38th Floor New York, NY 10022
MATTER CLOSURE FORM (C&H Form MC-1)
Form Version: MC-1 (Rev. 03/2023)
Processing Office: One North Wacker Drive, Suite 4200 Chicago, IL 60606
Classification: CONFIDENTIAL — ATTORNEY WORK PRODUCT / ADMINISTRATIVE. This form and all attachments constitute confidential internal administrative work product of Calderwood & Harkness LLP and are not to be disclosed outside the firm without the prior written authorization of the Conflicts Committee Chair or the Firm General Counsel.
Section 1: Matter Identification
Matter Number: 1031-00001
Matter Name: Metropolitan Transit Development Corp. — BIPA Enforcement Defense / Employee Class Action Defense
Date Opened: May 9, 2024
Date Closed: May 23, 2024
Office: Chicago (One North Wacker Drive, Suite 4200, Chicago, IL 60606)
Practice Group(s): Privacy & Data Security; Labor & Employment
Matter Status: Closed — Terminated (Conflicts Declination)
Description: This matter was opened on May 9, 2024, in connection with a prospective engagement by Metropolitan Transit Development Corp. ("MTDC") seeking representation in regulatory enforcement and class action defense proceedings arising from alleged violations of the Illinois Biometric Information Privacy Act ("BIPA") and related state privacy and employment statutes. The matter is being closed as of May 23, 2024, following a formal determination by the Firm's Conflicts Committee that acceptance of the proposed engagement would create an unwaivable conflict of interest with an existing firm client, Pinnacle Workforce Analytics, Inc. No attorney-client relationship was formed with MTDC. No substantive legal services were rendered. No fees were billed and no disbursements were incurred.
Section 2: Client Information
Prospective Client Full Legal Name: Metropolitan Transit Development Corp.
Short Name / Acronym: MTDC / Metro Transit
Entity Type: Unit of local government; special-purpose transit authority created and operating under the authority of the Illinois Local Mass Transit District Act, 70 ILCS 3610/1 et seq.
Jurisdiction of Organization: State of Illinois
Principal Office Address: 550 West Harrison Street, Suite 1400, Chicago, IL 60607
Client Employer Identification Number (EIN): 36-6041928
Primary Client Contact: Terrence Whitfield, General Counsel, Metropolitan Transit Development Corp., 550 West Harrison Street, Suite 1400, Chicago, IL 60607. Mr. Whitfield served as the principal point of contact for all communications related to the proposed engagement, including the initial intake inquiry and receipt of the declination letter.
Secondary Client Contact: Lucia Marchetti, Chief Information Security Officer, Metropolitan Transit Development Corp., 550 West Harrison Street, Suite 1400, Chicago, IL 60607. Ms. Marchetti was identified as the primary technical contact for purposes of the proposed engagement, with particular responsibility for matters relating to the TruScan 360 workforce-management platform and associated biometric-data practices.
Client Executive Director: Darnell Okafor, Executive Director, Metropolitan Transit Development Corp.
Referring Counsel: Constance Hargrove, Partner, Hargrove, Tillman & Reese LLP, 233 South Wacker Drive, Suite 5600, Chicago, IL 60606. Ms. Hargrove serves as MTDC's existing outside general counsel and referred the prospective engagement to Calderwood & Harkness for specialized BIPA defense capability. Ms. Hargrove was copied on all substantive communications with MTDC regarding the declination.
Client Relationship Status: Declined prospective client — no attorney-client relationship formed. MTDC has not previously retained Calderwood & Harkness LLP in any capacity, and no prior matter records exist in the firm's systems for MTDC or any of its predecessors, subsidiaries, or affiliated entities.
Section 3: Engagement Team
The following personnel were assigned to the intake and conflicts-screening process associated with Matter No. 1031-00001. As noted below, no substantive legal work was performed for the prospective client at any time.
Responsible Partner: Rachel Bernstein, Partner, Privacy & Data Security Practice Group, Chicago Office. Ms. Bernstein was designated as the responsible partner for purposes of the intake evaluation and was the primary point of contact with MTDC General Counsel Terrence Whitfield and referring counsel Constance Hargrove.
Billing Partner: Miriam Calloway, Partner, Healthcare & Life Sciences Practice Group, Chicago Office. Ms. Calloway was designated as billing partner in the firm's matter management system upon the opening of the matter, in accordance with standard firm intake procedures.
Lead Associate: Devon Archer, Associate (Class of 2019), Labor & Employment Practice Group, Chicago Office. Mr. Archer was assigned as lead associate for the proposed engagement and participated in the preliminary scope assessment and internal conflicts analysis.
Working Associate: Nadia Petrov, Associate (Class of 2021), Labor & Employment Practice Group, Chicago Office. Ms. Petrov was assigned as the working associate for the proposed engagement and assisted with the preliminary scope assessment.
Important Note Regarding Scope of Team Activities: No substantive legal work was performed for the prospective client. The engagement team's activities were strictly limited to intake screening, preliminary assessment of the proposed scope of engagement, and internal conflicts analysis. At no time did any member of the engagement team provide legal advice to MTDC, draft or review legal documents on MTDC's behalf, communicate legal strategy to MTDC, or otherwise undertake activities that would give rise to an attorney-client relationship. All time recorded by members of the engagement team in connection with this matter was entered as non-billable administrative time under the firm's standard intake and conflicts time codes.
Section 4: Description of Proposed Engagement
4.1 Scope of Proposed Representation
The proposed engagement, as described in communications from MTDC General Counsel Terrence Whitfield and referring counsel Constance Hargrove, encompassed the following categories of legal services:
(a) Regulatory Enforcement Defense — Illinois Attorney General CID. Defense of a Civil Investigative Demand ("CID") issued by the Illinois Attorney General's Bureau of Civil Rights, Reference No. CRB-2024-0417, dated April 22, 2024. The CID alleges that MTDC engaged in violations of the Illinois Biometric Information Privacy Act ("BIPA"), 740 ILCS 14/1 et seq., and the Illinois Personal Information Protection Act ("PIPA"), 815 ILCS 530/1 et seq., in connection with MTDC's deployment of a biometric-data-driven workforce-management platform used to collect, store, process, and disseminate the fingerprint scans, facial-geometry data, and hand-geometry data of MTDC employees. The CID demands production of documents and data relating to MTDC's biometric-data collection practices, employee consent procedures, data-retention and data-destruction schedules, vendor contracts, and data-sharing arrangements.
(b) Employee Class Action Defense — Cook County Circuit Court. Defense of a putative employee class action filed in the Circuit Court of Cook County, Chancery Division, Case No. 2024-CH-04417, filed April 29, 2024. The complaint was filed on behalf of a putative class of approximately 12,400 current and former MTDC employees, alleging violations of BIPA Sections 15(a), 15(b), 15(c), 15(d), and 15(e), as well as related state-law claims for invasion of privacy, negligence, and breach of implied contract. Plaintiffs seek statutory damages under BIPA Section 20 (liquidated damages of $1,000 per negligent violation and $5,000 per intentional or reckless violation), injunctive relief, and attorneys' fees. Plaintiffs' class counsel is identified as Kessler, Brandt & O'Neill LLP, 120 North LaSalle Street, Suite 2200, Chicago, IL 60602. Lead counsel: Martin Kessler. Co-counsel: Yolanda Brandt.
(c) Biometric-Data Practices Remediation Advice. General advisory services relating to the remediation of MTDC's biometric-data collection, storage, processing, dissemination, and destruction practices, with particular focus on practices implemented through the TruScan 360 workforce-management platform developed and licensed by Pinnacle Workforce Analytics, Inc. The proposed remediation advice would have encompassed review and revision of employee consent forms, data-retention schedules, data-destruction protocols, written biometric-data policies, and vendor data-processing agreements.
(d) Cross-Claims and Indemnification Proceedings Against Technology Vendors. Assessment and potential prosecution of cross-claims and indemnification demands against MTDC's technology vendors, including Pinnacle Workforce Analytics, Inc., under the Master Software License and Services Agreement ("MSLA") between MTDC and Pinnacle dated June 15, 2021. The MSLA, which has a total contract value of approximately $8,700,000 over a five-year term, contains indemnification provisions, warranties regarding regulatory compliance, and representations concerning BIPA compliance. MTDC indicated that it intended to assert that Pinnacle bears contractual responsibility for the design and implementation of the biometric-data practices at issue in the CID and the class action.
(e) Related Employment Counseling. General employment counseling concerning MTDC's workforce-monitoring policies, including review and revision of employee handbooks, acceptable-use policies, and collective bargaining agreement provisions relating to biometric data and electronic monitoring.
4.2 Anticipated Adverse Parties
The following parties were identified as actual or anticipated adverse parties in connection with the proposed engagement:
(a) Office of the Illinois Attorney General, Bureau of Civil Rights. The Bureau of Civil Rights issued the CID at the direction of the Deputy Attorney General for Civil Rights, Malcolm Jeffries. The Attorney General's office has retained outside special counsel for this matter: Ridgeway & Falk LLP (Diane Falk, lead counsel), 401 East Adams Street, Suite 300, Springfield, IL 62701.
(b) Putative Employee Class. A putative class of approximately 12,400 current and former MTDC employees, as identified in the class action complaint filed in Case No. 2024-CH-04417. The putative class is represented by Kessler, Brandt & O'Neill LLP, 120 North LaSalle Street, Suite 2200, Chicago, IL 60602. Lead counsel: Martin Kessler. Co-counsel: Yolanda Brandt.
(c) Pinnacle Workforce Analytics, Inc. Pinnacle was identified as a potential cross-claim and indemnification target under the MSLA dated June 15, 2021. Pinnacle is also a named responsible party in the Attorney General's CID. MTDC's proposed litigation strategy contemplated asserting affirmative claims against Pinnacle for breach of contract, breach of warranty, and contractual indemnification.
Section 5: Reason for Closure
5.1 Closure Category
Conflicts Declination — Unwaivable Current-Client Conflict.
5.2 Summary of Conflict
Calderwood & Harkness LLP currently represents Pinnacle Workforce Analytics, Inc. ("Pinnacle"), a Delaware corporation with its principal offices at 11900 Sunrise Valley Drive, Suite 500, Reston, VA 20191 (EIN: 54-2198437). The firm's existing engagement with Pinnacle is recorded under Matter No. 1031-00001, which was opened on March 14, 2022. The responsible partner for the Pinnacle engagement is Jonathan Mercer, Partner, intellectual Property / Patent Litigation Practice Group. The lead associate is Priya Subramaniam, Associate, intellectual Property / Patent Litigation Practice Group.
The existing Pinnacle engagement involves patent-enforcement litigation concerning the TruScan 360 biometric workforce-management platform. Specifically, Calderwood & Harkness represents Pinnacle as plaintiff in Pinnacle Workforce Analytics, Inc. v. Veritas Biometrics Corp., United States District Court for the Eastern District of Virginia, Case No. 1:22-cv-01533 (filed September 6, 2022). In that litigation, the firm has advanced arguments on behalf of Pinnacle asserting the novelty, technical sophistication, commercial value, and legitimate functionality of the TruScan 360 platform, including its biometric-data collection, processing, storage, and analysis capabilities.
The proposed MTDC engagement would have created a direct and irreconcilable conflict with the existing Pinnacle representation in the following respects:
(a) Direct Adversity. The proposed MTDC engagement would have required Calderwood & Harkness to argue — on behalf of MTDC and against the interests of Pinnacle — that the TruScan 360 platform's biometric-data collection, storage, and dissemination practices violated BIPA. This position is directly adverse to Pinnacle's interests and is diametrically opposed to the arguments the firm has advanced and continues to advance in the patent-enforcement litigation on Pinnacle's behalf regarding the legitimacy, innovation, and commercial value of TruScan 360.
(b) Adversity in Cross-Claims and Indemnification. MTDC's anticipated cross-claims and indemnification demands would be asserted directly against Pinnacle under the MSLA dated June 15, 2021 (total contract value: $8,700,000 over five years). The firm would have been required to prosecute affirmative claims against its own current client.
(c) Pinnacle as Co-Respondent in AG Enforcement Action. Pinnacle is a named responsible party in the Attorney General's CID (Ref. No. CRB-2024-0417). Defense of MTDC in the CID proceeding would necessarily entail shifting responsibility to Pinnacle for the design and implementation of the biometric-data practices under investigation.
(d) Possession of Pinnacle Confidential Information. Through the patent-enforcement litigation, the firm possesses significant quantities of Pinnacle's confidential and proprietary information that is directly relevant to the TruScan 360 platform, including technical specifications, source-code architecture summaries, data-flow diagrams, algorithmic design documentation, biometric-data retention and destruction policies, and related trade-secret materials. Use of this information in the proposed MTDC engagement would breach the firm's duties of confidentiality to Pinnacle.
5.3 Applicable Ethics Rules
The conflicts analysis was conducted under the following provisions of the Illinois Rules of Professional Conduct:
• Rule 1.7(a)(1) — Direct Adversity. The proposed engagement would involve representation of MTDC directly adverse to an existing client, Pinnacle, in the same or a substantially related matter. The TruScan 360 platform is the subject of both the existing Pinnacle representation and the proposed MTDC engagement. The firm would be required to take positions on behalf of MTDC that are directly contrary to positions it has taken and continues to take on behalf of Pinnacle.
• Rule 1.7(a)(2) — Material Limitation. Even absent direct adversity, the firm's obligations to Pinnacle would materially limit its ability to represent MTDC effectively. The firm's possession of Pinnacle's confidential information, its ongoing litigation strategy on Pinnacle's behalf, and its duties of loyalty to Pinnacle would constrain and compromise the firm's advocacy on behalf of MTDC.
• Rule 1.7(b) — Waivability Assessment. The Conflicts Committee determined that the conflict is not waivable under Rule 1.7(b). Specifically, the Conflicts Committee concluded that (i) it is not possible for the firm to provide competent and diligent representation to both MTDC and Pinnacle simultaneously given the directly opposing positions required, (ii) the representation of one client would involve the assertion of a claim by one client against another client represented by the firm in the same litigation or a substantially related proceeding, and (iii) the circumstances are such that informed consent, even if given by both clients, would not cure the conflict. The Conflicts Committee further noted that it did not seek Pinnacle's consent to the proposed dual representation because the conflict was determined to be structurally unwaivable.
• Rule 1.10 — Imputation. The Conflicts Committee analyzed whether screening mechanisms could be employed to address the conflict and determined that, under Illinois Rule 1.10, screening is not available to cure a concurrent-client conflict arising from a current firm partner's active representation of the conflicting client. Screening under Rule 1.10(a)(2) is limited to situations involving former-client conflicts attributable to lawyers who have changed firms and does not extend to the present circumstances.
Additionally, the Conflicts Committee considered Illinois Rule 1.9 (Duties to Former Clients) for the purpose of confirming that even if the Pinnacle engagement were to conclude in the future, the firm's duties to Pinnacle as a former client would independently preclude the MTDC engagement due to the substantial relationship between the matters and the confidential information possessed by the firm.
5.4 Conflicts Committee Determination
The Calderwood & Harkness Conflicts Committee convened on May 14, 2024, to consider the conflicts analysis prepared in connection with Matter No. 1031-00001. The Committee was chaired by Lawrence Keating, Senior Partner and Chair of the Conflicts Committee. After review of the Conflicts Search Reports (Rounds 1 and 2), the Conflicts Committee Analysis Memorandum, and the applicable ethics rules and authorities, the Committee unanimously determined that the conflict between the proposed MTDC engagement and the existing Pinnacle representation is unwaivable under Illinois Rule 1.7.
A Formal Conflicts Committee Resolution memorializing the declination determination was executed by Lawrence Keating on May 14, 2024. Firm General Counsel Helen Drazkowski reviewed the Conflicts Committee's analysis and concurred with the determination that the conflict is unwaivable and that the proposed engagement must be declined.
5.5 Reference Documents
The following documents were generated in connection with the conflicts analysis and are maintained in the matter file:
1. Conflicts Search Report — Round 1 (dated May 10, 2024)
2. Supplemental Conflicts Search Report — Round 2 (dated May 13, 2024)
3. Conflicts Committee Analysis Memorandum — Final (dated May 14, 2024)
4. Conflicts Committee Meeting Minutes (dated May 14, 2024)
5. Conflicts Committee Resolution — Formal Declination (dated May 14, 2024)
6. Ethics Analysis Memoranda addressing Illinois Rules 1.7, 1.7(b), 1.9, and 1.10
Section 6: Client Notification
6.1 Declination Notification
Date Prospective Client Notified of Declination: May 17, 2024
Method of Notification: Formal declination letter transmitted via email (encrypted) to Terrence Whitfield, General Counsel, Metropolitan Transit Development Corp. The declination letter explained that the firm was unable to accept the proposed engagement due to a conflict of interest with an existing client. Consistent with the firm's ethical obligations, the declination letter did not identify the conflicting client or disclose any details regarding the nature of the existing engagement.
Recipient: Terrence Whitfield, General Counsel, Metropolitan Transit Development Corp., 550 West Harrison Street, Suite 1400, Chicago, IL 60607
Copy to: Constance Hargrove, Partner, Hargrove, Tillman & Reese LLP, 233 South Wacker Drive, Suite 5600, Chicago, IL 60606 (MTDC's existing outside counsel and referring counsel). Ms. Hargrove was included on the declination communication at the request of Mr. Whitfield.
6.2 Referral to Alternative Counsel
Referral Provided: Yes
A referral letter dated May 20, 2024, was transmitted to Terrence Whitfield recommending two alternative firms with substantial BIPA defense experience:
(a) Aldridge, Paulson & Cho LLP — Victoria Aldridge, Partner and BIPA Practice Lead, 150 North Michigan Avenue, Suite 3500, Chicago, IL 60601. Ms. Aldridge has extensive experience defending BIPA class actions and regulatory enforcement proceedings on behalf of public-sector and quasi-governmental entities.
(b) Northfield McKay LLP — Damien Northfield, Partner and Data-Privacy Litigation Practice Lead, 311 South Wacker Drive, Suite 4800, Chicago, IL 60606. Mr. Northfield has significant experience with BIPA defense and vendor-indemnification disputes involving biometric-technology providers.
Courtesy heads-up emails were sent to both Victoria Aldridge and Damien Northfield on May 20, 2024, advising them that MTDC might be in contact regarding a potential engagement. No privileged information, confidential information, or details regarding the substance of the proposed engagement or the nature of the conflict were disclosed to either firm in these communications.
6.3 Return-of-Materials Confirmation
A return-of-materials confirmation letter was sent to Terrence Whitfield on May 23, 2024. The letter confirmed that no client documents, confidential information, or other materials were received from MTDC at any time during the intake process, and accordingly there are no materials to return.
6.4 Attorney-Client Relationship
Attorney-Client Relationship Formed: No. At no point during the intake and conflicts-screening process did Calderwood & Harkness LLP form an attorney-client relationship with Metropolitan Transit Development Corp. No legal advice was provided, no legal services were rendered, and no confidential information was received from the prospective client.
Section 7: Financial Summary
Estimated Foregone Fees (for Management Committee Reporting Purposes): $3,500,000 – $5,200,000. This estimate reflects an 18- to 24-month projection based on blended rates as follows: partner rate of $1,150 per hour; senior associate rate of $785 per hour; junior associate rate of $625 per hour. The estimate takes into account the anticipated scope and complexity of the CID defense, class action defense, vendor cross-claims, remediation advisory work, and related employment counseling. This estimate is provided for internal Management Committee reporting purposes only and does not represent a fee agreement, budget, or commitment.
Existing Client Annual Billings at Stake — Pinnacle Workforce Analytics, Inc. (FY 2023): $2,137,500. This figure represents the firm's total billings to Pinnacle under Matter No. 1031-00001 and related matters for the fiscal year ended December 31, 2023. This information is provided for Management Committee reporting purposes to contextualize the economic implications of the conflicts declination.
Note: All time entries recorded by members of the engagement team in connection with the intake and conflicts review for Matter No. 1031-00001 were recorded as non-billable administrative time under firm time codes ADM-INTAKE and ADM-CONFLICTS. No billable time was generated. No fees were charged to the prospective client or to any other client of the firm.
Section 8: Client Documents and Confidential Information
8.1 Prospective Client Materials
Client Documents Received from Prospective Client: None. No documents, files, data, or other materials were received from MTDC, from MTDC's General Counsel Terrence Whitfield, from MTDC's CISO Lucia Marchetti, from referring counsel Constance Hargrove, or from any other person or entity acting on MTDC's behalf.
Client Confidential Information Received: None. No confidential, privileged, proprietary, or otherwise sensitive information was received from MTDC or any person or entity acting on its behalf. Communications with MTDC during the intake process were limited to (i) identification of the prospective client and the general nature of the proposed engagement, (ii) identification of the anticipated adverse parties, and (iii) scheduling and logistical matters.
Prospective Client Materials to Be Returned: Not applicable. No materials were received from the prospective client, and accordingly no materials are required to be returned.
8.2 Confirmation by Responsible Partner
Rachel Bernstein, as the responsible partner for Matter No. 1031-00001, hereby confirms that no substantive client documents or confidential information were received from Metropolitan Transit Development Corp. at any point during the intake process. All communications with MTDC were limited to the intake screening described above, and no information received from MTDC during the intake process is of a nature that would create any duty of confidentiality or that could be used to the disadvantage of MTDC in any future matter.
8.3 Existing Client (Pinnacle) Information Disclosure
None of Pinnacle Workforce Analytics, Inc.'s confidential information was disclosed to the proposed MTDC engagement team at any time. Rachel Bernstein, Devon Archer, and Nadia Petrov did not access, review, or receive any of Pinnacle's confidential materials in connection with the intake and conflicts analysis for Matter No. 1031-00001. The conflicts analysis was conducted by the Conflicts & New Business Department based on information available in the firm's conflicts database and matter management system, without reference to substantive case files or confidential client information.
This has been confirmed by Colleen Farrow, Director, Conflicts & New Business, in a memorandum addressed to Jonathan Mercer (Pinnacle engagement partner) dated May 23, 2024. Mr. Mercer has acknowledged receipt of that memorandum.
Section 9: Document Retention
Retention Category: Declined Engagements — Conflicts (Category DE-C under the Calderwood & Harkness LLP Document Retention Policy, as amended January 2023)
Retention Period: Seven (7) years from the date of matter closure. All materials identified below shall be retained through May 23, 2031, at which time they will be eligible for destruction in accordance with the firm's standard document destruction procedures, subject to any applicable legal holds or regulatory requirements then in effect.
Materials to Be Retained: The following documents and materials are to be maintained in the matter file for Matter No. 1031-00001 for the duration of the seven-year retention period:
1. New-Matter Intake Request Form (C&H Form NM-1), dated May 9, 2024
2. Conflicts Search Request Memorandum, dated May 9, 2024
3. Conflicts Search Report — Round 1, dated May 10, 2024
4. Supplemental Conflicts Search Report — Round 2, dated May 13, 2024
5. All internal email correspondence related to the conflicts analysis (preserved in the firm's email archiving system and cross-referenced to Matter No. 1031-00001)
6. Conflicts Committee Meeting Agenda and Supporting Materials, dated May 14, 2024
7. Conflicts Committee Analysis Memorandum — Draft, dated May 13, 2024
8. Conflicts Committee Analysis Memorandum — Final, dated May 14, 2024
9. Conflicts Committee Meeting Minutes, dated May 14, 2024
10. Conflicts Committee Resolution — Formal Declination, dated May 14, 2024
11. Ethics Analysis Memoranda addressing Illinois Rules of Professional Conduct 1.7, 1.7(b), 1.9, and 1.10
12. Confidential Information Inventory — Pinnacle Workforce Analytics, Inc. (prepared by Conflicts & New Business in coordination with the Pinnacle engagement team)
13. Internal Declination Memorandum, dated May 16, 2024
14. Draft Declination Letter to MTDC, dated May 16, 2024
15. Final Declination Letter to MTDC, dated May 17, 2024
16. Referral Memorandum (internal), dated May 20, 2024
17. Referral Letter to MTDC, dated May 20, 2024
18. Return-of-Materials Confirmation Letter to MTDC, dated May 23, 2024
19. This Matter Closure Form (C&H Form MC-1), dated May 23, 2024
20. Document Retention and Destruction Memorandum for Matter No. 1031-00001, dated May 23, 2024
Responsible Custodian for Retained Files: Colleen Farrow, Director, Conflicts & New Business, Calderwood & Harkness LLP, One North Wacker Drive, Suite 4200, Chicago, IL 60606. Ms. Farrow is responsible for ensuring the secure maintenance, accessibility, and ultimate destruction (when eligible) of all materials retained under this matter.
Materials to Be Destroyed: None at this time. All materials identified above are subject to the seven-year retention period. No materials generated in connection with Matter No. 1031-00001 are eligible for immediate destruction.
Reference: Calderwood & Harkness LLP Document Retention and Destruction Memorandum for Matter No. 1031-00001, dated May 23, 2024, prepared by Colleen Farrow and approved by Rachel Bernstein.
Section 10: Conflicts Database Update
Database Updated: Yes — May 23, 2024
Entries Made: The following entries have been made in the firm's conflicts database (IntegriCheck™ Conflicts Management System, v. 8.4):
(a) Metropolitan Transit Development Corp. has been recorded as a declined prospective client. MTDC's status in the system is designated as "Declined — Prospective Client (No Relationship Formed)." MTDC is not recorded as a current client or former client of the firm.
(b) The nature of the conflict has been recorded as: unwaivable current-client conflict under Illinois Rule of Professional Conduct 1.7(a)(1) and 1.7(a)(2), with waivability analysis under Rule 1.7(b) resulting in a determination that the conflict is not waivable. The associated Conflicts Committee Resolution date (May 14, 2024) has been entered.
(c) A cross-reference has been created linking Matter No. 1031-00001 (MTDC — Declined) to Matter No. 1031-00001 (Pinnacle Workforce Analytics, Inc. — Active). The cross-reference identifies the nature of the relationship between the two matters and the basis for the conflict.
Future Search Implications: Future conflicts searches conducted by the firm involving either Metropolitan Transit Development Corp. (or any known aliases, affiliates, or successor entities) or Pinnacle Workforce Analytics, Inc. (or any known aliases, affiliates, or successor entities) will surface this record and the associated cross-reference. Any future intake involving either entity should be flagged for review by the Conflicts & New Business Department to ensure that the historical conflict is considered in connection with any new engagement evaluation.
Processed by: Colleen Farrow, Director, Conflicts & New Business
Reference: Conflicts Database Update Memorandum, dated May 23, 2024, prepared by Colleen Farrow
Section 11: Notifications Completed
The following notifications have been completed in connection with the closure of Matter No. 1031-00001:
All notifications listed above have been completed and copies have been placed in the matter file for Matter No. 1031-00001.
Section 12: Certifications and Signatures
12.1 Prepared By
Name: Rachel Bernstein Title: Partner, Privacy & Data Security Practice Group Date: May 23, 2024
Signature: ________
Rachel Bernstein
Certification: I certify that the information provided in this Matter Closure Form is accurate and complete to the best of my knowledge; that no attorney-client relationship was formed with Metropolitan Transit Development Corp.; that no substantive legal services were rendered; that no client documents or confidential information were received from the prospective client; and that no fees were billed or disbursements incurred. I further certify that I have reviewed the contents of this form and confirm that all statements herein are consistent with my personal knowledge and the records maintained in connection with Matter No. 1031-00001.
12.2 Processed and Approved By
Name: Colleen Farrow Title: Director, Conflicts & New Business Date: May 23, 2024
Signature: ________
Colleen Farrow
Certification: I confirm that this matter has been closed in the firm's matter management, billing, and conflicts systems; that the conflicts database has been updated as described herein; and that all applicable document retention procedures have been initiated. I further confirm that all notifications identified in Section 11 of this form have been completed, that the matter file has been assembled and secured in accordance with the firm's Document Retention Policy, and that the Conflicts Database Update Memorandum dated May 23, 2024, accurately reflects the entries made in the firm's conflicts system.
12.3 Reviewed By (Conflicts Committee Chair)
Name: Lawrence Keating Title: Senior Partner; Chair, Conflicts Committee Date: May 23, 2024
Signature: ________
Lawrence Keating
Notation: Closure consistent with Conflicts Committee Resolution dated May 14, 2024. I have reviewed this Matter Closure Form and confirm that the closure of Matter No. 1031-00001 is in accordance with the unanimous determination of the Conflicts Committee and the Formal Declination Resolution executed on May 14, 2024.
FORM REFERENCE AND DISTRIBUTION
Form Reference: C&H Form MC-1 (Rev. 03/2023)
Matter No.: 1031-00001
Confidentiality Notice: This form and all attachments constitute confidential internal administrative work product of Calderwood & Harkness LLP. This document is intended solely for use by authorized personnel of Calderwood & Harkness LLP and is not to be disclosed, disseminated, distributed, or copied outside the firm without the prior written authorization of the Conflicts Committee Chair or the Firm General Counsel. Unauthorized disclosure may result in disciplinary action and may implicate the firm's ethical obligations under the Illinois Rules of Professional Conduct.
Distribution:
• Conflicts & New Business Department (Colleen Farrow, Director)
• Firm Finance Department (Accounts Administration)
• Firm General Counsel (Helen Drazkowski)
• Management Committee (via Quarterly Conflicts Committee Report, Q2 2024)
Line Item | Amount
Total Fees Billed | $0.00
Total Disbursements Incurred | $0.00
Total Payments Received | $0.00
Outstanding Accounts Receivable | $0.00
Trust / Escrow Balances Held | $0.00
Retainer Received | None
Notification | Recipient | Date | Method
Declination letter | Terrence Whitfield, General Counsel, MTDC | May 17, 2024 | Email with attachment (encrypted)
Copy of declination letter | Constance Hargrove, Partner, Hargrove, Tillman & Reese LLP | May 17, 2024 | Email (cc)
Referral letter | Terrence Whitfield, General Counsel, MTDC | May 20, 2024 | Email with attachment
Referral heads-up | Victoria Aldridge, Partner, Aldridge, Paulson & Cho LLP | May 20, 2024 | Email
Referral heads-up | Damien Northfield, Partner, Northfield McKay LLP | May 20, 2024 | Email
Return-of-materials confirmation | Terrence Whitfield, General Counsel, MTDC | May 23, 2024 | Letter (via email and U.S. mail)
Matter closure notification — engagement team | Miriam Calloway, Devon Archer, Nadia Petrov | May 23, 2024 | Email
Matter closure notification — finance | C&H Finance Department (Attn: Accounts Administration) | May 23, 2024 | Email (sent by Colleen Farrow)
Confirmation to existing client partner | Jonathan Mercer, Partner (Pinnacle engagement partner) | May 23, 2024 | Internal memorandum

CONFIDENTIAL — ATTORNEY WORK PRODUCT / ADMINISTRATIVE

CALDERWOOD & HARKNESS LLP

FORM REFERENCE AND DISTRIBUTION

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