CALDERWOOD & HARKNESS LLP Attorneys at Law
333 South Grand Avenue, Suite 4800 Los Angeles, California 90071 Telephone: (213) 614-7200 Facsimile: (213) 614-7201 www.calderwoodharkness.com
December 10, 2024
VIA E-FILING AND U.S. MAIL
The Honorable Patricia Yamamoto Judge of the Superior Court of California County of Los Angeles Stanley Mosk Courthouse 111 North Hill Street Los Angeles, California 90012
Re: Redstone Gaming Corp. v. Grizzly Peak Research LLC, et al. Case No. 24STCV-01892 Notice of Settlement
Dear Judge Yamamoto:
I am Francesca Morano, a partner at Calderwood & Harkness LLP, counsel of record for plaintiff Redstone Gaming Corp. ("RGC" or "Plaintiff"). I write respectfully to advise the Court that the parties in the above-captioned action have reached a settlement-in-principle resolving all claims and cross-claims asserted in this matter. The settlement-in-principle was reached on December 4, 2024, following a two-day mediation session conducted on December 3–4, 2024, before the Honorable Gerald K. Matsuda (Ret.) at the Westside Mediation Center in Los Angeles, California. At the conclusion of those proceedings, the settlement terms were memorialized in a binding Mediator's Term Sheet, which was signed by authorized representatives of all parties and their respective counsel on December 4, 2024. This letter is submitted for the purpose of notifying the Court of the settlement, requesting that all pending dates be vacated, and requesting that the Court set an appropriate status conference or Order to Show Cause re: Dismissal at a date convenient to the Court.
The parties to the settlement are as follows. Plaintiff Redstone Gaming Corp. is a Nevada corporation publicly traded on the Nasdaq Stock Market under the ticker symbol "RDGM," with its principal place of business at 8800 Crimson Ridge Parkway, Suite 1200, Las Vegas, Nevada 89113. Defendants are Grizzly Peak Research LLC, a Delaware limited liability company; Grizzly Peak Capital Partners LP, a Delaware limited partnership; and Tobias Fenchurch, individually (collectively, "Defendants"). Defendants are represented by the law firm of Caldwell, Tseng & Barrow LLP, with lead partner Raymond Caldwell serving as lead counsel of record, located at 555 California Street, Suite 3100, San Francisco, California 94104. This letter is filed with the full knowledge and consent of counsel for Defendants, and counsel for Defendants concurs in each of the requests made herein.
The parties have agreed to settle the entire action, including all four causes of action asserted in the First Amended Complaint filed on March 18, 2024, specifically: (1) Trade Libel pursuant to California Civil Code § 46(3); (2) Intentional Interference with Prospective Economic Advantage; (3) Unfair Business Practices in violation of California Business and Professions Code § 17200 et seq.; and (4) Negligent Misrepresentation. The settlement is binding upon all parties pursuant to the terms of the signed Mediator's Term Sheet. The parties are currently engaged in the process of drafting and negotiating the definitive Settlement Agreement and Mutual Release, together with related ancillary documents, including but not limited to mutual releases, non-disparagement provisions, and the agreed-upon form of corrective public statements to be issued by Defendants. The parties anticipate that the final Settlement Agreement will be fully executed by all parties on or before January 6, 2025 (the anticipated "Effective Date"), and counsel for both sides are working diligently toward that goal. The specific financial terms of the settlement are confidential pursuant to the terms of the Mediator's Term Sheet, although the existence of the settlement itself is not subject to confidentiality restrictions.
Upon the effective execution of the Settlement Agreement, the parties contemplate submitting two stipulated filings to this Court for its review and approval. First, the parties intend to file a Stipulation and [Proposed] Order for Dismissal of the Entire Action with Prejudice, which will be submitted to the Court within ten (10) business days of the Effective Date. Based on the anticipated Effective Date of January 6, 2025, the target filing date for the Stipulation for Dismissal is on or before February 19, 2025. Second, the parties intend to submit a Stipulation and [Proposed] Order for Entry of Permanent Injunction against Defendants, to be filed contemporaneously with or shortly after the Stipulation for Dismissal. The injunctive relief contemplated by the settlement is consistent with the equitable remedies sought in RGC's First Amended Complaint, including restrictions on the publication and dissemination of certain analytical reports and public statements concerning RGC's financial condition and business operations. In connection with the foregoing, the parties intend to request that the Court retain jurisdiction to enforce the terms of the Settlement Agreement pursuant to California Code of Civil Procedure § 664.6. Consistent with the settlement terms, each party will bear its own attorneys' fees and costs incurred in connection with this action.
In light of the settlement, Plaintiff respectfully requests that the Court vacate all currently pending dates in this matter. This request encompasses any and all scheduled trial dates, pretrial conferences, hearing dates, discovery cutoff dates, expert designation deadlines, motions in limine deadlines, and any other deadlines or calendar settings that may presently appear on the Court's docket in connection with this case. Plaintiff notes for the Court's reference that the last substantive motion in this action — Defendants' Motion for Summary Judgment, or, in the alternative, Summary Adjudication — was heard and denied by this Court on November 15, 2024. No further motions are currently pending, and no discovery disputes or other matters remain outstanding before the Court or any assigned discovery referee.
Plaintiff further respectfully requests that the Court set an Order to Show Cause re: Dismissal (Settlement), or alternatively a status conference, at the Court's convenience, at a date no earlier than mid-February 2025. This timeline is requested in order to allow the parties sufficient time to: (a) finalize, execute, and deliver the definitive Settlement Agreement and Mutual Release; (b) complete all conditions precedent to the settlement, including but not limited to the deposit of settlement funds into a designated escrow account administered by an independent escrow agent and the publication of corrective statements by Defendants in accordance with the terms of the settlement; and (c) prepare and file the stipulated filings referenced above. Plaintiff respectfully suggests that a date on or around February 19, 2025, or at the Court's earliest convenience thereafter, would be appropriate for such a hearing or conference. The parties will ensure that the Stipulation and [Proposed] Order for Dismissal with Prejudice and the Stipulation and [Proposed] Order for Entry of Permanent Injunction are filed with the Court in advance of any such hearing, so that the Court may review those submissions prior to the scheduled appearance.
Counsel for both Plaintiff and Defendants are available to appear for any hearing, conference, or other proceeding the Court may wish to schedule in connection with this matter. Should the Court have any questions or require any additional information regarding the status of the settlement or the requests made in this letter, please do not hesitate to contact the undersigned. I may be reached directly at Calderwood & Harkness LLP, 333 South Grand Avenue, Suite 4800, Los Angeles, California 90071; by telephone at (213) 614-7244; or by email at fmorano@calderwoodharkness.com. Defense counsel Raymond Caldwell may be reached at Caldwell, Tseng & Barrow LLP, 555 California Street, Suite 3100, San Francisco, California 94104; by telephone at (415) 392-8600; or by email at rcaldwell@ctblaw.com.
We thank the Court for its attention to this matter and for its diligent management of this case throughout the proceedings.
Respectfully submitted,
CALDERWOOD & HARKNESS LLP
By: ________
Francesca Morano Partner State Bar No. 247891 Attorneys for Plaintiff Redstone Gaming Corp.
cc: Raymond Caldwell, Esq., Caldwell, Tseng & Barrow LLP (Counsel for Defendants) cc: Natalie Orenstein, Esq., Caldwell, Tseng & Barrow LLP (Counsel for Defendants) cc: Derek Olafson, General Counsel, Redstone Gaming Corp.
Enclosures: None. The Mediator's Term Sheet executed on December 4, 2024, is confidential pursuant to its terms and is not attached hereto. The specific financial terms of the settlement are likewise confidential, although the existence of the settlement is not subject to any confidentiality restriction.
PROOF OF SERVICE
Redstone Gaming Corp. v. Grizzly Peak Research LLC, et al. Case No. 24STCV-01892
I, Hannah Brinkley, declare as follows:
I am employed in the County of Los Angeles, State of California. I am over the age of eighteen (18) years and am not a party to the within action. My business address is Calderwood & Harkness LLP, 333 South Grand Avenue, Suite 4800, Los Angeles, California 90071.
On December 10, 2024, I served the foregoing document described as NOTICE OF SETTLEMENT on the interested parties in this action by the methods indicated below, addressed as follows:
Raymond Caldwell, Esq. Natalie Orenstein, Esq. Caldwell, Tseng & Barrow LLP 555 California Street, Suite 3100 San Francisco, California 94104 Telephone: (415) 392-8600
Email: rcaldwell@ctblaw.com; norenstein@ctblaw.com
Attorneys for Defendants Grizzly Peak Research LLC, Grizzly Peak Capital Partners LP, and Tobias Fenchurch
BY ELECTRONIC SERVICE: I caused the above-referenced document to be transmitted electronically via the Court's electronic filing system to the persons at the electronic service addresses listed above. The transmission was reported as complete and without error.
BY U.S. MAIL: I caused the above-referenced document to be enclosed in a sealed envelope with postage thereon fully prepaid, and placed the envelope for collection and mailing at Calderwood & Harkness LLP, 333 South Grand Avenue, Suite 4800, Los Angeles, California 90071, following ordinary business practices for the collection and processing of correspondence for mailing. On the same date, correspondence so deposited is placed in the United States Postal Service in the ordinary course of business. The envelope was addressed to the persons at the addresses listed above.
I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct.
Executed on December 10, 2024, at Los Angeles, California.
________________________________________
Hannah Brinkley Legal Secretary Calderwood & Harkness LLP