1038-00001 · Cascade Retail Holdings · Hearing Preparation

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IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF WASHINGTON SEATTLE DIVISION

DEFENDANTS' WITNESS LIST AND EXHIBIT LIST FOR PRELIMINARY INJUNCTION EVIDENTIARY HEARING

I. INTRODUCTION

Defendants Cascade Retail Holdings Inc. ("Cascade") and Pinnacle Market Group Inc. ("Pinnacle") (collectively, "Defendants"), by and through their respective undersigned counsel, Calderwood & Harkness LLP and Whitfield, Greer & Tanaka LLP, hereby submit this Witness List and Exhibit List pursuant to the Court's Scheduling Order entered at the initial case management conference held on July 14, 2025 (Dkt. No. 47), and in advance of the evidentiary hearing on the Federal Trade Commission's (the "FTC" or "Commission") Motion for Preliminary Injunction (Dkt. No. 12), which is scheduled to commence on September 8, 2025, before the Honorable Richard A. Johannsen, United States District Judge, in Courtroom 15B, United States Courthouse, 700 Stewart Street, Seattle, Washington 98101. The hearing is estimated to require five (5) court days.

Defendants anticipate calling five (5) witnesses during their case-in-chief, as described in Section II below, and offering approximately seventy-five (75) proposed exhibits, as described in Section III below. Defendants respectfully reserve the right to call additional witnesses in rebuttal and to offer additional exhibits as may become necessary in response to the FTC's case-in-chief, including any witnesses or exhibits that become relevant due to testimony or evidence presented by the Commission's witnesses. Defendants further reserve the right to supplement this Witness List and Exhibit List as permitted by the Court's Scheduling Order and the Federal Rules of Civil Procedure, subject to the notice requirements set forth therein.

The exhibit list set forth below reflects approximately seventy-five (75) proposed exhibits, designated DX-001 through DX-075, subject to supplementation consistent with the foregoing reservation of rights and the Court's orders.

II. WITNESS LIST

Defendants identify the following witnesses for the evidentiary hearing on the FTC's Motion for Preliminary Injunction:

A. Witness No. 1: Margaret "Meg" Thornberry

Full Name: Margaret "Meg" Thornberry

Title: Chief Executive Officer and Chairwoman of the Board of Directors, Cascade Retail Holdings Inc.

Business Address: 2200 Westlake Avenue North, Suite 3400, Seattle, Washington 98109

Type of Testimony: Live; Direct and Cross-Examination

Estimated Duration of Direct Examination: Approximately two and one-half (2.5) hours

Summary of Anticipated Testimony:

Ms. Thornberry is expected to testify regarding the following subjects:

(a) The strategic rationale for Cascade's proposed acquisition of Pinnacle Market Group Inc. for approximately $4.7 billion in total consideration, including the procompetitive benefits of combining Cascade's omnichannel retail infrastructure — which encompasses approximately 340 brick-and-mortar retail locations across 38 states, a 22-warehouse nationwide fulfillment network, and the CascadeDirect.com e-commerce platform — with Pinnacle's established marketplace platform and its base of approximately 185,000 active third-party sellers.

(b) An overview of Cascade's history and business operations, including its founding in 2003, its evolution into a leading omnichannel retailer, and its current business profile. Ms. Thornberry will testify that in fiscal year 2024 ("FY2024"), Cascade generated total revenue of approximately $28.6 billion, of which its e-commerce and marketplace segments generated approximately $9.3 billion in combined revenue. She will provide testimony regarding the CascadeMarket third-party marketplace platform, which was launched on June 1, 2019, and which, as of FY2024, hosted approximately 42,000 active third-party sellers and generated approximately $3.1 billion in gross merchandise value ("GMV").

(c) The competitive dynamics of the broader e-commerce retail market in the United States. Ms. Thornberry will testify regarding the competitive landscape, including the presence of Vertex Commerce Inc. ("Vertex Commerce"), Nomad Shops LLC ("Nomad Shops"), Brevity Social Commerce Inc. ("Brevity Social Commerce"), Trove Marketplace Inc. ("Trove Marketplace"), and numerous other competitors operating across marketplace, direct-to-consumer, and social commerce channels. Ms. Thornberry will describe how Cascade views competition in this market and the competitive pressures that Cascade faces from these and other competitors on a daily basis.

(d) Cascade's view that the relevant competitive market in which to assess this transaction encompasses all e-commerce retail in the United States — a market in which total U.S. e-commerce GMV reached approximately $757 billion in 2024 — rather than the artificially narrow "online marketplace platform services for third-party sellers in the United States" market alleged by the FTC in its Complaint. Ms. Thornberry will explain why, from a business perspective, marketplace platforms, direct-to-consumer e-commerce channels, social commerce platforms, and other online retail channels all compete for the same sellers and consumers and are reasonably interchangeable.

(e) The Cascade Board of Directors' evaluation process leading to the execution of the merger agreement, including the Board's review of the fairness opinion rendered by Mercer Hollis & Co., the due diligence process, and the negotiation of the Agreement and Plan of Merger, which was executed on March 14, 2025. Ms. Thornberry will describe the Board's careful consideration of the transaction's strategic merits, financial terms, and regulatory risk profile.

(f) Cascade's commitment to maintaining competitive take rates charged to third-party sellers and to investing in enhanced seller services following the consummation of the merger, including planned investments in fulfillment capabilities, technology tools, and marketing support designed to benefit sellers and consumers on the combined platform.

(g) The harm to Cascade, its shareholders, its approximately 78,000 employees, and its business partners that would result from the entry of a preliminary injunction. Ms. Thornberry will testify that an injunction enjoining the consummation of the merger would jeopardize the entire transaction given the outside date of March 14, 2026, set forth in the merger agreement (which is extendable to June 14, 2026, only if the sole remaining unsatisfied condition to closing is the receipt of antitrust regulatory clearance). She will describe the operational disruption, competitive harm, and uncertainty that Cascade would suffer during the pendency of a prolonged injunction, including the potential exposure to a reverse termination fee of $282 million and the erosion of employee morale and business partner confidence.

B. Witness No. 2: Patricia "Trish" Delacroix

Full Name: Patricia "Trish" Delacroix

Title: Senior Vice President, Marketplace & Platform Strategy, Cascade Retail Holdings Inc.

Business Address: 2200 Westlake Avenue North, Suite 3400, Seattle, Washington 98109

Type of Testimony: Live; Direct and Cross-Examination

Estimated Duration of Direct Examination: Approximately two (2) hours

Summary of Anticipated Testimony:

Ms. Delacroix is expected to testify regarding the following subjects:

(a) A detailed description of the planned post-merger integration of Cascade's and Pinnacle's marketplace operations, including the logistics and fulfillment integration plan that would incorporate Pinnacle's approximately 185,000 active third-party sellers into Cascade's 22-warehouse nationwide fulfillment network. Ms. Delacroix will describe the integration timeline, key milestones, and the operational steps that would be undertaken to achieve a seamless combination of the two platforms.

(b) The merger-specific efficiencies expected to result from the transaction, which are projected to total approximately $340 million annually by Year 3 following the closing. Ms. Delacroix will provide a detailed breakdown of these efficiencies, including approximately $195 million in logistics and fulfillment cost savings attributable to the integration of fulfillment operations, the elimination of duplicative shipping and warehousing arrangements, and the achievement of greater scale in logistics procurement, as well as approximately $145 million in technology and platform synergies resulting from the consolidation of technology platforms, the optimization of engineering workforces, and the creation of shared services infrastructure.

(c) The methodology and verification basis underlying the efficiency projections. Ms. Delacroix will explain the internal analyses conducted by Cascade's integration planning team, the assumptions and data inputs used to develop the efficiency estimates, and the third-party validation process that was undertaken during the transaction diligence period to confirm the reasonableness and achievability of the projected synergies.

(d) Current CascadeMarket operations and competitive positioning. Ms. Delacroix will testify that CascadeMarket charges a take rate of approximately 17% to its third-party sellers and generated approximately $527 million in marketplace services revenue in FY2024. She will describe CascadeMarket's competitive positioning relative to Vertex Commerce (which, per the FTC's own allegations, holds a 35.7% share of online marketplace GMV), Nomad Shops (at 14.6% per the FTC), and emerging platforms such as Brevity Social Commerce and Trove Marketplace.

(e) Evidence of seller multi-homing behavior across CascadeMarket, Pinnacle, Vertex Commerce, Nomad Shops, and other platforms. Ms. Delacroix will present data and analysis demonstrating that sellers view these platforms as substitutes and maintain active presences on multiple marketplaces simultaneously. She will explain the implications of multi-homing for the competitive effects analysis, including why high rates of multi-homing undermine any theory that the merger would enable the combined entity to exercise market power over sellers.

(f) The pass-through of cost savings to sellers and consumers, including specific plans to lower or maintain take rates following the merger and to invest in enhanced seller services such as improved fulfillment speeds, expanded marketing tools, and more robust analytics dashboards. Ms. Delacroix will testify regarding the competitive dynamics that would compel the combined entity to pass through efficiency gains rather than retain them, given the presence of formidable competitors such as Vertex Commerce and Nomad Shops.

(g) The integration of marketplace technology that will improve search, discovery, and recommendation algorithms for consumers, resulting in a better shopping experience and increased conversion rates that would benefit both consumers and sellers on the combined platform.

C. Witness No. 3: Rajiv Chandravar

Full Name: Rajiv Chandravar

Title: Co-Founder and Chief Executive Officer, Pinnacle Market Group Inc.

Business Address: 500 East 6th Street, Suite 800, Austin, Texas 78701

Type of Testimony: Live; Direct and Cross-Examination

Estimated Duration of Direct Examination: Approximately two (2) hours

Summary of Anticipated Testimony:

Mr. Chandrasekaran is expected to testify regarding the following subjects:

(a) The founding and history of Pinnacle Market Group Inc. Mr. Chandrasekaran co-founded Pinnacle in 2014, together with Lena Kowalski, with the vision of creating an online marketplace that would connect independent sellers with consumers across a diverse range of product categories, including home goods, artisanal products, specialty foods, fashion, and electronics. He will testify regarding Pinnacle's initial public offering on September 18, 2020, and its growth trajectory from a startup marketplace to a publicly traded company that, at its peak, was one of the leading independent marketplace platforms in the United States.

(b) The competitive challenges facing Pinnacle as an independent company. Mr. Chandrasekaran will testify that Pinnacle's GMV growth has decelerated significantly, declining from 28% year-over-year growth in 2022 to only 9% year-over-year growth in 2024. Concurrently, Pinnacle's seller churn rate has increased from 12% in 2022 to 21% in 2024, reflecting the increasing difficulty of retaining sellers in a highly competitive marketplace environment.

(c) The competitive pressures that Pinnacle faces from Vertex Commerce (which, per the FTC's own data, is the largest independent marketplace platform at 35.7% of marketplace GMV), from Nomad Shops (at 14.6% of marketplace GMV), and from emerging social commerce platforms, including Brevity Social Commerce (launched in 2023) and Trove Marketplace (launched in 2024). Mr. Chandrasekaran will explain how these competitive pressures have eroded Pinnacle's market position and contributed to the business challenges described above.

(d) Pinnacle's inability, as a standalone entity, to invest adequately in the fulfillment infrastructure, logistics capabilities, and technology that are necessary to compete effectively with larger and better-resourced competitors. Mr. Chandrasekaran will testify that Pinnacle's capital expenditure constraints have prevented it from building the kind of end-to-end fulfillment capabilities that sellers increasingly demand and that competitors such as Vertex Commerce offer.

(e) The strategic alternatives considered by Pinnacle's Board of Directors prior to accepting Cascade's acquisition offer. Mr. Chandrasekaran will describe the Board's evaluation of multiple options — including continuing as an independent company, pursuing a capital raise, and exploring a sale to other potential acquirers — and the Board's conclusion that a combination with Cascade would best serve the interests of Pinnacle's sellers, consumers, employees, and shareholders.

(f) Mr. Chandrasekaran's view, as Pinnacle's co-founder and CEO, that the proposed acquisition will strengthen Pinnacle's marketplace platform by providing access to Cascade's 22-warehouse fulfillment network, technology resources, and omnichannel retail infrastructure. He will testify that the merger represents the best available path for Pinnacle to remain competitive and to continue serving its community of approximately 185,000 active sellers.

(g) The harm to Pinnacle if the proposed transaction is blocked or substantially delayed by the entry of a preliminary injunction. Mr. Chandrasekaran will testify regarding the ongoing competitive decline that Pinnacle would experience as a standalone entity, the potential for accelerating seller attrition if the transaction is enjoined, and the risk that the deal could terminate entirely if the outside date expires, leaving Pinnacle in a weakened competitive position with diminished strategic alternatives.

D. Witness No. 4: Dr. Priya Ramanathan

Full Name: Dr. Priya Ramanathan

Title: Managing Director, Brindoval Analytics LLC (Testifying Expert Witness for Defendants)

Business Address: 1700 Pennsylvania Avenue NW, Suite 550, Washington, D.C. 20006

Type of Testimony: Live; Expert Testimony — Direct and Cross-Examination

Estimated Duration of Direct Examination: Approximately three (3) hours

Summary of Anticipated Testimony:

Dr. Ramanathan is a nationally recognized economist specializing in antitrust economics, industrial organization, and the economics of platform markets. She holds a Ph.D. in Economics from the Massachusetts Institute of Technology and has testified as an expert in numerous federal and state antitrust proceedings. Dr. Ramanathan is expected to testify regarding the following subjects, consistent with the opinions set forth in her Affirmative Expert Report dated August 18, 2025, and her Rebuttal Expert Report dated August 29, 2025:

(a) Relevant Product Market Definition. Dr. Ramanathan will present her expert opinion that the relevant product market should be defined as "all e-commerce retail" in the United States, rather than the narrow "online marketplace platform services for third-party sellers in the United States" market alleged by the FTC. She will explain why the FTC's proposed market definition is inconsistent with the economic evidence and with established principles of market definition in the context of two-sided platform markets.

(b) Demand-Side and Supply-Side Substitutability. Dr. Ramanathan will present her analysis of demand-side and supply-side substitutability, demonstrating that consumers and sellers substitute freely between marketplace platforms and direct-to-consumer retail channels. She will explain why, as a matter of economic reality, marketplace platforms, DTC e-commerce channels, and social commerce platforms are reasonably interchangeable from the perspective of both sellers seeking to reach consumers and consumers seeking to purchase goods online.

(c) Market Share Analysis Under a Broader Market Definition. Dr. Ramanathan will present her empirical analysis showing that the combined entity's share of total U.S. e-commerce GMV (approximately $757 billion in 2024) is approximately 7.3% when Cascade's direct-to-consumer e-commerce operations are included, and approximately 1.9% on a marketplace-only GMV basis ($14.5 billion combined Cascade and Pinnacle marketplace GMV divided by $757 billion total U.S. e-commerce GMV). These shares are far below the levels that would support a presumption of competitive harm under the applicable case law and the 2023 Merger Guidelines.

(d) Critique of the FTC's HHI Calculations. Dr. Ramanathan will critique the FTC's Herfindahl-Hirschman Index ("HHI") calculations, which show a pre-merger HHI of 2,361, a post-merger HHI of 2,856, and a delta of 495 — levels that, under the narrow market alleged by the FTC, exceed the thresholds identified in the 2023 Merger Guidelines for a presumption of illegality. Dr. Ramanathan will explain that these HHI calculations are a product of the FTC's improperly narrow market definition and that, under a broader and more economically appropriate market definition, HHI levels and increases fall well below the thresholds for presumptive illegality.

(e) Analysis of Merger-Specific Efficiencies. Dr. Ramanathan will present her analysis of the merger-specific efficiencies projected to result from the transaction — totaling approximately $340 million annually by Year 3 — and will opine that these efficiencies are cognizable, verifiable, and likely to be passed through to consumers and sellers in the form of lower fees, improved services, and enhanced platform capabilities. She will explain the economic basis for her pass-through analysis, including the role of competitive pressure from Vertex Commerce, Nomad Shops, and other competitors in compelling the combined entity to share efficiency gains with sellers and consumers.

(f) Critique of the FTC Expert's Diversion Ratio Analysis. Dr. Ramanathan will critique the seller-side diversion ratios calculated by the FTC's expert, Dr. Wallace Keenan of Thornfield Research Group, and will explain the methodological errors and empirical shortcomings in Dr. Keenan's analysis. She will demonstrate that Dr. Keenan's diversion ratios are inflated due to his reliance on the FTC's narrow market definition and his failure to account for the competitive significance of DTC e-commerce channels and social commerce platforms.

(g) Analysis of Pinnacle's Weakening Competitive Position. Dr. Ramanathan will analyze the implications of Pinnacle's declining competitive trajectory for the competitive effects analysis. She will present data showing that Pinnacle's GMV growth has decelerated from 28% year-over-year in 2022 to 9% year-over-year in 2024, and that Pinnacle's seller churn rate has increased from 12% in 2022 to 21% in 2024. She will explain why these trends are relevant to the Court's assessment of the transaction's likely competitive effects and the probability that Pinnacle's current competitive significance will diminish absent the merger.

(h) Multi-Homing Analysis. Dr. Ramanathan will present her analysis of seller multi-homing behavior across marketplace platforms, demonstrating that high rates of seller multi-homing undermine the FTC's theory of unilateral effects. She will explain that when sellers maintain active presences on multiple competing platforms simultaneously, a merged entity's ability to raise fees or reduce quality is constrained because sellers can readily shift transaction volume to competing platforms.

(i) Alternative Econometric Model. Dr. Ramanathan will present an alternative econometric model — incorporating the broader market definition and the effects of multi-homing — demonstrating that any upward pricing pressure from the merger is minimal and insufficient to support a finding of likely competitive harm. Her model will show that the Gross Upward Pricing Pressure Index ("GUPPI") for the combined entity is well below levels that would indicate a significant risk of anticompetitive price increases.

(j) The opinions set forth in this summary are described in full in Dr. Ramanathan's Affirmative Expert Report, dated August 18, 2025, and her Rebuttal Expert Report, dated August 29, 2025, copies of which have been served on the FTC in accordance with the Court's expert disclosure schedule.

E. Witness No. 5: Thomas Breck

Full Name: Thomas Breck

Title: Chief Financial Officer, Pinnacle Market Group Inc.

Business Address: 500 East 6th Street, Suite 800, Austin, Texas 78701

Type of Testimony: Live; Direct and Cross-Examination

Estimated Duration of Direct Examination: Approximately one and one-half (1.5) hours

Summary of Anticipated Testimony:

Mr. Breck is expected to testify regarding the following subjects:

(a) Pinnacle's financial condition and performance trajectory. Mr. Breck will testify that in FY2024, Pinnacle generated GMV of approximately $11.4 billion, net revenue of approximately $1.82 billion (reflecting a take rate of approximately 16%), and hosted approximately 185,000 active third-party sellers as of December 31, 2024. He will provide a comprehensive overview of Pinnacle's financial performance from its IPO in September 2020 through the present.

(b) Pinnacle's pre-announcement market capitalization and stock price performance. Mr. Breck will testify that, based on 175,047,319 shares of Pinnacle common stock outstanding, and an unaffected closing price of $22.30 per share on March 7, 2025 (the last trading day prior to public reports of a potential transaction), Pinnacle's pre-announcement market capitalization was approximately $3.9 billion. He will describe the trajectory of Pinnacle's stock price since its IPO and the decline in valuation reflecting the market's assessment of Pinnacle's competitive challenges.

(c) Detailed financial data supporting the deceleration of Pinnacle's business. Mr. Breck will present financial data and metrics documenting the deceleration of Pinnacle's GMV growth from 28% year-over-year in 2022 to 9% year-over-year in 2024, as well as the increase in seller churn from 12% in 2022 to 21% in 2024. He will explain the financial drivers of these trends and their implications for Pinnacle's standalone financial outlook.

(d) The capital expenditure constraints that limit Pinnacle's ability to invest in logistics, fulfillment, and technology on a standalone basis. Mr. Breck will testify regarding Pinnacle's historical capital expenditure levels, the investment gap between Pinnacle and its larger competitors, and the financial barriers that prevent Pinnacle from independently building the fulfillment infrastructure necessary to remain competitive.

(e) The financial terms of the proposed merger, including the merger consideration of $26.85 per share in cash, which represents a premium of approximately 20.4% over Pinnacle's unaffected closing price of $22.30 per share on March 7, 2025. Mr. Breck will describe the financial analysis performed by Pinnacle's management and financial advisors in connection with the transaction, including the work performed by Ridgeline Capital Partners in rendering its fairness opinion.

(f) Financial projections prepared by Pinnacle's management demonstrating the declining trajectory of the company on a standalone basis absent the merger. Mr. Breck will present Pinnacle's internal financial projections, which show continued deceleration in revenue growth, margin compression, and increasing competitive pressure from larger and better-resourced competitors.

(g) Mr. Breck's assessment, as Pinnacle's Chief Financial Officer, that the company requires the capital resources, fulfillment infrastructure, and technology capabilities that only a combination with Cascade can provide, and that the proposed merger represents the best available path to preserving and enhancing value for Pinnacle's shareholders, sellers, and other stakeholders.

F. Reservation of Rights

Defendants reserve the right to call the following additional witnesses in rebuttal, depending on the scope and content of the FTC's case-in-chief:

(a) David Ruan, President and Chief Operating Officer, Cascade Retail Holdings Inc., 2200 Westlake Avenue North, Suite 3400, Seattle, Washington 98109;

(b) Sonia Alvarez-Kirk, Chief Financial Officer, Cascade Retail Holdings Inc., 2200 Westlake Avenue North, Suite 3400, Seattle, Washington 98109;

(c) Lena Kowalski, Co-Founder and Chief Product Officer, Pinnacle Market Group Inc., 500 East 6th Street, Suite 800, Austin, Texas 78701; and

(d) Dr. Lucas Engström, Senior Economist, Brindoval Analytics LLC, 1700 Pennsylvania Avenue NW, Suite 550, Washington, D.C. 20006 (consulting expert who may be called to address narrow rebuttal topics as necessary in response to the FTC's case-in-chief).

Defendants further reserve the right to call any witness identified on the FTC's witness list as an adverse witness during Defendants' case-in-chief, or to recall any such witness during Defendants' rebuttal case. Nothing in this Witness List constitutes a waiver of Defendants' right to object to the scope or admissibility of testimony offered by the FTC's witnesses.

III. EXHIBIT LIST

Introductory Note. Defendants propose the following exhibits, numbered DX-001 through DX-075, for use at the evidentiary hearing on the FTC's Motion for Preliminary Injunction. This Exhibit List is subject to supplementation as permitted by the Court's Scheduling Order and as may become necessary in response to the FTC's case-in-chief.

All exhibits will be presented in electronic format, with originals available for inspection upon request. Defendants' counsel have conferred with counsel for the FTC regarding potential stipulations as to the authenticity and admissibility of certain exhibits, and Defendants anticipate filing any agreed-upon stipulations with the Court in advance of the hearing. To the extent the parties are unable to agree on authentication or admissibility, Defendants will present live witnesses or declarations to establish the foundation for each exhibit.

Certain exhibits listed below are designated "CONFIDENTIAL" or "HIGHLY CONFIDENTIAL — ATTORNEYS' EYES ONLY" pursuant to the Stipulated Protective Order entered by the Court on July 28, 2025 (Dkt. No. 58). Such exhibits will be presented under seal or in a closed courtroom session, as appropriate, in accordance with the Protective Order and the Court's procedures for handling confidential information during evidentiary hearings.

Counsel for Cascade (Calderwood & Harkness LLP) and counsel for Pinnacle (Whitfield, Greer & Tanaka LLP) have coordinated the preparation and organization of this Exhibit List pursuant to the Joint Defense Agreement dated April 15, 2025, to avoid duplication and ensure the efficient presentation of evidence.

A. Transaction Documents (DX-001 through DX-010)

B. Cascade Business and Competitive Position Documents (DX-011 through DX-025)

C. Pinnacle Business and Competitive Trajectory Documents (DX-026 through DX-040)

D. Market Definition and Competitive Landscape Documents (DX-041 through DX-055)

E. Efficiencies and Integration Documents (DX-056 through DX-065)

F. Expert Materials (DX-066 through DX-070)

G. Equities and Public Interest Documents (DX-071 through DX-075)

IV. OBJECTIONS TO FTC EXHIBITS

Defendants reserve the right to object to any exhibits offered by the FTC at the evidentiary hearing, including on the grounds of relevance under Federal Rules of Evidence 401 and 402; authenticity under Federal Rules of Evidence 901 and 902; hearsay under Federal Rules of Evidence 801 through 807; privilege, including attorney-client privilege, work product protection, and deliberative process privilege; unfair prejudice, confusion of the issues, or needless presentation of cumulative evidence under Federal Rule of Evidence 403; and any other applicable grounds under the Federal Rules of Evidence or the Court's orders.

Defendants further note that their Motion to Exclude the Expert Testimony of Dr. Wallace Keenan of Thornfield Research Group, the FTC's designated testifying expert, is currently pending before the Court (Dkt. No. 72, filed August 25, 2025). Defendants reserve all objections to exhibits offered by the FTC through or in connection with Dr. Keenan's testimony, including objections based on the grounds set forth in Defendants' pending Daubert motion. In the event the Court grants Defendants' Daubert motion in whole or in part, Defendants will object to the admission of any exhibits that are offered solely through Dr. Keenan or that are rendered irrelevant or inadmissible by the exclusion of Dr. Keenan's testimony.

Defendants' failure to identify specific objections to individual FTC exhibits at this time shall not constitute a waiver of any objection that Defendants may assert at the evidentiary hearing or in any pre-hearing briefing on evidentiary issues.

V. CERTIFICATION OF SERVICE

I, Howard Bellamy, hereby certify that on this date, a true and correct copy of the foregoing Defendants' Witness List and Exhibit List for Preliminary Injunction Evidentiary Hearing was served upon all parties of record by electronic filing via the Court's CM/ECF system, which will send notification of such filing to all counsel of record, including:

Claire Dunmore, Senior Trial Counsel Samuel Ortega, Trial Attorney Rebecca Yun, Trial Attorney Federal Trade Commission, Bureau of Competition 600 Pennsylvania Avenue NW Washington, D.C. 20580 Counsel for Plaintiff Federal Trade Commission

Diana Whitfield, Partner Kenneth Oshiro, Partner Whitfield, Greer & Tanaka LLP 100 Congress Avenue, Suite 2200 Austin, TX 78701 Counsel for Defendant Pinnacle Market Group Inc.

Martina Galloway, Partner Galloway & Peck LLP 800 Fifth Avenue, Suite 3100 Seattle, WA 98104 Counsel for the Independent Online Sellers Association ("IOSA"), to the extent that IOSA's Motion to Intervene (Dkt. No. 65, filed August 11, 2025) remains pending before the Court

Respectfully submitted,

For Defendant Cascade Retail Holdings Inc.:

CALDERWOOD & HARKNESS LLP

By: ________

Howard Bellamy (D.C. Bar No. 487213) Elaine Forsythe (D.C. Bar No. 512844) Elliot Nguyen (D.C. Bar No. 529071) Aaron Liu (Cal. Bar No. 318467, admitted pro hac vice) 1401 K Street NW, Suite 1200 Washington, D.C. 20005 Telephone: (202) 555-7400 Facsimile: (202) 555-7401 hbellamy@calderwoodharkness.com eforsythe@calderwoodharkness.com enguyen@calderwoodharkness.com aliu@calderwoodharkness.com

Date: ________

For Defendant Pinnacle Market Group Inc.:

WHITFIELD, GREER & TANAKA LLP

By: ________

Diana Whitfield (Tex. Bar No. 24059831, admitted pro hac vice) Kenneth Oshiro (Tex. Bar No. 24063117, admitted pro hac vice) 100 Congress Avenue, Suite 2200 Austin, TX 78701 Telephone: (512) 555-3200 Facsimile: (512) 555-3201 dwhitfield@wgtlaw.com koshiro@wgtlaw.com

Date: ________

Calderwood & Harkness LLP Matter No. 1038-00001

FEDERAL TRADE COMMISSION,

<!-- indent:2 -->Plaintiff,<!-- /indent -->	Case No. 2:25-cv-01087-RAJ
v.	DEFENDANTS' WITNESS LIST AND

EXHIBIT LIST FOR PRELIMINARY

CASCADE RETAIL HOLDINGS INC. and PINNACLE MARKET GROUP INC.,	INJUNCTION EVIDENTIARY HEARING
<!-- indent:2 -->Defendants.<!-- /indent -->	Hearing Date: September 8, 2025

Courtroom: 15B

Before: Hon. Richard A. Johannsen

Est. Duration: 5 Court Days

Exhibit No.	Description	Confidentiality Designation
DX-001	Agreement and Plan of Merger, dated March 14, 2025, among Cascade Retail Holdings Inc., CRH Merger Sub Inc., and Pinnacle Market Group Inc. (selected excerpts, including: Recitals; Article I (Defined Terms); Article II (The Merger, including merger consideration of $26.85 per share); Article VII (Conditions to Closing); Article VIII (Termination, including reverse termination fee of $282 million, company termination fee of $164.5 million, and outside date of March 14, 2026, extendable to June 14, 2026 solely in the event that the only unsatisfied closing condition is the receipt of antitrust regulatory clearance))	Confidential
DX-002	Commitment Letter from Whitmore National Bank, N.A. to Cascade Retail Holdings Inc., dated March 12, 2025, for a $2.8 billion senior secured term loan B facility and a $500 million revolving credit facility (Reference: CRH-WNB-2025-TLB)	Highly Confidential — AEO
DX-003	Form 8-K filed by Cascade Retail Holdings Inc. with the U.S. Securities and Exchange Commission, dated March 17, 2025, announcing the execution of the Agreement and Plan of Merger	Public
DX-004	Definitive Proxy Statement (Schedule 14A) filed by Pinnacle Market Group Inc. with the U.S. Securities and Exchange Commission, dated April 28, 2025	Public
DX-005	Fairness Opinion of Mercer Hollis & Co., dated March 13, 2025, to the Board of Directors of Cascade Retail Holdings Inc. (as included in the proxy materials)	Public
DX-006	Fairness Opinion of Ridgeline Capital Partners, dated March 13, 2025, to the Board of Directors of Pinnacle Market Group Inc. (as included in the proxy materials)	Public
DX-007	Hart-Scott-Rodino Act premerger notification filing cover page and transaction summary (HSR Filing No. HSR-20250402-0347), dated April 2, 2025	Confidential
DX-008	FTC Second Request for Additional Information and Documentary Material, File No. 251-0089, dated May 7, 2025 (redacted to remove material subject to deliberative process privilege)	Confidential
DX-009	Cascade Retail Holdings Inc. certification of substantial compliance with FTC Second Request, dated June 10, 2025	Confidential
DX-010	Minutes of the meeting of the Board of Directors of Cascade Retail Holdings Inc., held March 13, 2025, approving the Agreement and Plan of Merger (redacted to protect information subject to attorney-client privilege and work product protection)	Highly Confidential — AEO
Exhibit No.	Description	Confidentiality Designation
DX-011	Cascade Retail Holdings Inc. FY2024 Annual Report on Form 10-K, filed with the SEC on February 27, 2025 — excerpts including total revenue ($28.6 billion), e-commerce and marketplace segment reporting ($9.3 billion combined revenue), CascadeMarket GMV ($3.1 billion), and business description sections	Public
DX-012	CascadeMarket internal business review, Q4 FY2024 — marketplace services revenue ($527 million), take rate (17%), active third-party sellers (approximately 42,000), and competitive positioning analysis	Highly Confidential — AEO
DX-013	CascadeMarket launch documentation and initial business plan, dated June 1, 2019, including market opportunity analysis and projected growth trajectory	Confidential
DX-014	Cascade strategic planning presentation, February 2025 — "Omnichannel Growth and Marketplace Expansion Strategy" — discussing the strategic rationale for acquiring a complementary marketplace platform to accelerate Cascade's e-commerce growth	Highly Confidential — AEO
DX-015	Cascade marketplace competitive analysis, January 2025 — internal analysis of the competitive landscape, including market position assessments of Vertex Commerce, Nomad Shops, Pinnacle, Brevity Social Commerce, and Trove Marketplace	Highly Confidential — AEO
DX-016	Cascade seller survey results, March 2025 — survey of CascadeMarket third-party sellers regarding multi-homing behavior, platform usage across competing marketplaces, and seller satisfaction benchmarking	Confidential
DX-017	Cascade brick-and-mortar store location map — depicting the locations of approximately 340 retail stores across 38 states	Public
DX-018	Cascade fulfillment network overview — description and geographic map of the 22-warehouse nationwide fulfillment network, including capacity data and throughput metrics	Confidential
DX-019	Cascade e-commerce platform (CascadeDirect.com) traffic and transaction data, FY2024 — including unique visitors, conversion rates, order volumes, and GMV data	Highly Confidential — AEO
DX-020	Summary of Cascade's total e-commerce GMV for FY2024 (approximately $43.7 billion, combining direct-to-consumer sales via CascadeDirect.com and third-party marketplace GMV via CascadeMarket)	Highly Confidential — AEO
DX-021	Cascade Retail Holdings Inc. investor presentation, Q1 2025 — discussing market capitalization (approximately $41.2 billion as of June 27, 2025), Nasdaq ticker symbol CSRT, and strategic priorities including omnichannel expansion and marketplace growth	Public
DX-022	Cascade internal emails and memoranda, 2023–2025 — discussing competitive pressure from social commerce platforms (including Brevity Social Commerce and Trove Marketplace) and from direct-to-consumer e-commerce channels, and the implications of these competitive dynamics for Cascade's marketplace strategy	Highly Confidential — AEO
DX-023	Cascade marketplace take rate benchmarking study, November 2024 — comparing CascadeMarket's 17% take rate against the take rates charged by Vertex Commerce, Nomad Shops, Pinnacle, and other industry competitors	Highly Confidential — AEO

DX-024	Cascade customer acquisition and retention data, FY2024 — demonstrating overlap between the consumer bases of Cascade's marketplace platform and its direct retail operations, and the competitive significance of omnichannel consumer engagement	Confidential
DX-025	Independent auditor's report of Aldrich & Warwick CPAs LLP on the consolidated financial statements of Cascade Retail Holdings Inc. for the fiscal year ended December 31, 2024	Public
Exhibit No.	Description	Confidentiality Designation
DX-026	Pinnacle Market Group Inc. FY2024 Annual Report on Form 10-K, filed with the SEC on March 3, 2025 — excerpts including GMV ($11.4 billion), net revenue ($1.82 billion), take rate (16%), active sellers (approximately 185,000), and business description sections	Public
DX-027	Pinnacle internal board presentation, December 2024 — "Strategic Review: Competitive Challenges and Growth Outlook" — documenting GMV growth deceleration from 28% year-over-year (2022) to 9% year-over-year (2024) and the Board's assessment of Pinnacle's competitive position	Highly Confidential — AEO
DX-028	Pinnacle seller churn analysis, Q4 2024 — internal data and analysis showing the increase in seller churn rate from 12% (2022) to 21% (2024), including cohort analysis and identification of primary drivers of seller departures	Highly Confidential — AEO
DX-029	Pinnacle quarterly GMV data, 2020–2024 — time-series data showing Pinnacle's GMV growth trajectory, seasonal patterns, and the progressive deceleration of growth across the five-year period	Confidential
DX-030	Pinnacle internal memorandum, October 2024 — discussing competitive pressures from Vertex Commerce, including Vertex's expansion of fulfillment services and seller acquisition campaigns, and the urgent need for Pinnacle to invest in fulfillment infrastructure	Highly Confidential — AEO
DX-031	Minutes of the meeting of the Board of Directors of Pinnacle Market Group Inc., January 2025 — discussing strategic alternatives available to Pinnacle, including a potential sale of the company, a capital raise through equity or debt issuance, and a standalone operating plan	Highly Confidential — AEO
DX-032	Pinnacle seller exit survey data, 2023–2024 — compiled responses from departing sellers documenting the primary reasons for seller departures, including competition from other platforms offering superior fulfillment services, dissatisfaction with Pinnacle's logistics capabilities, and pricing pressure from competing marketplaces	Confidential
DX-033	Excerpts from Pinnacle Market Group Inc. IPO prospectus, dated September 18, 2020 — showing initial growth projections, market opportunity analysis, and competitive landscape assessment, as compared against Pinnacle's actual performance in subsequent years	Public
DX-034	Pinnacle management financial projections (standalone basis), prepared February 2025 — projecting continued GMV growth deceleration, margin compression, and increasing capital requirements for the period FY2025–FY2029, assuming Pinnacle remains an independent company	Highly Confidential — AEO
DX-035	Pinnacle competitive intelligence reports, 2023–2024 — internal analyses of Vertex Commerce's market expansion initiatives, Nomad Shops' seller acquisition campaigns, and the emergence of social commerce platforms as competitive threats	Highly Confidential — AEO
DX-036	Independent auditor's report of Kessler Fong Accounting Group LLP on the consolidated financial statements of Pinnacle Market Group Inc. for the fiscal year ended December 31, 2024	Public
DX-037	Pinnacle capital expenditure analysis, FY2022–FY2024 — showing constrained investment capacity in logistics infrastructure and technology development, with comparison to capital expenditure levels of Vertex Commerce and other competitors	Confidential
DX-038	Pinnacle seller satisfaction survey, Q3 2024 — documenting declining seller satisfaction scores and competitive benchmarking against Vertex Commerce and Nomad Shops across key dimensions including fulfillment speed, seller support, marketing tools, and fee competitiveness	Confidential
DX-039	Pinnacle internal analysis of social commerce competitive threat, August 2024 — evaluating the impact of Brevity Social Commerce Inc. and Trove Marketplace Inc. on Pinnacle's seller base, including estimated seller diversion to social commerce channels	Highly Confidential — AEO
DX-040	Pinnacle Market Group Inc. share price chart, September 2020 through March 2025 — showing the unaffected closing price of $22.30 per share on March 7, 2025, the pre-announcement market capitalization of approximately $3.9 billion, and the trajectory of Pinnacle's stock price from its IPO through the announcement of the proposed merger	Public
Exhibit No.	Description	Confidentiality Designation
DX-041	Third-party market research report on total U.S. e-commerce gross merchandise value for calendar year 2024, reporting total U.S. e-commerce GMV of approximately $757 billion	Public
DX-042	Defendants' market share analysis — broader "all e-commerce retail" market, showing the combined entity's share at approximately 7.3% of total U.S. e-commerce GMV (including Cascade's direct-to-consumer e-commerce operations), and approximately 1.9% on a marketplace-only GMV basis ($14.5 billion combined Cascade and Pinnacle marketplace GMV / $757 billion total U.S. e-commerce GMV)	Confidential
DX-043	Comparison chart of the FTC's alleged market shares under the "online marketplace platform services" market definition (Cascade 8.2%, Pinnacle 30.1%, combined 38.3%, Vertex Commerce 35.7%, Nomad Shops 14.6%, all others 11.4%) versus Defendants' market share analysis under the broader "all e-commerce retail" market definition	Confidential
DX-044	HHI calculations under Defendants' broader market definition, demonstrating that pre- and post-merger HHI levels are well below the concentration thresholds identified in the 2023 Merger Guidelines; includes side-by-side comparison with the FTC's HHI calculations (pre-merger 2,361, post-merger 2,856, delta 495) under the FTC's narrow market definition	Confidential
DX-045	Vertex Commerce Inc. public filings and annual reports — excerpts demonstrating Vertex Commerce's market position as the largest independent online marketplace platform in the United States (35.7% of online marketplace GMV per FTC), including revenue, GMV, seller base size, fulfillment capabilities, and recent expansion initiatives	Public
DX-046	Nomad Shops LLC business profile — publicly available information on Nomad Shops' marketplace operations, including its curated artisan and small-business focus, seller base, GMV (14.6% of marketplace GMV per FTC), and competitive positioning	Public

DX-047	Brevity Social Commerce Inc. launch announcement and press coverage (launched 2023) — demonstrating the relative ease of entry into online marketplace and e-commerce platform services, and the rapid growth of social commerce as a competitive channel	Public
DX-048	Trove Marketplace Inc. launch announcement and press coverage (launched 2024) — demonstrating recent entry into and expansion of the competitive landscape for online marketplace and e-commerce services	Public
DX-049	Analysis of barriers to entry in online marketplace platform services — including assessment of capital requirements, technology accessibility, network effects, and the ability of new entrants and adjacent competitors to enter and expand in marketplace services, demonstrating that barriers to entry and expansion are low	Confidential
DX-050	Multi-homing data analysis — empirical study of seller presence across multiple competing platforms (CascadeMarket, Pinnacle, Vertex Commerce, Nomad Shops, and other marketplaces), demonstrating high rates of multi-homing and the implications of multi-homing for competitive effects analysis	Confidential
DX-051	Cross-elasticity of demand analysis — data and econometric analysis showing consumer substitution between marketplace platforms and direct-to-consumer e-commerce channels, supporting a broader relevant product market definition	Confidential
DX-052	Social commerce market overview, 2023–2025 — documenting the rise of social media-integrated commerce as a competitive constraint on traditional marketplace platforms, including data on transaction volumes, seller adoption rates, and consumer usage patterns	Public
DX-053	Direct-to-consumer e-commerce growth data, 2020–2024 — demonstrating the expansion of DTC channels operated by brands and retailers as alternatives to third-party marketplace platforms, including data on the number of DTC e-commerce storefronts, DTC GMV growth, and the competitive significance of DTC channels	Public
DX-054	Academic and industry literature on two-sided platform markets — excerpts relevant to market definition in the context of platform markets, including references to Ohio v. Halcyon Corporation, 138 S. Ct. 2274 (2018), and economic scholarship on the competitive dynamics of multi-sided platforms	Public
DX-055	Third-party equity analyst reports on the U.S. online marketplace competitive landscape, 2024–2025 — excerpts from reports published by independent financial analysts assessing the competitive positions of Vertex Commerce, Pinnacle, Nomad Shops, and other marketplace platforms	Confidential
Exhibit No.	Description	Confidentiality Designation
DX-056	Cascade-Pinnacle integration plan, prepared by Patricia Delacroix and the Marketplace & Platform Strategy team, March 2025 — detailed operational plan for post-merger integration of marketplace operations, fulfillment networks, technology platforms, and seller services	Highly Confidential — AEO
DX-057	Efficiencies analysis — detailed breakdown of the $340 million in projected merger-specific efficiencies expected to be achieved by Year 3 post-closing: $195 million in logistics and fulfillment cost savings; $145 million in technology and platform synergies, with supporting calculations, assumptions, and data sources	Highly Confidential — AEO
DX-058	Logistics and fulfillment integration model — detailed analysis of the integration of Pinnacle's approximately 185,000 active sellers into Cascade's 22-warehouse fulfillment network, documenting the cost savings methodology, warehouse capacity analysis, transportation network optimization, and projected per-unit cost reductions	Highly Confidential — AEO
DX-059	Technology platform consolidation plan — analysis of technology and platform synergies, including engineering workforce optimization, infrastructure consolidation, cloud computing cost savings, shared services implementation, and the integration of search, discovery, and recommendation algorithms	Highly Confidential — AEO
DX-060	Third-party validation of efficiency projections — independent assessment prepared by management consultants engaged by Cascade during the transaction diligence process, confirming the reasonableness and achievability of the projected merger-specific efficiencies	Highly Confidential — AEO
DX-061	Seller benefit projections — analysis showing how efficiency savings from the merger would be passed through to sellers through lower marketplace fees, improved fulfillment speeds, reduced shipping costs, and enhanced seller tools and analytics capabilities	Highly Confidential — AEO
DX-062	Consumer benefit projections — analysis showing how the combined platform would offer broader product selection, faster delivery times, improved search and discovery functionality, and more competitive pricing for consumers	Highly Confidential — AEO
DX-063	Comparable merger integration case studies — analysis of successful marketplace and e-commerce platform integrations in analogous transactions in the technology and retail sectors, including efficiency realization timelines and pass-through rates	Confidential
DX-064	Take rate analysis — projections showing that the combined entity's take rates would remain competitive with Vertex Commerce, Nomad Shops, and other marketplace competitors, and that the realization of merger-specific efficiencies would enable downward pressure on take rates charged to third-party sellers	Highly Confidential — AEO
DX-065	Cascade-Pinnacle combined fulfillment network map and timeline for integration milestones — visual depiction of the planned post-merger fulfillment network and a detailed schedule of key integration activities and target completion dates	Confidential
Exhibit No.	Description	Confidentiality Designation
DX-066	Expert Report of Dr. Priya Ramanathan, Managing Director, Brindoval Analytics LLC, dated August 18, 2025 — affirmative expert report on relevant product market definition, market concentration, competitive effects analysis, efficiencies, and related economic issues	Highly Confidential — AEO
DX-067	Rebuttal Expert Report of Dr. Priya Ramanathan, Managing Director, Brindoval Analytics LLC, dated August 29, 2025 — responding to the expert report of Dr. Wallace Keenan of Thornfield Research Group	Highly Confidential — AEO
DX-068	Curriculum Vitae of Dr. Priya Ramanathan, Managing Director, Brindoval Analytics LLC — including academic credentials, professional experience, prior expert testimony, and publications	Public
DX-069	Demonstrative exhibit — market share comparison charts depicting the FTC's narrow market share calculations versus Defendants' broader market share analysis, prepared for use during the testimony of Dr. Ramanathan	Confidential

DX-070	Demonstrative exhibit — Pinnacle competitive trajectory charts depicting GMV growth deceleration (from 28% YoY in 2022 to 9% YoY in 2024) and seller churn rate increase (from 12% in 2022 to 21% in 2024), 2020–2024	Confidential
Exhibit No.	Description	Confidentiality Designation
DX-071	Declaration of Margaret Thornberry, Chief Executive Officer and Chairwoman of the Board, Cascade Retail Holdings Inc., regarding harm to Cascade from the entry of a preliminary injunction — including testimony on the impact on the merger timeline, the risk of deal termination in light of the March 14, 2026 outside date, Cascade's potential exposure to the $282 million reverse termination fee, employee uncertainty and the effect on retention and morale, competitive harm from prolonged regulatory overhang, and disruption to business partner relationships	Confidential
DX-072	Declaration of Rajiv Chandravar, Co-Founder and Chief Executive Officer, Pinnacle Market Group Inc., regarding harm to Pinnacle from the entry of a preliminary injunction — including testimony on continued competitive deterioration, accelerating seller attrition, management distraction, the inability to invest in long-term initiatives during pendency of the injunction, and the risk of deal termination if the outside date expires, leaving Pinnacle in a weakened competitive position with diminished strategic alternatives	Confidential
DX-073	Analysis of merger agreement termination provisions — summary of the outside date of March 14, 2026 (extendable to June 14, 2026, solely in the event that the receipt of antitrust regulatory clearance is the sole remaining unsatisfied closing condition), the reverse termination fee of $282 million payable by Cascade, and the company termination fee of $164.5 million payable by Pinnacle, with commentary on the practical implications of these provisions for the viability of the transaction in the event of a preliminary injunction	Confidential
DX-074	Pinnacle shareholder communications — letters from institutional shareholders of Pinnacle Market Group Inc. expressing support for the proposed transaction and urging consummation of the merger	Public
DX-075	Summary of the FTC Commission vote (3–2) authorizing the filing of the Complaint in this action — demonstrating the existence of internal division within the Commission on the merits of the challenge to the proposed transaction	Public

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF WASHINGTON SEATTLE DIVISION
DEFENDANTS' WITNESS LIST AND EXHIBIT LIST FOR PRELIMINARY INJUNCTION EVIDENTIARY HEARING
I. INTRODUCTION
Defendants Cascade Retail Holdings Inc. ("Cascade") and Pinnacle Market Group Inc. ("Pinnacle") (collectively, "Defendants"), by and through their respective undersigned counsel, Calderwood & Harkness LLP and Whitfield, Greer & Tanaka LLP, hereby submit this Witness List and Exhibit List pursuant to the Court's Scheduling Order entered at the initial case management conference held on July 14, 2025 (Dkt. No. 47), and in advance of the evidentiary hearing on the Federal Trade Commission's (the "FTC" or "Commission") Motion for Preliminary Injunction (Dkt. No. 12), which is scheduled to commence on September 8, 2025, before the Honorable Richard A. Johannsen, United States District Judge, in Courtroom 15B, United States Courthouse, 700 Stewart Street, Seattle, Washington 98101. The hearing is estimated to require five (5) court days.
Defendants anticipate calling five (5) witnesses during their case-in-chief, as described in Section II below, and offering approximately seventy-five (75) proposed exhibits, as described in Section III below. Defendants respectfully reserve the right to call additional witnesses in rebuttal and to offer additional exhibits as may become necessary in response to the FTC's case-in-chief, including any witnesses or exhibits that become relevant due to testimony or evidence presented by the Commission's witnesses. Defendants further reserve the right to supplement this Witness List and Exhibit List as permitted by the Court's Scheduling Order and the Federal Rules of Civil Procedure, subject to the notice requirements set forth therein.
The exhibit list set forth below reflects approximately seventy-five (75) proposed exhibits, designated DX-001 through DX-075, subject to supplementation consistent with the foregoing reservation of rights and the Court's orders.
II. WITNESS LIST
Defendants identify the following witnesses for the evidentiary hearing on the FTC's Motion for Preliminary Injunction:
A. Witness No. 1: Margaret "Meg" Thornberry
Full Name: Margaret "Meg" Thornberry
Title: Chief Executive Officer and Chairwoman of the Board of Directors, Cascade Retail Holdings Inc.
Business Address: 2200 Westlake Avenue North, Suite 3400, Seattle, Washington 98109
Type of Testimony: Live; Direct and Cross-Examination
Estimated Duration of Direct Examination: Approximately two and one-half (2.5) hours
Summary of Anticipated Testimony:
Ms. Thornberry is expected to testify regarding the following subjects:
(a) The strategic rationale for Cascade's proposed acquisition of Pinnacle Market Group Inc. for approximately $4.7 billion in total consideration, including the procompetitive benefits of combining Cascade's omnichannel retail infrastructure — which encompasses approximately 340 brick-and-mortar retail locations across 38 states, a 22-warehouse nationwide fulfillment network, and the CascadeDirect.com e-commerce platform — with Pinnacle's established marketplace platform and its base of approximately 185,000 active third-party sellers.
(b) An overview of Cascade's history and business operations, including its founding in 2003, its evolution into a leading omnichannel retailer, and its current business profile. Ms. Thornberry will testify that in fiscal year 2024 ("FY2024"), Cascade generated total revenue of approximately $28.6 billion, of which its e-commerce and marketplace segments generated approximately $9.3 billion in combined revenue. She will provide testimony regarding the CascadeMarket third-party marketplace platform, which was launched on June 1, 2019, and which, as of FY2024, hosted approximately 42,000 active third-party sellers and generated approximately $3.1 billion in gross merchandise value ("GMV").
(c) The competitive dynamics of the broader e-commerce retail market in the United States. Ms. Thornberry will testify regarding the competitive landscape, including the presence of Vertex Commerce Inc. ("Vertex Commerce"), Nomad Shops LLC ("Nomad Shops"), Brevity Social Commerce Inc. ("Brevity Social Commerce"), Trove Marketplace Inc. ("Trove Marketplace"), and numerous other competitors operating across marketplace, direct-to-consumer, and social commerce channels. Ms. Thornberry will describe how Cascade views competition in this market and the competitive pressures that Cascade faces from these and other competitors on a daily basis.
(d) Cascade's view that the relevant competitive market in which to assess this transaction encompasses all e-commerce retail in the United States — a market in which total U.S. e-commerce GMV reached approximately $757 billion in 2024 — rather than the artificially narrow "online marketplace platform services for third-party sellers in the United States" market alleged by the FTC in its Complaint. Ms. Thornberry will explain why, from a business perspective, marketplace platforms, direct-to-consumer e-commerce channels, social commerce platforms, and other online retail channels all compete for the same sellers and consumers and are reasonably interchangeable.
(e) The Cascade Board of Directors' evaluation process leading to the execution of the merger agreement, including the Board's review of the fairness opinion rendered by Mercer Hollis & Co., the due diligence process, and the negotiation of the Agreement and Plan of Merger, which was executed on March 14, 2025. Ms. Thornberry will describe the Board's careful consideration of the transaction's strategic merits, financial terms, and regulatory risk profile.
(f) Cascade's commitment to maintaining competitive take rates charged to third-party sellers and to investing in enhanced seller services following the consummation of the merger, including planned investments in fulfillment capabilities, technology tools, and marketing support designed to benefit sellers and consumers on the combined platform.
(g) The harm to Cascade, its shareholders, its approximately 78,000 employees, and its business partners that would result from the entry of a preliminary injunction. Ms. Thornberry will testify that an injunction enjoining the consummation of the merger would jeopardize the entire transaction given the outside date of March 14, 2026, set forth in the merger agreement (which is extendable to June 14, 2026, only if the sole remaining unsatisfied condition to closing is the receipt of antitrust regulatory clearance). She will describe the operational disruption, competitive harm, and uncertainty that Cascade would suffer during the pendency of a prolonged injunction, including the potential exposure to a reverse termination fee of $282 million and the erosion of employee morale and business partner confidence.
B. Witness No. 2: Patricia "Trish" Delacroix
Full Name: Patricia "Trish" Delacroix
Title: Senior Vice President, Marketplace & Platform Strategy, Cascade Retail Holdings Inc.
Business Address: 2200 Westlake Avenue North, Suite 3400, Seattle, Washington 98109
Type of Testimony: Live; Direct and Cross-Examination
Estimated Duration of Direct Examination: Approximately two (2) hours
Summary of Anticipated Testimony:
Ms. Delacroix is expected to testify regarding the following subjects:
(a) A detailed description of the planned post-merger integration of Cascade's and Pinnacle's marketplace operations, including the logistics and fulfillment integration plan that would incorporate Pinnacle's approximately 185,000 active third-party sellers into Cascade's 22-warehouse nationwide fulfillment network. Ms. Delacroix will describe the integration timeline, key milestones, and the operational steps that would be undertaken to achieve a seamless combination of the two platforms.
(b) The merger-specific efficiencies expected to result from the transaction, which are projected to total approximately $340 million annually by Year 3 following the closing. Ms. Delacroix will provide a detailed breakdown of these efficiencies, including approximately $195 million in logistics and fulfillment cost savings attributable to the integration of fulfillment operations, the elimination of duplicative shipping and warehousing arrangements, and the achievement of greater scale in logistics procurement, as well as approximately $145 million in technology and platform synergies resulting from the consolidation of technology platforms, the optimization of engineering workforces, and the creation of shared services infrastructure.
(c) The methodology and verification basis underlying the efficiency projections. Ms. Delacroix will explain the internal analyses conducted by Cascade's integration planning team, the assumptions and data inputs used to develop the efficiency estimates, and the third-party validation process that was undertaken during the transaction diligence period to confirm the reasonableness and achievability of the projected synergies.
(d) Current CascadeMarket operations and competitive positioning. Ms. Delacroix will testify that CascadeMarket charges a take rate of approximately 17% to its third-party sellers and generated approximately $527 million in marketplace services revenue in FY2024. She will describe CascadeMarket's competitive positioning relative to Vertex Commerce (which, per the FTC's own allegations, holds a 35.7% share of online marketplace GMV), Nomad Shops (at 14.6% per the FTC), and emerging platforms such as Brevity Social Commerce and Trove Marketplace.
(e) Evidence of seller multi-homing behavior across CascadeMarket, Pinnacle, Vertex Commerce, Nomad Shops, and other platforms. Ms. Delacroix will present data and analysis demonstrating that sellers view these platforms as substitutes and maintain active presences on multiple marketplaces simultaneously. She will explain the implications of multi-homing for the competitive effects analysis, including why high rates of multi-homing undermine any theory that the merger would enable the combined entity to exercise market power over sellers.
(f) The pass-through of cost savings to sellers and consumers, including specific plans to lower or maintain take rates following the merger and to invest in enhanced seller services such as improved fulfillment speeds, expanded marketing tools, and more robust analytics dashboards. Ms. Delacroix will testify regarding the competitive dynamics that would compel the combined entity to pass through efficiency gains rather than retain them, given the presence of formidable competitors such as Vertex Commerce and Nomad Shops.
(g) The integration of marketplace technology that will improve search, discovery, and recommendation algorithms for consumers, resulting in a better shopping experience and increased conversion rates that would benefit both consumers and sellers on the combined platform.
C. Witness No. 3: Rajiv Chandravar
Full Name: Rajiv Chandravar
Title: Co-Founder and Chief Executive Officer, Pinnacle Market Group Inc.
Business Address: 500 East 6th Street, Suite 800, Austin, Texas 78701
Type of Testimony: Live; Direct and Cross-Examination
Estimated Duration of Direct Examination: Approximately two (2) hours
Summary of Anticipated Testimony:
Mr. Chandrasekaran is expected to testify regarding the following subjects:
(a) The founding and history of Pinnacle Market Group Inc. Mr. Chandrasekaran co-founded Pinnacle in 2014, together with Lena Kowalski, with the vision of creating an online marketplace that would connect independent sellers with consumers across a diverse range of product categories, including home goods, artisanal products, specialty foods, fashion, and electronics. He will testify regarding Pinnacle's initial public offering on September 18, 2020, and its growth trajectory from a startup marketplace to a publicly traded company that, at its peak, was one of the leading independent marketplace platforms in the United States.
(b) The competitive challenges facing Pinnacle as an independent company. Mr. Chandrasekaran will testify that Pinnacle's GMV growth has decelerated significantly, declining from 28% year-over-year growth in 2022 to only 9% year-over-year growth in 2024. Concurrently, Pinnacle's seller churn rate has increased from 12% in 2022 to 21% in 2024, reflecting the increasing difficulty of retaining sellers in a highly competitive marketplace environment.
(c) The competitive pressures that Pinnacle faces from Vertex Commerce (which, per the FTC's own data, is the largest independent marketplace platform at 35.7% of marketplace GMV), from Nomad Shops (at 14.6% of marketplace GMV), and from emerging social commerce platforms, including Brevity Social Commerce (launched in 2023) and Trove Marketplace (launched in 2024). Mr. Chandrasekaran will explain how these competitive pressures have eroded Pinnacle's market position and contributed to the business challenges described above.
(d) Pinnacle's inability, as a standalone entity, to invest adequately in the fulfillment infrastructure, logistics capabilities, and technology that are necessary to compete effectively with larger and better-resourced competitors. Mr. Chandrasekaran will testify that Pinnacle's capital expenditure constraints have prevented it from building the kind of end-to-end fulfillment capabilities that sellers increasingly demand and that competitors such as Vertex Commerce offer.
(e) The strategic alternatives considered by Pinnacle's Board of Directors prior to accepting Cascade's acquisition offer. Mr. Chandrasekaran will describe the Board's evaluation of multiple options — including continuing as an independent company, pursuing a capital raise, and exploring a sale to other potential acquirers — and the Board's conclusion that a combination with Cascade would best serve the interests of Pinnacle's sellers, consumers, employees, and shareholders.
(f) Mr. Chandrasekaran's view, as Pinnacle's co-founder and CEO, that the proposed acquisition will strengthen Pinnacle's marketplace platform by providing access to Cascade's 22-warehouse fulfillment network, technology resources, and omnichannel retail infrastructure. He will testify that the merger represents the best available path for Pinnacle to remain competitive and to continue serving its community of approximately 185,000 active sellers.
(g) The harm to Pinnacle if the proposed transaction is blocked or substantially delayed by the entry of a preliminary injunction. Mr. Chandrasekaran will testify regarding the ongoing competitive decline that Pinnacle would experience as a standalone entity, the potential for accelerating seller attrition if the transaction is enjoined, and the risk that the deal could terminate entirely if the outside date expires, leaving Pinnacle in a weakened competitive position with diminished strategic alternatives.
D. Witness No. 4: Dr. Priya Ramanathan
Full Name: Dr. Priya Ramanathan
Title: Managing Director, Brindoval Analytics LLC (Testifying Expert Witness for Defendants)
Business Address: 1700 Pennsylvania Avenue NW, Suite 550, Washington, D.C. 20006
Type of Testimony: Live; Expert Testimony — Direct and Cross-Examination
Estimated Duration of Direct Examination: Approximately three (3) hours
Summary of Anticipated Testimony:
Dr. Ramanathan is a nationally recognized economist specializing in antitrust economics, industrial organization, and the economics of platform markets. She holds a Ph.D. in Economics from the Massachusetts Institute of Technology and has testified as an expert in numerous federal and state antitrust proceedings. Dr. Ramanathan is expected to testify regarding the following subjects, consistent with the opinions set forth in her Affirmative Expert Report dated August 18, 2025, and her Rebuttal Expert Report dated August 29, 2025:
(a) Relevant Product Market Definition. Dr. Ramanathan will present her expert opinion that the relevant product market should be defined as "all e-commerce retail" in the United States, rather than the narrow "online marketplace platform services for third-party sellers in the United States" market alleged by the FTC. She will explain why the FTC's proposed market definition is inconsistent with the economic evidence and with established principles of market definition in the context of two-sided platform markets.
(b) Demand-Side and Supply-Side Substitutability. Dr. Ramanathan will present her analysis of demand-side and supply-side substitutability, demonstrating that consumers and sellers substitute freely between marketplace platforms and direct-to-consumer retail channels. She will explain why, as a matter of economic reality, marketplace platforms, DTC e-commerce channels, and social commerce platforms are reasonably interchangeable from the perspective of both sellers seeking to reach consumers and consumers seeking to purchase goods online.
(c) Market Share Analysis Under a Broader Market Definition. Dr. Ramanathan will present her empirical analysis showing that the combined entity's share of total U.S. e-commerce GMV (approximately $757 billion in 2024) is approximately 7.3% when Cascade's direct-to-consumer e-commerce operations are included, and approximately 1.9% on a marketplace-only GMV basis ($14.5 billion combined Cascade and Pinnacle marketplace GMV divided by $757 billion total U.S. e-commerce GMV). These shares are far below the levels that would support a presumption of competitive harm under the applicable case law and the 2023 Merger Guidelines.
(d) Critique of the FTC's HHI Calculations. Dr. Ramanathan will critique the FTC's Herfindahl-Hirschman Index ("HHI") calculations, which show a pre-merger HHI of 2,361, a post-merger HHI of 2,856, and a delta of 495 — levels that, under the narrow market alleged by the FTC, exceed the thresholds identified in the 2023 Merger Guidelines for a presumption of illegality. Dr. Ramanathan will explain that these HHI calculations are a product of the FTC's improperly narrow market definition and that, under a broader and more economically appropriate market definition, HHI levels and increases fall well below the thresholds for presumptive illegality.
(e) Analysis of Merger-Specific Efficiencies. Dr. Ramanathan will present her analysis of the merger-specific efficiencies projected to result from the transaction — totaling approximately $340 million annually by Year 3 — and will opine that these efficiencies are cognizable, verifiable, and likely to be passed through to consumers and sellers in the form of lower fees, improved services, and enhanced platform capabilities. She will explain the economic basis for her pass-through analysis, including the role of competitive pressure from Vertex Commerce, Nomad Shops, and other competitors in compelling the combined entity to share efficiency gains with sellers and consumers.
(f) Critique of the FTC Expert's Diversion Ratio Analysis. Dr. Ramanathan will critique the seller-side diversion ratios calculated by the FTC's expert, Dr. Wallace Keenan of Thornfield Research Group, and will explain the methodological errors and empirical shortcomings in Dr. Keenan's analysis. She will demonstrate that Dr. Keenan's diversion ratios are inflated due to his reliance on the FTC's narrow market definition and his failure to account for the competitive significance of DTC e-commerce channels and social commerce platforms.
(g) Analysis of Pinnacle's Weakening Competitive Position. Dr. Ramanathan will analyze the implications of Pinnacle's declining competitive trajectory for the competitive effects analysis. She will present data showing that Pinnacle's GMV growth has decelerated from 28% year-over-year in 2022 to 9% year-over-year in 2024, and that Pinnacle's seller churn rate has increased from 12% in 2022 to 21% in 2024. She will explain why these trends are relevant to the Court's assessment of the transaction's likely competitive effects and the probability that Pinnacle's current competitive significance will diminish absent the merger.
(h) Multi-Homing Analysis. Dr. Ramanathan will present her analysis of seller multi-homing behavior across marketplace platforms, demonstrating that high rates of seller multi-homing undermine the FTC's theory of unilateral effects. She will explain that when sellers maintain active presences on multiple competing platforms simultaneously, a merged entity's ability to raise fees or reduce quality is constrained because sellers can readily shift transaction volume to competing platforms.
(i) Alternative Econometric Model. Dr. Ramanathan will present an alternative econometric model — incorporating the broader market definition and the effects of multi-homing — demonstrating that any upward pricing pressure from the merger is minimal and insufficient to support a finding of likely competitive harm. Her model will show that the Gross Upward Pricing Pressure Index ("GUPPI") for the combined entity is well below levels that would indicate a significant risk of anticompetitive price increases.
(j) The opinions set forth in this summary are described in full in Dr. Ramanathan's Affirmative Expert Report, dated August 18, 2025, and her Rebuttal Expert Report, dated August 29, 2025, copies of which have been served on the FTC in accordance with the Court's expert disclosure schedule.
E. Witness No. 5: Thomas Breck
Full Name: Thomas Breck
Title: Chief Financial Officer, Pinnacle Market Group Inc.
Business Address: 500 East 6th Street, Suite 800, Austin, Texas 78701
Type of Testimony: Live; Direct and Cross-Examination
Estimated Duration of Direct Examination: Approximately one and one-half (1.5) hours
Summary of Anticipated Testimony:
Mr. Breck is expected to testify regarding the following subjects:
(a) Pinnacle's financial condition and performance trajectory. Mr. Breck will testify that in FY2024, Pinnacle generated GMV of approximately $11.4 billion, net revenue of approximately $1.82 billion (reflecting a take rate of approximately 16%), and hosted approximately 185,000 active third-party sellers as of December 31, 2024. He will provide a comprehensive overview of Pinnacle's financial performance from its IPO in September 2020 through the present.
(b) Pinnacle's pre-announcement market capitalization and stock price performance. Mr. Breck will testify that, based on 175,047,319 shares of Pinnacle common stock outstanding, and an unaffected closing price of $22.30 per share on March 7, 2025 (the last trading day prior to public reports of a potential transaction), Pinnacle's pre-announcement market capitalization was approximately $3.9 billion. He will describe the trajectory of Pinnacle's stock price since its IPO and the decline in valuation reflecting the market's assessment of Pinnacle's competitive challenges.
(c) Detailed financial data supporting the deceleration of Pinnacle's business. Mr. Breck will present financial data and metrics documenting the deceleration of Pinnacle's GMV growth from 28% year-over-year in 2022 to 9% year-over-year in 2024, as well as the increase in seller churn from 12% in 2022 to 21% in 2024. He will explain the financial drivers of these trends and their implications for Pinnacle's standalone financial outlook.
(d) The capital expenditure constraints that limit Pinnacle's ability to invest in logistics, fulfillment, and technology on a standalone basis. Mr. Breck will testify regarding Pinnacle's historical capital expenditure levels, the investment gap between Pinnacle and its larger competitors, and the financial barriers that prevent Pinnacle from independently building the fulfillment infrastructure necessary to remain competitive.
(e) The financial terms of the proposed merger, including the merger consideration of $26.85 per share in cash, which represents a premium of approximately 20.4% over Pinnacle's unaffected closing price of $22.30 per share on March 7, 2025. Mr. Breck will describe the financial analysis performed by Pinnacle's management and financial advisors in connection with the transaction, including the work performed by Ridgeline Capital Partners in rendering its fairness opinion.
(f) Financial projections prepared by Pinnacle's management demonstrating the declining trajectory of the company on a standalone basis absent the merger. Mr. Breck will present Pinnacle's internal financial projections, which show continued deceleration in revenue growth, margin compression, and increasing competitive pressure from larger and better-resourced competitors.
(g) Mr. Breck's assessment, as Pinnacle's Chief Financial Officer, that the company requires the capital resources, fulfillment infrastructure, and technology capabilities that only a combination with Cascade can provide, and that the proposed merger represents the best available path to preserving and enhancing value for Pinnacle's shareholders, sellers, and other stakeholders.
F. Reservation of Rights
Defendants reserve the right to call the following additional witnesses in rebuttal, depending on the scope and content of the FTC's case-in-chief:
(a) David Ruan, President and Chief Operating Officer, Cascade Retail Holdings Inc., 2200 Westlake Avenue North, Suite 3400, Seattle, Washington 98109;
(b) Sonia Alvarez-Kirk, Chief Financial Officer, Cascade Retail Holdings Inc., 2200 Westlake Avenue North, Suite 3400, Seattle, Washington 98109;
(c) Lena Kowalski, Co-Founder and Chief Product Officer, Pinnacle Market Group Inc., 500 East 6th Street, Suite 800, Austin, Texas 78701; and
(d) Dr. Lucas Engström, Senior Economist, Brindoval Analytics LLC, 1700 Pennsylvania Avenue NW, Suite 550, Washington, D.C. 20006 (consulting expert who may be called to address narrow rebuttal topics as necessary in response to the FTC's case-in-chief).
Defendants further reserve the right to call any witness identified on the FTC's witness list as an adverse witness during Defendants' case-in-chief, or to recall any such witness during Defendants' rebuttal case. Nothing in this Witness List constitutes a waiver of Defendants' right to object to the scope or admissibility of testimony offered by the FTC's witnesses.
III. EXHIBIT LIST
Introductory Note.  Defendants propose the following exhibits, numbered DX-001 through DX-075, for use at the evidentiary hearing on the FTC's Motion for Preliminary Injunction. This Exhibit List is subject to supplementation as permitted by the Court's Scheduling Order and as may become necessary in response to the FTC's case-in-chief.
All exhibits will be presented in electronic format, with originals available for inspection upon request. Defendants' counsel have conferred with counsel for the FTC regarding potential stipulations as to the authenticity and admissibility of certain exhibits, and Defendants anticipate filing any agreed-upon stipulations with the Court in advance of the hearing. To the extent the parties are unable to agree on authentication or admissibility, Defendants will present live witnesses or declarations to establish the foundation for each exhibit.
Certain exhibits listed below are designated "CONFIDENTIAL" or "HIGHLY CONFIDENTIAL — ATTORNEYS' EYES ONLY" pursuant to the Stipulated Protective Order entered by the Court on July 28, 2025 (Dkt. No. 58). Such exhibits will be presented under seal or in a closed courtroom session, as appropriate, in accordance with the Protective Order and the Court's procedures for handling confidential information during evidentiary hearings.
Counsel for Cascade (Calderwood & Harkness LLP) and counsel for Pinnacle (Whitfield, Greer & Tanaka LLP) have coordinated the preparation and organization of this Exhibit List pursuant to the Joint Defense Agreement dated April 15, 2025, to avoid duplication and ensure the efficient presentation of evidence.
A. Transaction Documents (DX-001 through DX-010)
B. Cascade Business and Competitive Position Documents (DX-011 through DX-025)
C. Pinnacle Business and Competitive Trajectory Documents (DX-026 through DX-040)
D. Market Definition and Competitive Landscape Documents (DX-041 through DX-055)
E. Efficiencies and Integration Documents (DX-056 through DX-065)
F. Expert Materials (DX-066 through DX-070)
G. Equities and Public Interest Documents (DX-071 through DX-075)
IV. OBJECTIONS TO FTC EXHIBITS
Defendants reserve the right to object to any exhibits offered by the FTC at the evidentiary hearing, including on the grounds of relevance under Federal Rules of Evidence 401 and 402; authenticity under Federal Rules of Evidence 901 and 902; hearsay under Federal Rules of Evidence 801 through 807; privilege, including attorney-client privilege, work product protection, and deliberative process privilege; unfair prejudice, confusion of the issues, or needless presentation of cumulative evidence under Federal Rule of Evidence 403; and any other applicable grounds under the Federal Rules of Evidence or the Court's orders.
Defendants further note that their Motion to Exclude the Expert Testimony of Dr. Wallace Keenan of Thornfield Research Group, the FTC's designated testifying expert, is currently pending before the Court (Dkt. No. 72, filed August 25, 2025). Defendants reserve all objections to exhibits offered by the FTC through or in connection with Dr. Keenan's testimony, including objections based on the grounds set forth in Defendants' pending Daubert motion. In the event the Court grants Defendants' Daubert motion in whole or in part, Defendants will object to the admission of any exhibits that are offered solely through Dr. Keenan or that are rendered irrelevant or inadmissible by the exclusion of Dr. Keenan's testimony.
Defendants' failure to identify specific objections to individual FTC exhibits at this time shall not constitute a waiver of any objection that Defendants may assert at the evidentiary hearing or in any pre-hearing briefing on evidentiary issues.
V. CERTIFICATION OF SERVICE
I, Howard Bellamy, hereby certify that on this date, a true and correct copy of the foregoing Defendants' Witness List and Exhibit List for Preliminary Injunction Evidentiary Hearing was served upon all parties of record by electronic filing via the Court's CM/ECF system, which will send notification of such filing to all counsel of record, including:
Claire Dunmore, Senior Trial Counsel Samuel Ortega, Trial Attorney Rebecca Yun, Trial Attorney Federal Trade Commission, Bureau of Competition 600 Pennsylvania Avenue NW Washington, D.C. 20580 Counsel for Plaintiff Federal Trade Commission
Diana Whitfield, Partner Kenneth Oshiro, Partner Whitfield, Greer & Tanaka LLP 100 Congress Avenue, Suite 2200 Austin, TX 78701 Counsel for Defendant Pinnacle Market Group Inc.
Martina Galloway, Partner Galloway & Peck LLP 800 Fifth Avenue, Suite 3100 Seattle, WA 98104 Counsel for the Independent Online Sellers Association ("IOSA"), to the extent that IOSA's Motion to Intervene (Dkt. No. 65, filed August 11, 2025) remains pending before the Court
Respectfully submitted,
For Defendant Cascade Retail Holdings Inc.:
CALDERWOOD & HARKNESS LLP
By: ________
Howard Bellamy (D.C. Bar No. 487213) Elaine Forsythe (D.C. Bar No. 512844) Elliot Nguyen (D.C. Bar No. 529071) Aaron Liu (Cal. Bar No. 318467, admitted pro hac vice) 1401 K Street NW, Suite 1200 Washington, D.C. 20005 Telephone: (202) 555-7400 Facsimile: (202) 555-7401 hbellamy@calderwoodharkness.com eforsythe@calderwoodharkness.com enguyen@calderwoodharkness.com aliu@calderwoodharkness.com
Date: ________
For Defendant Pinnacle Market Group Inc.:
WHITFIELD, GREER & TANAKA LLP
By: ________
Diana Whitfield (Tex. Bar No. 24059831, admitted pro hac vice) Kenneth Oshiro (Tex. Bar No. 24063117, admitted pro hac vice) 100 Congress Avenue, Suite 2200 Austin, TX 78701 Telephone: (512) 555-3200 Facsimile: (512) 555-3201 dwhitfield@wgtlaw.com koshiro@wgtlaw.com
Date: ________
Calderwood & Harkness LLP Matter No. 1038-00001
FEDERAL TRADE COMMISSION,
<!-- indent:2 -->Plaintiff,<!-- /indent --> | Case No. 2:25-cv-01087-RAJ
v. | DEFENDANTS' WITNESS LIST AND
EXHIBIT LIST FOR PRELIMINARY
CASCADE RETAIL HOLDINGS INC. and PINNACLE MARKET GROUP INC., | INJUNCTION EVIDENTIARY HEARING
<!-- indent:2 -->Defendants.<!-- /indent --> | Hearing Date: September 8, 2025
Courtroom: 15B
Before: Hon. Richard A. Johannsen
Est. Duration: 5 Court Days
Exhibit No. | Description | Confidentiality Designation
DX-001 | Agreement and Plan of Merger, dated March 14, 2025, among Cascade Retail Holdings Inc., CRH Merger Sub Inc., and Pinnacle Market Group Inc. (selected excerpts, including: Recitals; Article I (Defined Terms); Article II (The Merger, including merger consideration of $26.85 per share); Article VII (Conditions to Closing); Article VIII (Termination, including reverse termination fee of $282 million, company termination fee of $164.5 million, and outside date of March 14, 2026, extendable to June 14, 2026 solely in the event that the only unsatisfied closing condition is the receipt of antitrust regulatory clearance)) | Confidential
DX-002 | Commitment Letter from Whitmore National Bank, N.A. to Cascade Retail Holdings Inc., dated March 12, 2025, for a $2.8 billion senior secured term loan B facility and a $500 million revolving credit facility (Reference: CRH-WNB-2025-TLB) | Highly Confidential — AEO
DX-003 | Form 8-K filed by Cascade Retail Holdings Inc. with the U.S. Securities and Exchange Commission, dated March 17, 2025, announcing the execution of the Agreement and Plan of Merger | Public
DX-004 | Definitive Proxy Statement (Schedule 14A) filed by Pinnacle Market Group Inc. with the U.S. Securities and Exchange Commission, dated April 28, 2025 | Public
DX-005 | Fairness Opinion of Mercer Hollis & Co., dated March 13, 2025, to the Board of Directors of Cascade Retail Holdings Inc. (as included in the proxy materials) | Public
DX-006 | Fairness Opinion of Ridgeline Capital Partners, dated March 13, 2025, to the Board of Directors of Pinnacle Market Group Inc. (as included in the proxy materials) | Public
DX-007 | Hart-Scott-Rodino Act premerger notification filing cover page and transaction summary (HSR Filing No. HSR-20250402-0347), dated April 2, 2025 | Confidential
DX-008 | FTC Second Request for Additional Information and Documentary Material, File No. 251-0089, dated May 7, 2025 (redacted to remove material subject to deliberative process privilege) | Confidential
DX-009 | Cascade Retail Holdings Inc. certification of substantial compliance with FTC Second Request, dated June 10, 2025 | Confidential
DX-010 | Minutes of the meeting of the Board of Directors of Cascade Retail Holdings Inc., held March 13, 2025, approving the Agreement and Plan of Merger (redacted to protect information subject to attorney-client privilege and work product protection) | Highly Confidential — AEO
Exhibit No. | Description | Confidentiality Designation
DX-011 | Cascade Retail Holdings Inc. FY2024 Annual Report on Form 10-K, filed with the SEC on February 27, 2025 — excerpts including total revenue ($28.6 billion), e-commerce and marketplace segment reporting ($9.3 billion combined revenue), CascadeMarket GMV ($3.1 billion), and business description sections | Public
DX-012 | CascadeMarket internal business review, Q4 FY2024 — marketplace services revenue ($527 million), take rate (17%), active third-party sellers (approximately 42,000), and competitive positioning analysis | Highly Confidential — AEO
DX-013 | CascadeMarket launch documentation and initial business plan, dated June 1, 2019, including market opportunity analysis and projected growth trajectory | Confidential
DX-014 | Cascade strategic planning presentation, February 2025 — "Omnichannel Growth and Marketplace Expansion Strategy" — discussing the strategic rationale for acquiring a complementary marketplace platform to accelerate Cascade's e-commerce growth | Highly Confidential — AEO
DX-015 | Cascade marketplace competitive analysis, January 2025 — internal analysis of the competitive landscape, including market position assessments of Vertex Commerce, Nomad Shops, Pinnacle, Brevity Social Commerce, and Trove Marketplace | Highly Confidential — AEO
DX-016 | Cascade seller survey results, March 2025 — survey of CascadeMarket third-party sellers regarding multi-homing behavior, platform usage across competing marketplaces, and seller satisfaction benchmarking | Confidential
DX-017 | Cascade brick-and-mortar store location map — depicting the locations of approximately 340 retail stores across 38 states | Public
DX-018 | Cascade fulfillment network overview — description and geographic map of the 22-warehouse nationwide fulfillment network, including capacity data and throughput metrics | Confidential
DX-019 | Cascade e-commerce platform (CascadeDirect.com) traffic and transaction data, FY2024 — including unique visitors, conversion rates, order volumes, and GMV data | Highly Confidential — AEO
DX-020 | Summary of Cascade's total e-commerce GMV for FY2024 (approximately $43.7 billion, combining direct-to-consumer sales via CascadeDirect.com and third-party marketplace GMV via CascadeMarket) | Highly Confidential — AEO
DX-021 | Cascade Retail Holdings Inc. investor presentation, Q1 2025 — discussing market capitalization (approximately $41.2 billion as of June 27, 2025), Nasdaq ticker symbol CSRT, and strategic priorities including omnichannel expansion and marketplace growth | Public
DX-022 | Cascade internal emails and memoranda, 2023–2025 — discussing competitive pressure from social commerce platforms (including Brevity Social Commerce and Trove Marketplace) and from direct-to-consumer e-commerce channels, and the implications of these competitive dynamics for Cascade's marketplace strategy | Highly Confidential — AEO
DX-023 | Cascade marketplace take rate benchmarking study, November 2024 — comparing CascadeMarket's 17% take rate against the take rates charged by Vertex Commerce, Nomad Shops, Pinnacle, and other industry competitors | Highly Confidential — AEO
DX-024 | Cascade customer acquisition and retention data, FY2024 — demonstrating overlap between the consumer bases of Cascade's marketplace platform and its direct retail operations, and the competitive significance of omnichannel consumer engagement | Confidential
DX-025 | Independent auditor's report of Aldrich & Warwick CPAs LLP on the consolidated financial statements of Cascade Retail Holdings Inc. for the fiscal year ended December 31, 2024 | Public
Exhibit No. | Description | Confidentiality Designation
DX-026 | Pinnacle Market Group Inc. FY2024 Annual Report on Form 10-K, filed with the SEC on March 3, 2025 — excerpts including GMV ($11.4 billion), net revenue ($1.82 billion), take rate (16%), active sellers (approximately 185,000), and business description sections | Public
DX-027 | Pinnacle internal board presentation, December 2024 — "Strategic Review: Competitive Challenges and Growth Outlook" — documenting GMV growth deceleration from 28% year-over-year (2022) to 9% year-over-year (2024) and the Board's assessment of Pinnacle's competitive position | Highly Confidential — AEO
DX-028 | Pinnacle seller churn analysis, Q4 2024 — internal data and analysis showing the increase in seller churn rate from 12% (2022) to 21% (2024), including cohort analysis and identification of primary drivers of seller departures | Highly Confidential — AEO
DX-029 | Pinnacle quarterly GMV data, 2020–2024 — time-series data showing Pinnacle's GMV growth trajectory, seasonal patterns, and the progressive deceleration of growth across the five-year period | Confidential
DX-030 | Pinnacle internal memorandum, October 2024 — discussing competitive pressures from Vertex Commerce, including Vertex's expansion of fulfillment services and seller acquisition campaigns, and the urgent need for Pinnacle to invest in fulfillment infrastructure | Highly Confidential — AEO
DX-031 | Minutes of the meeting of the Board of Directors of Pinnacle Market Group Inc., January 2025 — discussing strategic alternatives available to Pinnacle, including a potential sale of the company, a capital raise through equity or debt issuance, and a standalone operating plan | Highly Confidential — AEO
DX-032 | Pinnacle seller exit survey data, 2023–2024 — compiled responses from departing sellers documenting the primary reasons for seller departures, including competition from other platforms offering superior fulfillment services, dissatisfaction with Pinnacle's logistics capabilities, and pricing pressure from competing marketplaces | Confidential
DX-033 | Excerpts from Pinnacle Market Group Inc. IPO prospectus, dated September 18, 2020 — showing initial growth projections, market opportunity analysis, and competitive landscape assessment, as compared against Pinnacle's actual performance in subsequent years | Public
DX-034 | Pinnacle management financial projections (standalone basis), prepared February 2025 — projecting continued GMV growth deceleration, margin compression, and increasing capital requirements for the period FY2025–FY2029, assuming Pinnacle remains an independent company | Highly Confidential — AEO
DX-035 | Pinnacle competitive intelligence reports, 2023–2024 — internal analyses of Vertex Commerce's market expansion initiatives, Nomad Shops' seller acquisition campaigns, and the emergence of social commerce platforms as competitive threats | Highly Confidential — AEO
DX-036 | Independent auditor's report of Kessler Fong Accounting Group LLP on the consolidated financial statements of Pinnacle Market Group Inc. for the fiscal year ended December 31, 2024 | Public
DX-037 | Pinnacle capital expenditure analysis, FY2022–FY2024 — showing constrained investment capacity in logistics infrastructure and technology development, with comparison to capital expenditure levels of Vertex Commerce and other competitors | Confidential
DX-038 | Pinnacle seller satisfaction survey, Q3 2024 — documenting declining seller satisfaction scores and competitive benchmarking against Vertex Commerce and Nomad Shops across key dimensions including fulfillment speed, seller support, marketing tools, and fee competitiveness | Confidential
DX-039 | Pinnacle internal analysis of social commerce competitive threat, August 2024 — evaluating the impact of Brevity Social Commerce Inc. and Trove Marketplace Inc. on Pinnacle's seller base, including estimated seller diversion to social commerce channels | Highly Confidential — AEO
DX-040 | Pinnacle Market Group Inc. share price chart, September 2020 through March 2025 — showing the unaffected closing price of $22.30 per share on March 7, 2025, the pre-announcement market capitalization of approximately $3.9 billion, and the trajectory of Pinnacle's stock price from its IPO through the announcement of the proposed merger | Public
Exhibit No. | Description | Confidentiality Designation
DX-041 | Third-party market research report on total U.S. e-commerce gross merchandise value for calendar year 2024, reporting total U.S. e-commerce GMV of approximately $757 billion | Public
DX-042 | Defendants' market share analysis — broader "all e-commerce retail" market, showing the combined entity's share at approximately 7.3% of total U.S. e-commerce GMV (including Cascade's direct-to-consumer e-commerce operations), and approximately 1.9% on a marketplace-only GMV basis ($14.5 billion combined Cascade and Pinnacle marketplace GMV / $757 billion total U.S. e-commerce GMV) | Confidential
DX-043 | Comparison chart of the FTC's alleged market shares under the "online marketplace platform services" market definition (Cascade 8.2%, Pinnacle 30.1%, combined 38.3%, Vertex Commerce 35.7%, Nomad Shops 14.6%, all others 11.4%) versus Defendants' market share analysis under the broader "all e-commerce retail" market definition | Confidential
DX-044 | HHI calculations under Defendants' broader market definition, demonstrating that pre- and post-merger HHI levels are well below the concentration thresholds identified in the 2023 Merger Guidelines; includes side-by-side comparison with the FTC's HHI calculations (pre-merger 2,361, post-merger 2,856, delta 495) under the FTC's narrow market definition | Confidential
DX-045 | Vertex Commerce Inc. public filings and annual reports — excerpts demonstrating Vertex Commerce's market position as the largest independent online marketplace platform in the United States (35.7% of online marketplace GMV per FTC), including revenue, GMV, seller base size, fulfillment capabilities, and recent expansion initiatives | Public
DX-046 | Nomad Shops LLC business profile — publicly available information on Nomad Shops' marketplace operations, including its curated artisan and small-business focus, seller base, GMV (14.6% of marketplace GMV per FTC), and competitive positioning | Public
DX-047 | Brevity Social Commerce Inc. launch announcement and press coverage (launched 2023) — demonstrating the relative ease of entry into online marketplace and e-commerce platform services, and the rapid growth of social commerce as a competitive channel | Public
DX-048 | Trove Marketplace Inc. launch announcement and press coverage (launched 2024) — demonstrating recent entry into and expansion of the competitive landscape for online marketplace and e-commerce services | Public
DX-049 | Analysis of barriers to entry in online marketplace platform services — including assessment of capital requirements, technology accessibility, network effects, and the ability of new entrants and adjacent competitors to enter and expand in marketplace services, demonstrating that barriers to entry and expansion are low | Confidential
DX-050 | Multi-homing data analysis — empirical study of seller presence across multiple competing platforms (CascadeMarket, Pinnacle, Vertex Commerce, Nomad Shops, and other marketplaces), demonstrating high rates of multi-homing and the implications of multi-homing for competitive effects analysis | Confidential
DX-051 | Cross-elasticity of demand analysis — data and econometric analysis showing consumer substitution between marketplace platforms and direct-to-consumer e-commerce channels, supporting a broader relevant product market definition | Confidential
DX-052 | Social commerce market overview, 2023–2025 — documenting the rise of social media-integrated commerce as a competitive constraint on traditional marketplace platforms, including data on transaction volumes, seller adoption rates, and consumer usage patterns | Public
DX-053 | Direct-to-consumer e-commerce growth data, 2020–2024 — demonstrating the expansion of DTC channels operated by brands and retailers as alternatives to third-party marketplace platforms, including data on the number of DTC e-commerce storefronts, DTC GMV growth, and the competitive significance of DTC channels | Public
DX-054 | Academic and industry literature on two-sided platform markets — excerpts relevant to market definition in the context of platform markets, including references to Ohio v. Halcyon Corporation, 138 S. Ct. 2274 (2018), and economic scholarship on the competitive dynamics of multi-sided platforms | Public
DX-055 | Third-party equity analyst reports on the U.S. online marketplace competitive landscape, 2024–2025 — excerpts from reports published by independent financial analysts assessing the competitive positions of Vertex Commerce, Pinnacle, Nomad Shops, and other marketplace platforms | Confidential
Exhibit No. | Description | Confidentiality Designation
DX-056 | Cascade-Pinnacle integration plan, prepared by Patricia Delacroix and the Marketplace & Platform Strategy team, March 2025 — detailed operational plan for post-merger integration of marketplace operations, fulfillment networks, technology platforms, and seller services | Highly Confidential — AEO
DX-057 | Efficiencies analysis — detailed breakdown of the $340 million in projected merger-specific efficiencies expected to be achieved by Year 3 post-closing: $195 million in logistics and fulfillment cost savings; $145 million in technology and platform synergies, with supporting calculations, assumptions, and data sources | Highly Confidential — AEO
DX-058 | Logistics and fulfillment integration model — detailed analysis of the integration of Pinnacle's approximately 185,000 active sellers into Cascade's 22-warehouse fulfillment network, documenting the cost savings methodology, warehouse capacity analysis, transportation network optimization, and projected per-unit cost reductions | Highly Confidential — AEO
DX-059 | Technology platform consolidation plan — analysis of technology and platform synergies, including engineering workforce optimization, infrastructure consolidation, cloud computing cost savings, shared services implementation, and the integration of search, discovery, and recommendation algorithms | Highly Confidential — AEO
DX-060 | Third-party validation of efficiency projections — independent assessment prepared by management consultants engaged by Cascade during the transaction diligence process, confirming the reasonableness and achievability of the projected merger-specific efficiencies | Highly Confidential — AEO
DX-061 | Seller benefit projections — analysis showing how efficiency savings from the merger would be passed through to sellers through lower marketplace fees, improved fulfillment speeds, reduced shipping costs, and enhanced seller tools and analytics capabilities | Highly Confidential — AEO
DX-062 | Consumer benefit projections — analysis showing how the combined platform would offer broader product selection, faster delivery times, improved search and discovery functionality, and more competitive pricing for consumers | Highly Confidential — AEO
DX-063 | Comparable merger integration case studies — analysis of successful marketplace and e-commerce platform integrations in analogous transactions in the technology and retail sectors, including efficiency realization timelines and pass-through rates | Confidential
DX-064 | Take rate analysis — projections showing that the combined entity's take rates would remain competitive with Vertex Commerce, Nomad Shops, and other marketplace competitors, and that the realization of merger-specific efficiencies would enable downward pressure on take rates charged to third-party sellers | Highly Confidential — AEO
DX-065 | Cascade-Pinnacle combined fulfillment network map and timeline for integration milestones — visual depiction of the planned post-merger fulfillment network and a detailed schedule of key integration activities and target completion dates | Confidential
Exhibit No. | Description | Confidentiality Designation
DX-066 | Expert Report of Dr. Priya Ramanathan, Managing Director, Brindoval Analytics LLC, dated August 18, 2025 — affirmative expert report on relevant product market definition, market concentration, competitive effects analysis, efficiencies, and related economic issues | Highly Confidential — AEO
DX-067 | Rebuttal Expert Report of Dr. Priya Ramanathan, Managing Director, Brindoval Analytics LLC, dated August 29, 2025 — responding to the expert report of Dr. Wallace Keenan of Thornfield Research Group | Highly Confidential — AEO
DX-068 | Curriculum Vitae of Dr. Priya Ramanathan, Managing Director, Brindoval Analytics LLC — including academic credentials, professional experience, prior expert testimony, and publications | Public
DX-069 | Demonstrative exhibit — market share comparison charts depicting the FTC's narrow market share calculations versus Defendants' broader market share analysis, prepared for use during the testimony of Dr. Ramanathan | Confidential
DX-070 | Demonstrative exhibit — Pinnacle competitive trajectory charts depicting GMV growth deceleration (from 28% YoY in 2022 to 9% YoY in 2024) and seller churn rate increase (from 12% in 2022 to 21% in 2024), 2020–2024 | Confidential
Exhibit No. | Description | Confidentiality Designation
DX-071 | Declaration of Margaret Thornberry, Chief Executive Officer and Chairwoman of the Board, Cascade Retail Holdings Inc., regarding harm to Cascade from the entry of a preliminary injunction — including testimony on the impact on the merger timeline, the risk of deal termination in light of the March 14, 2026 outside date, Cascade's potential exposure to the $282 million reverse termination fee, employee uncertainty and the effect on retention and morale, competitive harm from prolonged regulatory overhang, and disruption to business partner relationships | Confidential
DX-072 | Declaration of Rajiv Chandravar, Co-Founder and Chief Executive Officer, Pinnacle Market Group Inc., regarding harm to Pinnacle from the entry of a preliminary injunction — including testimony on continued competitive deterioration, accelerating seller attrition, management distraction, the inability to invest in long-term initiatives during pendency of the injunction, and the risk of deal termination if the outside date expires, leaving Pinnacle in a weakened competitive position with diminished strategic alternatives | Confidential
DX-073 | Analysis of merger agreement termination provisions — summary of the outside date of March 14, 2026 (extendable to June 14, 2026, solely in the event that the receipt of antitrust regulatory clearance is the sole remaining unsatisfied closing condition), the reverse termination fee of $282 million payable by Cascade, and the company termination fee of $164.5 million payable by Pinnacle, with commentary on the practical implications of these provisions for the viability of the transaction in the event of a preliminary injunction | Confidential
DX-074 | Pinnacle shareholder communications — letters from institutional shareholders of Pinnacle Market Group Inc. expressing support for the proposed transaction and urging consummation of the merger | Public
DX-075 | Summary of the FTC Commission vote (3–2) authorizing the filing of the Complaint in this action — demonstrating the existence of internal division within the Commission on the merits of the challenge to the proposed transaction | Public

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF WASHINGTON SEATTLE DIVISION

I. INTRODUCTION

II. WITNESS LIST

III. EXHIBIT LIST

IV. OBJECTIONS TO FTC EXHIBITS

V. CERTIFICATION OF SERVICE

CALDERWOOD & HARKNESS LLP

WHITFIELD, GREER & TANAKA LLP

FEDERAL TRADE COMMISSION,

EXHIBIT LIST FOR PRELIMINARY

Record

Parties

Dates

Amounts