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IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

DECLARATION OF ROLAND ASHBY IN SUPPORT OF PLAINTIFF'S MOTION FOR TEMPORARY RESTRAINING ORDER AND PRELIMINARY INJUNCTION

I, Roland Ashby, hereby declare as follows:

1. I am over the age of eighteen and am competent to testify to the matters stated herein. I have personal knowledge of the facts set forth in this Declaration and, if called as a witness, could and would testify competently to the same. I make this Declaration pursuant to 10 Del. C. § 3927, under penalty of perjury. Except where specifically noted, the statements contained herein are based on my personal knowledge, my review of business records of Cascade Retail Holdings Inc. maintained in the ordinary course of business, and information provided to me by members of my staff and other officers of the company in the course of my duties.

I. BACKGROUND AND QUALIFICATIONS OF THE DECLARANT

2. My full name is Roland Ashby. I am the Chief People Officer ("CPO") of Cascade Retail Holdings Inc. ("CRH" or the "Company"). My principal office is located at CRH's corporate headquarters, 2200 Elliott Avenue West, Suite 3400, Seattle, Washington 98119.

3. I have served as CPO of CRH since August 2017, a period of approximately seven and one-half years. In this capacity, I am responsible for all human resources, talent management, compensation and benefits, and employee relations functions across CRH's entire organization, which employs approximately 24,500 people across the United States. I report directly to CRH's Chief Executive Officer, Marcus Langford.

4. As CPO, I have direct oversight of the administration of employment agreements, onboarding and offboarding processes, restrictive covenant administration, and the maintenance and custody of personnel records for all CRH employees. This responsibility extends to the Company's senior merchandising leadership, including each of the eight individual defendants named in this action (collectively, the "Departing Employees").

5. In my role, I am familiar with the employment history, compensation, contractual obligations, and the specific trade secrets and confidential information to which each of the Departing Employees had access during their tenure at CRH. I have personally reviewed each of their employment agreements, including the restrictive covenant provisions contained therein, in connection with the events described in this Declaration and in preparation for the filing of this action.

II. OVERVIEW OF CASCADE RETAIL HOLDINGS INC.

6. CRH is a corporation organized and existing under the laws of the State of Delaware. The Company is publicly traded on the Nasdaq Stock Market under the ticker symbol "CRHL." CRH is headquartered in Seattle, Washington.

7. CRH is a leading omnichannel retail and ecommerce company. The Company operates 387 brick-and-mortar retail locations across 34 states and maintains a robust direct-to-consumer ecommerce platform that serves customers nationwide. CRH's retail footprint spans a diverse set of product categories, including home goods, apparel, seasonal décor, hardlines, and private-label merchandise, among others.

8. For the fiscal year ended December 31, 2024 ("FY2024"), CRH reported annual revenue of approximately $6.82 billion. As of February 2025, the Company's approximate market capitalization was approximately $4.1 billion.

9. CRH's merchandising division is a core revenue driver for the Company. In FY2024, the merchandising division generated approximately $2.3 billion in gross merchandise value ("GMV"). The merchandising function is responsible for all buying decisions, vendor negotiations, category strategy, private-label product development, ecommerce assortment planning, seasonal planning, and category analytics across CRH's entire product offering. The performance and strategic direction of the merchandising division are directly tied to CRH's competitive position, profitability, and shareholder value.

10. CRH's Chief Executive Officer is Marcus Langford. The Company's General Counsel is Theresa Yun-Park.

III. THE DEPARTING EMPLOYEES AND THEIR ROLES

A. Priya Rathore

11. Defendant Priya Rathore ("Rathore") served as Senior Vice President, Merchandising at CRH. She originally joined the Company on June 3, 2019, in the role of Vice President, Merchandising Strategy. Rathore was subsequently promoted to the position of Senior Vice President, Merchandising, effective March 15, 2021.

12. In connection with her initial hiring, Rathore executed an Employment Agreement dated June 3, 2019 (the "Original Rathore Agreement"). Upon her promotion, Rathore executed an Amended and Restated Employment Agreement dated March 15, 2021 (the "Amended Rathore Agreement"). Both agreements were entered into between Rathore and CRH, and both contained restrictive covenant provisions. The Amended Rathore Agreement superseded and replaced the Original Rathore Agreement in its entirety. True and correct copies of both agreements are attached to this Declaration as Exhibit A and Exhibit B, respectively.

13. The Amended Rathore Agreement contains the following restrictive covenant provisions, among others:

(a) Non-Competition: An eighteen (18)-month post-termination non-competition covenant, prohibiting Rathore from engaging in or being employed in a merchandising, buying, category strategy, or substantially similar role at any competitor of CRH operating in the retail or ecommerce sector within the United States.

(b) Non-Solicitation of Employees: A twenty-four (24)-month post-termination non-solicitation covenant, prohibiting Rathore from directly or indirectly soliciting, recruiting, or inducing any employee of CRH to leave the Company's employment.

(c) Non-Solicitation of Vendors: A twenty-four (24)-month post-termination non-solicitation covenant, prohibiting Rathore from directly or indirectly soliciting, diverting, or interfering with CRH's relationships with its vendors, suppliers, and business partners.

(d) Confidentiality: A perpetual obligation not to use or disclose CRH's confidential information, trade secrets, and proprietary data, as defined in the agreement.

14. All of the restrictive covenant provisions in the Amended Rathore Agreement are governed by the laws of the State of Delaware, as specified in Section 14.1 of that agreement.

15. Rathore's total compensation for FY2024 consisted of the following components: (i) a base salary of $485,000; (ii) an annual performance bonus with a target of $290,000, representing 60% of her base salary; and (iii) a restricted stock unit ("RSU") grant valued at $725,000 at the time of grant, subject to four-year ratable annual vesting commencing from the date of her March 15, 2021 promotion.

16. As Senior Vice President, Merchandising, Rathore was the most senior merchandising executive at CRH. She oversaw all buying, vendor negotiations, category strategy, private-label development, and ecommerce assortment decisions across the Company's entire product portfolio. In this capacity, Rathore set the strategic direction for CRH's merchandising operations and served as the primary executive responsible for the performance of the $2.3 billion merchandising division.

17. By virtue of her position, Rathore had full and unrestricted access to CRH's most sensitive and competitively valuable confidential information and trade secrets in the merchandising function, including but not limited to: (i) Project Ridgeline, the Company's confidential five-year category expansion roadmap completed in October 2024, for which Rathore served as executive sponsor; (ii) CRH's proprietary vendor negotiation playbooks; (iii) seasonal buying algorithms; (iv) private-label sourcing strategies, cost structures, and margin targets; and (v) customer segmentation data and analytics models.

18. Rathore reported directly to CEO Marcus Langford. She supervised a team of approximately 120 merchandising professionals, which included all seven other Departing Employees named as defendants in this action.

B. The Other Seven Departing Employees

19. The remaining seven individual defendants occupied the following positions at CRH, with the indicated tenures, base salaries, and restrictive covenant terms:

(a) Derek Linden served as Vice President, Hardlines Merchandising. He was employed at CRH for approximately seven (7) years, with a base salary of $340,000. His employment agreement contains an eighteen (18)-month non-competition covenant, a twenty-four (24)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Linden reported directly to Rathore.

(b) Sonia Kaczmarek served as Vice President, Softlines Merchandising. She was employed at CRH for approximately five (5) years, with a base salary of $325,000. Her employment agreement contains an eighteen (18)-month non-competition covenant, a twenty-four (24)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Kaczmarek reported directly to Rathore.

(c) Amara Osei served as Director, Private Label Strategy. She was employed at CRH for approximately four (4) years, with a base salary of $265,000. Her employment agreement contains a twelve (12)-month non-competition covenant, an eighteen (18)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Osei reported directly to Rathore.

(d) Brent Halvorsen served as Director, Seasonal Planning & Analytics. He was employed at CRH for approximately six (6) years, with a base salary of $258,000. His employment agreement contains a twelve (12)-month non-competition covenant, an eighteen (18)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Halvorsen reported directly to Rathore.

(e) Lucia Fernandez-Gill served as Director, Vendor Relations (Domestic). She was employed at CRH for approximately five (5) years, with a base salary of $248,000. Her employment agreement contains a twelve (12)-month non-competition covenant, an eighteen (18)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Fernandez-Gill reported directly to Rathore.

(f) Nathan Tsao served as Senior Manager, eCommerce Merchandising. He was employed at CRH for approximately three (3) years, with a base salary of $195,000. His employment agreement contains a twelve (12)-month non-competition covenant, an eighteen (18)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Tsao reported directly to Rathore.

(g) Kira Johansson served as Senior Manager, Category Analytics. She was employed at CRH for approximately four (4) years, with a base salary of $192,000. Her employment agreement contains a twelve (12)-month non-competition covenant, an eighteen (18)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Johansson reported directly to Rathore.

20. Each of the seven individuals identified in the preceding paragraph executed an employment agreement with CRH containing the restrictive covenant provisions described above. True and correct copies of each of these employment agreements are attached to this Declaration as Exhibits C through I. In each case, the restrictive covenants were supported by adequate consideration, including the initial offer of employment, continued employment, promotions, annual bonuses, and equity compensation.

21. Collectively, these eight individuals — Rathore, Linden, Kaczmarek, Osei, Halvorsen, Fernandez-Gill, Tsao, and Johansson — constituted the entire senior leadership of CRH's merchandising division. There is no aspect of CRH's merchandising operations — from hardlines and softlines buying, to private-label strategy, to seasonal planning, to domestic vendor relations, to ecommerce merchandising, to category analytics — that was not under the direct management or oversight of one or more of these eight individuals.

C. The Critical Nature of Their Collective Roles

22. Together, the eight Departing Employees managed the entirety of CRH's merchandising operations, which, as noted above, accounted for approximately $2.3 billion in gross merchandise value in FY2024. They were the custodians of CRH's most sensitive competitive information in the merchandising function. The division under their collective leadership encompassed every functional pillar of CRH's merchandising operations: hardlines buying, softlines buying, private-label product development and sourcing, seasonal planning and demand analytics, domestic vendor relations, ecommerce merchandising and assortment strategy, and category analytics and customer segmentation.

23. To my knowledge, it is exceedingly rare in the retail industry for the entire senior leadership team of a major merchandising division to depart a company simultaneously. The coordinated nature of the departures and the fact that all eight individuals joined the same direct competitor amplifies the severity of the competitive threat to CRH beyond what would be occasioned by any single departure, no matter how senior.

IV. THE COORDINATED RESIGNATIONS ON FEBRUARY 7, 2025

A. The Simultaneous Submission of Resignations

24. On Friday, February 7, 2025, at 4:47 PM Pacific Standard Time, all eight Departing Employees simultaneously submitted letters of resignation via email. Each resignation was effective immediately. The resignations were directed both to my office and to the respective direct supervisors of the Departing Employees. In the case of Rathore, whose direct supervisor was CEO Marcus Langford, the resignation was also directed to Langford.

25. The simultaneous timing of the eight resignations — each submitted at precisely the same minute — is, in my professional judgment and experience, unmistakable evidence of advance coordination among the Departing Employees. In my approximately seven and one-half years as CPO of CRH, during which time I have overseen the departure of thousands of employees, I have never witnessed a circumstance in which eight members of a single team submitted resignations at the identical moment.

26. None of the eight Departing Employees provided the customary notice period that CRH's employment agreements contemplate. None offered a transition plan, suggested a successor, or made arrangements for the orderly transfer of their responsibilities. Each resignation letter was brief, stated only that the individual was resigning effective immediately, and thanked CRH for the "opportunity." The letters were strikingly similar in structure, tone, and length, which further suggests coordination and, based on my review, likely use of a common template or common legal counsel.

27. The resignations came without any prior indication of dissatisfaction, performance concerns, or negotiation regarding employment terms on the part of any of the eight individuals. To my knowledge, none of the Departing Employees had raised complaints about their compensation, working conditions, or role responsibilities in the months preceding their departure. CRH had not received any notice from any of the Departing Employees — or from any third party — suggesting that these individuals were considering alternative employment or were engaged in discussions with Verdana Commerce Group, Inc. ("Verdana") or any other company.

B. Ashby's Initial Response and discovery

28. I first became aware of the resignations on the evening of Friday, February 7, 2025, when I reviewed my email remotely over the weekend. Upon reviewing the eight resignation emails and noting their identical timestamps, I immediately recognized the coordinated nature of the departures and the serious implications for CRH's merchandising operations and confidential information.

29. On Monday, February 10, 2025, the next business day following the resignations, I alerted General Counsel Theresa Yun-Park to the coordinated nature of the departures and the potential restrictive covenant and confidentiality implications. I communicated to Ms. Yun-Park my concern that the simultaneous departure of the entire senior merchandising leadership team was not a coincidence and likely reflected a pre-planned, coordinated effort to recruit CRH's merchandising leadership to a competitor.

30. Also on February 10, 2025, I immediately directed CRH's Information Technology ("IT") department, under the supervision of Chief Information Officer Danielle Weston, to take the following steps to secure CRH's systems and data:

(a) Revoke all system access, including access to CRH's internal network, email, Aldermere Systems, Pinnacle Health IT, and all other enterprise applications, for each of the eight Departing Employees;

(b) Disable all CRH-issued devices — including laptops, mobile phones, and tablets — assigned to the Departing Employees;

(c) Begin the process of collecting and securing all CRH-issued laptops, mobile phones, and other equipment and devices in the possession of the Departing Employees; and

(d) Preserve all electronic data, including email communications, file access logs, download histories, and system activity logs, associated with the accounts of the eight Departing Employees.

31. CRH's IT department completed the revocation of system access for all eight Departing Employees by the close of business on February 10, 2025. The process of collecting returned company-issued devices was initiated on the same date, and CRH received returned devices from all eight individuals by February 18, 2025.

C. Confirmation of Restrictive Covenant Obligations

32. On February 12, 2025, I worked with General Counsel Yun-Park and CRH's in-house legal team to pull, compile, and conduct a comprehensive review of the employment agreements for all eight Departing Employees. Our review confirmed that each Departing Employee was bound by restrictive covenant provisions that included non-competition, non-solicitation of employees, non-solicitation of vendors, and perpetual confidentiality obligations, all governed by Delaware law.

33. The specific restrictive covenant terms applicable to each Departing Employee are summarized in the following table:

34. As indicated in the table above, the non-competition periods are eighteen (18) months for Rathore, Linden, and Kaczmarek, and twelve (12) months for Osei, Halvorsen, Fernandez-Gill, Tsao, and Johansson. The non-solicitation of employees periods are twenty-four (24) months for Rathore, Linden, and Kaczmarek, and eighteen (18) months for the remaining five individuals. The non-solicitation of vendors period is twenty-four (24) months for Rathore and eighteen (18) months for all others. The confidentiality obligations are perpetual for all eight Departing Employees. In each case, the geographic scope of the non-competition covenant is the United States.

D. Discovery of Destination Employer

35. On February 14, 2025, Verdana Commerce Group, Inc. ("Verdana") issued a press release entitled "Verdana Commerce Welcomes Industry-Leading Merchandising Team to Accelerate Growth." The press release publicly announced the hiring of Rathore and all seven other members of the CRH merchandising leadership team. A true and correct copy of the press release is attached to this Declaration as Exhibit J.

36. The press release announced that Rathore would serve as President, Merchandising & Strategy at Verdana. The roles of the remaining seven individuals were not specified in the press release, but the release described the group collectively as an "industry-leading merchandising team" and stated that their hiring was "a pivotal step in Verdana's transformational growth initiative."

37. Verdana is a direct competitor of CRH. Verdana is a Delaware corporation headquartered at 400 Christiana Gateway, Suite 700, Wilmington, Delaware 19801. Verdana operates in the retail and ecommerce sector and competes with CRH in twenty-eight (28) overlapping product categories, including home goods, apparel, and seasonal décor, which are among CRH's strongest and highest-margin merchandise categories.

38. Verdana's estimated FY2024 revenue was approximately $1.9 billion. While Verdana is significantly smaller than CRH, it is a well-capitalized and aggressively growing competitor. Verdana is a portfolio company of Greystone Capital Partners, LP. Specifically, Greystone Capital Fund VII, LP, a vintage 2022 private equity fund with approximately $8.5 billion in committed capital, holds the majority equity interest in Verdana. Greystone acquired Verdana in the third quarter of 2023 in a transaction valuing the company at approximately $2.4 billion in enterprise value.

39. In January 2025 — approximately one month prior to the Departing Employees' coordinated resignations — Verdana publicly announced what it described as a "transformational growth initiative" targeting $4 billion in annual revenue by 2028. The announcement specifically cited expansion into CRH's strongest categories, including private-label home goods and seasonal décor, as key pillars of the growth strategy. The timing of this announcement, followed by the coordinated recruitment of CRH's entire senior merchandising team, strongly suggests that Verdana's growth strategy was predicated, at least in significant part, on acquiring CRH's merchandising leadership and the proprietary knowledge they carry.

V. IMMEDIATE OPERATIONAL DISRUPTION TO CRH'S MERCHANDISING DIVISION

A. Loss of Senior Leadership

40. The simultaneous departure of the entire senior merchandising leadership team created an immediate and severe leadership vacuum within CRH's merchandising division. The magnitude of this disruption cannot be overstated. In a single coordinated action, CRH lost every senior leader responsible for the strategic direction and day-to-day management of a $2.3 billion business unit.

41. The Senior Vice President, Merchandising role — Rathore's former position — is the most senior merchandising position at CRH and is critical to setting the Company's overall merchandising strategy and overseeing its execution. With Rathore's departure, CRH lost the individual who had been the primary architect of the Company's merchandising direction for nearly four years.

42. Both Vice President-level positions departed simultaneously. Derek Linden's departure left CRH without an experienced leader for its hardlines merchandising operations, and Sonia Kaczmarek's departure left CRH without an experienced leader for its softlines merchandising operations. Hardlines and softlines represent the two largest merchandise categories at CRH, and their leadership positions are among the most critical in the division.

43. All four director-level positions also departed, stripping away functional expertise across multiple critical areas: Amara Osei's departure left CRH without its private-label strategy leader; Brent Halvorsen's departure left CRH without its seasonal planning and analytics leader; Lucia Fernandez-Gill's departure left CRH without its domestic vendor relations leader; and the departures of Nathan Tsao and Kira Johansson at the senior manager level removed key leaders in ecommerce merchandising and category analytics, respectively. In sum, every functional pillar of CRH's merchandising operations was left without its designated leader.

B. Interim Leadership Measures

44. In the immediate aftermath of the resignations, I worked in coordination with CEO Marcus Langford to appoint Martin Cho, an existing Vice President of Merchandising at CRH, as acting interim Senior Vice President of Merchandising. While Mr. Cho is a capable and dedicated executive, he had been in his current role for a comparatively shorter period and does not possess the breadth of experience, institutional knowledge, or depth of vendor relationships held by the departed team. Mr. Cho has candidly acknowledged to me that the scope of the interim responsibilities he has assumed is significantly beyond the capacity of any single individual.

45. CRH has been forced to redistribute the responsibilities of the eight Departing Employees across the remaining merchandising staff. However, the remaining staff members, while competent in their respective roles, are not equipped or experienced enough to absorb the full workload, decision-making authority, and strategic responsibilities previously held by eight senior professionals. The redistribution has resulted in role overload, delays in decision-making, and a reduction in the quality and timeliness of merchandising operations.

46. CRH has initiated emergency external recruiting efforts for the SVP, Merchandising role and for the other vacant leadership positions. However, based on my extensive experience in talent acquisition for senior retail merchandising roles, I can state that recruiting at this level of seniority and specialization typically requires three to six months to identify, evaluate, recruit, and onboard qualified candidates. This timeline assumes a normal market environment; the fact that CRH must fill eight senior positions simultaneously — and do so in an environment where a direct competitor has publicly signaled its aggressive growth ambitions — makes the recruiting challenge even more daunting.

C. Impact on Day-to-Day Operations

47. The departures occurred during a critical period in CRH's merchandising calendar. February is the month in which spring and summer seasonal buying decisions are finalized, purchase orders are issued to vendors, and vendor negotiations for the fall and holiday season begin in earnest. The timing of the coordinated departures inflicted maximum disruption on CRH's operations.

48. Specifically, the following operational impacts have been experienced or are ongoing:

(a) Vendor Negotiations Disrupted: Multiple ongoing vendor negotiations were disrupted by the departures. Several key vendor meetings — including negotiations with three of CRH's top ten domestic vendors by spend — had to be postponed or rescheduled due to the absence of the relevant CRH merchandising leaders. In at least two instances, vendor counterparts have expressed concern about CRH's organizational stability, which has weakened CRH's negotiating position.

(b) Project Ridgeline Implementation Suspended: Internal strategic planning meetings related to the implementation of Project Ridgeline, CRH's five-year category expansion roadmap, were suspended pending a comprehensive assessment of information security. Given that all eight Departing Employees had full access to Project Ridgeline materials and that evidence of data exfiltration has been discovered (as discussed in Section VII below), CRH has been unable to proceed with the implementation of key elements of the plan until it can assess the extent to which the plan's confidentiality has been compromised.

(c) Private-Label Sourcing Initiatives on Hold: Private-label sourcing initiatives, which Osei had been leading in her capacity as Director of Private Label Strategy, were put on hold following her departure. Private-label products are among CRH's highest-margin product lines, and delays in sourcing and product development will directly affect CRH's product assortment and profitability in the second half of FY2025.

(d) eCommerce Assortment Strategy Reassigned: The ecommerce assortment strategy for the second quarter of 2025, which Tsao had been developing as Senior Manager of eCommerce Merchandising, required reassignment to less experienced personnel. The strategy is now behind schedule, and the quality of the initial work product has required significant revision by Mr. Cho and other remaining staff.

(e) Category Analytics Reporting Delays: The category analytics reporting cadence, which Johansson had managed in her capacity as Senior Manager of Category Analytics, experienced meaningful delays. These reports inform critical merchandising decisions across the organization, and delays in their production have a cascading effect on buying decisions, inventory allocation, and pricing strategies.

D. Employee Morale and Retention Concerns

49. The coordinated departure of the entire senior merchandising leadership team caused significant anxiety and uncertainty among the remaining merchandising staff. Following the departures, CRH's merchandising division retained approximately 112 employees — the entire team minus the eight Departing Employees. These remaining employees suddenly found themselves without the leadership structure that had been in place, in some cases, for years.

50. In the days following the resignations, my HR team and I received numerous inquiries from remaining merchandising employees expressing concern about job security, the Company's strategic direction for the merchandising division, and whether additional departures were anticipated. Several employees expressed anxiety about the possibility that their former leaders might attempt to recruit them to Verdana.

51. In response to these concerns, I authorized and organized an emergency town hall meeting for the merchandising division, which was held on February 14, 2025 — the same day that Verdana issued its press release publicly announcing the hiring of the Departing Employees. The timing of the press release, on the very day of the town hall, further destabilized morale. CEO Marcus Langford addressed the team at the town hall, affirming CRH's commitment to the merchandising division and outlining interim leadership arrangements.

52. Based on my professional experience in human resources and employee relations, I have serious and well-founded concerns that Verdana and the Departing Employees may attempt to recruit additional CRH merchandising personnel. Such recruitment efforts would compound the operational disruption already experienced and could further destabilize CRH's merchandising workforce. The non-solicitation of employees provisions in the Departing Employees' agreements were designed to prevent precisely this type of cascading talent drain.

VI. THE DEPARTING EMPLOYEES' ACCESS TO CONFIDENTIAL AND PROPRIETARY INFORMATION

A. Project Ridgeline

53. Project Ridgeline is CRH's confidential five-year strategic category expansion plan. The plan was completed in October 2024 after approximately eighteen months of development. It represents one of the most significant strategic planning efforts in CRH's recent history and contains some of the Company's most competitively sensitive information.

54. Project Ridgeline encompasses, among other things: (i) proprietary vendor terms and negotiation strategies for CRH's key vendor relationships; (ii) private-label margin targets and product development roadmaps; (iii) ecommerce assortment algorithms designed to optimize online product offerings; (iv) category expansion priorities identifying which product categories CRH intends to enter, grow, or exit over the next five years; and (v) detailed financial models projecting the revenue, margin, and capital expenditure implications of the plan.

55. All eight Departing Employees had full access to Project Ridgeline materials. Each attended the final strategy sessions held in September and October 2024 and received the complete plan documentation, including the final strategic plan document, supporting analytical models, financial projections, and vendor strategy appendices.

56. Rathore served as the executive sponsor of Project Ridgeline and was the senior-most executive responsible for its development and eventual implementation. Halvorsen and Johansson contributed the analytical models that underpinned the plan's demand forecasts and inventory optimization strategies. Osei developed the private-label components of the plan, including margin targets and sourcing strategies for new private-label product lines. Fernandez-Gill provided vendor pricing inputs and contributed the vendor negotiation strategy components. Linden and Kaczmarek contributed category-specific strategies for hardlines and softlines, respectively. Tsao developed the ecommerce integration plans, including the algorithms for online assortment optimization.

57. In short, Project Ridgeline was a product of the collective expertise and proprietary knowledge of the very eight individuals who have now departed CRH to join its direct competitor. The risk that Verdana will benefit from the knowledge of Project Ridgeline's contents — either through the Departing Employees' inherent knowledge of the plan or through copies of plan documents that may have been exfiltrated — is acute and immediate.

B. Vendor Negotiation Playbooks and Pricing Data

58. The Departing Employees had access to CRH's proprietary vendor negotiation playbooks. These playbooks contain detailed strategies, preferred contractual terms, margin targets, and historical negotiation outcomes relating to CRH's relationships with its entire vendor base. The playbooks represent years of accumulated institutional knowledge and competitive intelligence and are among CRH's most closely guarded confidential business documents.

59. Fernandez-Gill, in her capacity as Director of Vendor Relations (Domestic), had particularly extensive and detailed knowledge of vendor terms and pricing for CRH's top fifty (50) domestic vendors by spend. This includes knowledge of the specific pricing tiers, rebate structures, volume discounts, co-marketing arrangements, and exclusivity terms that CRH has negotiated with these vendors. This information would be of extraordinary competitive value to Verdana, which competes with CRH in twenty-eight (28) overlapping product categories and sources from many of the same vendors.

60. Knowledge of CRH's vendor negotiation strategies and pricing data would enable Verdana to anticipate CRH's negotiating positions, undercut CRH's terms, and potentially divert vendor relationships to Verdana's benefit and CRH's detriment.

C. Private-Label Sourcing Strategies

61. Osei, in her capacity as Director of Private Label Strategy, had detailed knowledge of CRH's private-label sourcing strategies. This knowledge includes the identities of CRH's private-label suppliers (many of which are subject to confidentiality agreements and are not publicly known), the cost structures associated with private-label products, the margin targets that CRH has set for its private-label lines, and the product development pipelines for new private-label offerings planned for FY2025 and beyond.

62. Private-label products are a high-margin segment that is critical to CRH's competitive positioning and profitability. The private-label business has been a particular area of focus and investment for CRH, and the strategies and supplier relationships that Osei helped develop are not easily replicated. Disclosure of this information to Verdana would directly undermine CRH's private-label competitive advantage.

D. Customer Segmentation and Analytics Data

63. Johansson, in her capacity as Senior Manager of Category Analytics, had access to CRH's proprietary customer segmentation models and purchasing behavior analytics. These models are the product of significant investment in data science and analytics capabilities and are used by CRH to inform merchandising decisions, optimize product assortment, and develop pricing strategies tailored to specific customer segments.

64. The customer segmentation models incorporate proprietary data on customer purchasing patterns, demographic profiles, price sensitivity, channel preferences, and product affinity scores. This information is not publicly available and constitutes valuable trade secret information that would provide a significant competitive advantage to any competitor that obtained it.

E. Seasonal Buying Algorithms

65. Halvorsen, in his capacity as Director of Seasonal Planning & Analytics, had access to CRH's proprietary seasonal buying algorithms. These algorithms are sophisticated analytical tools that predict demand patterns across CRH's product categories and optimize inventory allocation across the Company's 387 retail locations and its ecommerce platform. The algorithms incorporate historical sales data, trend analysis, macroeconomic indicators, weather pattern data, and proprietary demand-sensing models developed by CRH over multiple years.

66. The seasonal buying algorithms are a critical competitive asset for CRH. They enable the Company to minimize inventory risk, reduce markdowns, and maximize sell-through rates. A competitor in possession of these algorithms — or the methodologies and data inputs underlying them — would gain a significant advantage in its own inventory planning and allocation processes.

VII. EVIDENCE OF DATA EXFILTRATION DISCOVERED DURING OFFBOARDING

67. On February 12, 2025, during the process of securing returned devices and auditing system access for the Departing Employees, CRH's IT department identified anomalous data access and download activity associated with the accounts of the Departing Employees. I was informed of these findings by Chief Information Officer Danielle Weston on the same date.

68. Specifically, CRH's IT department determined that between approximately January 10, 2025 and February 4, 2025, a total of approximately 14,327 files, totaling approximately 2.8 gigabytes of data, had been downloaded from CRH's Aldermere Systems and Pinnacle Health IT environments to personal cloud storage accounts — that is, cloud storage accounts not hosted or controlled by CRH. The downloads were traced to the accounts of the Departing Employees.

69. Based on the IT department's preliminary review, the downloaded files included, among other things: (i) Project Ridgeline presentations and strategic plan documentation; (ii) vendor negotiation term sheets and pricing data; (iii) private-label cost models and margin analyses; and (iv) customer segmentation data and analytics reports. In other words, the downloaded files encompassed the full spectrum of CRH's most sensitive and competitively valuable confidential information and trade secrets in the merchandising function.

70. The timeframe of the data exfiltration — between January 10 and February 4, 2025 — coincides with the period during which, based on the subsequent Verdana press release and other information, the Departing Employees were negotiating their departures from CRH and their new employment with Verdana. The data downloads began approximately one month before the coordinated resignations on February 7, 2025, and ceased approximately three days before the resignations were submitted. This temporal correlation strongly suggests that the data exfiltration was undertaken in anticipation of and in preparation for the Departing Employees' move to Verdana.

71. I immediately reported these findings to General Counsel Theresa Yun-Park. Ms. Yun-Park subsequently engaged Calderwood & Harkness LLP as outside litigation counsel (retained on February 18, 2025) and Pinnacle Forensics LLC ("Pinnacle"), a digital forensics firm, to conduct a full forensic imaging and analysis of the Departing Employees' CRH-issued devices, CRH system logs, and other relevant electronic evidence. Pinnacle was engaged on February 20, 2025, and its forensic investigation is being supervised by Dr. Rajiv Anand, Pinnacle's Managing Director and a recognized expert in digital forensics and electronic evidence preservation. Dr. Anand's investigation is ongoing, and CRH anticipates that his findings will provide additional detail regarding the scope, timing, and methods of the data exfiltration. CRH reserves the right to submit supplemental declarations and expert reports based on Dr. Anand's findings.

VIII. IRREPARABLE HARM TO CRH

A. Competitive Harm

72. The combination of eight senior merchandising professionals — constituting the entire senior leadership of CRH's merchandising division — joining CRH's direct competitor, each carrying deep institutional knowledge and potentially possessing copies of CRH's most sensitive trade secrets and confidential information, poses an immediate and irreparable competitive threat to CRH.

73. Verdana directly competes with CRH in twenty-eight (28) product categories. Verdana has publicly announced a "transformational growth initiative" specifically targeting CRH's strongest categories — private-label home goods and seasonal décor — with a stated goal of growing from $1.9 billion to $4 billion in revenue by 2028. The hiring of CRH's entire senior merchandising team is, by Verdana's own admission, a centerpiece of this growth strategy.

74. If the Departing Employees are permitted to work in merchandising roles at Verdana without restraint, CRH's competitive position in its core $2.3 billion merchandising business will be severely compromised. The Departing Employees carry with them an intimate and comprehensive understanding of CRH's merchandising strategy, vendor relationships, pricing approaches, private-label development plans, seasonal algorithms, and customer analytics. This knowledge will inevitably inform their work at Verdana, even absent affirmative misuse of trade secret materials.

75. The harm is not merely hypothetical or speculative. Verdana's own press release explicitly positions the hiring of the Departing Employees as part of Verdana's "transformational growth initiative." The press release does not describe the hires as incremental additions to Verdana's existing team; rather, it characterizes them as a foundational element of Verdana's competitive strategy. The inference is inescapable: Verdana intends to leverage the Departing Employees' knowledge of CRH's operations and strategies to compete more effectively against CRH.

B. Inability to Quantify Damages

76. The competitive harm from the misuse or inevitable disclosure of CRH's confidential information and trade secrets is not readily quantifiable in monetary terms. The information at risk — Project Ridgeline's strategic roadmap, vendor negotiation playbooks, private-label cost structures, seasonal buying algorithms, and customer segmentation models — represents years of investment, proprietary development, and competitive intelligence gathering. The value of this information lies not in any single data point but in its comprehensive, integrated nature, which provides CRH with a competitive advantage that has been built over many years and at great expense.

77. Once disclosed to a competitor, the confidentiality of this information cannot be restored. A trade secret, once revealed, ceases to be a trade secret. No amount of monetary damages can undo the competitive harm that results from a competitor's acquisition and use of proprietary strategic plans, vendor terms, and analytical models. The harm is therefore irreparable by its very nature.

78. Moreover, even if it were theoretically possible to quantify the competitive harm, the magnitude of the potential loss — given that CRH's merchandising division generates $2.3 billion in annual GMV and that Verdana is targeting CRH's strongest categories for expansion — would make any damages award speculative, uncertain, and inherently inadequate to make CRH whole. Legal remedies in the form of monetary damages would be inadequate to compensate CRH for the loss of competitive advantage that would result from the unrestricted employment of the Departing Employees at Verdana in merchandising roles.

C. Ongoing Risk of Further Employee Solicitation

79. I have a reasonable basis to believe that the Departing Employees may attempt to recruit additional CRH merchandising staff to join Verdana. The Departing Employees maintained close working relationships with the approximately 112 remaining merchandising employees at CRH, many of whom reported directly or indirectly to one or more of the Departing Employees. The Departing Employees are well positioned to identify and target the most talented and strategically valuable members of CRH's remaining merchandising team.

80. The non-solicitation of employees obligations in the Departing Employees' employment agreements were intended to prevent precisely this type of cascading talent drain. Without injunctive relief enforcing those obligations, CRH faces the very real prospect of further destabilization of its merchandising workforce at a time when it can least afford additional departures. The loss of additional merchandising personnel to Verdana would compound the operational disruption described above and could render CRH's merchandising division unable to function effectively during the critical spring and summer buying season.

IX. STEPS TAKEN BY CRH TO MITIGATE HARM

81. CRH has taken and continues to take the following steps to mitigate the harm caused by the coordinated departure of the Departing Employees:

(a) System Access Revocation and Device Collection: CRH revoked all system access for the eight Departing Employees on February 10, 2025, and collected all company-issued devices, including laptops, mobile phones, and tablets, by February 18, 2025.

(b) Interim Leadership Appointment: CRH appointed Martin Cho as acting interim Senior Vice President of Merchandising to provide temporary leadership continuity for the division.

(c) Emergency External Recruiting: CRH initiated emergency external recruiting efforts for the SVP, Merchandising role and the other vacant senior merchandising positions. These efforts are ongoing, but, as noted above, are expected to require three to six months to yield qualified candidates.

(d) Employee Communication: CRH conducted an internal town hall meeting on February 14, 2025, at which CEO Marcus Langford addressed the merchandising division to provide reassurance, answer questions, and outline the Company's plans for maintaining operational continuity.

(e) Engagement of Outside Counsel: CRH engaged Calderwood & Harkness LLP as outside litigation counsel on February 18, 2025, to advise on the enforcement of the Departing Employees' restrictive covenant obligations and the protection of CRH's trade secrets and confidential information.

(f) Cease-and-Desist Letters: On February 25, 2025, Calderwood & Harkness LLP, on behalf of CRH, sent cease-and-desist letters to each of the eight Departing Employees, to Verdana Commerce Group, Inc. (to the attention of its General Counsel, Helen Tsoi), and to Greystone Capital Partners, LP (to the attention of its Managing Partner, Elliot Westbrook). The letters demanded immediate compliance with the Departing Employees' restrictive covenant obligations and the return of all CRH confidential information and trade secret materials. To date, CRH has not received substantive responses to these letters.

(g) Forensic Investigation: CRH engaged Pinnacle Forensics LLC on February 20, 2025, under the supervision of Dr. Rajiv Anand, to conduct forensic imaging and analysis of the Departing Employees' CRH-issued devices, CRH system access logs, and other relevant electronic evidence. This investigation is ongoing.

(h) Private Investigation: CRH engaged Aurelian Investigations Group Inc. on February 21, 2025, under the supervision of Sandra Fielding, to investigate the circumstances surrounding the coordinated departure, including the timeline and nature of communications between the Departing Employees, Verdana, and Greystone Capital Partners. This investigation is also ongoing.

82. Despite these mitigation efforts, CRH cannot fully protect itself from the competitive harm described above without the assistance of this Court. The restrictive covenant provisions in the Departing Employees' employment agreements provide CRH with contractual rights that are enforceable under Delaware law, but the exercise of those rights requires judicial enforcement through injunctive relief.

X. CONCLUSION AND REQUEST FOR RELIEF

83. Based on the foregoing, CRH has suffered and will continue to suffer irreparable harm as a result of the coordinated departure of the eight individual defendants to Verdana Commerce Group, Inc. in violation of their contractual obligations to CRH. The loss of the entire senior merchandising leadership team to a direct competitor, the evidence of pre-departure data exfiltration, and the threat of further employee solicitation collectively present an urgent competitive crisis that warrants the immediate intervention of this Court.

84. The restrictive covenant provisions contained in each Departing Employee's employment agreement are reasonable in scope, duration, and geographic reach, and are enforceable under Delaware law. Each provision was supported by adequate consideration, including initial offers of employment, continued employment, promotions, annual performance bonuses, and restricted stock unit grants. The provisions serve the legitimate business interests of CRH in protecting its trade secrets, confidential information, customer and vendor relationships, and investment in training and developing its senior merchandising leadership.

85. CRH respectfully requests that the Court grant the Temporary Restraining Order and Preliminary Injunction sought in Plaintiff's Motion, restraining and enjoining the eight individual defendants — Priya Rathore, Derek Linden, Sonia Kaczmarek, Amara Osei, Brent Halvorsen, Lucia Fernandez-Gill, Nathan Tsao, and Kira Johansson — from commencing or continuing employment in merchandising or substantially similar roles at Verdana Commerce Group, Inc., or any of its subsidiaries or affiliates, pending the resolution of this matter on the merits.

86. CRH further requests that the Court issue such additional injunctive relief as it deems appropriate, including but not limited to orders requiring the return or destruction of all CRH confidential information and trade secret materials in the possession of the Departing Employees and Verdana, and prohibiting the Departing Employees from soliciting CRH employees, vendors, or suppliers.

87. CRH is prepared to post an injunction bond in such amount as the Court may require pursuant to Court of Chancery Rule 65.

I declare under penalty of perjury under the laws of the State of Delaware that the foregoing is true and correct.

Executed on March 5, 2025, at Seattle, Washington.

________________________________________

Roland Ashby Chief People Officer Cascade Retail Holdings Inc. 2200 Elliott Avenue West, Suite 3400 Seattle, Washington 98119

CERTIFICATE OF SERVICE

I, Bernard Crawford, hereby certify that on March 5, 2025, a true and correct copy of the foregoing Declaration of Roland Ashby in Support of Plaintiff's Motion for Temporary Restraining Order and Preliminary Injunction was served upon the following counsel of record by electronic filing through the Court's File & ServeXpress system and by email:

Catherine Nygaard, Esquire Whitfield, Nygaard & Doyle LLP 1000 North Market Street, Suite 1500 Wilmington, Delaware 19801 Counsel for Defendants Priya Rathore, Derek Linden, Sonia Kaczmarek, Amara Osei, Brent Halvorsen, Lucia Fernandez-Gill, Nathan Tsao, and Kira Johansson

Gavin Blackhall, Esquire Blackhall & Soren LLP 300 Delaware Avenue, Suite 900 Wilmington, Delaware 19801 Counsel for Defendant Verdana Commerce Group, Inc.

________________________________________

Bernard Crawford (No. 5847) CALDERWOOD & HARKNESS LLP 1301 K Street NW, Suite 1200 Washington, DC 20005 Telephone: (202) 555-4800 Facsimile: (202) 555-4801

Email: bcrawford@calderwoodharkness.com

Attorney for Plaintiff Cascade Retail Holdings Inc.

CASCADE RETAIL HOLDINGS INC.,

Plaintiff,

C.A. No. 2025-0198-MTZ

PRIYA RATHORE, DEREK LINDEN, SONIA KACZMAREK, AMARA OSEI, BRENT HALVORSEN, LUCIA FERNANDEZ-GILL, NATHAN TSAO, KIRA JOHANSSON, and VERDANA COMMERCE GROUP, INC.,

Defendants.

Defendant	Non-Competition	Non-Solicitation (Employees)	Non-Solicitation (Vendors)	Confidentiality	Geographic Scope
Priya Rathore	18 months	24 months	24 months	Perpetual	United States
Derek Linden	18 months	24 months	18 months	Perpetual	United States
Sonia Kaczmarek	18 months	24 months	18 months	Perpetual	United States
Amara Osei	12 months	18 months	18 months	Perpetual	United States
Brent Halvorsen	12 months	18 months	18 months	Perpetual	United States
Lucia Fernandez-Gill	12 months	18 months	18 months	Perpetual	United States
Nathan Tsao	12 months	18 months	18 months	Perpetual	United States
Kira Johansson	12 months	18 months	18 months	Perpetual	United States

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
DECLARATION OF ROLAND ASHBY IN SUPPORT OF PLAINTIFF'S MOTION FOR TEMPORARY RESTRAINING ORDER AND PRELIMINARY INJUNCTION
I, Roland Ashby, hereby declare as follows:
1. I am over the age of eighteen and am competent to testify to the matters stated herein. I have personal knowledge of the facts set forth in this Declaration and, if called as a witness, could and would testify competently to the same. I make this Declaration pursuant to 10 Del. C. § 3927, under penalty of perjury. Except where specifically noted, the statements contained herein are based on my personal knowledge, my review of business records of Cascade Retail Holdings Inc. maintained in the ordinary course of business, and information provided to me by members of my staff and other officers of the company in the course of my duties.
I. BACKGROUND AND QUALIFICATIONS OF THE DECLARANT
2. My full name is Roland Ashby. I am the Chief People Officer ("CPO") of Cascade Retail Holdings Inc. ("CRH" or the "Company"). My principal office is located at CRH's corporate headquarters, 2200 Elliott Avenue West, Suite 3400, Seattle, Washington 98119.
3. I have served as CPO of CRH since August 2017, a period of approximately seven and one-half years. In this capacity, I am responsible for all human resources, talent management, compensation and benefits, and employee relations functions across CRH's entire organization, which employs approximately 24,500 people across the United States. I report directly to CRH's Chief Executive Officer, Marcus Langford.
4. As CPO, I have direct oversight of the administration of employment agreements, onboarding and offboarding processes, restrictive covenant administration, and the maintenance and custody of personnel records for all CRH employees. This responsibility extends to the Company's senior merchandising leadership, including each of the eight individual defendants named in this action (collectively, the "Departing Employees").
5. In my role, I am familiar with the employment history, compensation, contractual obligations, and the specific trade secrets and confidential information to which each of the Departing Employees had access during their tenure at CRH. I have personally reviewed each of their employment agreements, including the restrictive covenant provisions contained therein, in connection with the events described in this Declaration and in preparation for the filing of this action.
II. OVERVIEW OF CASCADE RETAIL HOLDINGS INC.
6. CRH is a corporation organized and existing under the laws of the State of Delaware. The Company is publicly traded on the Nasdaq Stock Market under the ticker symbol "CRHL." CRH is headquartered in Seattle, Washington.
7. CRH is a leading omnichannel retail and ecommerce company. The Company operates 387 brick-and-mortar retail locations across 34 states and maintains a robust direct-to-consumer ecommerce platform that serves customers nationwide. CRH's retail footprint spans a diverse set of product categories, including home goods, apparel, seasonal décor, hardlines, and private-label merchandise, among others.
8. For the fiscal year ended December 31, 2024 ("FY2024"), CRH reported annual revenue of approximately $6.82 billion. As of February 2025, the Company's approximate market capitalization was approximately $4.1 billion.
9. CRH's merchandising division is a core revenue driver for the Company. In FY2024, the merchandising division generated approximately $2.3 billion in gross merchandise value ("GMV"). The merchandising function is responsible for all buying decisions, vendor negotiations, category strategy, private-label product development, ecommerce assortment planning, seasonal planning, and category analytics across CRH's entire product offering. The performance and strategic direction of the merchandising division are directly tied to CRH's competitive position, profitability, and shareholder value.
10. CRH's Chief Executive Officer is Marcus Langford. The Company's General Counsel is Theresa Yun-Park.
III. THE DEPARTING EMPLOYEES AND THEIR ROLES
A. Priya Rathore
11. Defendant Priya Rathore ("Rathore") served as Senior Vice President, Merchandising at CRH. She originally joined the Company on June 3, 2019, in the role of Vice President, Merchandising Strategy. Rathore was subsequently promoted to the position of Senior Vice President, Merchandising, effective March 15, 2021.
12. In connection with her initial hiring, Rathore executed an Employment Agreement dated June 3, 2019 (the "Original Rathore Agreement"). Upon her promotion, Rathore executed an Amended and Restated Employment Agreement dated March 15, 2021 (the "Amended Rathore Agreement"). Both agreements were entered into between Rathore and CRH, and both contained restrictive covenant provisions. The Amended Rathore Agreement superseded and replaced the Original Rathore Agreement in its entirety. True and correct copies of both agreements are attached to this Declaration as Exhibit A and Exhibit B, respectively.
13. The Amended Rathore Agreement contains the following restrictive covenant provisions, among others:
(a) Non-Competition: An eighteen (18)-month post-termination non-competition covenant, prohibiting Rathore from engaging in or being employed in a merchandising, buying, category strategy, or substantially similar role at any competitor of CRH operating in the retail or ecommerce sector within the United States.
(b) Non-Solicitation of Employees: A twenty-four (24)-month post-termination non-solicitation covenant, prohibiting Rathore from directly or indirectly soliciting, recruiting, or inducing any employee of CRH to leave the Company's employment.
(c) Non-Solicitation of Vendors: A twenty-four (24)-month post-termination non-solicitation covenant, prohibiting Rathore from directly or indirectly soliciting, diverting, or interfering with CRH's relationships with its vendors, suppliers, and business partners.
(d) Confidentiality: A perpetual obligation not to use or disclose CRH's confidential information, trade secrets, and proprietary data, as defined in the agreement.
14. All of the restrictive covenant provisions in the Amended Rathore Agreement are governed by the laws of the State of Delaware, as specified in Section 14.1 of that agreement.
15. Rathore's total compensation for FY2024 consisted of the following components: (i) a base salary of $485,000; (ii) an annual performance bonus with a target of $290,000, representing 60% of her base salary; and (iii) a restricted stock unit ("RSU") grant valued at $725,000 at the time of grant, subject to four-year ratable annual vesting commencing from the date of her March 15, 2021 promotion.
16. As Senior Vice President, Merchandising, Rathore was the most senior merchandising executive at CRH. She oversaw all buying, vendor negotiations, category strategy, private-label development, and ecommerce assortment decisions across the Company's entire product portfolio. In this capacity, Rathore set the strategic direction for CRH's merchandising operations and served as the primary executive responsible for the performance of the $2.3 billion merchandising division.
17. By virtue of her position, Rathore had full and unrestricted access to CRH's most sensitive and competitively valuable confidential information and trade secrets in the merchandising function, including but not limited to: (i) Project Ridgeline, the Company's confidential five-year category expansion roadmap completed in October 2024, for which Rathore served as executive sponsor; (ii) CRH's proprietary vendor negotiation playbooks; (iii) seasonal buying algorithms; (iv) private-label sourcing strategies, cost structures, and margin targets; and (v) customer segmentation data and analytics models.
18. Rathore reported directly to CEO Marcus Langford. She supervised a team of approximately 120 merchandising professionals, which included all seven other Departing Employees named as defendants in this action.
B. The Other Seven Departing Employees
19. The remaining seven individual defendants occupied the following positions at CRH, with the indicated tenures, base salaries, and restrictive covenant terms:
(a) Derek Linden served as Vice President, Hardlines Merchandising. He was employed at CRH for approximately seven (7) years, with a base salary of $340,000. His employment agreement contains an eighteen (18)-month non-competition covenant, a twenty-four (24)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Linden reported directly to Rathore.
(b) Sonia Kaczmarek served as Vice President, Softlines Merchandising. She was employed at CRH for approximately five (5) years, with a base salary of $325,000. Her employment agreement contains an eighteen (18)-month non-competition covenant, a twenty-four (24)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Kaczmarek reported directly to Rathore.
(c) Amara Osei served as Director, Private Label Strategy. She was employed at CRH for approximately four (4) years, with a base salary of $265,000. Her employment agreement contains a twelve (12)-month non-competition covenant, an eighteen (18)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Osei reported directly to Rathore.
(d) Brent Halvorsen served as Director, Seasonal Planning & Analytics. He was employed at CRH for approximately six (6) years, with a base salary of $258,000. His employment agreement contains a twelve (12)-month non-competition covenant, an eighteen (18)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Halvorsen reported directly to Rathore.
(e) Lucia Fernandez-Gill served as Director, Vendor Relations (Domestic). She was employed at CRH for approximately five (5) years, with a base salary of $248,000. Her employment agreement contains a twelve (12)-month non-competition covenant, an eighteen (18)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Fernandez-Gill reported directly to Rathore.
(f) Nathan Tsao served as Senior Manager, eCommerce Merchandising. He was employed at CRH for approximately three (3) years, with a base salary of $195,000. His employment agreement contains a twelve (12)-month non-competition covenant, an eighteen (18)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Tsao reported directly to Rathore.
(g) Kira Johansson served as Senior Manager, Category Analytics. She was employed at CRH for approximately four (4) years, with a base salary of $192,000. Her employment agreement contains a twelve (12)-month non-competition covenant, an eighteen (18)-month non-solicitation of employees covenant, an eighteen (18)-month non-solicitation of vendors covenant, and perpetual confidentiality obligations, all governed by Delaware law. Johansson reported directly to Rathore.
20. Each of the seven individuals identified in the preceding paragraph executed an employment agreement with CRH containing the restrictive covenant provisions described above. True and correct copies of each of these employment agreements are attached to this Declaration as Exhibits C through I. In each case, the restrictive covenants were supported by adequate consideration, including the initial offer of employment, continued employment, promotions, annual bonuses, and equity compensation.
21. Collectively, these eight individuals — Rathore, Linden, Kaczmarek, Osei, Halvorsen, Fernandez-Gill, Tsao, and Johansson — constituted the entire senior leadership of CRH's merchandising division. There is no aspect of CRH's merchandising operations — from hardlines and softlines buying, to private-label strategy, to seasonal planning, to domestic vendor relations, to ecommerce merchandising, to category analytics — that was not under the direct management or oversight of one or more of these eight individuals.
C. The Critical Nature of Their Collective Roles
22. Together, the eight Departing Employees managed the entirety of CRH's merchandising operations, which, as noted above, accounted for approximately $2.3 billion in gross merchandise value in FY2024. They were the custodians of CRH's most sensitive competitive information in the merchandising function. The division under their collective leadership encompassed every functional pillar of CRH's merchandising operations: hardlines buying, softlines buying, private-label product development and sourcing, seasonal planning and demand analytics, domestic vendor relations, ecommerce merchandising and assortment strategy, and category analytics and customer segmentation.
23. To my knowledge, it is exceedingly rare in the retail industry for the entire senior leadership team of a major merchandising division to depart a company simultaneously. The coordinated nature of the departures and the fact that all eight individuals joined the same direct competitor amplifies the severity of the competitive threat to CRH beyond what would be occasioned by any single departure, no matter how senior.
IV. THE COORDINATED RESIGNATIONS ON FEBRUARY 7, 2025
A. The Simultaneous Submission of Resignations
24. On Friday, February 7, 2025, at 4:47 PM Pacific Standard Time, all eight Departing Employees simultaneously submitted letters of resignation via email. Each resignation was effective immediately. The resignations were directed both to my office and to the respective direct supervisors of the Departing Employees. In the case of Rathore, whose direct supervisor was CEO Marcus Langford, the resignation was also directed to Langford.
25. The simultaneous timing of the eight resignations — each submitted at precisely the same minute — is, in my professional judgment and experience, unmistakable evidence of advance coordination among the Departing Employees. In my approximately seven and one-half years as CPO of CRH, during which time I have overseen the departure of thousands of employees, I have never witnessed a circumstance in which eight members of a single team submitted resignations at the identical moment.
26. None of the eight Departing Employees provided the customary notice period that CRH's employment agreements contemplate. None offered a transition plan, suggested a successor, or made arrangements for the orderly transfer of their responsibilities. Each resignation letter was brief, stated only that the individual was resigning effective immediately, and thanked CRH for the "opportunity." The letters were strikingly similar in structure, tone, and length, which further suggests coordination and, based on my review, likely use of a common template or common legal counsel.
27. The resignations came without any prior indication of dissatisfaction, performance concerns, or negotiation regarding employment terms on the part of any of the eight individuals. To my knowledge, none of the Departing Employees had raised complaints about their compensation, working conditions, or role responsibilities in the months preceding their departure. CRH had not received any notice from any of the Departing Employees — or from any third party — suggesting that these individuals were considering alternative employment or were engaged in discussions with Verdana Commerce Group, Inc. ("Verdana") or any other company.
B. Ashby's Initial Response and discovery
28. I first became aware of the resignations on the evening of Friday, February 7, 2025, when I reviewed my email remotely over the weekend. Upon reviewing the eight resignation emails and noting their identical timestamps, I immediately recognized the coordinated nature of the departures and the serious implications for CRH's merchandising operations and confidential information.
29. On Monday, February 10, 2025, the next business day following the resignations, I alerted General Counsel Theresa Yun-Park to the coordinated nature of the departures and the potential restrictive covenant and confidentiality implications. I communicated to Ms. Yun-Park my concern that the simultaneous departure of the entire senior merchandising leadership team was not a coincidence and likely reflected a pre-planned, coordinated effort to recruit CRH's merchandising leadership to a competitor.
30. Also on February 10, 2025, I immediately directed CRH's Information Technology ("IT") department, under the supervision of Chief Information Officer Danielle Weston, to take the following steps to secure CRH's systems and data:
(a) Revoke all system access, including access to CRH's internal network, email, Aldermere Systems, Pinnacle Health IT, and all other enterprise applications, for each of the eight Departing Employees;
(b) Disable all CRH-issued devices — including laptops, mobile phones, and tablets — assigned to the Departing Employees;
(c) Begin the process of collecting and securing all CRH-issued laptops, mobile phones, and other equipment and devices in the possession of the Departing Employees; and
(d) Preserve all electronic data, including email communications, file access logs, download histories, and system activity logs, associated with the accounts of the eight Departing Employees.
31. CRH's IT department completed the revocation of system access for all eight Departing Employees by the close of business on February 10, 2025. The process of collecting returned company-issued devices was initiated on the same date, and CRH received returned devices from all eight individuals by February 18, 2025.
C. Confirmation of Restrictive Covenant Obligations
32. On February 12, 2025, I worked with General Counsel Yun-Park and CRH's in-house legal team to pull, compile, and conduct a comprehensive review of the employment agreements for all eight Departing Employees. Our review confirmed that each Departing Employee was bound by restrictive covenant provisions that included non-competition, non-solicitation of employees, non-solicitation of vendors, and perpetual confidentiality obligations, all governed by Delaware law.
33. The specific restrictive covenant terms applicable to each Departing Employee are summarized in the following table:
34. As indicated in the table above, the non-competition periods are eighteen (18) months for Rathore, Linden, and Kaczmarek, and twelve (12) months for Osei, Halvorsen, Fernandez-Gill, Tsao, and Johansson. The non-solicitation of employees periods are twenty-four (24) months for Rathore, Linden, and Kaczmarek, and eighteen (18) months for the remaining five individuals. The non-solicitation of vendors period is twenty-four (24) months for Rathore and eighteen (18) months for all others. The confidentiality obligations are perpetual for all eight Departing Employees. In each case, the geographic scope of the non-competition covenant is the United States.
D. Discovery of Destination Employer
35. On February 14, 2025, Verdana Commerce Group, Inc. ("Verdana") issued a press release entitled "Verdana Commerce Welcomes Industry-Leading Merchandising Team to Accelerate Growth." The press release publicly announced the hiring of Rathore and all seven other members of the CRH merchandising leadership team. A true and correct copy of the press release is attached to this Declaration as Exhibit J.
36. The press release announced that Rathore would serve as President, Merchandising & Strategy at Verdana. The roles of the remaining seven individuals were not specified in the press release, but the release described the group collectively as an "industry-leading merchandising team" and stated that their hiring was "a pivotal step in Verdana's transformational growth initiative."
37. Verdana is a direct competitor of CRH. Verdana is a Delaware corporation headquartered at 400 Christiana Gateway, Suite 700, Wilmington, Delaware 19801. Verdana operates in the retail and ecommerce sector and competes with CRH in twenty-eight (28) overlapping product categories, including home goods, apparel, and seasonal décor, which are among CRH's strongest and highest-margin merchandise categories.
38. Verdana's estimated FY2024 revenue was approximately $1.9 billion. While Verdana is significantly smaller than CRH, it is a well-capitalized and aggressively growing competitor. Verdana is a portfolio company of Greystone Capital Partners, LP. Specifically, Greystone Capital Fund VII, LP, a vintage 2022 private equity fund with approximately $8.5 billion in committed capital, holds the majority equity interest in Verdana. Greystone acquired Verdana in the third quarter of 2023 in a transaction valuing the company at approximately $2.4 billion in enterprise value.
39. In January 2025 — approximately one month prior to the Departing Employees' coordinated resignations — Verdana publicly announced what it described as a "transformational growth initiative" targeting $4 billion in annual revenue by 2028. The announcement specifically cited expansion into CRH's strongest categories, including private-label home goods and seasonal décor, as key pillars of the growth strategy. The timing of this announcement, followed by the coordinated recruitment of CRH's entire senior merchandising team, strongly suggests that Verdana's growth strategy was predicated, at least in significant part, on acquiring CRH's merchandising leadership and the proprietary knowledge they carry.
V. IMMEDIATE OPERATIONAL DISRUPTION TO CRH'S MERCHANDISING DIVISION
A. Loss of Senior Leadership
40. The simultaneous departure of the entire senior merchandising leadership team created an immediate and severe leadership vacuum within CRH's merchandising division. The magnitude of this disruption cannot be overstated. In a single coordinated action, CRH lost every senior leader responsible for the strategic direction and day-to-day management of a $2.3 billion business unit.
41. The Senior Vice President, Merchandising role — Rathore's former position — is the most senior merchandising position at CRH and is critical to setting the Company's overall merchandising strategy and overseeing its execution. With Rathore's departure, CRH lost the individual who had been the primary architect of the Company's merchandising direction for nearly four years.
42. Both Vice President-level positions departed simultaneously. Derek Linden's departure left CRH without an experienced leader for its hardlines merchandising operations, and Sonia Kaczmarek's departure left CRH without an experienced leader for its softlines merchandising operations. Hardlines and softlines represent the two largest merchandise categories at CRH, and their leadership positions are among the most critical in the division.
43. All four director-level positions also departed, stripping away functional expertise across multiple critical areas: Amara Osei's departure left CRH without its private-label strategy leader; Brent Halvorsen's departure left CRH without its seasonal planning and analytics leader; Lucia Fernandez-Gill's departure left CRH without its domestic vendor relations leader; and the departures of Nathan Tsao and Kira Johansson at the senior manager level removed key leaders in ecommerce merchandising and category analytics, respectively. In sum, every functional pillar of CRH's merchandising operations was left without its designated leader.
B. Interim Leadership Measures
44. In the immediate aftermath of the resignations, I worked in coordination with CEO Marcus Langford to appoint Martin Cho, an existing Vice President of Merchandising at CRH, as acting interim Senior Vice President of Merchandising. While Mr. Cho is a capable and dedicated executive, he had been in his current role for a comparatively shorter period and does not possess the breadth of experience, institutional knowledge, or depth of vendor relationships held by the departed team. Mr. Cho has candidly acknowledged to me that the scope of the interim responsibilities he has assumed is significantly beyond the capacity of any single individual.
45. CRH has been forced to redistribute the responsibilities of the eight Departing Employees across the remaining merchandising staff. However, the remaining staff members, while competent in their respective roles, are not equipped or experienced enough to absorb the full workload, decision-making authority, and strategic responsibilities previously held by eight senior professionals. The redistribution has resulted in role overload, delays in decision-making, and a reduction in the quality and timeliness of merchandising operations.
46. CRH has initiated emergency external recruiting efforts for the SVP, Merchandising role and for the other vacant leadership positions. However, based on my extensive experience in talent acquisition for senior retail merchandising roles, I can state that recruiting at this level of seniority and specialization typically requires three to six months to identify, evaluate, recruit, and onboard qualified candidates. This timeline assumes a normal market environment; the fact that CRH must fill eight senior positions simultaneously — and do so in an environment where a direct competitor has publicly signaled its aggressive growth ambitions — makes the recruiting challenge even more daunting.
C. Impact on Day-to-Day Operations
47. The departures occurred during a critical period in CRH's merchandising calendar. February is the month in which spring and summer seasonal buying decisions are finalized, purchase orders are issued to vendors, and vendor negotiations for the fall and holiday season begin in earnest. The timing of the coordinated departures inflicted maximum disruption on CRH's operations.
48. Specifically, the following operational impacts have been experienced or are ongoing:
(a) Vendor Negotiations Disrupted: Multiple ongoing vendor negotiations were disrupted by the departures. Several key vendor meetings — including negotiations with three of CRH's top ten domestic vendors by spend — had to be postponed or rescheduled due to the absence of the relevant CRH merchandising leaders. In at least two instances, vendor counterparts have expressed concern about CRH's organizational stability, which has weakened CRH's negotiating position.
(b) Project Ridgeline Implementation Suspended: Internal strategic planning meetings related to the implementation of Project Ridgeline, CRH's five-year category expansion roadmap, were suspended pending a comprehensive assessment of information security. Given that all eight Departing Employees had full access to Project Ridgeline materials and that evidence of data exfiltration has been discovered (as discussed in Section VII below), CRH has been unable to proceed with the implementation of key elements of the plan until it can assess the extent to which the plan's confidentiality has been compromised.
(c) Private-Label Sourcing Initiatives on Hold: Private-label sourcing initiatives, which Osei had been leading in her capacity as Director of Private Label Strategy, were put on hold following her departure. Private-label products are among CRH's highest-margin product lines, and delays in sourcing and product development will directly affect CRH's product assortment and profitability in the second half of FY2025.
(d) eCommerce Assortment Strategy Reassigned: The ecommerce assortment strategy for the second quarter of 2025, which Tsao had been developing as Senior Manager of eCommerce Merchandising, required reassignment to less experienced personnel. The strategy is now behind schedule, and the quality of the initial work product has required significant revision by Mr. Cho and other remaining staff.
(e) Category Analytics Reporting Delays: The category analytics reporting cadence, which Johansson had managed in her capacity as Senior Manager of Category Analytics, experienced meaningful delays. These reports inform critical merchandising decisions across the organization, and delays in their production have a cascading effect on buying decisions, inventory allocation, and pricing strategies.
D. Employee Morale and Retention Concerns
49. The coordinated departure of the entire senior merchandising leadership team caused significant anxiety and uncertainty among the remaining merchandising staff. Following the departures, CRH's merchandising division retained approximately 112 employees — the entire team minus the eight Departing Employees. These remaining employees suddenly found themselves without the leadership structure that had been in place, in some cases, for years.
50. In the days following the resignations, my HR team and I received numerous inquiries from remaining merchandising employees expressing concern about job security, the Company's strategic direction for the merchandising division, and whether additional departures were anticipated. Several employees expressed anxiety about the possibility that their former leaders might attempt to recruit them to Verdana.
51. In response to these concerns, I authorized and organized an emergency town hall meeting for the merchandising division, which was held on February 14, 2025 — the same day that Verdana issued its press release publicly announcing the hiring of the Departing Employees. The timing of the press release, on the very day of the town hall, further destabilized morale. CEO Marcus Langford addressed the team at the town hall, affirming CRH's commitment to the merchandising division and outlining interim leadership arrangements.
52. Based on my professional experience in human resources and employee relations, I have serious and well-founded concerns that Verdana and the Departing Employees may attempt to recruit additional CRH merchandising personnel. Such recruitment efforts would compound the operational disruption already experienced and could further destabilize CRH's merchandising workforce. The non-solicitation of employees provisions in the Departing Employees' agreements were designed to prevent precisely this type of cascading talent drain.
VI. THE DEPARTING EMPLOYEES' ACCESS TO CONFIDENTIAL AND PROPRIETARY INFORMATION
A. Project Ridgeline
53. Project Ridgeline is CRH's confidential five-year strategic category expansion plan. The plan was completed in October 2024 after approximately eighteen months of development. It represents one of the most significant strategic planning efforts in CRH's recent history and contains some of the Company's most competitively sensitive information.
54. Project Ridgeline encompasses, among other things: (i) proprietary vendor terms and negotiation strategies for CRH's key vendor relationships; (ii) private-label margin targets and product development roadmaps; (iii) ecommerce assortment algorithms designed to optimize online product offerings; (iv) category expansion priorities identifying which product categories CRH intends to enter, grow, or exit over the next five years; and (v) detailed financial models projecting the revenue, margin, and capital expenditure implications of the plan.
55. All eight Departing Employees had full access to Project Ridgeline materials. Each attended the final strategy sessions held in September and October 2024 and received the complete plan documentation, including the final strategic plan document, supporting analytical models, financial projections, and vendor strategy appendices.
56. Rathore served as the executive sponsor of Project Ridgeline and was the senior-most executive responsible for its development and eventual implementation. Halvorsen and Johansson contributed the analytical models that underpinned the plan's demand forecasts and inventory optimization strategies. Osei developed the private-label components of the plan, including margin targets and sourcing strategies for new private-label product lines. Fernandez-Gill provided vendor pricing inputs and contributed the vendor negotiation strategy components. Linden and Kaczmarek contributed category-specific strategies for hardlines and softlines, respectively. Tsao developed the ecommerce integration plans, including the algorithms for online assortment optimization.
57. In short, Project Ridgeline was a product of the collective expertise and proprietary knowledge of the very eight individuals who have now departed CRH to join its direct competitor. The risk that Verdana will benefit from the knowledge of Project Ridgeline's contents — either through the Departing Employees' inherent knowledge of the plan or through copies of plan documents that may have been exfiltrated — is acute and immediate.
B. Vendor Negotiation Playbooks and Pricing Data
58. The Departing Employees had access to CRH's proprietary vendor negotiation playbooks. These playbooks contain detailed strategies, preferred contractual terms, margin targets, and historical negotiation outcomes relating to CRH's relationships with its entire vendor base. The playbooks represent years of accumulated institutional knowledge and competitive intelligence and are among CRH's most closely guarded confidential business documents.
59. Fernandez-Gill, in her capacity as Director of Vendor Relations (Domestic), had particularly extensive and detailed knowledge of vendor terms and pricing for CRH's top fifty (50) domestic vendors by spend. This includes knowledge of the specific pricing tiers, rebate structures, volume discounts, co-marketing arrangements, and exclusivity terms that CRH has negotiated with these vendors. This information would be of extraordinary competitive value to Verdana, which competes with CRH in twenty-eight (28) overlapping product categories and sources from many of the same vendors.
60. Knowledge of CRH's vendor negotiation strategies and pricing data would enable Verdana to anticipate CRH's negotiating positions, undercut CRH's terms, and potentially divert vendor relationships to Verdana's benefit and CRH's detriment.
C. Private-Label Sourcing Strategies
61. Osei, in her capacity as Director of Private Label Strategy, had detailed knowledge of CRH's private-label sourcing strategies. This knowledge includes the identities of CRH's private-label suppliers (many of which are subject to confidentiality agreements and are not publicly known), the cost structures associated with private-label products, the margin targets that CRH has set for its private-label lines, and the product development pipelines for new private-label offerings planned for FY2025 and beyond.
62. Private-label products are a high-margin segment that is critical to CRH's competitive positioning and profitability. The private-label business has been a particular area of focus and investment for CRH, and the strategies and supplier relationships that Osei helped develop are not easily replicated. Disclosure of this information to Verdana would directly undermine CRH's private-label competitive advantage.
D. Customer Segmentation and Analytics Data
63. Johansson, in her capacity as Senior Manager of Category Analytics, had access to CRH's proprietary customer segmentation models and purchasing behavior analytics. These models are the product of significant investment in data science and analytics capabilities and are used by CRH to inform merchandising decisions, optimize product assortment, and develop pricing strategies tailored to specific customer segments.
64. The customer segmentation models incorporate proprietary data on customer purchasing patterns, demographic profiles, price sensitivity, channel preferences, and product affinity scores. This information is not publicly available and constitutes valuable trade secret information that would provide a significant competitive advantage to any competitor that obtained it.
E. Seasonal Buying Algorithms
65. Halvorsen, in his capacity as Director of Seasonal Planning & Analytics, had access to CRH's proprietary seasonal buying algorithms. These algorithms are sophisticated analytical tools that predict demand patterns across CRH's product categories and optimize inventory allocation across the Company's 387 retail locations and its ecommerce platform. The algorithms incorporate historical sales data, trend analysis, macroeconomic indicators, weather pattern data, and proprietary demand-sensing models developed by CRH over multiple years.
66. The seasonal buying algorithms are a critical competitive asset for CRH. They enable the Company to minimize inventory risk, reduce markdowns, and maximize sell-through rates. A competitor in possession of these algorithms — or the methodologies and data inputs underlying them — would gain a significant advantage in its own inventory planning and allocation processes.
VII. EVIDENCE OF DATA EXFILTRATION DISCOVERED DURING OFFBOARDING
67. On February 12, 2025, during the process of securing returned devices and auditing system access for the Departing Employees, CRH's IT department identified anomalous data access and download activity associated with the accounts of the Departing Employees. I was informed of these findings by Chief Information Officer Danielle Weston on the same date.
68. Specifically, CRH's IT department determined that between approximately January 10, 2025 and February 4, 2025, a total of approximately 14,327 files, totaling approximately 2.8 gigabytes of data, had been downloaded from CRH's Aldermere Systems and Pinnacle Health IT environments to personal cloud storage accounts — that is, cloud storage accounts not hosted or controlled by CRH. The downloads were traced to the accounts of the Departing Employees.
69. Based on the IT department's preliminary review, the downloaded files included, among other things: (i) Project Ridgeline presentations and strategic plan documentation; (ii) vendor negotiation term sheets and pricing data; (iii) private-label cost models and margin analyses; and (iv) customer segmentation data and analytics reports. In other words, the downloaded files encompassed the full spectrum of CRH's most sensitive and competitively valuable confidential information and trade secrets in the merchandising function.
70. The timeframe of the data exfiltration — between January 10 and February 4, 2025 — coincides with the period during which, based on the subsequent Verdana press release and other information, the Departing Employees were negotiating their departures from CRH and their new employment with Verdana. The data downloads began approximately one month before the coordinated resignations on February 7, 2025, and ceased approximately three days before the resignations were submitted. This temporal correlation strongly suggests that the data exfiltration was undertaken in anticipation of and in preparation for the Departing Employees' move to Verdana.
71. I immediately reported these findings to General Counsel Theresa Yun-Park. Ms. Yun-Park subsequently engaged Calderwood & Harkness LLP as outside litigation counsel (retained on February 18, 2025) and Pinnacle Forensics LLC ("Pinnacle"), a digital forensics firm, to conduct a full forensic imaging and analysis of the Departing Employees' CRH-issued devices, CRH system logs, and other relevant electronic evidence. Pinnacle was engaged on February 20, 2025, and its forensic investigation is being supervised by Dr. Rajiv Anand, Pinnacle's Managing Director and a recognized expert in digital forensics and electronic evidence preservation. Dr. Anand's investigation is ongoing, and CRH anticipates that his findings will provide additional detail regarding the scope, timing, and methods of the data exfiltration. CRH reserves the right to submit supplemental declarations and expert reports based on Dr. Anand's findings.
VIII. IRREPARABLE HARM TO CRH
A. Competitive Harm
72. The combination of eight senior merchandising professionals — constituting the entire senior leadership of CRH's merchandising division — joining CRH's direct competitor, each carrying deep institutional knowledge and potentially possessing copies of CRH's most sensitive trade secrets and confidential information, poses an immediate and irreparable competitive threat to CRH.
73. Verdana directly competes with CRH in twenty-eight (28) product categories. Verdana has publicly announced a "transformational growth initiative" specifically targeting CRH's strongest categories — private-label home goods and seasonal décor — with a stated goal of growing from $1.9 billion to $4 billion in revenue by 2028. The hiring of CRH's entire senior merchandising team is, by Verdana's own admission, a centerpiece of this growth strategy.
74. If the Departing Employees are permitted to work in merchandising roles at Verdana without restraint, CRH's competitive position in its core $2.3 billion merchandising business will be severely compromised. The Departing Employees carry with them an intimate and comprehensive understanding of CRH's merchandising strategy, vendor relationships, pricing approaches, private-label development plans, seasonal algorithms, and customer analytics. This knowledge will inevitably inform their work at Verdana, even absent affirmative misuse of trade secret materials.
75. The harm is not merely hypothetical or speculative. Verdana's own press release explicitly positions the hiring of the Departing Employees as part of Verdana's "transformational growth initiative." The press release does not describe the hires as incremental additions to Verdana's existing team; rather, it characterizes them as a foundational element of Verdana's competitive strategy. The inference is inescapable: Verdana intends to leverage the Departing Employees' knowledge of CRH's operations and strategies to compete more effectively against CRH.
B. Inability to Quantify Damages
76. The competitive harm from the misuse or inevitable disclosure of CRH's confidential information and trade secrets is not readily quantifiable in monetary terms. The information at risk — Project Ridgeline's strategic roadmap, vendor negotiation playbooks, private-label cost structures, seasonal buying algorithms, and customer segmentation models — represents years of investment, proprietary development, and competitive intelligence gathering. The value of this information lies not in any single data point but in its comprehensive, integrated nature, which provides CRH with a competitive advantage that has been built over many years and at great expense.
77. Once disclosed to a competitor, the confidentiality of this information cannot be restored. A trade secret, once revealed, ceases to be a trade secret. No amount of monetary damages can undo the competitive harm that results from a competitor's acquisition and use of proprietary strategic plans, vendor terms, and analytical models. The harm is therefore irreparable by its very nature.
78. Moreover, even if it were theoretically possible to quantify the competitive harm, the magnitude of the potential loss — given that CRH's merchandising division generates $2.3 billion in annual GMV and that Verdana is targeting CRH's strongest categories for expansion — would make any damages award speculative, uncertain, and inherently inadequate to make CRH whole. Legal remedies in the form of monetary damages would be inadequate to compensate CRH for the loss of competitive advantage that would result from the unrestricted employment of the Departing Employees at Verdana in merchandising roles.
C. Ongoing Risk of Further Employee Solicitation
79. I have a reasonable basis to believe that the Departing Employees may attempt to recruit additional CRH merchandising staff to join Verdana. The Departing Employees maintained close working relationships with the approximately 112 remaining merchandising employees at CRH, many of whom reported directly or indirectly to one or more of the Departing Employees. The Departing Employees are well positioned to identify and target the most talented and strategically valuable members of CRH's remaining merchandising team.
80. The non-solicitation of employees obligations in the Departing Employees' employment agreements were intended to prevent precisely this type of cascading talent drain. Without injunctive relief enforcing those obligations, CRH faces the very real prospect of further destabilization of its merchandising workforce at a time when it can least afford additional departures. The loss of additional merchandising personnel to Verdana would compound the operational disruption described above and could render CRH's merchandising division unable to function effectively during the critical spring and summer buying season.
IX. STEPS TAKEN BY CRH TO MITIGATE HARM
81. CRH has taken and continues to take the following steps to mitigate the harm caused by the coordinated departure of the Departing Employees:
(a) System Access Revocation and Device Collection: CRH revoked all system access for the eight Departing Employees on February 10, 2025, and collected all company-issued devices, including laptops, mobile phones, and tablets, by February 18, 2025.
(b) Interim Leadership Appointment: CRH appointed Martin Cho as acting interim Senior Vice President of Merchandising to provide temporary leadership continuity for the division.
(c) Emergency External Recruiting: CRH initiated emergency external recruiting efforts for the SVP, Merchandising role and the other vacant senior merchandising positions. These efforts are ongoing, but, as noted above, are expected to require three to six months to yield qualified candidates.
(d) Employee Communication: CRH conducted an internal town hall meeting on February 14, 2025, at which CEO Marcus Langford addressed the merchandising division to provide reassurance, answer questions, and outline the Company's plans for maintaining operational continuity.
(e) Engagement of Outside Counsel: CRH engaged Calderwood & Harkness LLP as outside litigation counsel on February 18, 2025, to advise on the enforcement of the Departing Employees' restrictive covenant obligations and the protection of CRH's trade secrets and confidential information.
(f) Cease-and-Desist Letters: On February 25, 2025, Calderwood & Harkness LLP, on behalf of CRH, sent cease-and-desist letters to each of the eight Departing Employees, to Verdana Commerce Group, Inc. (to the attention of its General Counsel, Helen Tsoi), and to Greystone Capital Partners, LP (to the attention of its Managing Partner, Elliot Westbrook). The letters demanded immediate compliance with the Departing Employees' restrictive covenant obligations and the return of all CRH confidential information and trade secret materials. To date, CRH has not received substantive responses to these letters.
(g) Forensic Investigation: CRH engaged Pinnacle Forensics LLC on February 20, 2025, under the supervision of Dr. Rajiv Anand, to conduct forensic imaging and analysis of the Departing Employees' CRH-issued devices, CRH system access logs, and other relevant electronic evidence. This investigation is ongoing.
(h) Private Investigation: CRH engaged Aurelian Investigations Group Inc. on February 21, 2025, under the supervision of Sandra Fielding, to investigate the circumstances surrounding the coordinated departure, including the timeline and nature of communications between the Departing Employees, Verdana, and Greystone Capital Partners. This investigation is also ongoing.
82. Despite these mitigation efforts, CRH cannot fully protect itself from the competitive harm described above without the assistance of this Court. The restrictive covenant provisions in the Departing Employees' employment agreements provide CRH with contractual rights that are enforceable under Delaware law, but the exercise of those rights requires judicial enforcement through injunctive relief.
X. CONCLUSION AND REQUEST FOR RELIEF
83. Based on the foregoing, CRH has suffered and will continue to suffer irreparable harm as a result of the coordinated departure of the eight individual defendants to Verdana Commerce Group, Inc. in violation of their contractual obligations to CRH. The loss of the entire senior merchandising leadership team to a direct competitor, the evidence of pre-departure data exfiltration, and the threat of further employee solicitation collectively present an urgent competitive crisis that warrants the immediate intervention of this Court.
84. The restrictive covenant provisions contained in each Departing Employee's employment agreement are reasonable in scope, duration, and geographic reach, and are enforceable under Delaware law. Each provision was supported by adequate consideration, including initial offers of employment, continued employment, promotions, annual performance bonuses, and restricted stock unit grants. The provisions serve the legitimate business interests of CRH in protecting its trade secrets, confidential information, customer and vendor relationships, and investment in training and developing its senior merchandising leadership.
85. CRH respectfully requests that the Court grant the Temporary Restraining Order and Preliminary Injunction sought in Plaintiff's Motion, restraining and enjoining the eight individual defendants — Priya Rathore, Derek Linden, Sonia Kaczmarek, Amara Osei, Brent Halvorsen, Lucia Fernandez-Gill, Nathan Tsao, and Kira Johansson — from commencing or continuing employment in merchandising or substantially similar roles at Verdana Commerce Group, Inc., or any of its subsidiaries or affiliates, pending the resolution of this matter on the merits.
86. CRH further requests that the Court issue such additional injunctive relief as it deems appropriate, including but not limited to orders requiring the return or destruction of all CRH confidential information and trade secret materials in the possession of the Departing Employees and Verdana, and prohibiting the Departing Employees from soliciting CRH employees, vendors, or suppliers.
87. CRH is prepared to post an injunction bond in such amount as the Court may require pursuant to Court of Chancery Rule 65.
I declare under penalty of perjury under the laws of the State of Delaware that the foregoing is true and correct.
Executed on March 5, 2025, at Seattle, Washington.
________________________________________
Roland Ashby Chief People Officer Cascade Retail Holdings Inc. 2200 Elliott Avenue West, Suite 3400 Seattle, Washington 98119
CERTIFICATE OF SERVICE
I, Bernard Crawford, hereby certify that on March 5, 2025, a true and correct copy of the foregoing Declaration of Roland Ashby in Support of Plaintiff's Motion for Temporary Restraining Order and Preliminary Injunction was served upon the following counsel of record by electronic filing through the Court's File & ServeXpress system and by email:
Catherine Nygaard, Esquire Whitfield, Nygaard & Doyle LLP 1000 North Market Street, Suite 1500 Wilmington, Delaware 19801 Counsel for Defendants Priya Rathore, Derek Linden, Sonia Kaczmarek, Amara Osei, Brent Halvorsen, Lucia Fernandez-Gill, Nathan Tsao, and Kira Johansson
Gavin Blackhall, Esquire Blackhall & Soren LLP 300 Delaware Avenue, Suite 900 Wilmington, Delaware 19801 Counsel for Defendant Verdana Commerce Group, Inc.
________________________________________
Bernard Crawford (No. 5847) CALDERWOOD & HARKNESS LLP 1301 K Street NW, Suite 1200 Washington, DC 20005 Telephone: (202) 555-4800 Facsimile: (202) 555-4801
Email: bcrawford@calderwoodharkness.com
Attorney for Plaintiff Cascade Retail Holdings Inc.
CASCADE RETAIL HOLDINGS INC.,
Plaintiff,
C.A. No. 2025-0198-MTZ
v.
PRIYA RATHORE, DEREK LINDEN, SONIA KACZMAREK, AMARA OSEI, BRENT HALVORSEN, LUCIA FERNANDEZ-GILL, NATHAN TSAO, KIRA JOHANSSON, and VERDANA COMMERCE GROUP, INC.,
Defendants.
Defendant | Non-Competition | Non-Solicitation (Employees) | Non-Solicitation (Vendors) | Confidentiality | Geographic Scope
Priya Rathore | 18 months | 24 months | 24 months | Perpetual | United States
Derek Linden | 18 months | 24 months | 18 months | Perpetual | United States
Sonia Kaczmarek | 18 months | 24 months | 18 months | Perpetual | United States
Amara Osei | 12 months | 18 months | 18 months | Perpetual | United States
Brent Halvorsen | 12 months | 18 months | 18 months | Perpetual | United States
Lucia Fernandez-Gill | 12 months | 18 months | 18 months | Perpetual | United States
Nathan Tsao | 12 months | 18 months | 18 months | Perpetual | United States
Kira Johansson | 12 months | 18 months | 18 months | Perpetual | United States