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1038-00007 · Cascade Retail Holdings · Internal Memoranda

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CALDERWOOD & HARKNESS LLP

INTERNAL MEMORANDUM

TO: Douglas Carmichael, Partner

FROM: Yuki Nakamura, Senior Associate

DATE: August 10, 2022

RE: Court's Ruling on Vantor's Motion to Compel Expanded discovery — Implications for Defense Strategy

MATTER: Cascade Retail Holdings Inc. — Defense of Tortious Interference Claim

MATTER NO.: 1038-00007

CASE: Vantor Holdings Corp. v. Cascade Retail Holdings Inc., Case No. 21STCV-34872, Superior Court of California, County of Los Angeles

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I. Executive Summary

On August 3, 2022, Judge Patricia Okafor of the Superior Court of California, County of Los Angeles, issued her ruling on Vantor Holdings Corp.'s ("Vantor") motion to compel expanded discovery, which Vantor filed on June 15, 2022. The motion sought what amounted to class-certification-style discovery across the entirety of Cascade Retail Holdings Inc.'s ("Cascade") supplier relationships established or pursued under its Project Atlas strategic sourcing initiative. The court granted the motion in part and denied it in part.

Specifically, the court denied Vantor's request for discovery into all of Cascade's supplier relationships under Project Atlas — which would have encompassed all 25 suppliers identified in the initiative — but ordered expanded discovery into 15 additional supplier relationships beyond the three relationships that are directly at issue in this litigation: Hemsworth Consumer Products LLC ("Hemsworth"), Tridale Manufacturing Inc. ("Tridale"), and Orion Lifestyle Brands Corp. ("Orion"). As a result, the total number of supplier relationships subject to discovery has expanded from three to eighteen.

This memorandum provides a detailed analysis of the court's ruling, its practical impact on document discovery and the deposition schedule, the anticipated increase in costs — including both e-discovery expenses and additional attorney time — and my recommended adjustments to our defense strategy in light of the expanded discovery scope.

The key takeaway is as follows: while the ruling is materially narrower than what Vantor sought, and thus represents a partial victory for Cascade, it nonetheless substantially increases the discovery burden and associated costs. More critically, the ruling creates new and non-trivial risks that certain of the 15 additional supplier relationships may yield documents that Vantor can use to argue a broader pattern of supplier poaching under Project Atlas. If Vantor is able to demonstrate that Cascade systematically targeted suppliers who had existing exclusivity arrangements with competitors, the resulting pattern evidence — even if insufficient to establish independent legal claims — could meaningfully strengthen Vantor's trial narrative and complicate our motion for summary judgment.

I recommend that we take immediate steps to assess the exposure presented by the 15 additional supplier relationships, coordinate with our e-discovery vendor to begin supplemental collections, and proactively engage opposing counsel regarding stipulated limitations on any additional depositions. Each of these steps, and others, is discussed in detail below.

II. Background and Procedural History

A. Vantor's Motion to Compel (Filed June 15, 2022)

On June 15, 2022, Vantor, through its counsel at Kessler, Brandt & Whitfield LLP — specifically lead counsel Martin Kessler and co-counsel Natalie Whitfield — filed a motion to compel expanded discovery in this matter. The motion was noticed for hearing on August 1, 2022, and was heard by Judge Okafor on that date.

The substance of Vantor's motion sought discovery across all Cascade supplier relationships that were initiated, developed, or pursued as part of Project Atlas, Cascade's strategic supplier diversification initiative launched in approximately February 2021. As this team is well aware, Project Atlas was a comprehensive sourcing initiative led by Cascade's Vice President of Strategic Sourcing, Annika Bergström, under the oversight of Senior Vice President of Supply Chain & Procurement, Lena Torvik. The initiative identified 25 potential supplier relationships aimed at diversifying Cascade's supply base, reducing dependency on certain legacy suppliers, and securing more favorable pricing and terms in key product categories.

Vantor's theory of the case, as articulated in its motion papers, is that Project Atlas was not merely a legitimate competitive sourcing initiative but rather a systematic campaign to poach the exclusive suppliers of Cascade's competitors — most notably Vantor itself. Vantor argued that a pattern-and-practice inquiry across all 25 Project Atlas supplier relationships was necessary to demonstrate that Cascade's conduct toward Hemsworth, Tridale, and Orion was not isolated or incidental but was instead part of a deliberate and coordinated effort to interfere with Vantor's existing exclusivity arrangements.

In support of its motion, Vantor cited 14 internal Project Atlas emails, produced during the initial phase of discovery, that referenced Vantor's existing supplier relationships. Vantor contended that these emails demonstrated that Cascade was aware of Vantor's supplier base and was specifically targeting suppliers with whom Vantor had existing arrangements.

In terms of specific relief, Vantor sought the following:

(a) Production of all documents and electronically stored information ("ESI") relating to each of the 25 suppliers identified in the Project Atlas initiative, including but not limited to internal communications, strategy memoranda, presentation materials, meeting notes, financial analyses, and correspondence with the suppliers themselves;

(b) Depositions of all Cascade personnel who were involved in any aspect of the supplier relationships pursued under Project Atlas, without numerical limitation; and

(c) An order deeming any failure to produce documents relating to all 25 Project Atlas suppliers as a discovery abuse warranting further sanctions.

Vantor estimated that discovery into all 25 supplier relationships would require production from approximately 12 additional custodians beyond those from whom documents had already been collected.

B. Cascade's Opposition (Filed July 18, 2022) and Reply (Filed July 29, 2022)

Calderwood & Harkness filed a comprehensive opposition to Vantor's motion on July 18, 2022, and a reply brief on July 29, 2022. Our opposition advanced several arguments designed to demonstrate the overbreadth and disproportionality of Vantor's request.

First, we emphasized the scope of discovery that had already been conducted in this matter. As of the date of our opposition, 452,316 documents had been collected from Cascade custodians across the agreed-upon custodian list. Of those, 198,740 documents had been reviewed for relevance and privilege, and 78,412 documents had been produced to Vantor. This represented a substantial and good-faith discovery effort covering the three supplier relationships at the core of this litigation — Hemsworth, Tridale, and Orion — as well as general background documents relating to Project Atlas and Cascade's competitive strategy.

Second, we argued that the case, as pled, concerns only three specific supplier relationships and three specific exclusive supply agreements. Vantor's operative complaint identifies interference with the Vantor–Hemsworth Exclusive Supply Agreement (effective March 2019), the Vantor–Tridale Preferred Supplier Agreement (effective June 2020), and the Vantor–Orion Strategic Partnership Agreement (effective January 2020). Discovery into 22 additional supplier relationships that are not the subject of any claim in this litigation is facially overbroad and amounts to a fishing expedition designed to increase the burden and cost of litigation for Cascade.

Third, we submitted declarations from Cascade's General Counsel, David Pruitt, and from Samuel Byrd, the Project Manager at Krane Investigations LLC (our e-discovery vendor), detailing the estimated burden and cost of reviewing additional custodian files across all 25 Project Atlas suppliers. Mr. Byrd estimated that expanding the collection to all 25 suppliers would require collection from an additional 8–12 custodians, processing of an estimated 150,000–250,000 additional documents, and first-pass review costs in excess of $400,000.

Fourth, we argued that the 14 internal Project Atlas emails referencing Vantor's supplier relationships did not justify the sweeping discovery Vantor sought. We noted that these 14 emails represented less than 0.5% of the 2,847 total Project Atlas emails reviewed in discovery, and that none of the 14 emails referenced the specific terms of any exclusivity arrangement between Vantor and its suppliers. Rather, the emails reflected general market awareness of competitor supplier relationships — a normal and unremarkable feature of competitive business intelligence.

In our reply brief, we reiterated these arguments and responded to Vantor's contention that discovery into all 25 supplier relationships was necessary to establish Cascade's state of mind. We argued that state of mind regarding the three at-issue supplier relationships is properly established through discovery focused on those three relationships, not through an industry-wide survey of Cascade's sourcing practices.

C. Our Prior Meet-and-Confer Efforts

Before Vantor filed its motion to compel, the parties engaged in meet-and-confer discussions concerning the scope of expanded discovery. On June 2, 2022, I sent a detailed meet-and-confer letter to Martin Kessler and Natalie Whitfield at Kessler, Brandt & Whitfield LLP, proposing a narrowed scope for any expanded discovery that the parties could agree to without court intervention. Specifically, our June 2 letter proposed that Cascade would voluntarily produce documents relating to up to five additional supplier relationships under Project Atlas — those most closely analogous to the three at-issue suppliers in terms of product category, geographic market, or supplier profile — in exchange for Vantor's agreement not to seek further expansion of the discovery scope.

Vantor rejected this proposal in its June 10, 2022 response letter, contending that any limitation on discovery into all 25 Project Atlas supplier relationships would be artificial and would deprive Vantor of the ability to establish the full scope of Cascade's tortious conduct. Vantor stated that it intended to proceed with motion practice and filed its motion to compel five days later.

For the record, the meet-and-confer correspondence and our good-faith efforts to resolve the discovery dispute without court intervention were referenced in our opposition papers and were noted by the court in its ruling.

III. Analysis of the Court's August 3, 2022 Ruling

A. What the Court Granted

The court's August 3, 2022 order granted Vantor's motion to compel in part by ordering expanded discovery into 15 additional supplier relationships beyond the three that are directly at issue in this litigation. This brings the total number of supplier relationships subject to discovery to 18.

The court identified the 15 additional suppliers by reference to the Project Atlas master spreadsheet (produced as Document No. CASCADE-00042517), which lists all 25 suppliers targeted under the initiative. The court ordered discovery into all supplier relationships on that spreadsheet except for the seven suppliers that both parties agreed at the hearing were either never contacted by Cascade or declined initial outreach without any further engagement. Thus, the 15 additional suppliers represent those with whom Cascade had at least some substantive engagement under Project Atlas, even if no formal supply agreement was ultimately reached.

In reaching this determination, the court made several findings that are important for our defense strategy going forward:

First, the court found that evidence of Cascade's approach to other suppliers during the Project Atlas initiative is relevant to whether Cascade engaged in a pattern of conduct that bears on its intent and knowledge regarding the three at-issue supplier relationships. The court reasoned that if Cascade systematically targeted suppliers that it knew or should have known had existing exclusivity arrangements with competitors, this would be probative of whether Cascade acted with the requisite knowledge when it solicited Hemsworth, Tridale, and Orion.

Second, the court found that limiting discovery to only the three at-issue suppliers would deprive Vantor of evidence potentially probative of Cascade's intent, knowledge, and modus operandi. The court analogized to the use of "other acts" evidence under Evidence Code section 1101(b), noting that while the admissibility of such evidence at trial is a separate question, the broader standard for discovery relevance permits inquiry into matters reasonably calculated to lead to admissible evidence.

Third, the court found that the 14 internal Project Atlas emails referencing Vantor's existing supplier relationships, while limited in number, were sufficient to establish a threshold basis for expanded discovery. The court noted that if Cascade personnel were discussing Vantor's supplier relationships in the context of Project Atlas, it is reasonable to infer that additional documents may exist regarding Cascade's awareness of competitor exclusivity arrangements in connection with other suppliers.

The court ordered Cascade to produce documents relating to the 15 additional supplier relationships within 60 days of the date of the ruling, placing the supplemental production deadline at approximately October 2, 2022.

B. What the Court Denied

Importantly, the court denied several aspects of Vantor's motion, and these denials provide meaningful boundaries on the scope of the expanded discovery:

First, the court denied Vantor's request for discovery into all Cascade supplier relationships beyond those identified in Project Atlas. Vantor had argued in its motion papers that Cascade's broader supplier relationships — including those predating Project Atlas — were relevant to establishing Cascade's general business practices. The court rejected this argument as untethered to the claims at issue and noted that the Project Atlas initiative is the relevant framework for the conduct alleged in the complaint.

Second, the court denied Vantor's request for unlimited depositions of Cascade personnel involved in each of the 25 Project Atlas supplier relationships. The court noted that the existing deposition schedule — which contemplates 14 depositions total (8 by Vantor, 6 by Cascade) — was already substantial, and that additional depositions should be limited and proportional to the needs of the case. The court did not set a specific numerical limit on additional depositions but indicated that it would entertain a motion for protective order from Cascade if the deposition burden becomes unreasonable.

Third, the court declined to make any finding that Cascade's prior discovery conduct constituted a discovery abuse or warranted sanctions. The court expressly noted that Cascade had engaged in good-faith meet-and-confer efforts and had produced a substantial volume of documents responsive to the discovery requests as originally scoped.

C. Key Language from the Ruling

Several passages from the court's written ruling merit particular attention, as they will likely frame the parties' arguments going forward and may be cited by Vantor in subsequent motion practice:

The court stated, in relevant part:

"The 14 internal Project Atlas emails referencing Vantor's existing supplier relationships — representing a small but not insignificant subset of the 2,847 total Project Atlas emails reviewed in discovery — suggest that Cascade was at least aware of Vantor as a competitor for supplier relationships. This awareness, combined with the systematic and coordinated nature of the Project Atlas initiative, supports a limited expansion of discovery to allow Vantor to explore whether Cascade's conduct toward Hemsworth, Tridale, and Orion was part of a broader pattern."

The court further stated:

"The Court is mindful of the proportionality requirements of the California Code of Civil Procedure and does not endorse discovery that is unlimited in scope or untethered from the claims at issue. The expansion to 15 additional supplier relationships — for a total of 18 — represents a reasonable middle ground that balances Vantor's legitimate need for evidence bearing on Cascade's intent and knowledge against Cascade's legitimate concerns about the burden and cost of expanded discovery."

This language is significant for two reasons. First, the court's reference to proportionality provides a foundation for our anticipated efforts to limit additional depositions and to challenge any further expansion of the discovery scope. Second, the court's characterization of the expansion as a "reasonable middle ground" may make it difficult to obtain reconsideration or appellate relief (via writ) of the discovery order, as the court has framed its ruling as a balanced exercise of discretion.

IV. Practical Impact on discovery

A. Document Collection and Review

The court's ruling will require Cascade to identify, collect, process, review, and produce documents related to 15 additional supplier relationships under the Project Atlas initiative. This represents a substantial expansion of the discovery effort that has been underway since March 2022.

Based on the volume and composition of documents collected for the three at-issue suppliers — Hemsworth, Tridale, and Orion — we can project the approximate scope of the additional collection effort. For the three at-issue suppliers, approximately 452,316 total documents were collected from eight primary custodians and multiple secondary sources, including shared drives, project management platforms, and email archives. Extrapolating from this volume, and accounting for the fact that some of the 15 additional suppliers may have involved less extensive engagement than the three at-issue suppliers, we anticipate that the expanded discovery will require collection and processing of an additional 80,000 to 120,000 documents.

The primary custodians for the expanded discovery are expected to be:

• Annika Bergström, Vice President of Strategic Sourcing — Ms. Bergström was the operational lead for Project Atlas and had direct involvement in supplier outreach and negotiation across the full scope of the initiative. Her files are likely to contain the largest volume of responsive material for the additional suppliers.

• Lena Torvik, Senior Vice President of Supply Chain & Procurement — Ms. Torvik provided executive oversight of Project Atlas, including approval of the initiative's $4.2 million budget allocation and strategic direction for supplier targeting. Her files are likely to contain high-level strategy documents, budget memoranda, and executive presentations covering all 25 Project Atlas suppliers.

• Members of the Project Atlas team — Additional custodians may include procurement managers, category leads, and business development personnel who were assigned to specific supplier relationships under the initiative. We will need to work with Cascade's in-house team to identify the specific individuals involved with each of the 15 additional suppliers.

It is important to note that documents already collected from Ms. Bergström and Ms. Torvik may contain responsive material for the additional 15 suppliers, as their files were collected broadly in the initial phase of discovery. To the extent that existing collections from these custodians contain documents relating to the expanded supplier set, those documents can be identified through additional search terms and review without requiring supplemental forensic collections. However, supplemental collections from additional team members who were not included in the original custodian list will almost certainly be necessary, and these collections will need to be coordinated with Krane Investigations LLC.

B. Increased E-discovery Costs (Krane Investigations LLC)

Krane Investigations LLC, under the supervision of Project Manager Samuel Byrd, currently manages the e-discovery platform and document review workflow for this matter. Krane has been engaged since the outset of discovery in March 2022, and its services include forensic data collection, processing and de-duplication of ESI, hosting of documents on a Relativity-based review platform, technology-assisted review (TAR) workflows, and coordination of contract reviewer teams for first-pass and second-pass document review.

Current e-discovery costs through Krane for the core discovery period (March 2022 through August 2022) are already substantial. As of the most recent invoice (July 2022), total e-discovery costs billed through Krane for this matter amount to approximately $387,000, covering the initial collection, processing, and review of the 452,316 documents collected in the first phase.

Based on preliminary discussions with Mr. Byrd following the court's ruling, the estimated additional e-discovery costs for the expanded supplier discovery are approximately $200,000 to $350,000, depending on the volume and complexity of the additional collections. This estimate encompasses the following components:

• Additional document processing and de-duplication: $40,000–$60,000, covering the ingestion of an estimated 80,000–120,000 additional documents into the Relativity platform, including metadata extraction, text extraction, and de-duplication against the existing document universe.

• Hosting costs: $15,000–$25,000, covering the incremental hosting fees for expanded data volumes on the Relativity platform through the close of the discovery period.

• Contract reviewer time for first-pass review: $120,000–$210,000, representing the largest component of the additional cost. Based on current reviewer throughput rates of approximately 50–60 documents per hour, and assuming an additional 80,000–120,000 documents requiring first-pass review, this component will require approximately 1,400–2,400 reviewer-hours at prevailing contract reviewer rates.

• Quality control, second-pass review, and privilege logging: $25,000–$55,000, covering senior reviewer oversight, privilege log preparation for responsive-but-privileged documents, and quality control sampling.

These additional costs will be billed through Calderwood & Harkness as part of the overall litigation budget for this matter. I recommend that we provide updated cost projections to the client as soon as practicable, as discussed further in Section VI below.

C. Impact on Deposition Schedule

The court's ruling, while not authorizing unlimited depositions, opens the door for Vantor to seek depositions of Cascade personnel specifically regarding the 15 additional supplier relationships. The court's statement that any such depositions should be "limited and proportional" provides some basis for resisting an excessive number of additional depositions, but it does not foreclose Vantor from seeking at least some additional testimony on the expanded discovery topics.

Based on Vantor's prior discovery conduct and the aggressive posture its counsel has taken throughout this litigation, we should anticipate that Vantor will seek at a minimum two to four additional depositions related to the expanded discovery. These may include:

• Depositions of Cascade procurement managers or category leads who had direct responsibility for specific supplier relationships among the 15 additional suppliers;

• Depositions of representatives of the additional suppliers themselves, particularly any suppliers that had existing arrangements with Vantor or other competitors; and

• Extended or supplemental deposition time for witnesses already on the deposition schedule, such as Ms. Bergström and Ms. Torvik, to cover the expanded scope of supplier relationships.

Regarding the already-scheduled depositions, the expanded discovery will have a direct and significant impact on deposition preparation. The deposition of Annika Bergström, currently scheduled for October 12, 2022, was originally scoped to cover her involvement in the Hemsworth, Tridale, and Orion supplier relationships and her general role in the Project Atlas initiative. The court's ruling means that Vantor's counsel will now have a legitimate basis to question Ms. Bergström in detail about her involvement with each of the 15 additional suppliers, including the outreach strategy, due diligence conducted regarding existing supplier arrangements, communications with supplier contacts, and the ultimate disposition of each supplier relationship. This substantially broadens the scope of preparation required for Ms. Bergström's deposition and may necessitate extending the deposition beyond a single day.

Similarly, the deposition of Lena Torvik, currently scheduled for November 18, 2022, will now need to address her executive oversight of Project Atlas more broadly, including the initiative's goals regarding all 25 targeted suppliers, the rationale for the $4.2 million budget allocation, and any discussions at the senior leadership level regarding the competitive implications of the initiative.

The deposition of Thomas Brennecke, Vantor's Vice President of Supplier Relations, remains scheduled for October 26, 2022, and is being taken by Cascade. The expanded discovery scope may provide additional areas for questioning of Mr. Brennecke regarding Vantor's relationships with the 15 additional suppliers and whether any of those suppliers had existing arrangements with Vantor.

In total, the case currently contemplates 14 depositions: 8 to be noticed by Vantor and 6 to be noticed by Cascade. The expanded discovery may increase this number modestly, though we intend to resist any significant expansion through the measures described in Section V.C below.

D. Timeline

The court's 60-day production deadline places the supplemental production of documents relating to the 15 additional supplier relationships at approximately October 2, 2022. Meeting this deadline will require immediate action to coordinate supplemental document collections with Krane Investigations LLC and to prioritize the processing and review of the additional documents.

The timeline for the expanded discovery effort is as follows:

This timeline is aggressive, particularly given the volume of additional documents anticipated. If the supplemental collections from additional custodians reveal a substantially larger document universe than the 80,000–120,000 documents currently estimated, we may need to seek a brief extension of the production deadline or prioritize certain suppliers for early production while completing the remaining reviews on a rolling basis.

V. Implications for Defense Strategy

A. Risk of Pattern-and-Practice Evidence

The primary strategic risk created by the expanded discovery is that Vantor may uncover evidence from the 15 additional supplier relationships suggesting that Cascade engaged in a broader pattern of targeting competitors' exclusive suppliers. This is the very theory that motivated Vantor's motion to compel, and while the court's ruling was narrower than Vantor sought, the expanded scope provides Vantor with a meaningful opportunity to develop pattern evidence.

The risk is most acute with respect to any of the 15 additional suppliers that had existing exclusivity arrangements with Vantor or other competitors at the time Cascade initiated contact under Project Atlas. If Cascade entered into agreements — or even pursued advanced negotiations — with suppliers that had such existing arrangements, Vantor could argue this supports several inferences damaging to Cascade's defense:

(a) That Cascade had a general practice of targeting suppliers with existing exclusivity arrangements, making it more likely that Cascade knew about the specific exclusivity provisions in the Vantor–Hemsworth, Vantor–Tridale, and Vantor–Orion agreements;

(b) That Cascade's internal characterization of Project Atlas as a "supplier diversification" initiative was pretextual, and that the true purpose of the initiative was to disrupt competitors' supply chains;

(c) That Cascade's conduct was sufficiently systematic and deliberate to constitute the "independently wrongful conduct" required to sustain a claim for tortious interference with prospective economic advantage under California law; and

(d) That the pattern of conduct demonstrates malice or oppression sufficient to support a claim for punitive damages, which Vantor has not yet sought to add but may move to amend to include.

To mitigate this risk, we need to conduct a rapid internal review with Cascade's legal team — specifically David Pruitt, General Counsel, and Annika Bergström — to identify which of the 15 additional suppliers, if any, had prior exclusive arrangements with Vantor or other known competitors at the time Cascade initiated contact. This review should also identify any internal communications in which Cascade personnel discussed or acknowledged the existence of such arrangements.

If the internal review reveals that most or all of the 15 additional suppliers did not have exclusive arrangements with Vantor or its competitors, we will be in a strong position to argue at summary judgment that the expanded discovery disproves, rather than supports, Vantor's pattern theory. Conversely, if the review reveals that several additional suppliers did have such arrangements, we will need to develop specific factual defenses for each such supplier relationship and to consider whether any proactive disclosures or stipulations may be warranted.

B. The 14 Project Atlas Emails

As noted above, the court's ruling was influenced in significant part by the existence of the 14 internal Project Atlas emails that reference Vantor's supplier relationships. It is therefore essential that we continue to closely analyze these emails and develop affirmative arguments to limit their impact.

Per our earlier analysis, as set forth in the memorandum prepared by Carlos Espinoza dated June 30, 2022, none of the 14 emails demonstrates actual knowledge of the specific exclusivity terms in the Vantor–Hemsworth, Vantor–Tridale, or Vantor–Orion agreements. The emails reference Vantor as a competitor in general terms and note that certain suppliers "have been working with Vantor" or "are currently supplying Vantor," but they do not reference the existence or terms of any exclusivity provision. Several of the emails appear to reflect general competitive intelligence of the type routinely gathered by procurement teams in the retail industry, rather than evidence of targeted interference with known contractual rights.

However, Vantor will almost certainly argue that the expanded discovery will reveal additional communications referencing Vantor or its supplier relationships, strengthening the inference of knowledge. If additional emails are uncovered in the 15 expanded supplier files that reference Vantor's relationships in more specific terms — or, critically, that reference the existence of exclusivity provisions — the cumulative effect could be damaging.

Our defense strategy must continue to draw the distinction between general awareness of a competitor's supplier base — which is a normal and expected feature of competitive commerce — and actual knowledge of specific contractual exclusivity provisions. Under California law, tortious interference with contractual relations requires knowledge of the existence of the contract. Pacific Gas & Electric Co. v. Ridgeline Trust Bank, 50 Cal.3d 1118, 1126 (1990). General awareness that a competitor has supplier relationships does not equate to knowledge that those relationships are governed by exclusivity provisions that would be breached by dealing with the supplier.

This distinction is the linchpin of our defense on the knowledge element, and the expanded discovery will test its strength. We should prepare for the possibility that Vantor will uncover additional emails or documents that narrow the gap between "general awareness" and "actual knowledge," and we should develop anticipatory arguments to address such evidence.

C. Narrowing Depositions — Recommended Approach

Given the court's ruling, we should take a proactive approach to limiting the scope of any additional depositions that Vantor may seek in connection with the 15 expanded supplier relationships. Our approach should proceed in two phases: first, a meet-and-confer with opposing counsel to seek a stipulated limitation; and second, if the meet-and-confer is unsuccessful, a motion for protective order.

The arguments for limiting additional depositions are strong and are well-supported by the court's own emphasis on proportionality in its ruling:

First, the key fact witnesses for Cascade regarding the Project Atlas initiative — Ms. Bergström and Ms. Torvik — are already scheduled for depositions on October 12 and November 18, 2022, respectively. Both witnesses can be questioned regarding the additional 15 supplier relationships during their already-scheduled depositions, without the need for separate depositions of lower-level procurement staff who had limited involvement in strategic decision-making.

Second, depositions of the additional suppliers themselves should not be permitted absent a threshold showing that a particular supplier relationship is directly relevant to the three at-issue relationships. The suppliers are third parties, and compelling their testimony on peripheral matters imposes burdens not only on Cascade but on the suppliers themselves.

Third, the court's ruling expressly emphasized proportionality, and duplicative depositions on peripheral supplier relationships — where the deponents' testimony would largely overlap with that of Ms. Bergström and Ms. Torvik — are not proportional to the needs of the case.

I recommend that we prepare a proposed stipulation with Kessler, Brandt & Whitfield that limits any supplemental depositions to no more than two to three additional witnesses, with reasonable time limits (e.g., four hours per deposition). The stipulation should also provide that any additional depositions will be limited in scope to the deponent's specific involvement with the relevant supplier relationship and will not extend to broader questioning about Cascade's competitive strategy or market positioning.

If Vantor rejects the proposed stipulation, we should be prepared to file a motion for protective order under California Code of Civil Procedure § 2025.420, seeking substantially similar limitations. The court's ruling provides a strong foundation for such a motion, given the court's express statement that it would entertain a protective order if the deposition burden becomes unreasonable.

D. Impact on Summary Judgment Strategy

We are currently planning to file a motion for partial summary judgment on two of Vantor's four causes of action: (1) the claim under California Business & Professions Code § 17200 (unfair competition), and (2) the claim for tortious interference with prospective economic advantage. Our target filing date for the summary judgment motion is early 2023, and based on current scheduling, we anticipate filing the motion on or about February 28, 2023.

The expanded discovery may affect our summary judgment strategy in two respects.

First, the timing of our summary judgment motion may need to be adjusted if the expanded discovery produces a substantial volume of new evidence that requires analysis and incorporation into our motion papers. While our core legal arguments on the § 17200 claim (preemption by the exclusive remedies available under the supply agreements) and the prospective advantage claim (failure to establish independently wrongful conduct) are well-developed, we will need to account for any pattern evidence that emerges from the expanded discovery and to address it affirmatively in our moving papers.

Second, and more critically, if the expanded discovery produces documents favorable to Vantor's pattern-and-practice theory, Vantor will almost certainly use this evidence in opposition to our summary judgment motion on the prospective advantage claim. Vantor's theory is that the pattern of conduct across multiple supplier relationships constitutes the "independently wrongful conduct" required to sustain a claim for tortious interference with prospective economic advantage under della Penna v. Crowne Albany Industries, 11 Cal.4th 376 (1995), and Glenrock Corporation, 29 Cal.4th 1134 (2003).

However, even pattern evidence of competitive supplier solicitation does not constitute "independently wrongful conduct" under California law. The California Supreme Court has made clear that legitimate competition for business relationships — including supplier relationships — is not tortious, even if it results in the disruption of a competitor's existing relationships. della Penna, 11 Cal.4th at 392–93. The mere fact that Cascade pursued multiple supplier relationships under a coordinated initiative does not transform lawful competitive conduct into independently wrongful conduct, absent evidence that Cascade employed unlawful means (e.g., misrepresentation, bribery, or violation of trade secret protections) or acted with the sole purpose of injuring Vantor rather than advancing its own legitimate business interests.

Our summary judgment motion should address and preempt this argument by establishing that Project Atlas was a legitimate competitive initiative motivated by Cascade's business needs and that competitive supplier solicitation, even on a systematic basis, does not constitute independently wrongful conduct as a matter of law. We should develop this argument with reference to the specific evidence produced in discovery, including the business justifications for Project Atlas documented in Cascade's internal records.

E. Deposition Preparation Adjustments

The expanded discovery scope requires immediate adjustments to our deposition preparation for the two key Cascade witnesses whose depositions are already scheduled.

Annika Bergström (October 12, 2022): The deposition preparation for Ms. Bergström must now cover not only the three at-issue supplier relationships (Hemsworth, Tridale, and Orion) but also her involvement with the 15 additional Project Atlas supplier relationships. Ms. Bergström is likely to face detailed questioning regarding her outreach to each of the additional suppliers, the information she gathered regarding each supplier's existing relationships (including any exclusive arrangements), the communications she had with supplier contacts, and the decisions made regarding each supplier relationship. Our preparation must include a comprehensive review of all documents produced regarding each of the 15 additional suppliers, identification of any documents that may be used against Ms. Bergström during the deposition, and development of key themes and defensive talking points for each supplier relationship. Given the significantly expanded scope, I recommend scheduling at least two full-day preparation sessions with Ms. Bergström prior to her deposition.

Lena Torvik (November 18, 2022): The deposition preparation for Ms. Torvik must similarly address her executive oversight of Project Atlas more broadly. Vantor's counsel will likely seek to question Ms. Torvik regarding the strategic goals of Project Atlas, the criteria used to select the 25 targeted suppliers, whether competitive disruption was an objective of the initiative, the $4.2 million budget allocation and how it was distributed across the various supplier relationships, and any reports or presentations she provided to Cascade's senior leadership or board regarding the initiative. Our preparation should focus on establishing that Project Atlas was driven by legitimate business objectives — supply chain resilience, cost optimization, and product quality — rather than competitive interference.

I recommend that Carlos Espinoza begin preparing expanded deposition preparation memoranda for both witnesses immediately. These memoranda should incorporate the expanded scope of supplier relationships and should identify, for each of the 15 additional suppliers, the key documents, timeline of engagement, and potential areas of vulnerability.

VI. Budget Impact

A. Estimated Additional Costs

The court's ruling will result in material additional costs for the defense of this matter. The following is a preliminary estimate of the incremental costs attributable to the expanded discovery:

The additional attorney time is estimated at approximately 300 to 500 additional hours across the Calderwood & Harkness team, encompassing senior associate and associate time for document review and deposition preparation, as well as partner time for strategic oversight, deposition attendance, and any motion practice related to the protective order. At blended rates, this represents approximately $200,000 to $350,000 in additional attorney fees.

The potential additional local counsel costs through Wortham & Adair LLP (Diana Prescott) relate to any supplemental California motion practice that may arise in connection with the expanded discovery, including a potential motion for protective order to limit depositions and any discovery-related disputes that require court appearances in Los Angeles.

B. Communication to Client

I recommend that Douglas Carmichael communicate the court's ruling and its cost implications to David Pruitt, Cascade's General Counsel, promptly — ideally within the next several business days. Mr. Pruitt should be informed of the substance of the ruling, the practical impact on the discovery effort, and the preliminary cost estimates set forth above.

The initial exposure assessment and litigation budget memorandum, which was prepared and circulated on November 15, 2021 at the outset of this engagement, should be updated to reflect the increased discovery costs resulting from the court's ruling. The original budget projected total defense costs through trial of approximately $2.8 million to $3.5 million. The expanded discovery is likely to push total defense costs into the range of $3.2 million to $4.2 million, depending on the volume of additional documents, the number of supplemental depositions, and whether any additional motion practice is required.

In addition, we should address the insurance coverage implications of the increased costs. Pinnacle National Insurance Co. is providing defense cost coverage under Cascade's commercial general liability policy (Policy No. PNG-CGL-2021-04487). Our primary contact at Pinnacle is Leonard Furman, who has been receiving periodic updates on defense costs and case developments. We should confirm with Mr. Furman that the expanded discovery costs fall within the scope of the defense cost coverage and provide updated cost estimates to the insurer in accordance with the policy's reporting requirements. Failure to provide timely notice of increased defense costs could jeopardize coverage, and we should ensure compliance with the notice provisions of the policy.

VII. Recommended Next Steps

Based on the analysis set forth in this memorandum, I recommend the following action items, organized by timeline:

1. Immediate (within 5 business days): Confer with David Pruitt (Cascade General Counsel) and Annika Bergström to identify any of the 15 additional supplier relationships that may involve prior exclusive arrangements with Vantor or other competitors. This internal review is critical to assessing the risk profile of the expanded discovery and should be completed before the supplemental document collection begins.

2. Within 10 days (by August 20, 2022): Coordinate with Krane Investigations LLC (Samuel Byrd, Project Manager) to begin supplemental document collection for the 15 additional supplier relationships. This coordination should include identification of additional custodians, development of targeted search terms for the expanded supplier set, and establishment of processing and review protocols for the expanded collection. Mr. Byrd should also be asked to provide a refined cost estimate once the scope of the supplemental collections is confirmed.

3. Within 14 days (by August 24, 2022): Send an updated budget estimate to David Pruitt reflecting the additional costs attributable to the expanded discovery. Separately, notify Pinnacle National Insurance Co. (Leonard Furman) of the court's ruling and the increased expected defense costs, and request written confirmation that the expanded discovery costs are covered under the policy.

4. Within 21 days (by August 31, 2022): Propose a meet-and-confer with Kessler, Brandt & Whitfield LLP regarding stipulated limitations on additional depositions related to the 15 expanded supplier relationships. Our proposed stipulation should limit supplemental depositions to no more than two to three additional witnesses, with time limitations of four hours per deposition. If Vantor rejects the proposed stipulation or fails to respond, we should promptly prepare and file a motion for protective order under California Code of Civil Procedure § 2025.420.

5. By October 2, 2022: Complete the supplemental document production for the 15 additional supplier relationships per the court's 60-day deadline. This deadline is firm and non-negotiable absent a stipulation or court order extending it. We should build in adequate time for privilege review and privilege log preparation before the production deadline.

6. Ongoing (September – November 2022): Adjust deposition preparation memoranda for Annika Bergström (October 12, 2022 deposition) and Lena Torvik (November 18, 2022 deposition) to incorporate the expanded scope of supplier relationships. Carlos Espinoza should take the lead on preparing these expanded memoranda, with my oversight and Douglas Carmichael's strategic input. Preparation sessions with both witnesses should be scheduled for the weeks preceding their respective depositions.

7. By early 2023: Reassess the summary judgment strategy in light of any new evidence produced during the expanded discovery. If the expanded discovery produces evidence that strengthens Vantor's pattern-and-practice theory, we should evaluate whether to adjust the scope or timing of our summary judgment motion. Conversely, if the expanded discovery produces evidence that undermines Vantor's theory — for example, by showing that most of the 15 additional suppliers did not have existing exclusive arrangements with Vantor or other competitors — we should incorporate this evidence affirmatively into our summary judgment motion.

VIII. Conclusion

The court's August 3, 2022 ruling on Vantor's motion to compel represents a mixed outcome. On the positive side, the court denied Vantor's request for discovery into all Cascade supplier relationships, rejected Vantor's request for unlimited depositions, and declined to find that Cascade's prior discovery conduct constituted an abuse. The court's emphasis on proportionality throughout the ruling provides a foundation for resisting further expansion of the discovery scope and for limiting additional depositions.

On the other hand, the expansion of discovery from 3 to 18 supplier relationships creates meaningful additional burden, cost, and risk. The most significant risk is that pattern evidence from the 15 additional supplier relationships could strengthen Vantor's trial narrative, even if such evidence does not independently establish the legal elements of tortious interference. If Vantor is able to present evidence at trial that Cascade systematically targeted suppliers with existing exclusivity arrangements, the jury may be more inclined to credit Vantor's theory that Cascade acted with knowledge and intent regarding the Hemsworth, Tridale, and Orion relationships specifically.

Notwithstanding this risk, the core defense strategy remains sound. Cascade's principal defenses — lack of actual knowledge of the specific exclusivity provisions in the Vantor supplier agreements, independent supplier action in choosing to engage with Cascade, the suppliers' exercise of termination-for-convenience clauses available under their agreements with Vantor (90 days for Hemsworth, 60 days for Tridale, 120 days for Orion), and Vantor's failure to mitigate its damages — are not undermined by the expanded discovery scope. These defenses are grounded in the specific facts of the three at-issue supplier relationships and are not dependent on the absence of pattern evidence regarding other suppliers.

Prompt action on the next steps outlined in Section VII above will position us to manage the expanded discovery efficiently, minimize additional costs, and ensure that we are fully prepared for the upcoming depositions and the eventual summary judgment filing. I will coordinate with the team to implement these steps immediately and will provide a status update at our next case team meeting.

I am available to discuss any aspect of this memorandum at your convenience.

Yuki Nakamura Senior Associate Calderwood & Harkness LLP

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT This memorandum is protected by the attorney-client privilege and the work product doctrine. Do not distribute outside the case team without prior authorization.

Milestone	Date
Supplemental document collection begins	August 15–22, 2022
Processing and ingestion into Relativity	August 22 – September 5, 2022
First-pass document review	September 5–26, 2022
Privilege review and privilege log preparation	September 19–30, 2022
Supplemental production to Vantor	October 2, 2022 (court deadline)
Deposition of Annika Bergström	October 12, 2022
Deposition of Thomas Brennecke (Vantor)	October 26, 2022
Deposition of Lena Torvik	November 18, 2022
Cost Category	Estimated Range
Additional e-discovery costs (Krane Investigations LLC)	$200,000–$350,000
Additional attorney time (document review, deposition preparation, motion practice)	$200,000–$350,000
Potential additional local counsel costs (Wortham & Adair LLP)	$15,000–$40,000
Total estimated additional costs	$415,000–$740,000

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT This memorandum is protected by the attorney-client privilege and the work product doctrine. It is intended solely for internal use by attorneys at Calderwood & Harkness LLP working on the above-referenced matter. Any disclosure, distribution, or copying of this memorandum or its contents to any person not authorized to receive it is strictly prohibited.
CALDERWOOD & HARKNESS LLP
INTERNAL MEMORANDUM
TO: Douglas Carmichael, Partner
FROM: Yuki Nakamura, Senior Associate
DATE: August 10, 2022
RE: Court's Ruling on Vantor's Motion to Compel Expanded discovery — Implications for Defense Strategy
MATTER: Cascade Retail Holdings Inc. — Defense of Tortious Interference Claim
MATTER NO.: 1038-00007
CASE: Vantor Holdings Corp. v. Cascade Retail Holdings Inc., Case No. 21STCV-34872, Superior Court of California, County of Los Angeles
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I. Executive Summary
On August 3, 2022, Judge Patricia Okafor of the Superior Court of California, County of Los Angeles, issued her ruling on Vantor Holdings Corp.'s ("Vantor") motion to compel expanded discovery, which Vantor filed on June 15, 2022. The motion sought what amounted to class-certification-style discovery across the entirety of Cascade Retail Holdings Inc.'s ("Cascade") supplier relationships established or pursued under its Project Atlas strategic sourcing initiative. The court granted the motion in part and denied it in part.
Specifically, the court denied Vantor's request for discovery into all of Cascade's supplier relationships under Project Atlas — which would have encompassed all 25 suppliers identified in the initiative — but ordered expanded discovery into 15 additional supplier relationships beyond the three relationships that are directly at issue in this litigation: Hemsworth Consumer Products LLC ("Hemsworth"), Tridale Manufacturing Inc. ("Tridale"), and Orion Lifestyle Brands Corp. ("Orion"). As a result, the total number of supplier relationships subject to discovery has expanded from three to eighteen.
This memorandum provides a detailed analysis of the court's ruling, its practical impact on document discovery and the deposition schedule, the anticipated increase in costs — including both e-discovery expenses and additional attorney time — and my recommended adjustments to our defense strategy in light of the expanded discovery scope.
The key takeaway is as follows: while the ruling is materially narrower than what Vantor sought, and thus represents a partial victory for Cascade, it nonetheless substantially increases the discovery burden and associated costs. More critically, the ruling creates new and non-trivial risks that certain of the 15 additional supplier relationships may yield documents that Vantor can use to argue a broader pattern of supplier poaching under Project Atlas. If Vantor is able to demonstrate that Cascade systematically targeted suppliers who had existing exclusivity arrangements with competitors, the resulting pattern evidence — even if insufficient to establish independent legal claims — could meaningfully strengthen Vantor's trial narrative and complicate our motion for summary judgment.
I recommend that we take immediate steps to assess the exposure presented by the 15 additional supplier relationships, coordinate with our e-discovery vendor to begin supplemental collections, and proactively engage opposing counsel regarding stipulated limitations on any additional depositions. Each of these steps, and others, is discussed in detail below.
II. Background and Procedural History
A. Vantor's Motion to Compel (Filed June 15, 2022)
On June 15, 2022, Vantor, through its counsel at Kessler, Brandt & Whitfield LLP — specifically lead counsel Martin Kessler and co-counsel Natalie Whitfield — filed a motion to compel expanded discovery in this matter. The motion was noticed for hearing on August 1, 2022, and was heard by Judge Okafor on that date.
The substance of Vantor's motion sought discovery across all Cascade supplier relationships that were initiated, developed, or pursued as part of Project Atlas, Cascade's strategic supplier diversification initiative launched in approximately February 2021. As this team is well aware, Project Atlas was a comprehensive sourcing initiative led by Cascade's Vice President of Strategic Sourcing, Annika Bergström, under the oversight of Senior Vice President of Supply Chain & Procurement, Lena Torvik. The initiative identified 25 potential supplier relationships aimed at diversifying Cascade's supply base, reducing dependency on certain legacy suppliers, and securing more favorable pricing and terms in key product categories.
Vantor's theory of the case, as articulated in its motion papers, is that Project Atlas was not merely a legitimate competitive sourcing initiative but rather a systematic campaign to poach the exclusive suppliers of Cascade's competitors — most notably Vantor itself. Vantor argued that a pattern-and-practice inquiry across all 25 Project Atlas supplier relationships was necessary to demonstrate that Cascade's conduct toward Hemsworth, Tridale, and Orion was not isolated or incidental but was instead part of a deliberate and coordinated effort to interfere with Vantor's existing exclusivity arrangements.
In support of its motion, Vantor cited 14 internal Project Atlas emails, produced during the initial phase of discovery, that referenced Vantor's existing supplier relationships. Vantor contended that these emails demonstrated that Cascade was aware of Vantor's supplier base and was specifically targeting suppliers with whom Vantor had existing arrangements.
In terms of specific relief, Vantor sought the following:
(a) Production of all documents and electronically stored information ("ESI") relating to each of the 25 suppliers identified in the Project Atlas initiative, including but not limited to internal communications, strategy memoranda, presentation materials, meeting notes, financial analyses, and correspondence with the suppliers themselves;
(b) Depositions of all Cascade personnel who were involved in any aspect of the supplier relationships pursued under Project Atlas, without numerical limitation; and
(c) An order deeming any failure to produce documents relating to all 25 Project Atlas suppliers as a discovery abuse warranting further sanctions.
Vantor estimated that discovery into all 25 supplier relationships would require production from approximately 12 additional custodians beyond those from whom documents had already been collected.
B. Cascade's Opposition (Filed July 18, 2022) and Reply (Filed July 29, 2022)
Calderwood & Harkness filed a comprehensive opposition to Vantor's motion on July 18, 2022, and a reply brief on July 29, 2022. Our opposition advanced several arguments designed to demonstrate the overbreadth and disproportionality of Vantor's request.
First, we emphasized the scope of discovery that had already been conducted in this matter. As of the date of our opposition, 452,316 documents had been collected from Cascade custodians across the agreed-upon custodian list. Of those, 198,740 documents had been reviewed for relevance and privilege, and 78,412 documents had been produced to Vantor. This represented a substantial and good-faith discovery effort covering the three supplier relationships at the core of this litigation — Hemsworth, Tridale, and Orion — as well as general background documents relating to Project Atlas and Cascade's competitive strategy.
Second, we argued that the case, as pled, concerns only three specific supplier relationships and three specific exclusive supply agreements. Vantor's operative complaint identifies interference with the Vantor–Hemsworth Exclusive Supply Agreement (effective March 2019), the Vantor–Tridale Preferred Supplier Agreement (effective June 2020), and the Vantor–Orion Strategic Partnership Agreement (effective January 2020). Discovery into 22 additional supplier relationships that are not the subject of any claim in this litigation is facially overbroad and amounts to a fishing expedition designed to increase the burden and cost of litigation for Cascade.
Third, we submitted declarations from Cascade's General Counsel, David Pruitt, and from Samuel Byrd, the Project Manager at Krane Investigations LLC (our e-discovery vendor), detailing the estimated burden and cost of reviewing additional custodian files across all 25 Project Atlas suppliers. Mr. Byrd estimated that expanding the collection to all 25 suppliers would require collection from an additional 8–12 custodians, processing of an estimated 150,000–250,000 additional documents, and first-pass review costs in excess of $400,000.
Fourth, we argued that the 14 internal Project Atlas emails referencing Vantor's supplier relationships did not justify the sweeping discovery Vantor sought. We noted that these 14 emails represented less than 0.5% of the 2,847 total Project Atlas emails reviewed in discovery, and that none of the 14 emails referenced the specific terms of any exclusivity arrangement between Vantor and its suppliers. Rather, the emails reflected general market awareness of competitor supplier relationships — a normal and unremarkable feature of competitive business intelligence.
In our reply brief, we reiterated these arguments and responded to Vantor's contention that discovery into all 25 supplier relationships was necessary to establish Cascade's state of mind. We argued that state of mind regarding the three at-issue supplier relationships is properly established through discovery focused on those three relationships, not through an industry-wide survey of Cascade's sourcing practices.
C. Our Prior Meet-and-Confer Efforts
Before Vantor filed its motion to compel, the parties engaged in meet-and-confer discussions concerning the scope of expanded discovery. On June 2, 2022, I sent a detailed meet-and-confer letter to Martin Kessler and Natalie Whitfield at Kessler, Brandt & Whitfield LLP, proposing a narrowed scope for any expanded discovery that the parties could agree to without court intervention. Specifically, our June 2 letter proposed that Cascade would voluntarily produce documents relating to up to five additional supplier relationships under Project Atlas — those most closely analogous to the three at-issue suppliers in terms of product category, geographic market, or supplier profile — in exchange for Vantor's agreement not to seek further expansion of the discovery scope.
Vantor rejected this proposal in its June 10, 2022 response letter, contending that any limitation on discovery into all 25 Project Atlas supplier relationships would be artificial and would deprive Vantor of the ability to establish the full scope of Cascade's tortious conduct. Vantor stated that it intended to proceed with motion practice and filed its motion to compel five days later.
For the record, the meet-and-confer correspondence and our good-faith efforts to resolve the discovery dispute without court intervention were referenced in our opposition papers and were noted by the court in its ruling.
III. Analysis of the Court's August 3, 2022 Ruling
A. What the Court Granted
The court's August 3, 2022 order granted Vantor's motion to compel in part by ordering expanded discovery into 15 additional supplier relationships beyond the three that are directly at issue in this litigation. This brings the total number of supplier relationships subject to discovery to 18.
The court identified the 15 additional suppliers by reference to the Project Atlas master spreadsheet (produced as Document No. CASCADE-00042517), which lists all 25 suppliers targeted under the initiative. The court ordered discovery into all supplier relationships on that spreadsheet except for the seven suppliers that both parties agreed at the hearing were either never contacted by Cascade or declined initial outreach without any further engagement. Thus, the 15 additional suppliers represent those with whom Cascade had at least some substantive engagement under Project Atlas, even if no formal supply agreement was ultimately reached.
In reaching this determination, the court made several findings that are important for our defense strategy going forward:
First, the court found that evidence of Cascade's approach to other suppliers during the Project Atlas initiative is relevant to whether Cascade engaged in a pattern of conduct that bears on its intent and knowledge regarding the three at-issue supplier relationships. The court reasoned that if Cascade systematically targeted suppliers that it knew or should have known had existing exclusivity arrangements with competitors, this would be probative of whether Cascade acted with the requisite knowledge when it solicited Hemsworth, Tridale, and Orion.
Second, the court found that limiting discovery to only the three at-issue suppliers would deprive Vantor of evidence potentially probative of Cascade's intent, knowledge, and modus operandi. The court analogized to the use of "other acts" evidence under Evidence Code section 1101(b), noting that while the admissibility of such evidence at trial is a separate question, the broader standard for discovery relevance permits inquiry into matters reasonably calculated to lead to admissible evidence.
Third, the court found that the 14 internal Project Atlas emails referencing Vantor's existing supplier relationships, while limited in number, were sufficient to establish a threshold basis for expanded discovery. The court noted that if Cascade personnel were discussing Vantor's supplier relationships in the context of Project Atlas, it is reasonable to infer that additional documents may exist regarding Cascade's awareness of competitor exclusivity arrangements in connection with other suppliers.
The court ordered Cascade to produce documents relating to the 15 additional supplier relationships within 60 days of the date of the ruling, placing the supplemental production deadline at approximately October 2, 2022.
B. What the Court Denied
Importantly, the court denied several aspects of Vantor's motion, and these denials provide meaningful boundaries on the scope of the expanded discovery:
First, the court denied Vantor's request for discovery into all Cascade supplier relationships beyond those identified in Project Atlas. Vantor had argued in its motion papers that Cascade's broader supplier relationships — including those predating Project Atlas — were relevant to establishing Cascade's general business practices. The court rejected this argument as untethered to the claims at issue and noted that the Project Atlas initiative is the relevant framework for the conduct alleged in the complaint.
Second, the court denied Vantor's request for unlimited depositions of Cascade personnel involved in each of the 25 Project Atlas supplier relationships. The court noted that the existing deposition schedule — which contemplates 14 depositions total (8 by Vantor, 6 by Cascade) — was already substantial, and that additional depositions should be limited and proportional to the needs of the case. The court did not set a specific numerical limit on additional depositions but indicated that it would entertain a motion for protective order from Cascade if the deposition burden becomes unreasonable.
Third, the court declined to make any finding that Cascade's prior discovery conduct constituted a discovery abuse or warranted sanctions. The court expressly noted that Cascade had engaged in good-faith meet-and-confer efforts and had produced a substantial volume of documents responsive to the discovery requests as originally scoped.
C. Key Language from the Ruling
Several passages from the court's written ruling merit particular attention, as they will likely frame the parties' arguments going forward and may be cited by Vantor in subsequent motion practice:
The court stated, in relevant part:
"The 14 internal Project Atlas emails referencing Vantor's existing supplier relationships — representing a small but not insignificant subset of the 2,847 total Project Atlas emails reviewed in discovery — suggest that Cascade was at least aware of Vantor as a competitor for supplier relationships. This awareness, combined with the systematic and coordinated nature of the Project Atlas initiative, supports a limited expansion of discovery to allow Vantor to explore whether Cascade's conduct toward Hemsworth, Tridale, and Orion was part of a broader pattern."
The court further stated:
"The Court is mindful of the proportionality requirements of the California Code of Civil Procedure and does not endorse discovery that is unlimited in scope or untethered from the claims at issue. The expansion to 15 additional supplier relationships — for a total of 18 — represents a reasonable middle ground that balances Vantor's legitimate need for evidence bearing on Cascade's intent and knowledge against Cascade's legitimate concerns about the burden and cost of expanded discovery."
This language is significant for two reasons. First, the court's reference to proportionality provides a foundation for our anticipated efforts to limit additional depositions and to challenge any further expansion of the discovery scope. Second, the court's characterization of the expansion as a "reasonable middle ground" may make it difficult to obtain reconsideration or appellate relief (via writ) of the discovery order, as the court has framed its ruling as a balanced exercise of discretion.
IV. Practical Impact on discovery
A. Document Collection and Review
The court's ruling will require Cascade to identify, collect, process, review, and produce documents related to 15 additional supplier relationships under the Project Atlas initiative. This represents a substantial expansion of the discovery effort that has been underway since March 2022.
Based on the volume and composition of documents collected for the three at-issue suppliers — Hemsworth, Tridale, and Orion — we can project the approximate scope of the additional collection effort. For the three at-issue suppliers, approximately 452,316 total documents were collected from eight primary custodians and multiple secondary sources, including shared drives, project management platforms, and email archives. Extrapolating from this volume, and accounting for the fact that some of the 15 additional suppliers may have involved less extensive engagement than the three at-issue suppliers, we anticipate that the expanded discovery will require collection and processing of an additional 80,000 to 120,000 documents.
The primary custodians for the expanded discovery are expected to be:
• Annika Bergström, Vice President of Strategic Sourcing — Ms. Bergström was the operational lead for Project Atlas and had direct involvement in supplier outreach and negotiation across the full scope of the initiative. Her files are likely to contain the largest volume of responsive material for the additional suppliers.
• Lena Torvik, Senior Vice President of Supply Chain & Procurement — Ms. Torvik provided executive oversight of Project Atlas, including approval of the initiative's $4.2 million budget allocation and strategic direction for supplier targeting. Her files are likely to contain high-level strategy documents, budget memoranda, and executive presentations covering all 25 Project Atlas suppliers.
• Members of the Project Atlas team — Additional custodians may include procurement managers, category leads, and business development personnel who were assigned to specific supplier relationships under the initiative. We will need to work with Cascade's in-house team to identify the specific individuals involved with each of the 15 additional suppliers.
It is important to note that documents already collected from Ms. Bergström and Ms. Torvik may contain responsive material for the additional 15 suppliers, as their files were collected broadly in the initial phase of discovery. To the extent that existing collections from these custodians contain documents relating to the expanded supplier set, those documents can be identified through additional search terms and review without requiring supplemental forensic collections. However, supplemental collections from additional team members who were not included in the original custodian list will almost certainly be necessary, and these collections will need to be coordinated with Krane Investigations LLC.
B. Increased E-discovery Costs (Krane Investigations LLC)
Krane Investigations LLC, under the supervision of Project Manager Samuel Byrd, currently manages the e-discovery platform and document review workflow for this matter. Krane has been engaged since the outset of discovery in March 2022, and its services include forensic data collection, processing and de-duplication of ESI, hosting of documents on a Relativity-based review platform, technology-assisted review (TAR) workflows, and coordination of contract reviewer teams for first-pass and second-pass document review.
Current e-discovery costs through Krane for the core discovery period (March 2022 through August 2022) are already substantial. As of the most recent invoice (July 2022), total e-discovery costs billed through Krane for this matter amount to approximately $387,000, covering the initial collection, processing, and review of the 452,316 documents collected in the first phase.
Based on preliminary discussions with Mr. Byrd following the court's ruling, the estimated additional e-discovery costs for the expanded supplier discovery are approximately $200,000 to $350,000, depending on the volume and complexity of the additional collections. This estimate encompasses the following components:
• Additional document processing and de-duplication: $40,000–$60,000, covering the ingestion of an estimated 80,000–120,000 additional documents into the Relativity platform, including metadata extraction, text extraction, and de-duplication against the existing document universe.
• Hosting costs: $15,000–$25,000, covering the incremental hosting fees for expanded data volumes on the Relativity platform through the close of the discovery period.
• Contract reviewer time for first-pass review: $120,000–$210,000, representing the largest component of the additional cost. Based on current reviewer throughput rates of approximately 50–60 documents per hour, and assuming an additional 80,000–120,000 documents requiring first-pass review, this component will require approximately 1,400–2,400 reviewer-hours at prevailing contract reviewer rates.
• Quality control, second-pass review, and privilege logging: $25,000–$55,000, covering senior reviewer oversight, privilege log preparation for responsive-but-privileged documents, and quality control sampling.
These additional costs will be billed through Calderwood & Harkness as part of the overall litigation budget for this matter. I recommend that we provide updated cost projections to the client as soon as practicable, as discussed further in Section VI below.
C. Impact on Deposition Schedule
The court's ruling, while not authorizing unlimited depositions, opens the door for Vantor to seek depositions of Cascade personnel specifically regarding the 15 additional supplier relationships. The court's statement that any such depositions should be "limited and proportional" provides some basis for resisting an excessive number of additional depositions, but it does not foreclose Vantor from seeking at least some additional testimony on the expanded discovery topics.
Based on Vantor's prior discovery conduct and the aggressive posture its counsel has taken throughout this litigation, we should anticipate that Vantor will seek at a minimum two to four additional depositions related to the expanded discovery. These may include:
• Depositions of Cascade procurement managers or category leads who had direct responsibility for specific supplier relationships among the 15 additional suppliers;
• Depositions of representatives of the additional suppliers themselves, particularly any suppliers that had existing arrangements with Vantor or other competitors; and
• Extended or supplemental deposition time for witnesses already on the deposition schedule, such as Ms. Bergström and Ms. Torvik, to cover the expanded scope of supplier relationships.
Regarding the already-scheduled depositions, the expanded discovery will have a direct and significant impact on deposition preparation. The deposition of Annika Bergström, currently scheduled for October 12, 2022, was originally scoped to cover her involvement in the Hemsworth, Tridale, and Orion supplier relationships and her general role in the Project Atlas initiative. The court's ruling means that Vantor's counsel will now have a legitimate basis to question Ms. Bergström in detail about her involvement with each of the 15 additional suppliers, including the outreach strategy, due diligence conducted regarding existing supplier arrangements, communications with supplier contacts, and the ultimate disposition of each supplier relationship. This substantially broadens the scope of preparation required for Ms. Bergström's deposition and may necessitate extending the deposition beyond a single day.
Similarly, the deposition of Lena Torvik, currently scheduled for November 18, 2022, will now need to address her executive oversight of Project Atlas more broadly, including the initiative's goals regarding all 25 targeted suppliers, the rationale for the $4.2 million budget allocation, and any discussions at the senior leadership level regarding the competitive implications of the initiative.
The deposition of Thomas Brennecke, Vantor's Vice President of Supplier Relations, remains scheduled for October 26, 2022, and is being taken by Cascade. The expanded discovery scope may provide additional areas for questioning of Mr. Brennecke regarding Vantor's relationships with the 15 additional suppliers and whether any of those suppliers had existing arrangements with Vantor.
In total, the case currently contemplates 14 depositions: 8 to be noticed by Vantor and 6 to be noticed by Cascade. The expanded discovery may increase this number modestly, though we intend to resist any significant expansion through the measures described in Section V.C below.
D. Timeline
The court's 60-day production deadline places the supplemental production of documents relating to the 15 additional supplier relationships at approximately October 2, 2022. Meeting this deadline will require immediate action to coordinate supplemental document collections with Krane Investigations LLC and to prioritize the processing and review of the additional documents.
The timeline for the expanded discovery effort is as follows:
This timeline is aggressive, particularly given the volume of additional documents anticipated. If the supplemental collections from additional custodians reveal a substantially larger document universe than the 80,000–120,000 documents currently estimated, we may need to seek a brief extension of the production deadline or prioritize certain suppliers for early production while completing the remaining reviews on a rolling basis.
V. Implications for Defense Strategy
A. Risk of Pattern-and-Practice Evidence
The primary strategic risk created by the expanded discovery is that Vantor may uncover evidence from the 15 additional supplier relationships suggesting that Cascade engaged in a broader pattern of targeting competitors' exclusive suppliers. This is the very theory that motivated Vantor's motion to compel, and while the court's ruling was narrower than Vantor sought, the expanded scope provides Vantor with a meaningful opportunity to develop pattern evidence.
The risk is most acute with respect to any of the 15 additional suppliers that had existing exclusivity arrangements with Vantor or other competitors at the time Cascade initiated contact under Project Atlas. If Cascade entered into agreements — or even pursued advanced negotiations — with suppliers that had such existing arrangements, Vantor could argue this supports several inferences damaging to Cascade's defense:
(a) That Cascade had a general practice of targeting suppliers with existing exclusivity arrangements, making it more likely that Cascade knew about the specific exclusivity provisions in the Vantor–Hemsworth, Vantor–Tridale, and Vantor–Orion agreements;
(b) That Cascade's internal characterization of Project Atlas as a "supplier diversification" initiative was pretextual, and that the true purpose of the initiative was to disrupt competitors' supply chains;
(c) That Cascade's conduct was sufficiently systematic and deliberate to constitute the "independently wrongful conduct" required to sustain a claim for tortious interference with prospective economic advantage under California law; and
(d) That the pattern of conduct demonstrates malice or oppression sufficient to support a claim for punitive damages, which Vantor has not yet sought to add but may move to amend to include.
To mitigate this risk, we need to conduct a rapid internal review with Cascade's legal team — specifically David Pruitt, General Counsel, and Annika Bergström — to identify which of the 15 additional suppliers, if any, had prior exclusive arrangements with Vantor or other known competitors at the time Cascade initiated contact. This review should also identify any internal communications in which Cascade personnel discussed or acknowledged the existence of such arrangements.
If the internal review reveals that most or all of the 15 additional suppliers did not have exclusive arrangements with Vantor or its competitors, we will be in a strong position to argue at summary judgment that the expanded discovery disproves, rather than supports, Vantor's pattern theory. Conversely, if the review reveals that several additional suppliers did have such arrangements, we will need to develop specific factual defenses for each such supplier relationship and to consider whether any proactive disclosures or stipulations may be warranted.
B. The 14 Project Atlas Emails
As noted above, the court's ruling was influenced in significant part by the existence of the 14 internal Project Atlas emails that reference Vantor's supplier relationships. It is therefore essential that we continue to closely analyze these emails and develop affirmative arguments to limit their impact.
Per our earlier analysis, as set forth in the memorandum prepared by Carlos Espinoza dated June 30, 2022, none of the 14 emails demonstrates actual knowledge of the specific exclusivity terms in the Vantor–Hemsworth, Vantor–Tridale, or Vantor–Orion agreements. The emails reference Vantor as a competitor in general terms and note that certain suppliers "have been working with Vantor" or "are currently supplying Vantor," but they do not reference the existence or terms of any exclusivity provision. Several of the emails appear to reflect general competitive intelligence of the type routinely gathered by procurement teams in the retail industry, rather than evidence of targeted interference with known contractual rights.
However, Vantor will almost certainly argue that the expanded discovery will reveal additional communications referencing Vantor or its supplier relationships, strengthening the inference of knowledge. If additional emails are uncovered in the 15 expanded supplier files that reference Vantor's relationships in more specific terms — or, critically, that reference the existence of exclusivity provisions — the cumulative effect could be damaging.
Our defense strategy must continue to draw the distinction between general awareness of a competitor's supplier base — which is a normal and expected feature of competitive commerce — and actual knowledge of specific contractual exclusivity provisions. Under California law, tortious interference with contractual relations requires knowledge of the existence of the contract. Pacific Gas & Electric Co. v. Ridgeline Trust Bank, 50 Cal.3d 1118, 1126 (1990). General awareness that a competitor has supplier relationships does not equate to knowledge that those relationships are governed by exclusivity provisions that would be breached by dealing with the supplier.
This distinction is the linchpin of our defense on the knowledge element, and the expanded discovery will test its strength. We should prepare for the possibility that Vantor will uncover additional emails or documents that narrow the gap between "general awareness" and "actual knowledge," and we should develop anticipatory arguments to address such evidence.
C. Narrowing Depositions — Recommended Approach
Given the court's ruling, we should take a proactive approach to limiting the scope of any additional depositions that Vantor may seek in connection with the 15 expanded supplier relationships. Our approach should proceed in two phases: first, a meet-and-confer with opposing counsel to seek a stipulated limitation; and second, if the meet-and-confer is unsuccessful, a motion for protective order.
The arguments for limiting additional depositions are strong and are well-supported by the court's own emphasis on proportionality in its ruling:
First, the key fact witnesses for Cascade regarding the Project Atlas initiative — Ms. Bergström and Ms. Torvik — are already scheduled for depositions on October 12 and November 18, 2022, respectively. Both witnesses can be questioned regarding the additional 15 supplier relationships during their already-scheduled depositions, without the need for separate depositions of lower-level procurement staff who had limited involvement in strategic decision-making.
Second, depositions of the additional suppliers themselves should not be permitted absent a threshold showing that a particular supplier relationship is directly relevant to the three at-issue relationships. The suppliers are third parties, and compelling their testimony on peripheral matters imposes burdens not only on Cascade but on the suppliers themselves.
Third, the court's ruling expressly emphasized proportionality, and duplicative depositions on peripheral supplier relationships — where the deponents' testimony would largely overlap with that of Ms. Bergström and Ms. Torvik — are not proportional to the needs of the case.
I recommend that we prepare a proposed stipulation with Kessler, Brandt & Whitfield that limits any supplemental depositions to no more than two to three additional witnesses, with reasonable time limits (e.g., four hours per deposition). The stipulation should also provide that any additional depositions will be limited in scope to the deponent's specific involvement with the relevant supplier relationship and will not extend to broader questioning about Cascade's competitive strategy or market positioning.
If Vantor rejects the proposed stipulation, we should be prepared to file a motion for protective order under California Code of Civil Procedure § 2025.420, seeking substantially similar limitations. The court's ruling provides a strong foundation for such a motion, given the court's express statement that it would entertain a protective order if the deposition burden becomes unreasonable.
D. Impact on Summary Judgment Strategy
We are currently planning to file a motion for partial summary judgment on two of Vantor's four causes of action: (1) the claim under California Business & Professions Code § 17200 (unfair competition), and (2) the claim for tortious interference with prospective economic advantage. Our target filing date for the summary judgment motion is early 2023, and based on current scheduling, we anticipate filing the motion on or about February 28, 2023.
The expanded discovery may affect our summary judgment strategy in two respects.
First, the timing of our summary judgment motion may need to be adjusted if the expanded discovery produces a substantial volume of new evidence that requires analysis and incorporation into our motion papers. While our core legal arguments on the § 17200 claim (preemption by the exclusive remedies available under the supply agreements) and the prospective advantage claim (failure to establish independently wrongful conduct) are well-developed, we will need to account for any pattern evidence that emerges from the expanded discovery and to address it affirmatively in our moving papers.
Second, and more critically, if the expanded discovery produces documents favorable to Vantor's pattern-and-practice theory, Vantor will almost certainly use this evidence in opposition to our summary judgment motion on the prospective advantage claim. Vantor's theory is that the pattern of conduct across multiple supplier relationships constitutes the "independently wrongful conduct" required to sustain a claim for tortious interference with prospective economic advantage under della Penna v. Crowne Albany Industries, 11 Cal.4th 376 (1995), and Glenrock Corporation, 29 Cal.4th 1134 (2003).
However, even pattern evidence of competitive supplier solicitation does not constitute "independently wrongful conduct" under California law. The California Supreme Court has made clear that legitimate competition for business relationships — including supplier relationships — is not tortious, even if it results in the disruption of a competitor's existing relationships. della Penna, 11 Cal.4th at 392–93. The mere fact that Cascade pursued multiple supplier relationships under a coordinated initiative does not transform lawful competitive conduct into independently wrongful conduct, absent evidence that Cascade employed unlawful means (e.g., misrepresentation, bribery, or violation of trade secret protections) or acted with the sole purpose of injuring Vantor rather than advancing its own legitimate business interests.
Our summary judgment motion should address and preempt this argument by establishing that Project Atlas was a legitimate competitive initiative motivated by Cascade's business needs and that competitive supplier solicitation, even on a systematic basis, does not constitute independently wrongful conduct as a matter of law. We should develop this argument with reference to the specific evidence produced in discovery, including the business justifications for Project Atlas documented in Cascade's internal records.
E. Deposition Preparation Adjustments
The expanded discovery scope requires immediate adjustments to our deposition preparation for the two key Cascade witnesses whose depositions are already scheduled.
Annika Bergström (October 12, 2022): The deposition preparation for Ms. Bergström must now cover not only the three at-issue supplier relationships (Hemsworth, Tridale, and Orion) but also her involvement with the 15 additional Project Atlas supplier relationships. Ms. Bergström is likely to face detailed questioning regarding her outreach to each of the additional suppliers, the information she gathered regarding each supplier's existing relationships (including any exclusive arrangements), the communications she had with supplier contacts, and the decisions made regarding each supplier relationship. Our preparation must include a comprehensive review of all documents produced regarding each of the 15 additional suppliers, identification of any documents that may be used against Ms. Bergström during the deposition, and development of key themes and defensive talking points for each supplier relationship. Given the significantly expanded scope, I recommend scheduling at least two full-day preparation sessions with Ms. Bergström prior to her deposition.
Lena Torvik (November 18, 2022): The deposition preparation for Ms. Torvik must similarly address her executive oversight of Project Atlas more broadly. Vantor's counsel will likely seek to question Ms. Torvik regarding the strategic goals of Project Atlas, the criteria used to select the 25 targeted suppliers, whether competitive disruption was an objective of the initiative, the $4.2 million budget allocation and how it was distributed across the various supplier relationships, and any reports or presentations she provided to Cascade's senior leadership or board regarding the initiative. Our preparation should focus on establishing that Project Atlas was driven by legitimate business objectives — supply chain resilience, cost optimization, and product quality — rather than competitive interference.
I recommend that Carlos Espinoza begin preparing expanded deposition preparation memoranda for both witnesses immediately. These memoranda should incorporate the expanded scope of supplier relationships and should identify, for each of the 15 additional suppliers, the key documents, timeline of engagement, and potential areas of vulnerability.
VI. Budget Impact
A. Estimated Additional Costs
The court's ruling will result in material additional costs for the defense of this matter. The following is a preliminary estimate of the incremental costs attributable to the expanded discovery:
The additional attorney time is estimated at approximately 300 to 500 additional hours across the Calderwood & Harkness team, encompassing senior associate and associate time for document review and deposition preparation, as well as partner time for strategic oversight, deposition attendance, and any motion practice related to the protective order. At blended rates, this represents approximately $200,000 to $350,000 in additional attorney fees.
The potential additional local counsel costs through Wortham & Adair LLP (Diana Prescott) relate to any supplemental California motion practice that may arise in connection with the expanded discovery, including a potential motion for protective order to limit depositions and any discovery-related disputes that require court appearances in Los Angeles.
B. Communication to Client
I recommend that Douglas Carmichael communicate the court's ruling and its cost implications to David Pruitt, Cascade's General Counsel, promptly — ideally within the next several business days. Mr. Pruitt should be informed of the substance of the ruling, the practical impact on the discovery effort, and the preliminary cost estimates set forth above.
The initial exposure assessment and litigation budget memorandum, which was prepared and circulated on November 15, 2021 at the outset of this engagement, should be updated to reflect the increased discovery costs resulting from the court's ruling. The original budget projected total defense costs through trial of approximately $2.8 million to $3.5 million. The expanded discovery is likely to push total defense costs into the range of $3.2 million to $4.2 million, depending on the volume of additional documents, the number of supplemental depositions, and whether any additional motion practice is required.
In addition, we should address the insurance coverage implications of the increased costs. Pinnacle National Insurance Co. is providing defense cost coverage under Cascade's commercial general liability policy (Policy No. PNG-CGL-2021-04487). Our primary contact at Pinnacle is Leonard Furman, who has been receiving periodic updates on defense costs and case developments. We should confirm with Mr. Furman that the expanded discovery costs fall within the scope of the defense cost coverage and provide updated cost estimates to the insurer in accordance with the policy's reporting requirements. Failure to provide timely notice of increased defense costs could jeopardize coverage, and we should ensure compliance with the notice provisions of the policy.
VII. Recommended Next Steps
Based on the analysis set forth in this memorandum, I recommend the following action items, organized by timeline:
1. Immediate (within 5 business days): Confer with David Pruitt (Cascade General Counsel) and Annika Bergström to identify any of the 15 additional supplier relationships that may involve prior exclusive arrangements with Vantor or other competitors. This internal review is critical to assessing the risk profile of the expanded discovery and should be completed before the supplemental document collection begins.
2. Within 10 days (by August 20, 2022): Coordinate with Krane Investigations LLC (Samuel Byrd, Project Manager) to begin supplemental document collection for the 15 additional supplier relationships. This coordination should include identification of additional custodians, development of targeted search terms for the expanded supplier set, and establishment of processing and review protocols for the expanded collection. Mr. Byrd should also be asked to provide a refined cost estimate once the scope of the supplemental collections is confirmed.
3. Within 14 days (by August 24, 2022): Send an updated budget estimate to David Pruitt reflecting the additional costs attributable to the expanded discovery. Separately, notify Pinnacle National Insurance Co. (Leonard Furman) of the court's ruling and the increased expected defense costs, and request written confirmation that the expanded discovery costs are covered under the policy.
4. Within 21 days (by August 31, 2022): Propose a meet-and-confer with Kessler, Brandt & Whitfield LLP regarding stipulated limitations on additional depositions related to the 15 expanded supplier relationships. Our proposed stipulation should limit supplemental depositions to no more than two to three additional witnesses, with time limitations of four hours per deposition. If Vantor rejects the proposed stipulation or fails to respond, we should promptly prepare and file a motion for protective order under California Code of Civil Procedure § 2025.420.
5. By October 2, 2022: Complete the supplemental document production for the 15 additional supplier relationships per the court's 60-day deadline. This deadline is firm and non-negotiable absent a stipulation or court order extending it. We should build in adequate time for privilege review and privilege log preparation before the production deadline.
6. Ongoing (September – November 2022): Adjust deposition preparation memoranda for Annika Bergström (October 12, 2022 deposition) and Lena Torvik (November 18, 2022 deposition) to incorporate the expanded scope of supplier relationships. Carlos Espinoza should take the lead on preparing these expanded memoranda, with my oversight and Douglas Carmichael's strategic input. Preparation sessions with both witnesses should be scheduled for the weeks preceding their respective depositions.
7. By early 2023: Reassess the summary judgment strategy in light of any new evidence produced during the expanded discovery. If the expanded discovery produces evidence that strengthens Vantor's pattern-and-practice theory, we should evaluate whether to adjust the scope or timing of our summary judgment motion. Conversely, if the expanded discovery produces evidence that undermines Vantor's theory — for example, by showing that most of the 15 additional suppliers did not have existing exclusive arrangements with Vantor or other competitors — we should incorporate this evidence affirmatively into our summary judgment motion.
VIII. Conclusion
The court's August 3, 2022 ruling on Vantor's motion to compel represents a mixed outcome. On the positive side, the court denied Vantor's request for discovery into all Cascade supplier relationships, rejected Vantor's request for unlimited depositions, and declined to find that Cascade's prior discovery conduct constituted an abuse. The court's emphasis on proportionality throughout the ruling provides a foundation for resisting further expansion of the discovery scope and for limiting additional depositions.
On the other hand, the expansion of discovery from 3 to 18 supplier relationships creates meaningful additional burden, cost, and risk. The most significant risk is that pattern evidence from the 15 additional supplier relationships could strengthen Vantor's trial narrative, even if such evidence does not independently establish the legal elements of tortious interference. If Vantor is able to present evidence at trial that Cascade systematically targeted suppliers with existing exclusivity arrangements, the jury may be more inclined to credit Vantor's theory that Cascade acted with knowledge and intent regarding the Hemsworth, Tridale, and Orion relationships specifically.
Notwithstanding this risk, the core defense strategy remains sound. Cascade's principal defenses — lack of actual knowledge of the specific exclusivity provisions in the Vantor supplier agreements, independent supplier action in choosing to engage with Cascade, the suppliers' exercise of termination-for-convenience clauses available under their agreements with Vantor (90 days for Hemsworth, 60 days for Tridale, 120 days for Orion), and Vantor's failure to mitigate its damages — are not undermined by the expanded discovery scope. These defenses are grounded in the specific facts of the three at-issue supplier relationships and are not dependent on the absence of pattern evidence regarding other suppliers.
Prompt action on the next steps outlined in Section VII above will position us to manage the expanded discovery efficiently, minimize additional costs, and ensure that we are fully prepared for the upcoming depositions and the eventual summary judgment filing. I will coordinate with the team to implement these steps immediately and will provide a status update at our next case team meeting.
I am available to discuss any aspect of this memorandum at your convenience.
Yuki Nakamura Senior Associate Calderwood & Harkness LLP
PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT This memorandum is protected by the attorney-client privilege and the work product doctrine. Do not distribute outside the case team without prior authorization.
Milestone | Date
Supplemental document collection begins | August 15–22, 2022
Processing and ingestion into Relativity | August 22 – September 5, 2022
First-pass document review | September 5–26, 2022
Privilege review and privilege log preparation | September 19–30, 2022
Supplemental production to Vantor | October 2, 2022 (court deadline)
Deposition of Annika Bergström | October 12, 2022
Deposition of Thomas Brennecke (Vantor) | October 26, 2022
Deposition of Lena Torvik | November 18, 2022
Cost Category | Estimated Range
Additional e-discovery costs (Krane Investigations LLC) | $200,000–$350,000
Additional attorney time (document review, deposition preparation, motion practice) | $200,000–$350,000
Potential additional local counsel costs (Wortham & Adair LLP) | $15,000–$40,000
Total estimated additional costs | $415,000–$740,000

CALDERWOOD & HARKNESS LLP

INTERNAL MEMORANDUM

MATTER NO.: 1038-00007

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