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SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK COMMERCIAL DIVISION

BELMONT RIDGE BANK NA,

Plaintiff/Counterclaim Defendant,

— against —

TRITON HARBOR INDUSTRIES, LLC, MARCUS J. KAPPEL, and ELAINE D. KAPPEL,

Defendants/Counterclaim Plaintiffs.

Index No. 654871/2024

Assigned Justice: Hon. Althea Marchetti

STIPULATED DISCOVERY SCHEDULE AND PRELIMINARY CONFERENCE ORDER

December 6, 2024

A Preliminary Conference was held on December 6, 2024, before the Honorable Althea Marchetti, Justice of the Supreme Court, Commercial Division, New York County, pursuant to 22 NYCRR § 202.70(g), Rule 8, and the Court's Individual Rules and Practices.

Present for Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA were Linda Osei, Esq. and Carlos Espinoza, Esq. of Calderwood & Harkness LLP, 600 Lexington Avenue, 30th Floor, New York, New York 10022.

Present for Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel were Theodore Huang, Esq. and Natasha Orlov, Esq. of Kestrel Voss & Huang LLP, 780 Third Avenue, 24th Floor, New York, New York 10017.

WHEREAS, the original complaint in this action was filed on August 12, 2024, by Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA ("Belmont Ridge" or "Plaintiff"), asserting causes of action for, among other things, enforcement of a Forbearance and Modification Agreement dated October 6, 2023 (the "Forbearance Agreement"), judgment on personal guaranties executed by Marcus J. Kappel and Elaine D. Kappel in connection therewith, and recovery of a deficiency balance arising from the underlying credit facilities; and

WHEREAS, Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC ("Triton Harbor"), Marcus J. Kappel, and Elaine D. Kappel (collectively, "Defendants" or "Counterclaim Plaintiffs") filed their Answer with Counterclaims on October 18, 2024, asserting causes of action for fraudulent inducement, negligent misrepresentation, breach of the implied covenant of good faith and fair dealing, and rescission of the Forbearance Agreement and the related personal guaranties; and

WHEREAS, Plaintiff/Counterclaim Defendant filed its Answer to the Counterclaims on November 22, 2024, denying the material allegations of the Counterclaims and asserting affirmative defenses thereto; and

WHEREAS, a substitution of counsel was duly filed on November 12, 2024, substituting Calderwood & Harkness LLP in place of Blakemore & Stern LLP as counsel for Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA, and such substitution has been acknowledged and consented to by all parties; and

WHEREAS, the parties have conferred in good faith regarding a discovery schedule and have reached agreement on the matters set forth below, subject to the approval of this Court; and

WHEREAS, the Court has reviewed the parties' pre-conference submissions, including Plaintiff's letter to the Court dated December 2, 2024, Defendants' responsive letter dated December 4, 2024, and the parties' proposed preliminary conference order submitted jointly on December 5, 2024, and having heard the parties' respective positions at the Preliminary Conference held this date;

NOW, upon the foregoing, and upon the consent of the parties through their respective counsel of record, it is hereby

ORDERED as follows:

Section 1: Document discovery

1.1 Initial Document Production. Each party shall serve its initial production of documents responsive to all outstanding document requests no later than January 15, 2025. As of the date of this Order, Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA has received eighty-seven (87) document requests from Defendants/Counterclaim Plaintiffs, served in connection with Defendants' First Request for Production of Documents dated September 30, 2024. Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel have collectively received fifty-two (52) document requests from Plaintiff/Counterclaim Defendant, served in connection with Plaintiff's First Request for Production of Documents dated October 25, 2024.

All document productions shall be made in accordance with the parties' agreed-upon protocol for the production of electronically stored information ("ESI"), which the parties represent they are in the process of finalizing. The ESI protocol shall be memorialized in a separate written stipulation to be executed by counsel for both parties and submitted to the Court for so-ordering no later than December 20, 2024, concurrent with the submission of the proposed confidentiality and protective order referenced in Section 3 below. The ESI protocol shall address, at a minimum, the format of production (including load files, metadata fields, and native file productions), the scope of custodians and data sources to be searched, search terms and methodology, and de-duplication parameters.

1.2 Privilege Logs. Privilege logs shall accompany each party's initial document production and shall be served concurrently with, or within fourteen (14) business days following, the date of the initial production — that is, no later than February 5, 2025. Privilege logs shall contain, at a minimum, the following information for each document or communication withheld or redacted on the basis of privilege:

(a) The Bates range or document control number assigned to the withheld or redacted document;

(b) The date of the document or communication;

(d) All recipients of the document or communication, including individuals designated on the "to," "cc," and "bcc" lines;

(e) A general description of the subject matter of the document or communication, described with sufficient specificity to permit an assessment of the privilege claim without revealing privileged content; and

(f) The specific privilege or privileges asserted as the basis for withholding or redacting the document, including but not limited to attorney-client privilege, the work product doctrine, or any other applicable privilege or protection.

Privilege logs shall be updated and supplemented in connection with each supplemental document production, as set forth in Section 1.3 below.

1.3 Supplemental Productions. The parties shall make rolling supplemental document productions on a reasonable basis as additional responsive documents are identified, collected, reviewed, and prepared for production. All supplemental document productions shall be completed no later than March 31, 2025. Each supplemental production shall be accompanied by a cover letter identifying the general categories of documents included in the supplemental production and, where applicable, the specific document requests to which the supplemental documents are responsive.

Any documents located or identified after the supplemental production deadline of March 31, 2025, must be produced promptly upon identification. Any such late production shall be accompanied by a written explanation describing the circumstances of the delayed identification, the steps taken to locate responsive documents prior to the deadline, and the reason for the delay. The opposing party's rights with respect to any untimely production, including but not limited to the right to seek re-opening of depositions or other appropriate relief, are expressly preserved.

1.4 Privilege Disputes. The parties shall meet and confer in good faith regarding any disputes concerning the assertion of privilege over documents withheld or redacted before raising such disputes with the Court. The meet-and-confer process shall include, at a minimum, written correspondence identifying with particularity the documents at issue and the basis for the challenging party's position, followed by a telephonic or in-person conference between counsel. The parties shall make every reasonable effort to resolve privilege disputes without Court intervention.

Any motion to compel production of documents withheld on the basis of privilege shall be filed no later than March 14, 2025, to permit the Court adequate time to resolve such disputes before the close of fact discovery. Any such motion shall include a detailed privilege log analysis, a description of the meet-and-confer efforts undertaken, and, where appropriate, a proposed protocol for in camera review by the Court.

The Court notes the parties' disagreement regarding the privilege status of certain internal bank memoranda prepared by members of Belmont Ridge Bank NA's Special Assets Group during the period from June 2023 through October 2023, which Defendants contend were prepared in the ordinary course of business and are thus not protected by the attorney-client privilege or work product doctrine. The Court expects the parties to address this disagreement through the meet-and-confer process in the first instance and to narrow the scope of any dispute to the greatest extent possible before seeking judicial intervention.

Section 2: Interrogatories

2.1 Responses to Outstanding Interrogatories. Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA shall serve its responses and objections to Defendants/Counterclaim Plaintiffs' First Set of Interrogatories, consisting of fourteen (14) interrogatories (including subparts), no later than January 15, 2025. The First Set of Interrogatories was served on Plaintiff/Counterclaim Defendant on or about October 18, 2024, and the parties have agreed by stipulation to extend the response deadline to the date set forth herein.

Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel shall serve their responses and objections to Plaintiff/Counterclaim Defendant's First Set of Interrogatories, consisting of twelve (12) interrogatories (including subparts), no later than January 15, 2025. The First Set of Interrogatories was served on Defendants/Counterclaim Plaintiffs on or about October 25, 2024, and the parties have agreed by stipulation to extend the response deadline to the date set forth herein.

All interrogatory responses shall be verified in accordance with CPLR 3133. Where a corporate party responds to interrogatories, the response shall identify by name and title the individual or individuals who provided the information upon which the response is based.

2.2 Supplemental Interrogatories. Any supplemental interrogatories shall be served no later than March 1, 2025. The total number of interrogatories served by each side (including initial and supplemental interrogatories, and counting each subpart as a separate interrogatory) shall not exceed twenty-five (25), absent agreement of the parties or leave of Court.

Responses to supplemental interrogatories shall be due thirty (30) days after service thereof. All supplemental interrogatory responses shall be verified in accordance with CPLR 3133.

Section 3: Confidentiality / Protective Order

The parties shall submit a stipulated confidentiality and protective order to the Court for so-ordering no later than December 20, 2024. The proposed protective order shall govern the treatment of confidential business information, proprietary financial records, internal bank documents (including but not limited to credit memoranda, risk assessments, internal audit reports, and loan committee materials), borrower financial information, and any other information designated as "Confidential" or "Highly Confidential — Attorneys' Eyes Only" by the producing party in this action.

The parties represent that they have substantially agreed on the terms of the proposed protective order and anticipate no difficulty in meeting the December 20, 2024 deadline. In the event the parties are unable to reach agreement on one or more provisions of the proposed protective order, each party shall submit its proposed version to the Court by the December 20, 2024 deadline, together with a brief letter (not to exceed three pages) identifying the disputed provisions and the party's position thereon.

Pending the entry of the stipulated confidentiality and protective order, the parties agree that any documents produced in discovery shall be used solely for purposes of this litigation and shall not be disclosed to any third party without the prior written consent of the producing party.

Section 4: Fact Depositions

4.1 Deposition Schedule. The parties have conferred and agreed to the following deposition schedule for fact witnesses, subject to the availability of each deponent. In the event a deponent is unavailable on the scheduled date, the parties shall meet and confer to select a mutually agreeable alternative date that does not materially disrupt the overall discovery schedule or the sequence of depositions set forth herein.

The parties acknowledge that the sequencing of depositions set forth above was agreed upon after good-faith negotiation and reflects the parties' respective preferences for taking certain depositions following the completion of initial document productions and interrogatory responses.

4.2 Deposition Parameters. Each deposition shall be limited to seven (7) hours of examination per deponent, exclusive of breaks for meals, rest, and consultation with counsel, unless otherwise agreed by the parties in writing or ordered by the Court upon a showing of good cause. For the avoidance of doubt, the seven-hour limitation applies to the aggregate examination time of all examining counsel, and is not per party.

All depositions shall take place in New York County unless the parties agree in writing to an alternative location. In the absence of agreement to the contrary, depositions of witnesses affiliated with Belmont Ridge Bank NA shall take place at the offices of Kestrel Voss & Huang LLP, and depositions of witnesses affiliated with Triton Harbor Industries, LLC shall take place at the offices of Calderwood & Harkness LLP.

Depositions shall be recorded by stenographic means by a court reporter selected by the noticing party. Any party may, at its own expense, arrange for simultaneous videographic recording of any deposition, provided that such party gives at least five (5) business days' prior written notice to the other side of its intention to videotape the deposition. Videographic recording shall be conducted by a videographer who is independent of the parties and counsel.

4.3 Additional Fact Depositions. Either party may notice additional fact depositions of party or non-party witnesses upon reasonable notice, subject to the close of fact discovery deadline set forth in Section 4.4 below. The parties shall meet and confer in good faith regarding the scheduling of any additional party depositions, with the goal of completing all additional party depositions within the existing discovery schedule and without disrupting the sequence of depositions agreed to in Section 4.1.

The parties shall further meet and confer regarding the scheduling of any non-party depositions, including but not limited to depositions of witnesses from Mercer Tidwell & Associates LLC (which served as an outside financial advisor to Triton Harbor Industries, LLC in connection with the negotiation of the Forbearance Agreement), Ridgeline Appraisal Group, Inc. (which prepared certain real property and asset appraisals relied upon by Belmont Ridge Bank NA in connection with the Forbearance Agreement), and any other third parties with knowledge of facts relevant to the claims and defenses in this action.

Any non-party depositions shall be conducted pursuant to subpoenas issued in accordance with CPLR 3101 and 3106, and any applicable provisions governing service of process upon non-party witnesses. All non-party depositions shall be completed prior to the close of fact discovery.

4.4 Close of Fact discovery. All fact discovery in this action, including all fact depositions (whether of party or non-party witnesses), interrogatory responses, supplemental document productions, and all other fact discovery that may be served or noticed, shall be completed no later than April 30, 2025. The parties are directed to plan their discovery activities so as to ensure compliance with this deadline and to raise any anticipated difficulties with the Court promptly, rather than seeking extensions on the eve of the deadline.

Section 5: Expert discovery

5.1 Expert Disclosures. Each party shall serve its initial expert disclosures, including expert reports prepared pursuant to CPLR 3101(d)(1)(i), no later than May 15, 2025. Initial expert disclosures shall include the subject matter on which each expert is expected to testify, the substance of the facts and opinions to which the expert is expected to testify, a summary of the grounds for each opinion, the expert's qualifications, a list of all publications authored by the expert in the preceding ten (10) years, a list of all cases in which the expert has testified at trial or by deposition within the preceding four (4) years, and a statement of the compensation to be paid for the expert's study and testimony.

Rebuttal expert disclosures, if any, including rebuttal expert reports, shall be served no later than June 2, 2025. Rebuttal expert disclosures shall be limited to matters raised in the opposing party's initial expert disclosures and shall not introduce new opinions or subject areas beyond the scope of proper rebuttal.

5.2 Expert Depositions. Depositions of all expert witnesses designated by any party shall be completed no later than June 30, 2025. Expert depositions shall be limited to seven (7) hours per expert, exclusive of breaks, unless otherwise agreed by the parties in writing or ordered by the Court. The parties shall meet and confer to schedule expert depositions promptly following the exchange of initial and rebuttal expert disclosures.

5.3 Close of Expert discovery. All expert discovery in this action, including all expert disclosures, expert reports, rebuttal reports, and expert depositions, shall be completed no later than June 30, 2025.

Section 6: Motions

6.1 Dispositive Motions. Any motions for summary judgment or partial summary judgment pursuant to CPLR 3212 shall be filed no later than September 15, 2025. All motions for summary judgment shall be made returnable in accordance with the Court's Individual Rules and shall comply with the requirements of 22 NYCRR § 202.70(g), Rule 19-a (Statement of Material Facts).

Opposition papers shall be filed within the time prescribed by CPLR 2214 and the Court's Individual Rules for the Commercial Division. Reply papers, if any, shall be filed within the time prescribed by CPLR 2214 and the Court's Individual Rules. No sur-reply shall be permitted absent prior leave of the Court.

The parties are reminded that the page limitations set forth in the Court's Individual Rules apply to all motion papers, including memoranda of law, and that requests for leave to exceed page limitations must be made by letter application in advance of the filing deadline.

6.2 Pre-Dispositive Motions. The Court notes that Plaintiff/Counterclaim Defendant has indicated, through counsel, its intention to file a motion to dismiss the punitive damages demand asserted in the Counterclaims, on the grounds that the Counterclaims fail to state a claim for punitive damages as a matter of law. Any such motion may be filed on the parties' own schedule and need not await the summary judgment deadline set forth in Section 6.1 above. The parties are encouraged to meet and confer regarding the briefing schedule for any such motion and to submit a proposed briefing schedule to the Court by letter.

Any discovery-related motions, including but not limited to motions to compel disclosure or production pursuant to CPLR 3124, motions for protective orders pursuant to CPLR 3103, and motions to quash subpoenas, shall be filed promptly after completion of the required meet-and-confer process. The Court directs the parties to make good-faith efforts to resolve all discovery disputes without Court intervention. In the event a discovery dispute cannot be resolved through the meet-and-confer process, the moving party shall first request a discovery conference with the Court by letter, setting forth the nature of the dispute and a summary of the meet-and-confer efforts undertaken, before filing a formal motion.

Section 7: Settlement / Alternative Dispute Resolution

The Court encourages the parties to engage in meaningful settlement discussions or alternative dispute resolution at an appropriate time in this litigation. The Commercial Division offers a mediation program, and the parties are advised that mediation can be a valuable tool for resolving complex commercial disputes efficiently and cost-effectively, particularly in cases such as this one involving ongoing business relationships and substantial financial claims.

The parties shall advise the Court if they wish to be referred to the Court's mediation program or if they have agreed to engage a private mediator. Any referral to mediation or agreement to pursue alternative dispute resolution shall not affect the discovery schedule or other deadlines set forth in this Order, unless the parties stipulate otherwise with the approval of the Court.

Section 8: Compliance Conferences

A compliance conference shall be held on March 21, 2025, at a time to be scheduled by the Court, to address the status of document discovery, any outstanding privilege disputes, the progress of depositions, and any other issues that have arisen during the course of fact discovery. The parties shall be prepared to advise the Court of the status of all outstanding discovery and to identify any disputes or anticipated difficulties.

A further compliance conference shall be held on July 18, 2025, following the close of expert discovery, to address any remaining pre-trial issues, including the schedule for dispositive motions, any anticipated pre-trial proceedings, and the expected readiness of the case for trial.

The parties shall submit a joint status letter to the Court no later than three (3) business days before each scheduled compliance conference. The joint status letter shall describe the current status of discovery, identify any outstanding disputes, and set forth any requests for relief or modification of the discovery schedule. In the event the parties are unable to agree on a joint letter, each party may submit a separate status letter of no more than three (3) pages.

Section 9: Modifications

This schedule may be modified only by written stipulation of the parties approved by the Court, or by Order of the Court upon a showing of good cause. The parties are reminded that the Commercial Division's commitment to the efficient resolution of complex commercial disputes requires adherence to established discovery schedules, and that requests for extensions will not be granted routinely.

Any request to extend a deadline set forth in this Order shall be made promptly upon the party's becoming aware of the need for an extension and shall include: (a) a detailed explanation of the reasons necessitating the extension; (b) a description of the diligent efforts undertaken to comply with the original deadline; (c) a proposed amended schedule for all subsequent deadlines affected by the requested extension; and (d) a representation as to whether the opposing party consents to or opposes the requested extension.

Section 10: Reservation of Rights

Nothing in this Order shall be construed to limit any party's right to seek appropriate relief from the Court at any time during the pendency of this action, including but not limited to motions to compel disclosure or discovery, motions for protective orders, motions for sanctions for discovery abuses, motions in limine, or any other relief to which a party may be entitled under the CPLR, the Commercial Division Rules, or applicable law.

This Order is without prejudice to any party's right to raise objections to discovery requests, to assert privileges in accordance with applicable law, or to challenge the admissibility of evidence at trial or on any motion. The entry of this Order shall not constitute a waiver of any party's rights, claims, defenses, or objections, all of which are expressly reserved.

SO ORDERED.

________________________________________

Hon. Althea Marchetti, J.S.C. Supreme Court of the State of New York Commercial Division, New York County

Dated: December 6, 2024

STIPULATED AND AGREED:

For Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA:

________________________________________

Linda Osei, Esq. CALDERWOOD & HARKNESS LLP 600 Lexington Avenue, 30th Floor New York, New York 10022 Telephone: (212) 555-4100 Facsimile: (212) 555-4101

Attorneys for Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA

For Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel:

________________________________________

Theodore Huang, Esq. KESTREL VOSS & HUANG LLP 780 Third Avenue, 24th Floor New York, New York 10017 Telephone: (212) 555-7800 Facsimile: (212) 555-7801

Attorneys for Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel

Deponent	Affiliation / Role	Scheduled Date
Derek Whitmore	Senior Vice President, Head of Special Assets Group, Belmont Ridge Bank NA	February 18, 2025
Joanna Reeves	Vice President, Special Assets Group, Belmont Ridge Bank NA	February 25, 2025
Philip Aaronson	Executive Vice President, Chief Credit Officer, Belmont Ridge Bank NA	March 4, 2025
Marcus J. Kappel	Founder, Chief Executive Officer, and 72% Member, Triton Harbor Industries, LLC	March 11, 2025
Elaine D. Kappel	Chief Financial Officer and 28% Member, Triton Harbor Industries, LLC	March 18, 2025

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK COMMERCIAL DIVISION
BELMONT RIDGE BANK NA,
Plaintiff/Counterclaim Defendant,
— against —
TRITON HARBOR INDUSTRIES, LLC, MARCUS J. KAPPEL, and ELAINE D. KAPPEL,
Defendants/Counterclaim Plaintiffs.
Index No. 654871/2024
Assigned Justice: Hon. Althea Marchetti
STIPULATED DISCOVERY SCHEDULE AND PRELIMINARY CONFERENCE ORDER
December 6, 2024
A Preliminary Conference was held on December 6, 2024, before the Honorable Althea Marchetti, Justice of the Supreme Court, Commercial Division, New York County, pursuant to 22 NYCRR § 202.70(g), Rule 8, and the Court's Individual Rules and Practices.
Present for Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA were Linda Osei, Esq. and Carlos Espinoza, Esq. of Calderwood & Harkness LLP, 600 Lexington Avenue, 30th Floor, New York, New York 10022.
Present for Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel were Theodore Huang, Esq. and Natasha Orlov, Esq. of Kestrel Voss & Huang LLP, 780 Third Avenue, 24th Floor, New York, New York 10017.
WHEREAS, the original complaint in this action was filed on August 12, 2024, by Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA ("Belmont Ridge" or "Plaintiff"), asserting causes of action for, among other things, enforcement of a Forbearance and Modification Agreement dated October 6, 2023 (the "Forbearance Agreement"), judgment on personal guaranties executed by Marcus J. Kappel and Elaine D. Kappel in connection therewith, and recovery of a deficiency balance arising from the underlying credit facilities; and
WHEREAS, Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC ("Triton Harbor"), Marcus J. Kappel, and Elaine D. Kappel (collectively, "Defendants" or "Counterclaim Plaintiffs") filed their Answer with Counterclaims on October 18, 2024, asserting causes of action for fraudulent inducement, negligent misrepresentation, breach of the implied covenant of good faith and fair dealing, and rescission of the Forbearance Agreement and the related personal guaranties; and
WHEREAS, Plaintiff/Counterclaim Defendant filed its Answer to the Counterclaims on November 22, 2024, denying the material allegations of the Counterclaims and asserting affirmative defenses thereto; and
WHEREAS, a substitution of counsel was duly filed on November 12, 2024, substituting Calderwood & Harkness LLP in place of Blakemore & Stern LLP as counsel for Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA, and such substitution has been acknowledged and consented to by all parties; and
WHEREAS, the parties have conferred in good faith regarding a discovery schedule and have reached agreement on the matters set forth below, subject to the approval of this Court; and
WHEREAS, the Court has reviewed the parties' pre-conference submissions, including Plaintiff's letter to the Court dated December 2, 2024, Defendants' responsive letter dated December 4, 2024, and the parties' proposed preliminary conference order submitted jointly on December 5, 2024, and having heard the parties' respective positions at the Preliminary Conference held this date;
NOW, upon the foregoing, and upon the consent of the parties through their respective counsel of record, it is hereby
ORDERED as follows:
Section 1: Document discovery
1.1 Initial Document Production. Each party shall serve its initial production of documents responsive to all outstanding document requests no later than January 15, 2025. As of the date of this Order, Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA has received eighty-seven (87) document requests from Defendants/Counterclaim Plaintiffs, served in connection with Defendants' First Request for Production of Documents dated September 30, 2024. Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel have collectively received fifty-two (52) document requests from Plaintiff/Counterclaim Defendant, served in connection with Plaintiff's First Request for Production of Documents dated October 25, 2024.
All document productions shall be made in accordance with the parties' agreed-upon protocol for the production of electronically stored information ("ESI"), which the parties represent they are in the process of finalizing. The ESI protocol shall be memorialized in a separate written stipulation to be executed by counsel for both parties and submitted to the Court for so-ordering no later than December 20, 2024, concurrent with the submission of the proposed confidentiality and protective order referenced in Section 3 below. The ESI protocol shall address, at a minimum, the format of production (including load files, metadata fields, and native file productions), the scope of custodians and data sources to be searched, search terms and methodology, and de-duplication parameters.
1.2 Privilege Logs. Privilege logs shall accompany each party's initial document production and shall be served concurrently with, or within fourteen (14) business days following, the date of the initial production — that is, no later than February 5, 2025. Privilege logs shall contain, at a minimum, the following information for each document or communication withheld or redacted on the basis of privilege:
(a) The Bates range or document control number assigned to the withheld or redacted document;
(b) The date of the document or communication;
(c) The author or sender of the document or communication;
(d) All recipients of the document or communication, including individuals designated on the "to," "cc," and "bcc" lines;
(e) A general description of the subject matter of the document or communication, described with sufficient specificity to permit an assessment of the privilege claim without revealing privileged content; and
(f) The specific privilege or privileges asserted as the basis for withholding or redacting the document, including but not limited to attorney-client privilege, the work product doctrine, or any other applicable privilege or protection.
Privilege logs shall be updated and supplemented in connection with each supplemental document production, as set forth in Section 1.3 below.
1.3 Supplemental Productions. The parties shall make rolling supplemental document productions on a reasonable basis as additional responsive documents are identified, collected, reviewed, and prepared for production. All supplemental document productions shall be completed no later than March 31, 2025. Each supplemental production shall be accompanied by a cover letter identifying the general categories of documents included in the supplemental production and, where applicable, the specific document requests to which the supplemental documents are responsive.
Any documents located or identified after the supplemental production deadline of March 31, 2025, must be produced promptly upon identification. Any such late production shall be accompanied by a written explanation describing the circumstances of the delayed identification, the steps taken to locate responsive documents prior to the deadline, and the reason for the delay. The opposing party's rights with respect to any untimely production, including but not limited to the right to seek re-opening of depositions or other appropriate relief, are expressly preserved.
1.4 Privilege Disputes. The parties shall meet and confer in good faith regarding any disputes concerning the assertion of privilege over documents withheld or redacted before raising such disputes with the Court. The meet-and-confer process shall include, at a minimum, written correspondence identifying with particularity the documents at issue and the basis for the challenging party's position, followed by a telephonic or in-person conference between counsel. The parties shall make every reasonable effort to resolve privilege disputes without Court intervention.
Any motion to compel production of documents withheld on the basis of privilege shall be filed no later than March 14, 2025, to permit the Court adequate time to resolve such disputes before the close of fact discovery. Any such motion shall include a detailed privilege log analysis, a description of the meet-and-confer efforts undertaken, and, where appropriate, a proposed protocol for in camera review by the Court.
The Court notes the parties' disagreement regarding the privilege status of certain internal bank memoranda prepared by members of Belmont Ridge Bank NA's Special Assets Group during the period from June 2023 through October 2023, which Defendants contend were prepared in the ordinary course of business and are thus not protected by the attorney-client privilege or work product doctrine. The Court expects the parties to address this disagreement through the meet-and-confer process in the first instance and to narrow the scope of any dispute to the greatest extent possible before seeking judicial intervention.
Section 2: Interrogatories
2.1 Responses to Outstanding Interrogatories. Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA shall serve its responses and objections to Defendants/Counterclaim Plaintiffs' First Set of Interrogatories, consisting of fourteen (14) interrogatories (including subparts), no later than January 15, 2025. The First Set of Interrogatories was served on Plaintiff/Counterclaim Defendant on or about October 18, 2024, and the parties have agreed by stipulation to extend the response deadline to the date set forth herein.
Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel shall serve their responses and objections to Plaintiff/Counterclaim Defendant's First Set of Interrogatories, consisting of twelve (12) interrogatories (including subparts), no later than January 15, 2025. The First Set of Interrogatories was served on Defendants/Counterclaim Plaintiffs on or about October 25, 2024, and the parties have agreed by stipulation to extend the response deadline to the date set forth herein.
All interrogatory responses shall be verified in accordance with CPLR 3133. Where a corporate party responds to interrogatories, the response shall identify by name and title the individual or individuals who provided the information upon which the response is based.
2.2 Supplemental Interrogatories. Any supplemental interrogatories shall be served no later than March 1, 2025. The total number of interrogatories served by each side (including initial and supplemental interrogatories, and counting each subpart as a separate interrogatory) shall not exceed twenty-five (25), absent agreement of the parties or leave of Court.
Responses to supplemental interrogatories shall be due thirty (30) days after service thereof. All supplemental interrogatory responses shall be verified in accordance with CPLR 3133.
Section 3: Confidentiality / Protective Order
The parties shall submit a stipulated confidentiality and protective order to the Court for so-ordering no later than December 20, 2024. The proposed protective order shall govern the treatment of confidential business information, proprietary financial records, internal bank documents (including but not limited to credit memoranda, risk assessments, internal audit reports, and loan committee materials), borrower financial information, and any other information designated as "Confidential" or "Highly Confidential — Attorneys' Eyes Only" by the producing party in this action.
The parties represent that they have substantially agreed on the terms of the proposed protective order and anticipate no difficulty in meeting the December 20, 2024 deadline. In the event the parties are unable to reach agreement on one or more provisions of the proposed protective order, each party shall submit its proposed version to the Court by the December 20, 2024 deadline, together with a brief letter (not to exceed three pages) identifying the disputed provisions and the party's position thereon.
Pending the entry of the stipulated confidentiality and protective order, the parties agree that any documents produced in discovery shall be used solely for purposes of this litigation and shall not be disclosed to any third party without the prior written consent of the producing party.
Section 4: Fact Depositions
4.1 Deposition Schedule. The parties have conferred and agreed to the following deposition schedule for fact witnesses, subject to the availability of each deponent. In the event a deponent is unavailable on the scheduled date, the parties shall meet and confer to select a mutually agreeable alternative date that does not materially disrupt the overall discovery schedule or the sequence of depositions set forth herein.
The parties acknowledge that the sequencing of depositions set forth above was agreed upon after good-faith negotiation and reflects the parties' respective preferences for taking certain depositions following the completion of initial document productions and interrogatory responses.
4.2 Deposition Parameters. Each deposition shall be limited to seven (7) hours of examination per deponent, exclusive of breaks for meals, rest, and consultation with counsel, unless otherwise agreed by the parties in writing or ordered by the Court upon a showing of good cause. For the avoidance of doubt, the seven-hour limitation applies to the aggregate examination time of all examining counsel, and is not per party.
All depositions shall take place in New York County unless the parties agree in writing to an alternative location. In the absence of agreement to the contrary, depositions of witnesses affiliated with Belmont Ridge Bank NA shall take place at the offices of Kestrel Voss & Huang LLP, and depositions of witnesses affiliated with Triton Harbor Industries, LLC shall take place at the offices of Calderwood & Harkness LLP.
Depositions shall be recorded by stenographic means by a court reporter selected by the noticing party. Any party may, at its own expense, arrange for simultaneous videographic recording of any deposition, provided that such party gives at least five (5) business days' prior written notice to the other side of its intention to videotape the deposition. Videographic recording shall be conducted by a videographer who is independent of the parties and counsel.
4.3 Additional Fact Depositions. Either party may notice additional fact depositions of party or non-party witnesses upon reasonable notice, subject to the close of fact discovery deadline set forth in Section 4.4 below. The parties shall meet and confer in good faith regarding the scheduling of any additional party depositions, with the goal of completing all additional party depositions within the existing discovery schedule and without disrupting the sequence of depositions agreed to in Section 4.1.
The parties shall further meet and confer regarding the scheduling of any non-party depositions, including but not limited to depositions of witnesses from Mercer Tidwell & Associates LLC (which served as an outside financial advisor to Triton Harbor Industries, LLC in connection with the negotiation of the Forbearance Agreement), Ridgeline Appraisal Group, Inc. (which prepared certain real property and asset appraisals relied upon by Belmont Ridge Bank NA in connection with the Forbearance Agreement), and any other third parties with knowledge of facts relevant to the claims and defenses in this action.
Any non-party depositions shall be conducted pursuant to subpoenas issued in accordance with CPLR 3101 and 3106, and any applicable provisions governing service of process upon non-party witnesses. All non-party depositions shall be completed prior to the close of fact discovery.
4.4 Close of Fact discovery. All fact discovery in this action, including all fact depositions (whether of party or non-party witnesses), interrogatory responses, supplemental document productions, and all other fact discovery that may be served or noticed, shall be completed no later than April 30, 2025. The parties are directed to plan their discovery activities so as to ensure compliance with this deadline and to raise any anticipated difficulties with the Court promptly, rather than seeking extensions on the eve of the deadline.
Section 5: Expert discovery
5.1 Expert Disclosures. Each party shall serve its initial expert disclosures, including expert reports prepared pursuant to CPLR 3101(d)(1)(i), no later than May 15, 2025. Initial expert disclosures shall include the subject matter on which each expert is expected to testify, the substance of the facts and opinions to which the expert is expected to testify, a summary of the grounds for each opinion, the expert's qualifications, a list of all publications authored by the expert in the preceding ten (10) years, a list of all cases in which the expert has testified at trial or by deposition within the preceding four (4) years, and a statement of the compensation to be paid for the expert's study and testimony.
Rebuttal expert disclosures, if any, including rebuttal expert reports, shall be served no later than June 2, 2025. Rebuttal expert disclosures shall be limited to matters raised in the opposing party's initial expert disclosures and shall not introduce new opinions or subject areas beyond the scope of proper rebuttal.
5.2 Expert Depositions. Depositions of all expert witnesses designated by any party shall be completed no later than June 30, 2025. Expert depositions shall be limited to seven (7) hours per expert, exclusive of breaks, unless otherwise agreed by the parties in writing or ordered by the Court. The parties shall meet and confer to schedule expert depositions promptly following the exchange of initial and rebuttal expert disclosures.
5.3 Close of Expert discovery. All expert discovery in this action, including all expert disclosures, expert reports, rebuttal reports, and expert depositions, shall be completed no later than June 30, 2025.
Section 6: Motions
6.1 Dispositive Motions. Any motions for summary judgment or partial summary judgment pursuant to CPLR 3212 shall be filed no later than September 15, 2025. All motions for summary judgment shall be made returnable in accordance with the Court's Individual Rules and shall comply with the requirements of 22 NYCRR § 202.70(g), Rule 19-a (Statement of Material Facts).
Opposition papers shall be filed within the time prescribed by CPLR 2214 and the Court's Individual Rules for the Commercial Division. Reply papers, if any, shall be filed within the time prescribed by CPLR 2214 and the Court's Individual Rules. No sur-reply shall be permitted absent prior leave of the Court.
The parties are reminded that the page limitations set forth in the Court's Individual Rules apply to all motion papers, including memoranda of law, and that requests for leave to exceed page limitations must be made by letter application in advance of the filing deadline.
6.2 Pre-Dispositive Motions. The Court notes that Plaintiff/Counterclaim Defendant has indicated, through counsel, its intention to file a motion to dismiss the punitive damages demand asserted in the Counterclaims, on the grounds that the Counterclaims fail to state a claim for punitive damages as a matter of law. Any such motion may be filed on the parties' own schedule and need not await the summary judgment deadline set forth in Section 6.1 above. The parties are encouraged to meet and confer regarding the briefing schedule for any such motion and to submit a proposed briefing schedule to the Court by letter.
Any discovery-related motions, including but not limited to motions to compel disclosure or production pursuant to CPLR 3124, motions for protective orders pursuant to CPLR 3103, and motions to quash subpoenas, shall be filed promptly after completion of the required meet-and-confer process. The Court directs the parties to make good-faith efforts to resolve all discovery disputes without Court intervention. In the event a discovery dispute cannot be resolved through the meet-and-confer process, the moving party shall first request a discovery conference with the Court by letter, setting forth the nature of the dispute and a summary of the meet-and-confer efforts undertaken, before filing a formal motion.
Section 7: Settlement / Alternative Dispute Resolution
The Court encourages the parties to engage in meaningful settlement discussions or alternative dispute resolution at an appropriate time in this litigation. The Commercial Division offers a mediation program, and the parties are advised that mediation can be a valuable tool for resolving complex commercial disputes efficiently and cost-effectively, particularly in cases such as this one involving ongoing business relationships and substantial financial claims.
The parties shall advise the Court if they wish to be referred to the Court's mediation program or if they have agreed to engage a private mediator. Any referral to mediation or agreement to pursue alternative dispute resolution shall not affect the discovery schedule or other deadlines set forth in this Order, unless the parties stipulate otherwise with the approval of the Court.
Section 8: Compliance Conferences
A compliance conference shall be held on March 21, 2025, at a time to be scheduled by the Court, to address the status of document discovery, any outstanding privilege disputes, the progress of depositions, and any other issues that have arisen during the course of fact discovery. The parties shall be prepared to advise the Court of the status of all outstanding discovery and to identify any disputes or anticipated difficulties.
A further compliance conference shall be held on July 18, 2025, following the close of expert discovery, to address any remaining pre-trial issues, including the schedule for dispositive motions, any anticipated pre-trial proceedings, and the expected readiness of the case for trial.
The parties shall submit a joint status letter to the Court no later than three (3) business days before each scheduled compliance conference. The joint status letter shall describe the current status of discovery, identify any outstanding disputes, and set forth any requests for relief or modification of the discovery schedule. In the event the parties are unable to agree on a joint letter, each party may submit a separate status letter of no more than three (3) pages.
Section 9: Modifications
This schedule may be modified only by written stipulation of the parties approved by the Court, or by Order of the Court upon a showing of good cause. The parties are reminded that the Commercial Division's commitment to the efficient resolution of complex commercial disputes requires adherence to established discovery schedules, and that requests for extensions will not be granted routinely.
Any request to extend a deadline set forth in this Order shall be made promptly upon the party's becoming aware of the need for an extension and shall include: (a) a detailed explanation of the reasons necessitating the extension; (b) a description of the diligent efforts undertaken to comply with the original deadline; (c) a proposed amended schedule for all subsequent deadlines affected by the requested extension; and (d) a representation as to whether the opposing party consents to or opposes the requested extension.
Section 10: Reservation of Rights
Nothing in this Order shall be construed to limit any party's right to seek appropriate relief from the Court at any time during the pendency of this action, including but not limited to motions to compel disclosure or discovery, motions for protective orders, motions for sanctions for discovery abuses, motions in limine, or any other relief to which a party may be entitled under the CPLR, the Commercial Division Rules, or applicable law.
This Order is without prejudice to any party's right to raise objections to discovery requests, to assert privileges in accordance with applicable law, or to challenge the admissibility of evidence at trial or on any motion. The entry of this Order shall not constitute a waiver of any party's rights, claims, defenses, or objections, all of which are expressly reserved.
SO ORDERED.
________________________________________
Hon. Althea Marchetti, J.S.C. Supreme Court of the State of New York Commercial Division, New York County
Dated: December 6, 2024
STIPULATED AND AGREED:
For Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA:
________________________________________
Linda Osei, Esq. CALDERWOOD & HARKNESS LLP 600 Lexington Avenue, 30th Floor New York, New York 10022 Telephone: (212) 555-4100 Facsimile: (212) 555-4101
Attorneys for Plaintiff/Counterclaim Defendant Belmont Ridge Bank NA
For Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel:
________________________________________
Theodore Huang, Esq. KESTREL VOSS & HUANG LLP 780 Third Avenue, 24th Floor New York, New York 10017 Telephone: (212) 555-7800 Facsimile: (212) 555-7801
Attorneys for Defendants/Counterclaim Plaintiffs Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel
Deponent | Affiliation / Role | Scheduled Date
Derek Whitmore | Senior Vice President, Head of Special Assets Group, Belmont Ridge Bank NA | February 18, 2025
Joanna Reeves | Vice President, Special Assets Group, Belmont Ridge Bank NA | February 25, 2025
Philip Aaronson | Executive Vice President, Chief Credit Officer, Belmont Ridge Bank NA | March 4, 2025
Marcus J. Kappel | Founder, Chief Executive Officer, and 72% Member, Triton Harbor Industries, LLC | March 11, 2025
Elaine D. Kappel | Chief Financial Officer and 28% Member, Triton Harbor Industries, LLC | March 18, 2025

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK COMMERCIAL DIVISION

BELMONT RIDGE BANK NA,

STIPULATED DISCOVERY SCHEDULE AND PRELIMINARY CONFERENCE ORDER

SO ORDERED.

STIPULATED AND AGREED:

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