Permian Corp. v. United States

In 1978, the Occidental Petroleum Corporation and subsidiary Permian Corporation (collectively, Occidental) (plaintiff) proposed an exchange offer for shares of Mead Corporation. Mead sued Occidental to challenge Occidental’s proposal. Occidental produced documents during discovery in the Mead-Occidental litigation. Meanwhile, Occidental was also involved in a Securities and Exchange Commission (SEC) investigation regarding Occidental’s proposed exchange offer for Mead. The SEC asked Occidental for permission to obtain from Mead Occidental’s documents relating to the exchange offer because Mead’s counsel had already reviewed Occidental’s document production and found the relevant documents. Occidental agreed and sent letters to Mead’s counsel and SEC staff stating that Mead could deliver documents to the SEC but had to tell Occidental which documents had been delivered within 48 hours of delivery. All documents were to be stamped with a warning against disclosure by the SEC, and the SEC agreed not to deliver any documents to other government agencies without giving Occidental reasonable notice. Occidental and the SEC also reached an oral understanding that Occidental would be advised about other governmental requests for Occidental’s confidential materials so that Occidental could assert claims of privilege. Mead’s production of Occidental documents to the SEC included 36 documents about the legality of Permian’s crude-oil pricing, written by Permian employees or Permian’s outside counsel. Occidental knew that the SEC had the documents by mid-December 1978 but never objected to Mead’s disclosure of the documents. In early 1979, the United States Department of Energy (DOE) requested the 36 documents from the SEC in connection with a DOE investigation into Permian’s petroleum pricing. Occidental objected, but the SEC indicated its intent to release the documents anyway. Occidental sued the federal government (defendant) to prevent disclosure of the documents. The district court enjoined the SEC from disclosing the documents to the DOE, finding that the documents were covered by attorney-client or work-product privileges and that Occidental had not waived the privilege merely by allowing the documents to be delivered to the SEC. The government appealed.