United States v. Panhandle Eastern Corp.

The United States (plaintiff), on behalf of the Maritime Administration, filed a civil suit against Panhandle Eastern Corporation (PEC) (defendant) and its affiliates, including Panhandle Eastern Pipe Line Co. (PEPL). The United States served a request for production of documents, which included a request for all documents related to an arbitration between PEPL and Sonatrach, Algeria’s state-owned oil and gas company. PEPL filed a motion for a protective order pursuant to Federal Rule of Civil Procedure 26(c), arguing that disclosure of the requested documents would harm its future relationships with both Sonatrach and the Algerian government. In support of its motion, PEPL filed the affidavit of Louis Begley, an attorney who had represented PEPL as its lead counsel in the Sonatrach arbitration. Begley’s affidavit asserted that (1) confidentiality was mandated by the internal rules of the Court of Arbitration of the International Chamber of Commerce (ICC), the organization that had selected the arbitrator; (2) the parties had agreed to keep the arbitration documents confidential; and (3) disclosure of the documents would offend the sensibilities of Sonatrach and the Algerian government, thus harming PEPL’s future business negotiations. The affidavit did not identify specific ways in which disclosure of the arbitration documents would cause harm to PEPL.