Cases & Deals

Chevron successfully pursues federal court and administrative actions to challenge process for finalizing ownership interests at Elk Hills oil field

Client(s) Chevron Corporation

Jones Day successfully represented Chevron Corporation in several administrative proceedings and two trials in the U.S. Court of Federal Claims in matters relating to the administrative process established by the parties to finalize the government’s and Chevron’s ownership interests of the Elk Hills oil field near Bakersfield CA, the largest unitized oil field in North America.

In the Court of Federal Claims litigation, Chevron won a liability and $19 million damages verdict for fraudulent breach of contract against U.S. Department of Energy; that verdict included an almost $1 million sanction against Department of Justice for bad faith conduct and discovery abuse. The court found that the government had violated the parties’ agreements by having extensive ex parte communications between its advocates and administrative decisionmakers and even had those advocates participate in drafting administrative decisions. In the course of the proceedings, the court ordered the government to produce hundreds of documents that it had withheld as privileged, and, in doing so, applied the crime/fraud exception to the attorney-client privilege against the government.

In the administrative proceedings, Chevron challenged the equity determinations of the Department of Energy's Assistant Secretary for Fossil Energy as legally erroneous, arbitrary and capricious, and contrary to sound engineering principles.

Chevron U.S.A., Inc. v. United States, No. 1:04CV1365 (Ct. Fed. Cl.), Chevron U.S.A., Inc. v. United States Department of Energy, No. TEA-0010 (DOE Office of Hearings and Appeals)