## Facts

- The United States sued Panhandle Eastern Corporation and affiliated entities, seeking monetary, equitable, and declaratory relief tied to the government’s security interest as guarantor of ship-financing bonds under the Merchant Marine Act of 1936.
- During discovery, the United States served a document request seeking all materials related to a Geneva arbitration between Panhandle Eastern Pipe Line Co. (PEPL) and Sonatrach (an Algerian state oil and gas company), including transcripts, exhibits, and pleadings.
- After negotiations and a scheduling order, the court ordered production of the arbitration materials by November 12, 1987.
- PEPL did not produce the materials by the deadline and, on December 4, 1987, moved for a protective order under Federal Rule of Civil Procedure 26(c) to bar disclosure.
- PEPL supported the motion primarily with an affidavit from arbitration counsel asserting that ICC arbitration rules and party agreement required confidentiality and that disclosure could harm PEPL’s business relationship with Sonatrach and the Algerian government.

## Issues

1. Whether PEPL showed “good cause” under Federal Rule of Civil Procedure 26(c) to justify a protective order preventing production of the Sonatrach arbitration documents.
2. Whether asserted confidentiality obligations and claimed economic harm, stated in general terms, are sufficient to restrict discovery.
3. Whether a motion for protective order filed after a court-ordered production deadline is untimely and independently warrants denial.

## Decision

- The court denied PEPL’s motion for a protective order.
- PEPL failed to establish “good cause” because its showing of harm was broad, conclusory, and unsupported by specific facts.
- Confidentiality associated with international arbitration did not create an automatic bar to discovery in federal litigation.
- The motion was untimely because PEPL waited until after the ordered production deadline had passed despite having earlier opportunities to raise confidentiality concerns.

## Legal Principles

- Under Rule 26(c), the moving party bears the burden to show “good cause” with a particularized, fact-specific need for protection; generalized allegations are insufficient.
- Confidentiality provisions in arbitration rules or party agreements do not, by themselves, create a privilege or categorical protection from discovery.
- Predicted economic or relational harms must be supported by concrete, non-speculative evidence rather than vague assertions.
- Protective-order motions should be filed before the production date; post-deadline filings, especially after noncompliance with an order, strongly weigh against relief.

## Conclusion

The court refused to block discovery of the international arbitration record because PEPL did not substantiate specific harm and sought protection only after missing a court-ordered production deadline, failing Rule 26(c)’s good-cause and timeliness requirements.


United States v. Panhandle E. Corp., 118 F.R.D. 346 (D. Del. 1988)