Public Lands: Elk Hills Naval Petroleum Reserve Unitization: Valuation of Reserves

摘要

See the case summary, 181 O.&G.R. 471 for a complete discussion of the facts. In this iteration of the litigation, the court is resolving the issue of how much the United States needs to pay Chevron in reliance damages based upon the United States' breach of contract relating to the allocation of values to their respective interests in what was the Elk Hills Naval Petroleum Reserve. Chevron has the burden of proof in claiming reliance damages to show that the damages were reasonably foreseeable by the breaching party, the breach is a substantial causal factor in the damages and the damages are shown with reasonable certainty. The United States had proffered rebuttal evidence as to the claimed amounts based on the notion that Chevron is only entitled to recover as reliance damages those damages caused by the breaching party's actions. The court diminished the reliance damages awarded from around $75 million to around $18 million but then awarded Chevron $904,483 as a sanction for the bad faith conduct of the United States relating to the assertions of privilege that arose during the recovery process.