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U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 23297 / July 6, 2015

Securities and Exchange Commission v. Navistar International Corp., Civil Action No. 1:14-cv-10163 (N.D. Ill., filed Dec. 18, 2014)

Illinois Court Orders Production of Documents Claimed to Be Privileged by Navistar International Corporation in SEC Investigation

The Commission announced that on June 30, 2015, United States Magistrate Judge Sidney I. Schenkier issued an Order ("Order") requiring production of certain documents that Navistar International Corporation ("Navistar") claimed to be privileged in response to investigative subpoenas issued by Commission staff. The Commission filed an Application for an Order Compelling Compliance with Administrative Subpoenas against Navistar in December 2014 and filed an Amended Application in January 2015.

According to the Application, the Commission is investigating possible fraud relating to statements made by Navistar regarding its efforts to obtain a certificate of conformity from the U.S Environmental Protection Agency, certifying that Navistar's engines complied with certain provisions of the Clean Air Act. Pursuant to investigative subpoenas, Navistar was obligated to produce documents to the Commission. Navistar has produced many documents in response to the Commission's subpoenas, but it also has redacted and withheld other documents on privilege grounds. In the Application, the Commission requested that the Court overrule Navistar's privilege claims over certain documents that the Commission alleged to involve lobbying and communications firms retained by Navistar, communications among only non-attorneys, and draft documents.

In response to the Application, the Court reviewed a subset of 72 documents that Navistar has redacted and withheld on privilege grounds. In the Order, the Court overruled Navistar's privilege assertions as to 46 documents in their entirety and overruled Navistar's privilege assertions as to parts of 16 additional documents. Specifically, the Court : (1) overruled Navistar's privilege assertions as to 33 of the documents that the Commission alleged to involve lobbying and communications firms retained by Navistar, sustained in part Navistar's privilege assertions as to four of these documents, and sustained Navistar's privilege assertions as to two of these documents; (2) overruled Navistar's privilege assertions as to nine of the documents that the Commission alleged to involve communications among only non-attorneys, sustained in part Navistar's privilege assertions as to 12 of these documents, and sustained Navistar's privilege assertions as to six of these documents; and (3) overruled Navistar's privilege assertions over four of the documents that the Commission alleged to involve certain drafts, and sustained Navistar's privilege assertions as to two of these documents. The Court also ordered that in addition to the documents that the Court found not to be protected from production, Navistar must produce documents that Navistar in good faith determines not to be protected under the analysis employed by the Court's in its rulings on the subset of documents it reviewed.

The Commission notes that it is continuing to conduct a fact-finding inquiry and has not concluded that anyone has broken the law.

For further information, please see Litigation Release Number LR-23183 (Jan. 29, 2015).

Court Order

 

http://www.sec.gov/litigation/litreleases/2015/lr23297.htm


Modified: 07/06/2015