NY law firm files class action suit
A New York law firm filed a class-action lawsuit Thursday on behalf of shareholders over disclosures about Chesapeake's Founder Well Participation Program.
It joins at least two other lawsuits filed over similar subjects last week in federal court in Oklahoma City.
The lawsuit, filed on behalf of two shareholders in Queens, New York, alleges Chesapeake and CEO Aubrey McClendon failed to disclose material facts about the well program and loans taken out against McClendon's interests in the wells. The lawsuit said shareholders lost money once news of the loans was made public and the stock declined in value.
“They failed to disclose material adverse facts about the significant degree to which McClendon had not only leveraged all his FWPP holdings, but had taken out hundreds of millions of dollars of personal loans from the very company that was buying interests in Chesapeake's substantial gas and oil properties, EIG,” the lawsuit stated.
The class-action lawsuit was filed by Pomerantz Haudek Grossman & Gross LLP, which also was the lead firm in a previous case against Chesapeake and McClendon over his 2008 bonus payments.
From staff reports