Bloomberg News

Chesapeake Stockholders Seek Delay of Annual Meeting From Court

May 17, 2012

A group of Chesapeake Energy Corp. (CHK:US) investors asked a judge to postpone the company’s annual shareholders’ meeting so they can gain additional disclosure of Chief Executive Officer Aubrey McClendon’s compensation.

In papers filed May 15 with U.S. District Judge Vicki Miles-LaGrange in Oklahoma City, Chesapeake stockholders said they also want details of the CEO’s indebtedness to third parties said to have financed his investment in company oil wells, arguing it may have created a conflict of interest.

The request was made in the context of a lawsuit filed in the name of the second-largest U.S. natural gas producer against McClendon and eight Chesapeake directors. The meeting is set for June 8.

T. Boone Pickens, the billionaire Texas hedge-fund manager, sold almost half a million shares in Chesapeake during the past six weeks through May 10, as the stock fell 24 percent on investor reaction to natural-gas prices and potential management conflicts.

Chesapeake closed yesterday at $14.04 after touching a 52- week low of $13.90 in New York Stock Exchange Trading.

“The board has facilitated McClendon’s abuse of the company by permitting rampant conflicts of interest to go unchecked and undisclosed,” the investors said in their filing.

Miles-LaGrange told the defendants to file their opposition to the shareholders’ request by May 23 and set a hearing date of May 30.

Jim Gipson, a spokesman for the Oklahoma City-based company, declined to comment on the court filing.

The case is Deborah G. Mallow IRA SEP Investment Plan v. Aubrey K. McClendon, 12-cv-436, U.S. District Court for the Western District of Oklahoma (Oklahoma City).

To contact the reporter on this story: Andrew Harris in Chicago at aharris16@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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Companies Mentioned

  • CHK
    (Chesapeake Energy Corp)
    • $24.67 USD
    • -0.10
    • -0.41%
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