Chesapeake Energy -6% premarket in wake of McClendon indictment
Mar 2 2016, 07:56 ET | About: Chesapeake Energy Corporation (CHK) | By: Carl Surran, SA News Editor Contact this editor with comments or a news tip
Chesapeake Energy (NYSE:CHK) -5.9% premarket after former CEO Aubrey McClendon was indicted for rigging bids on oil and gas leases.CHK says it "does not expect to face criminal prosecution or fines" related to the matter, adding that the company has taken significant steps to address legacy issues and comply with laws and regulations.The DoJ charges that the participants in the alleged bid-rigging scheme decided ahead of time who would win the leases; the state of Michigan made similar allegations against CHK, and the company settled that case for $25M last year.McClendon, who calls the charges "wrong and unprecedented," says he is being "singled out" as the only person in the oil and gas industry in more than 110 years to be charged under the Sherman Act for oil and gas leasing activity.Among notable recent cases where the DoJ pursued criminal charges against CEOs, former Peanut Corp. of America president Stewart Parnell was sentenced to 28 years in prison for a cover-up that led to a deadly salmonella outbreak, and former Massey Energy CEO Don Blankenship was convicted of conspiracy to violate federal mine safety laws but was acquitted of lying to investors and regulators about the company’s safety record.