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Press release from PR Newswire

Faruqi & Faruqi, LLP Encourages Investors Who Suffered Substantial Losses Investing In Chesapeake Energy Corporation To Contact The Firm

Friday, May 25, 2012

Faruqi & Faruqi, LLP Encourages Investors Who Suffered Substantial Losses Investing In Chesapeake Energy Corporation To Contact The Firm19:07 EDT Friday, May 25, 2012NEW YORK, May 25, 2012 /PRNewswire/ -- Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential securities fraud at Chesapeake Energy Corporation ("Chesapeake" or the "Company") (NYSE: CHK).   (Logo: ) Chesapeake CEO Aubrey K. McClendon ("McClendon") currently owns roughly 1.35 million shares of Chesapeake stock (presently worth approximately $24 million). This interest is dwarfed by McClendon's share of Chesapeake's oil and gas wells that McClendon reportedly owns pursuant to the Company's Founders Well Participation Program (the "FWPP").  Under that program, McClendon has the right to purchase 2.5% interest in each well drilled by Chesapeake, must pay a proportionate share of related costs, and is entitled to a proportionate share of revenues generated therefrom.McClendon has reportedly participated aggressively in this program, and amassed interests currently valued over $300 million.  However, because of large up front development and operating costs, McClendon's FWPP interests are significantly underwater and have yet to generate any positive cash flow.Unbeknownst to investors, starting in 2009, McClendon leveraged all of his FWPP interests in order to pay up front development costs.  He not only secured loans on his ownership interests in the wells, but also sold off revenue "participation rights" in the wells.  McClendon also secured a personal loan in excess of $500 million from EIG Global Energy Partners, a hedge fund that engaged in financing transactions with Chesapeake.It was not until April 18, 2012 that these previously undisclosed details were widely disclosed by investigative reports published by Reuters and The Wall Street Journal.  Chesapeake shares plummeted $1.06 (from $19.12 per share) ? a 5.5% decline ? representing over a $500 million decline in market cap.Request more information now by clicking here: Take Action If you purchased Chesapeake securities between April 30, 2009 and April 17, 2012 and would like to discuss your legal rights, visit  You can also contact us by calling Richard Gonnello or Francis McConville toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to or  Faruqi & Faruqi, LLP also encourages anyone with information regarding Chesapeake's conduct to contact the firm, including whistleblowers, former employees, shareholders and others. Attorney Advertising.  The law firm responsible for this advertisement is Faruqi & Faruqi, LLP (  Prior results do not guarantee or predict a similar outcome with respect to any future matter.  We welcome the opportunity to discuss your particular case.  All communications will be treated in a confidential matter. FARUQI & FARUQI, LLP 369 Lexington Avenue, 10th Floor New York, NY 10017 Attn:  Richard Gonnello, Esq. Francis McConville, Esq. Telephone: (877) 247-4292 or (212) 983-9330 SOURCE Faruqi & Faruqi, LLP