Chesapeake, Execs Sued Over Stock Offering Omissions

Law360, New York (September 7, 2011, 7:20 PM EDT) -- Natural gas producer Chesapeake Energy Corp. and its directors were hit with a shareholder derivative lawsuit in Oklahoma on Tuesday claiming they breached their fiduciary duties by failing to disclose certain risks as part of a stock offering worth $1.65 billion.

Stockholder M. Lee Arnold says in his complaint that the risks left out of the stock offering's registration statement concerned Chesapeake's aggressive use of knockout swaps as part of its hedging activities, the company's ties to now bankrupt Lehman Brothers Inc. in its hedging contracts...
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