Chesapeake Antitrust Investigation
Chesapeake Energy if under federal investigation for possible antitrust violations.
Related: Chesapeake to Pay Record Royalty Settlement
TheU.S. Department of Justice announced last month that it has opened an investigation into possible antitrust violations by Chesapeake Energy Corp.
ABC News is reporting that the agency has issued subpoenas for documents related to how the Chesapeake pays royalty owners and accounts for oil and gas reserves.
“There are ongoing governmental regulatory investigations and inquiries into such matters as our royalty practices and possible antitrust violations. The outcome of any pending or future litigation or governmental regulatory matter is uncertain and may adversely affect our results of operations. In addition, we have incurred substantial legal expenses in the past three years, and such expenses may continue to be significant in the future.”
As crude prices and rig counts plummeted over the last year, the number of lawsuits have increased and Texas courts are seeing everything from royalty, lease and title complaints to more complicated contract disputes involving major investors.
Chesapeake has been at the forefront of oil and gas litigation across the country including being named in several lawsuits alleging underpayment of royalties in Arkansas, Louisiana, Ohio, Oklahoma, Pennsylvania and Texas.
- January: the Fort Worth school district was awarded $1 million when Chesapeake improperly deducted expenses from royalties owed to the district and its taxpayers. The suit involved at least 30 leases on land covering at least 1,000 acres.
- February: the Texas Supreme Court upheld a lower court’s ruling to award at least $1 million in royalties, interest and attorney fees to the Hyder family who had been fighting Chesapeake Energy since 2010.
- May: Chesapeake agreed to pay Fort Worth $15 million to settle a lawsuit that claimed the company owed $33.5 million in royalty payments from more than 260 leases on about 5,800 acres of city property in Tarrant and Johnson counties.
- April: the Michigan Attorney General reached an agreement with Chesapeake that included setting up a $25 million fund to pay residents who say they were defrauded by the company.