Roughly two years after ousting Aubrey McClendon, Chesapeake Energy is reportedly accusing its co-founder and former CEO of stealing sensitive company information on his way out the door.
The Oklahoma City-based energy giant filed a lawsuit in federal court Tuesday alleging that, in 2013, McClendon spent his final months at the helm of Chesapeake hoarding company data on available land with potential for oil and gas mining, according to Reuters. Chesapeake (CHK) says McClendon had maps printed and also e-mailed himself information on open acreage in the Utica Shale formation, in Ohio, before putting that data to use for his next venture: founding rival company American Energy Partners.
McClendon co-founded Chesapeake in 1989 and helped accelerate the company’s growth by adopting the now widely-used drilling method of hydraulic fracturing, also known as “fracking.” With McClendon at the helm, Chesapeake grew to become the country’s second-largest natural gas producer, behind only Exxon Mobil (XOM). In 2008, Coins2Day profiled McClendon, noting Chesapeake’s ascent amid U.S. Natural gas prices that were skyrocketing at the time, but have since come back down to earth. (Those declining natural gas prices left Chesapeake saddled with debt after its rapid expansion efforts, and the recent drop-off in oil prices has seen the company’s stock price fall nearly 17% over the past year.)
However, McClendon agreed to step down from his CEO role in early 2013 after reports surfaced revealing he had borrowed more than $1 billion against his own stake in company oil wells. The reports raised questions about a possible conflict of interest, although a Chesapeake internal investigation found no evidence of wrongdoing. McClendon was also under SEC investigation for the loans, much of which came from financial entities with investments in Chesapeake, but the government dropped its probe last year.
Within a year of McClendon leaving Chesapeake, Reuters reports, an affiliate of McClendon’s American Energy Partners had raised $1.7 billion in equity and debt that the company said it would use to buy 110,000 acres in the Utica Shale formation and begin drilling. Chesapeake’s lawsuit accuses American Energy Partners of violating Oklahoma trade secrets laws and the company is asking a federal judge to create a trust to house all of the income McClendon’s current company has earned from Utica Shale drilling, which the lawsuit claims was earned as a result of stolen Chesapeake data.
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In a statement Tuesday, McClendon and American Energy Partners said they would “respond vigorously to a baseless legal action” brought by Chesapeake. Chesapeake promised McClendon he could have information on thousands of oil wells upon his departure from the company, the former CEO said in a press release. That release also says McClendon’s separation agreement with Chesapeake gave him the right to share that information with future employees and business partners.
“It is beyond belief that the company that I co-founded 25 years ago and where I worked tirelessly to build it into one of America’s largest and most successful oil and gas producers has now decided to add insult to injury almost two years to the day after my resignation by wrongly accusing me of misappropriating information,” McClendon said in a statement.
He added: “It is a sad day to see Chesapeake stoop so low as to sue its co-founder for having information that was earned, paid for and provided through my contracts with Chesapeake.”
In a statement issued Tuesday afternoon, Chesapeake disagreed with McClendon’s claim that he obtained the company data in question legally, as part of his separation agreement. “We strongly disagree with Mr. McClendon’s and AEP’s allegations and will address them in the appropriate forum,” Chesapeake spokesman Gordon Pennoyer said.
UPDATE: This article has been updated with a response from Chesapeake to statements by McClendon and American Energy Partners.
