Gretchen Morgenson of the New York Times reports that former Sonic owner Aubrey McClendon is facing an inquiry in the state of Oklahoma after a shareholder of Chesapeake Energy demanded tighter scrutiny of a huge bonus McClendon received in the tail-end of 2008.
As Morenson reports, McClendon was awarded $75 million by Chesapeake and a new contract in December 2008, after his old contract (a five-year deal signed in 2007), was viewed as out of date (translation - because Chesapeake's stock had dropped so precipitously, it was no longer financially viable for the soon-to-be-broke McClendon).
Anyhow, the board of directors deemed CHK's $33 billion drop in value from July to December to be meritorious of a $75 million reward to Aubrey. The shareholders, Louisiana Municipal Police Employee Retirement System, which saw their 85,000 shares drop in value from more than $6 million to less than $2 million, didn't think so.
And so, rather than file a lawsuit, the group decided to file a "books and records demand" in the State of Oklahoma. Will this filing force McClendon to return the $75 million and tear up his new contract? Unlikely. Will this filing force Chesapeake to go through a few months of uncomfortable headlines, require the conniving McClendon to fess up to poor management, and create some unsettling feelings for the board of directors? You bet.
Couldn't happen to a nicer bunch of guys.