Gastar Exploration Ltd. (
) is down 24% at $1.27, lifting off an earlier new year low of
$1.17, still reeling after Chesapeake Energy Corp. (
) and its wholly owned subsidiary Chesapeake Exploration L.L.C.
filed a lawsuit against GST and certain of its subsidiaries in the
U.S. District Court for the Southern District of Texas.
The lawsuit is based on claims previously described in GST's
Annual Report on Form 10-K for the year ended December 31, 2011.
The lawsuit seeks rescission of certain transactions that closed in
2005 involving GST's Hilltop Prospect in Leon and Robertson
Counties in Texas and an investment in GST's common stock by
Chesapeake. In addition to its original initial investment of $81.6
million, Chesapeake is seeking reimbursement of additional lease
and well costs allegedly expended by them.
GST president and CEO J. Russell Porter said CHK's allegations
are based on a "mutual mistake of fact, are completely without
merit." GST said it rejects CHK's claims and intends to vigorously
defend itself against this lawsuit.
CHK is down near 3% at close to $19.00, trading in a 52-week
range of $13.32 - $29.87.