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Prosecutors Dropping McClendon Indictment, But Industry-Wide Lease Price Fixing Case to Continue

Prosecutors in Oklahoma have moved to drop charges against Aubrey McClendon for his alleged role in a rig bidding conspiracy, following his untimely death Wednesday. However, an ongoing federal investigation continues into price fixing, bid rigging and other anticompetitive conduct in the oil and natural gas industry, officials said.

The motion to dismiss the charge against the natural gas industry icon was filed Thursday in U.S. District Court for the Western District of Oklahoma, one day after McClendon, 56, was killed in a one-vehicle crash in Oklahoma City (see Daily GPIMarch 2aMarch 2b). Dismissing the action "would best meet the ends of justice in that the defendant is now deceased," the filing stated. The filing was made by the Department of Justice's Chicago-based Antitrust Division.

A Justice spokesperson declined to comment but said the federal investigation of antitrust conduct in the industry would continue. The indictment against McClendon indicated he had orchestrated a conspiracy between March 2007 to March 2012 when he was CEO of Chesapeake Energy Corp. The conspiracy alleges that he and another “large” oil and gas company agreed not to bid against each other to purchase the leases in northwestern Oklahoma. The other company has been tentatively identified as SandRidge Energy Co., which at the time of the alleged scheme was run by Chesapeake co-founder Tom Ward.

The indictment also indicated that “various corporations and individuals, not made defendants in this indictment, participated as co-conspirators in the offense charged...and performed acts and made statements in furtherance thereof.”

Meanwhile, Oklahoma City police said the investigation into McClendon's accident could take up to two weeks. An autopsy also is being conducted, which could take up to four months.

A sunrise memorial open to the community was planned to begin about 6:30 a.m. Saturday in the city along the Oklahoma River. It was to start along the shoreline in front of the original Chesapeake Boathouse on Lincoln Boulevard. McClendon was considered instrumental in creating the renowned OKC Boathouse Foundation and Boathouse District. Rowers and paddlers were invited to launch their boats in quiet meditation.

"Aubrey McClendon was the energy behind the dream that has become the OKC Boathouse Foundation and the Boathouse District on the Oklahoma River," said OKC Boathouse Foundation Director Mike Knopp. "His innovative spirit, kindness and generosity will long be remembered."

A public memorial service also is scheduled for 10 a.m. Monday at Crossings Community Church, 14600 N. Portland Ave. in Oklahoma City. The family has requested that, in lieu of flowers, donations be made to The Boys and Girls Clubs of Oklahoma County, P.O. Box 18701, Oklahoma City, OK 73154.

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