Corporate slime & 1%'ers strike again...

Oil giant's shell game nets elderly farmers
Promises made, but not kept, and it's all legal

TRAVERSE CITY, Michigan — Late in the summer of 2010, hundreds of farmers in northern Michigan were fuming. All had signed leases with local brokers permitting drillers to tap natural gas and oil beneath their land. All were demanding thousands of dollars in bonuses they had been promised in exchange. But none knew for certain whom to go after.

That's because the company rejecting their leases hadn't signed them to begin with. In fact, the company issuing the rejections wasn't much of a business at all. It was a shell company - a paper-only firm with no real operations - called Northern Michigan Exploration LLC.

One jilted land owner, Eric Boyer-Lashuay, called to complain to the broker who had handled his lease. Northern, he recalls saying, is "a shell company ... a blank door with no one behind it." Today, he puts it this way: "It was all a fake, all a scam."

Northern has voided hundreds of land deals, and was indeed a facade - a shell company created so that one of America's largest energy companies could conceal its role in the leasing spree, a Reuters investigation has found. Oklahoma-based Chesapeake Energy Corp., the nation's second-largest gas driller, was behind the entire operation.

Chesapeake had created one shell company that set up another, Northern Michigan Exploration. Next, Northern hired brokers who signed leases with residents such as Boyer-Lashuay. And those brokers were under strict orders not to divulge Chesapeake's role, records reviewed by Reuters show.

In fact, the effort in Michigan was directed from the very top - by Chesapeake's CEO, Aubrey McClendon. In corporate filings that Chesapeake made public earlier this year - nine months after McClendon's agents began signing Michigan land leases - McClendon is named as the chief executive officer of Northern, the shell company that voided hundreds of those leases.

Chesapeake's effort to hide its involvement isn't illegal. To the contrary, the company's maneuvering exemplifies how U.S. corporations routinely can conceal financial and corporate transactions through the use of shell companies.

http://www.msnbc.msn.com/id/45804987/ns ... _business/

Yep, here's how the corporate slime operate... "Trust us... We're here to help you"....and our buddies, the GOP, are covering our backsides....

Well, That is the pits for sure. I expect there will be plenty of legal action on this matter. It sucks, but it in no way is a generalization as you wish to make it.

What's this got to do with 1%'ers?

An exploration company created a shell company to test the waters with out tipping their hand, who was harmed? What did the "farmers" give up? Nothing. What did they receive? Nothing. No harm no foul.

So, legal documents, i.e., signed leases, turn out to be fraudulent, promises made in the legal documents allowing the corporate slime to drill, in exchange for lease payments are rejected...And to you that's "no harm, no foul"?

Why am I not surprised... Sure, it's only a fraudulent lease... The document wasn't worth the paper it was written on, and Chesapeake Energy Corp knew it... And actually created a phony shell company, that in turn created a second phony shell company to cover their tracks....And to you that's "no harm, no foul"?

Why am I not surprised...

LadyJazzer wrote:
[snip]

Yep, here's how the corporate slime operate... "Trust us... We're here to help you"....and our buddies, the GOP, are covering our backsides....

There was NOTHING in that article that had anything to do with the GOP. The words "GOP", "conservative", "Republican"... nothing... never show up anywhere in the article. One Democratic politician is mentioned.

And the article states "Chesapeake's effort to hide its involvement isn't illegal. To the contrary, the company's maneuvering exemplifies how U.S. corporations routinely can conceal financial and corporate transactions through the use of shell companies." So... I don't know who is covering anything except for the fact that the law is on their side.

How does the GOP figure into this article?

from the quoted article

Chesapeake says it acted properly. It says some land owners were paid bonuses. It also disputes "canceling" any Michigan contracts; rather, some contracts were "rejected" because property titles didn't pass muster, its corporate counsel says.

In written responses, Chesapeake says it sometimes uses shell companies to "keep a low profile" and avoid tipping off competitors and "speculators" about its land-leasing and drilling efforts. Such tactics are common in real estate, scholars say.
"It's common to take leases through a shell corporation or through a landman company," says Lowe, the professor of energy law at SMU's Dedman Law School in Dallas. "If you're a farmer or a rancher and you see a big, deep-pocketed oil company pull up in your driveway, then your price goes up."

I still don't see where any wells were drilled and the landowners were not paid. Maybe the landowners should have done a little due diligence instead of falling for the hype, before signing leases expecting a windfall.

Yeah... Stupid suckers... Shouldn't have believed a shell corporation of a shell corporation would have acted ethically or legally. Dumb twits...

Things seem to be a little less than clear here, which is not surprising given the initiator of the thread and her daily quest to become outraged at something or another.

The people who were not paid after they signed a lease - was there, or was there not, drilling that occurred after the lease was signed? If Chesapeake rejected the lease due to title irregularities or questions, it would seem to follow that no drilling then occurred on a land where there was no lease. Those leases that were accepted seemed to have been paid in accordance with the terms of the lease. If the lease was not accepted, and no drilling occurred, why would anyone owe anything to the land owner whether it was Chesapeake or their shell company? Can someone explain to me why a lease that was not accepted would still have money owed? If you sign the lease paper for a car and the company rejects the lease for whatever reason, why would you be still owed the use of the car under the terms and conditions of the lease?

So we have a battle between wealthy land owners and "Big Oil"? :pop

The lawyers will probably win...