BR&B’s Class and Derivative Lawsuit Involving Cheniere Energy Yields Postponement of Shareholder Vote on Proposed Share Reserve Increase

6/2/2014 - Barrack, Rodos & Bacine announces that the class and derivative lawsuit it filed in the Court of Chancery of the State of Delaware on behalf of the public stockholders of Cheniere Energy, Inc. against the company’s CEO, certain of its executives, and the members of its board of directors, has sparked a significant reaction by the company.  The complaint, which was filed May 29, 2014, alleged that Cheniere’s management team and board breached the terms of the company’s bylaws as well as their fiduciary duties to the company and its shareholders.  The complaint alleged that the defendants were unjustly enriched by the hundreds of millions of dollars of stock awarded to them in 2013 by the board.  The lawsuit also sought to enjoin an upcoming shareholder vote on a board proposal for a 30 million share increase for future stock awards until defendants have made full and fair disclosure about both previous stock awards and the current share reserve increase proposal.

On May 30, 2014, BR&B filed brief in support of the previously-filed motion to expedite proceedings in the case, which requested that the Court hold a hearing on whether the shareholder vote scheduled for June 12, 2014, should go forward without further disclosures being made by the company.  A copy of the brief filed in support of the motion is available here.

In response, on June 2, 2014, the company filed a Form 8-K with the U.S. Securities and Exchange Commission, announcing that it has decided

to postpone the 2014 Annual Meeting of Stockholders of the Company, previously scheduled to be held … on Thursday, June 12, 2014, in light of a complaint that has been filed in the Delaware Court of Chancery of the State of Delaware styled Jones v. Souki, et al., C.A. No. 9710-VCL (Del. Ch.) and plaintiff’s request to expedite proceedings before the June 12th Annual Meeting.  

The company also announced that its 2014 Annual Meeting has been postponed until September 11, 2014, and that formal notice setting forth the exact location and time of the rescheduled meeting will be mailed to stockholders “in due course.”

For additional information about this class action, please contact Barrack Rodos & Bacine at (215) 963-0600, or via e-mail to Michael Toomey at mtoomey@barrack.com or Julie Palley at jpalley@barrack.com