According to a law firm press release dated September 5, 2008, a class action complaint has been filed against the company and certain current and former officers and directors. The Complaint alleges violations of Section 11 and Section 15 of the Securities Act of 1933, including allegations of material misrepresentations and
omissions in Quest's Registration Statement and Prospectus issued in connection with the Initial Public Offering ("IPO") on November 7, 2007. The class period begins with the IPO on November 7, 2007 and continues through August 25, 2008.
Quest Energy and certain of its officers and a controlling entity are charged with including, or allowing the inclusion of, materially false and misleading statements in the Registration Statement and Prospectus issued in connection with the Company's IPO, in violation of the Securities Act of 1933. In particular, despite raising $150 million in its IPO, Quest Energy failed to properly disclose related
party transactions between its former CEO and an entity he controlled. On August 25, 2008 Quest Energy announced the resignation of CEO Jerry Cash after the Oklahoma Department of Securities' inquiry concerning, among other issues, questionable transfers of Quest Energy funds to an entity Mr. Cash controlled. The Company announced the creation of a special committee to conduct an internal
investigation. After these announcements, the price of Quest Energy shares has fallen dramatically.
On December 29, 2008, an Order of Consolidation was entered by the court consolidating all parallel actions.
On September 24, 2009, an order granting lead plaintiff and lead counsel was entered by the court.
On November 3, 2009, the Court held a status conference in this matter. At the status conference, the Court granted lead plaintiffs’ unopposed request to file separate consolidated amended complaints. Accordingly, the Court ORDERS that all pleadings and filings for the Quest Energy Class be filed under Friedman v. Quest Energy Partners, LP, et al., case no. CIV-08-936-M and all pleadings and filings for the Quest Resource Class be filed under Jents v. Quest Resource Corporation, et al., case no. CIV-08-968-M.
On Novemeber 10, 2009, a Consolidated Complaint against Quest Energy Partners LP was filed by the Lead Plaintiff Groups in this action.
On August 13, 2010, pursuant to an Order of the United States District Court for the Western District of Oklahoma, a preliminary approval of settlement was found to be fair, reasonable and adequate.