U.S. wants trustee appointed to oversee Solyndra
Reporting from Washington — The U.S. government wants a trustee appointed to run failed solar panel manufacturer Solyndra Inc. because company executives have refused to answer questions about the operation.
The decision by Solyndra Chief Executive Brian Harrington and Chief Financial Officer Bill Stover to invoke their 5th Amendment rights at a congressional hearing last week prevents them “from properly exercising their fiduciary responsibilities,†according to a government filing Friday with the Delaware court handling Solyndra’s bankruptcy.
Investigations into the Fremont, Calif., company’s failure also threaten to distract company executives from performing their duties as they seek Chapter 11 restructuring, said the filing by the U.S. Trustee, an arm of the Justice Department that oversees bankruptcy cases.
Solyndra received a $535-million loan guarantee from the Department of Energy in 2009. The company’s failure has led to investigations by the FBI and the Department of Energy’s inspector general, as well as to congressional hearings.
Republicans have charged that the Obama administration rushed Solyndra’s application and later restructured the loan guarantee for political reasons. Administration officials have denied any wrongdoing.
The government “at this juncture … alleges no specific wrongdoing,†Friday’s filing said. But a trustee is needed, it said, to ensure the company can be run properly during the bankruptcy proceedings.
On Sept. 15, Solyndra’s counsel, Benjamin Schwartz, refused to answer a question from the U.S. Trustee about the company’s customer contracts because “the topic likely would be the subject of investigation and possibly litigation,†the government filing said.
The government requested that the court liquidate the company under Chapter 7 if a trustee is not appointed.
A Solyndra spokesman did not respond to a request for comment.
Addressing the controversy Friday, White House Press Secretary Jay Carney said President Obama stood by Energy Secretary Steven Chu, who gave final approval for the Solyndra loan guarantee and its restructuring.
“Secretary Chu does have the president’s full confidence,†Carney said.
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