Executives at the now-bankrupt solar manufacturer Solyndra won’t testify at the Congressional hearing which is looking into allegations of improper dealings between the green tech company and the White House. Solyndra CEO Brian Harrison and CFO Bill Stover have announced they will plead the Fifth during questioning, on advice of their legal counsel.
The company, the first to be financed by the government’s stimulus plan, has left taxpayers on the hook for $535 million in federally guaranteed loans, and is being held up by some as a high-profile example of President Obama’s failure to properly manage government subsidies.
Solyndra first applied for its loan in 2006, during the Bush administration, but was not awarded the funding until 2009, under Obama. The President also came to the company’s Fremont plant in May of 2010 (video), praising the company as innovative example of how green tech could bring new jobs and aid in the country’s economic recovery.
Fifteen months after receiving federal funding, Solyndra shut down its plants, laid off workers, and was the subject of an FBI raid, due to the questions surrounding whether it had misled federal officials regarding its financial situation. With the public failure, the U.S. Department of Justice is looking into how this company was awarded the funding in the first place.
The largely Republican House Energy and Commerce committee believes there could be a link between the White House’s decision to grant the loan and the involvement of Obama fundraisers George Kaiser, whose family was Solyndra’s biggest investor, and Steve Spinner, a top official in the Energy Department. Although Spinner’s role in the Energy Department was to oversee the $25 billion in government-backed loans, Spinner was not involved with the Solyndra decision specifically because his wife’s law firm represented the company.
The White House claims that Solyndra’s failure was created by a drop in prices and demands for solar panels, however. It denies that Solyndra was given the loan for political reasons. Solyndra itself cites heavy competition from Chinese solar panel makers, which drove down its prices.
Even though Solyndra’s top execs are choosing to not answer direct questions at the upcoming hearing on Friday, the hearing is still being held. McDermott Will & Emery, the firm representing Solyndra in the hearings, says it advised its clients not to talk, due to the ongoing Department of Justice investigation.
“This is not a decision arrived at lightly, but it is a decision dictated by current circumstances,” Walter F. Brown Jr., the lawyer for Solyndra CEO Brian Harrison wrote in a letter to Congress.
“On September 8, 2011, federal agents executed a search warrant at Solyndra’s facilities. Moreover, the United States Department of Justice has initiated an investigation into Solyndra,” he said. Energy Committee Chairman Fred Upton (R.-Mich.) and Rep. Cliff Stearns (R-Fla.), who chairs the oversight and investigations subcommittee, retorted via a statement, “who exactly are Solyndra’s executives trying to protect and what are they trying to hide?”
“We have many questions for Solyndra’s executives on their dealings with the Obama administration, their efforts to secure federal support for a project that appeared doomed from the outset, and why they made certain representations to Congress regarding their dire financial situation just two months ago,” the statement read.