Despite objections by the government, Solyndra, the California-based solar panel manufacturer that went bust in August 2011 after receiving $528 million in federal loan guarantees, received approval Monday to go ahead with its bankruptcy plan, Reuters reported.
The government asked a Delaware U.S. Bankruptcy court to reject Solyndra's disclosure statement, arguing that the plan would illegally give $341 million in tax breaks to the venture capital investors Argonaut Private Equity and Madrone Capital Partners.
Argonaut Ventures I is linked to Tulsa billionaire George Kaiser, a fund raiser for President Barack Obama in the 2008 campaign. Argonaut is also the investment arm of the George Kaiser Family Fund Foundation.
In August, Reuters reported, "Argonaut Venture I...and Madrone Partners are set to pilot a reorganized shell company out of the wreckage...part of a Chapter 11 plan...that could be a vehicle to transform the dollars Solyndra lost into significantly more than half a billion future tax breaks for the private equity firms."
In her decision, U. S. Bankruptcy Judge Mary Walrath said the government failed to prove the primary purpose of the plan was to preserve tax benefits for the investors, as reported by Reuters.
The government, which reportedly is unlikely to recoup much of its loan, may appeal the ruling, according to IRS attorney Anne Oliver.
Solyndra underwent an 18 month investigation spearheaded by Republicans based on suspicions relating to its government loan, which was part of a program to promote clean energy, and Kaiser's connection to Argonaut and to President Obama. Solyndra was the first company to receive a loan guarantee under Obama's stimulus program.
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