Michigan Attorney General Dana Nessel filed a lawsuit against a bankrupt Portage solar company, Climax Solar, its owner Joshua Thompson, and multiple lenders over an alleged sales and lending scheme.
The state argues this scheme affected about 1,600 homeowners, leaving many with half-finished projects, property damage, and debt, News Channel 3 reported.
Here's what to know
In the complaint, the state accuses the defendants of violating the Consumer Financial Protection Act, the Michigan Consumer Protection Act, and the Michigan Home Solicitation Sales Act. It also has common-law fraud and unjust enrichment claims.
Michigan officials estimate the financing connected to the alleged scheme at about $81 million.
News Channel 3 reported that the complaint describes a "pitch, sign, fund, fail, and collect" approach in which homeowners were allegedly pushed through e-contracts and financing paperwork during just one visit.
Sales pitches allegedly promised quicker installation, lower power costs, and access to federal tax credits, the outlet reported. The outcome, many customers claim, was solar equipment that was unfinished, underperforming, unsafe, or never turned on.
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More background
The lawsuit says lenders released funds before systems were fully finished, connected to the grid, or cleared by utilities to operate. It further alleges that more than $22 million in financing costs were folded into the listed price of the systems rather than plainly disclosed as finance charges, with dealer and platform fees exceeding 27% of the amount financed.
The complaint also says some customers faced property damage, permit problems, and failed inspections.
What's being done?
Court records show Climax Solar entered Chapter 7 bankruptcy on April 24, 2024, and has shut down, according to News Channel 3. The case is still in its early stages, and no court date has been scheduled.
Anyone considering solar or other eco-friendly home products may also want to educate themselves about greenwashing so flashy sales pitches do not hide expensive terms or poor workmanship.
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