Skip to Content

SolarCity Is Being Sued for Intellectual Property Theft

September 27, 2016

A SolarCity Corp. Residential Solar Panel Installation Ahead Of Earnings FiguresA SolarCity Corp. Residential Solar Panel Installation Ahead Of Earnings Figures
Workers unload solar panels during a SolarCity residential installation in Albuquerque, New Mexico on Feb. 8, 2016. Sergio Flores/Bloomberg via Getty Images

Elon Musk’s SolarCity (SCTY) has been accused of intellectual property theft by Cogenra Solar, a wholly owned subsidiary of SunPower (SPWR), and Khosla Ventures.

In a lawsuit filed in San Francisco on Monday, the parties accused SolarCity of gaining undue advantage of Cogenra’s Shingling technology that helps in manufacturing high-efficiency commercially viable solar panels.

SolarCity and its subsidiary Silevo misappropriated Cogenra’s trade secrets, manufacturing processes, and other intellectual property to give themselves a competitive advantage and head start in developing shingled-cell solar modules, Cogenra said in the lawsuit.

See also: SolarCity, Berkshire’s NV Energy Settle Nevada Rooftop Solar Dispute

SolarCity said that last week it discovered that a former SolarCity employee had unlawfully downloaded confidential information, copied that information to a personal hard drive, and then joined SunPower as a senior sales manager.

“Any unauthorized copying and use of this information is a very serious violation of SolarCity’s intellectual property rights so we immediately notified SunPower,” SolarCity said in a statement.

Cogenra’s complaint fails to identify any actual trade secret that Cogenra owns, much less that SolarCity supposedly misappropriated, SolarCity said.

From 2009 to 2015, venture capital firm Khosla Ventures owned about 80% of Cogenra, the lawsuit stated.

Last week Tesla said its proposed acquisition of SolarCity could be delayed because of shareholder lawsuits alleging board members breached their fiduciary duty.