Pink Energy files for bankruptcy amid mounting complaints against the NC solar company

After its sudden closure amid lawsuits and an avalanche of complaints, the North Carolina solar energy company Pink Energy has filed for Chapter 7 bankruptcy.

The Mooresville-based company, formerly known as Power Home Solar, filed Oct. 7 for liquidation bankruptcy in Western District of North Carolina, documents show. Pink Energy claims it has more than $138 million in debts and at least $100 million in assets, according to court documents. The Charlotte Business Journal first reported on the bankruptcy filing.

A Chapter 7 bankruptcy seeks to liquid the company, unlike a Chapter 11 reorganization bankruptcy.

It’s the latest move by the eight-year-old solar company that served 35,000 residential solar customers in 16 states, including about 5,700 homes in North Carolina.

Pink Energy’s troubles stems from what the company CEO Jayson Waller alleges was faulty equipment from its former business partner Wisconsin-based Generac Power Systems leading to “rampant consumer discontent.”

Timeline of Pink Energy’s fall

In August, Pink Energy sued Generac in federal court in Virginia, citing negligence, breach of contract and other claims against its former business partner, The Charlotte Observer had reported.

Switches produced by Generac, which are supposed to cut off electricity to individual solar panels in case of lightning strikes or power surges, melted or exploded, according to Pink Energy’s complaint.

Last month, Pink Energy reported its third round of companywide layoffs before permanently closing. Pink Energy had had over 2,100 employees at the start of the year before all the layoffs, company officials told The Charlotte Observer.

Last week, Pink Energy CEO Jayson Waller on LinkedIn again blamed former business partner Generac for solar equipment failure leading to financial struggles.

Generac turned blame on Pink Energy. The SnapRS problem was due to bad installation by Pink Energy, the company said in an email to The Charlotte Observer.Generac said customers who need help with its components can reach out to them.

Also, Pink Energy is being investigated by four attorneys general in North Carolina, Virginia, Missouri and Ohio, amid mounting lawsuits and customer complaints.

N.C. Attorney General Josh Stein’s office has fielded 270 complaints about Pink Energy, Press Secretary Nazneen Ahmed told The Charlotte Observer. There were 25 complaints from 2016 to 2020, another 25 complaints last year, and there rest were all received this year, Ahmed said.

Last week, Waller apologized to customers on LinkedIn:

“I’m sorry customers have been left confused and upset. The events leading up to this point came fast and furious. We spent over 50 million dollars in services in just a few months.”

Now, Pink Energy, which is also facing more than a dozen federal lawsuits since mid-July, is seeking relief from its creditors filing for bankruptcy.

In the bankruptcy filing

The bankruptcy court filing shows Pink Energy has between 25,001 and 50,000 creditors.

Among the largest creditors listed are: JP Morgan Chase Bank for nearly $81 million; Meta Platforms Inc. in California for nearly $4.6 million; and U.S. Department of Labor, Wage and Hour Division and Silfab Solar in Buffalo, N.Y., both for over $3.6 million.

Also listed among creditors are Pink Energy executives. Co-founders Jayson Waller of Davidson and Kevin Klink of Mooresville, each owed $442,714.88, and chief operating officer Stephen Murphy of Florida owed $340,543.92, according to the filing.

This story was originally published October 11, 2022 at 6:30 AM.