Solyndra investor asked for White House publicity as firm sought federal funds
By Carol D. Leonnig and Joe Stephens,
An investor in Solyndra who was also an Obama administration adviser pushed the White House in 2009 to support the solar panel maker. His push came as the company was seeking a half-billion-dollar Energy Department loan, documents show.
David Prend, a co-founder of the Boston venture capital firm Rockport Capital, met with Obama’s then climate czar, Carol M. Browner, in late February to discuss clean-energy policies of the administration — and Solyndra’s innovative solar panels were mentioned. He then e-mailed a White House aide to “help get the word out” about the company’s pending partnership with the Obama administration. Prend’s Boston-based venture capital firm held 7.5 percent of the company’s equity.
Before Solyndra won the Energy Department’s preliminary approval for a $535 million loan, Prend and a lobbyist for a trade group he helped lead suggested that the White House, and perhaps President Obama, should showcase the company.
“I thought the White House might want to take advantage of this event to highlight a highly successful public/private partnership,” Prend wrote on March 13, 2009.
“Would the President be able to visit Solyndra,” Emily Baker, a lobbyist at the trade group, wrote a few days later, after Prend copied her on his White House request. “Wow, that would be fantastic!”
Solyndra has since shut down. This week, the company disclosed that its chief executive, Brian Harrison, stepped down on Oct. 7. Solyndra filed for bankruptcy protection in early September. Days later, federal investigators raided its plant in Fremont, Calif.
Harrison declined to answer questions from a congressional investigative committee, citing his right not to incriminate himself. He has been accused by Democratic and Republican lawmakers of misleading them this summer about the company’s rosy prospects.
Meanwhile, Prend’s correspondence with the White House, released last week by a government source, shows him suggesting that the White House could help the company meet the requirements for winning the Energy Department-guaranteed loan. Prend did not respond to calls for comment for this story, and a company representative did not respond to e-mails seeking the firm’s comment.
“Solyndra must still raise over $200 million in matching private equity according to the terms of the loan guarantee program,” Prend wrote on March 13 to Greg Nelson, a White House business liaison. “In the current economic environment, they could use all the positive publicity they can get.”
Energy Secretary Steven Chu ended up announcing the preliminary loan agreement, and the company raised the capital without Obama’s personal support.
The e-mails give a glimpse of both an investor’s welcome reception at the White House and the multiple roles Prend had as he pushed for Solyndra. An administration official said Nelson was properly interacting with a business investor seeking attention.
At the time he requested White House support, Prend was co-founder of Rockport Capital, an early investor in Solyndra, starting in 2007. He also chaired a renewable energy panel that advised Obama’s Energy Department on solar technologies and investments.
Prend also was then a board member of a politically influential trade group, the National Venture Capital Association (NVCA). Several of the association’s members had raised campaign money for Obama.
White House press secretary Jay Carney has said Solyndra won its federal loan through merit-based decisions made by career officials within the Energy Department, and with no interference by the White House. The White House also has denied any influence in the loan decision by George Kaiser, a Tulsa billionaire and Obama fundraiser who is linked to several funds that held Solyndra investments. Kaiser also has said he had no involvement in the loan.
A series of new e-mails and disclosures show that a lot of Obama’s political appointees focused considerable energy on getting the company’s federal backing approved. At the Energy Department, Chu boasted of accelerating Solyndra’s application and approving it ahead of schedule to show the administration was trying to stimulate the weakened economy. One of his stimulus advisers, Steven Spinner, whose wife’s firm represented Solyndra, pushed actively for final approval on Solyndra’s loan.
Inside the White House, federal budget staffers complained that the White House chief of staff’s office was rushing them to give final approval to the Solyndra loan in time for a Sept. 4 event, at which Vice President Biden would help announce the loan. Browner also met and talked with a backer of Solyndra before the company won preliminary approval for the project March 20.
Emily Mendell, a spokeswoman for NVCA, said Prend met with Browner in late February — along with a handful of other NVCA board members who were invested in clean-tech companies — with the purpose of discussing broad administration policies. She said that Solyndra and a few other clean-tech companies were only mentioned in passing.
A House energy subcommittee now investigating Solyndra is scheduled to hold another hearing Friday to question Treasury officials about the loan deal.
In this week’s court filings in its federal bankruptcy case, Solyndra argues that Harrison’s resignation was expected even before the FBI raided the company’s offices and Harrison pleaded his Fifth Amendment rights.
Harrison joined Solyndra as chief executive in July 2010, taking over from company founder Chris Gronet.
He and other Solyndra officials have been criticized for projecting a rosy financial picture for the company as late as this summer. Behind the scenes, the firm was desperately trying to stave off bankruptcy.
The company contends that its default on the Energy Department loan should have come as no surprise, since the agency’s representatives sat in on its board meetings and the department got weekly updates on Solyndra’s “finances, operations and prospects.”
“At no time since the DOE loan guarantee was approved did the DOE raise any concerns about improprieties,” attorneys for Solyndra argued in an Oct. 11 filing to the U.S. Bankruptcy Court in Delaware.
A Energy Department spokesman declined to comment on Harrison’s departure.
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