Solyndra plan draws objection from hospitality worker union Unite Here

By Caroline Salls

Pittsburgh, Oct. 11 - Solyndra LLC's bankruptcy reorganization plan drew opposition from officials of hospitality workers union Unite Here, according to a Unite Here news release.

The officials said they are in part reacting to conservative politicians denouncing the millions in federal subsidies and loan guarantees given to Solyndra.

"What has usually been missing from this past year's commentary is that much of Solyndra's funding came from private sources," Unite Here secretary-treasurer Sherri Chiesa said in the release.

"Prominent among them is Madrone Capital, a private equity firm that acts as an investment arm of the Walton family fortune. The Waltons are active supporters of Republicans."

Chiesa also noted a connection to Hyatt Hotels.

Madrone benefits

According to the release, Solyndra's plan will heavily benefit Madrone and other major investors at the expense of Solyndra's smaller creditors and the federal government, which will likely recoup only three cents and less than 19 cents on the dollar, respectively.

"In principle, bankruptcy plans are supposed to protect creditors over shareholders, because shareholders get all the upside if a company does well - that is part of the inherent risk in making an equity investment," Unite Here general counsel Richard McCracken said in the release.

The union said Solyndra's plan would give these investors all of this company's tax credits, which are likely worth $318 million to $352 million, according to the bankruptcy disclosure statement.

Unite Here said investors Madrone and Argonaut would pay at most $10.2 million for these credits.

The union said Madrone has ties to Wal-Mart, Enphase Energy, Hyatt Hotels Corp., Baidu and 99Bill Corp.

"With that kind of profile, there can be little doubt that Madrone and [Madrone co-managing partner Greg] Penner can afford to give Solyndra's creditors and the American taxpayer a better share of Solyndra's unused hundreds of millions in tax benefits," Chiesa said in the release.

"In the interest of taxpayers like our union's members and Solyndra's creditors alike, this deal does not deserve to see the light of day."

Solyndra's plan confirmation hearing is scheduled for Oct. 17.

Solyndra is a Fremont, Calif.-based manufacturer of cylindrical solar photovoltaic systems for large industrial and commercial rooftops. The company filed for bankruptcy on Sept. 6, 2011 in the U.S. Bankruptcy Court for the District of Delaware. Its Chapter 11 case number is 11-12799.

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