Solyndra trust opposes Suntech case recognition, eyes venue transfer

By Caroline Salls

Pittsburgh, March 17 - The Solyndra Residual Trust objected to Suntech Power Holdings Co., Ltd.'s Chapter 15 petition for recognition of its Cayman Islands proceedings and asked the U.S. Bankruptcy Court for the Southern District of New York to transfer Suntech's case to the U.S. District Court for the Northern District of California, according to Monday court filings.

Solyndra said Suntech accessed the American capital markets to raise nearly $1 billion through a combination of note and American Depositary Share offerings and then used this capital to support its below-cost pricing strategy "and to fund its plan to destroy the U.S. domestic solar industry."

"Unfortunately, Suntech was successful - it and its co-conspirators drove a dozen U.S. solar panel manufacturers, including Solyndra, into bankruptcy, while increasing their market share and attaining monopoly power," Solyndra said.

"Once the International Trade Commission, Department of Commerce, and finally Solyndra sought redress for this anticompetitive behavior, Suntech resorted to insolvency protection in the Cayman islands.

"Suntech's Chapter 15 petition is part of a calculated scheme to rinse away the liability associated with the company's unlawful conduct, defraud the company's creditors and transfer the solar assets to another entity backed by Chinese provincial investment who can capitalize on Suntech's unlawfully obtained market position without encumbrance."

Although Suntech was registered in the Cayman Islands for tax purposes and maintained its "registered office" there, Solyndra said Suntech's center of main interests (COMI) was not in the Cayman Islands as of the commencement of the Cayman proceeding.

"The facts show that Suntech had no commercial relationship to the Cayman Islands such that no creditor would have or should have reasonably expected to have claims adjudicated in the Cayman Islands," the objection said.

To establish the Cayman Islands as Suntech's COMI, Solyndra said Suntech's liquidators have since opened a bank account in the Cayman Islands solely to fund the fees of Cayman Islands professionals; appointed a director based in the Cayman Islands; and held a meeting of the board of directors in the Cayman Islands.

"This court should refuse to sanction this cynical attempt to manufacture a COMI for Suntech in the Cayman Islands and should deny recognition of the Cayman Proceeding as a foreign main proceeding," Solyndra said.

A hearing on recognition of the Cayman proceedings and the venue transfer request is scheduled for April 1.

Suntech is a Wuxi, China-based manufacturer and distributor of solar panels. Its liquidators filed the Chapter 15 case on Feb. 21 under case number 14-10383.

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