Case Spotlight: First Solar Inc. Reaches $350m Settlement Agreement

COMPANYFirst Solar Inc.
SETTLEMENT AMOUNT$350,000,000 (tentative settlement)
INDUSTRYManufacturing
CLAIMSMisleading financials
RELEVANT PERIOD April 30, 2008 - February 28, 2012
CLAIM DEADLINETBD

CASE BACKGROUND

In Q3 2009, First Solar Inc., one of the largest and most successful U.S. solar-panel manufacturers, announced the discovery of a defect that impacted 4% of the panels it produced between June 2008 and June 2009. The company pledged to replace any faulty panels distributed to customers. It was not until July 2010 that First Solar logged the impact of those claims on its financials, which accounted for tens of millions of dollars. In Q4 2011, the warranty-related expenses increased causing an 11% decrease in the share price.

A class action lawsuit was filed in 2012 accusing First Solar of failing to provide a clear picture of its warranty-related costs in financial filings whereby shares dropped nearly 90% between Spring 2009 and Winter 2012.

CLASS DEFINITION

All persons and entities who purchased or otherwise acquired the Company’s shares during the period April 30, 2008 and February 28, 2012.

RECENT UPDATE

On January 6, 2020, First Solar Inc. announced that they agree to pay $350m to settle the previously disclosed class action litigation filed in 2012 (Smilovits v. First Solar, Inc., et al., No. 2:12-cv-00555-DGC).

IMPORTANT DATES AND DEADLINES

  • Final Approval Hearing; February 14, 2020

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