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Career Civil Servants and Outside Counsel Agreed that Solyndra Restructuring was Legal

November 17, 2011 - 5:12pm

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There were a series of incorrect assertions and misstatements during the November 17, 2011, hearing about the legality of the restructuring of the Solyndra loan.  Secretary Chu relied on the thoughtful, thorough legal analysis of the career lawyers in the Department’s loan program.  The chief counsel of the loan program, as well as the Department’s general counsel, conducted a careful analysis of the terms of the restructuring and determined that it was legal and consistent with the Department’s obligation to protect taxpayers.  (Read the memo HERE.)
 
This legal opinion was reviewed by the Department’s outside counsel, Morrison and Foerster, who said that it was a “reasonable interpretation” and that it was sufficient to “support the contemplated action to be taken by the Secretary.”  (Read those emails HERE
.) 
 
In addition, the former General Counsel of the Department of Energy has released an independent analysis supporting the legal view of the Department’s career civil servant attorneys. (Read it HERE
. )
 
The Republican committee staff have released an early draft of an outline of a legal and contractual analysis from Morrison & Foerster which does not take a firm view of whether the Department can subordinate a loan subsequent to origination, EXCEPT to say that: “there does not seem to be any restriction on subordination of Borrower reimbursement obligations to DOE.”

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