KNOXVILLE, Tenn. — The company that owns Solar Titan is now under a federally imposed restraining order and the control of a federally appointed receiver.
The attorneys general for Tennessee and Kentucky sought federal intervention in U.S. District Court in East Tennessee this week. Investigators cite concerns over "pervasive and ongoing deceptive and unfair business practices" in seeking the protective order.
On Monday, U.S. District Court Judge Clifton L. Corker, based in Greeneville, granted their requests, appointing Richard Ray as receiver for the firm, which is owned in title by Ideal Horizon Benefits LLC.
"There is good cause to believe that immediate and irreparable harm will result from Solar Titan Defendants’ ongoing violations of the Consumer Financial Protection Act... and other state and federal laws unless the Solar Titan Defendants are restrained and enjoined by Order of this Court," Judge Corker wrote in his decision.
WBIR for months has been reporting on customer complaints about the Knoxville-based Solar Titan. Numerous customers who say they've spent thousands of dollars have told 10News that Solar Titan has failed to deliver on promises for its solar products.
The complaint said Solar Titan and its leaders — Craig Kelley, Richard Atnip and Sarah Kirkland — "drastically exaggerates the amount of electric utility bill savings consumers will experience."
It said the systems rarely performed as promised.
"Because Solar Titan's installation process is heavily flawed, the systems are often not operational until months after the consumer has started receiving bills from Mosaic," the complaint said. "Solar Titan installers are often inexperienced and lack proper training. They also lack appropriate oversight from licensed professionals."
The Tennessee Attorney General's Office has received scores of complaints since 2022 from customers who say they were duped by Solar Titan personnel about the benefits and services they'd get from solar panel installations. Kentucky has fielded over 115 complaints, 92 submitted directly to the Attorney General's Office since 2020.
“Companies that cheat customers through false representations should and will be held accountable,” Attorney General Jonathan Skrmetti said. “Our Consumer Protection team has spent countless hours investigating hundreds of complaints related to Solar Titan. I appreciate their diligence and dedication to serving Tennesseans.”
According to an announcement Wednesday by the Kentucky Attorney General's Office, an investigation "uncovered evidence indicating that Solar Titan’s principals were potentially misappropriating consumer funds by making lavish personal purchases instead of paying employees or fulfilling obligations to customers."
The attorneys general want to ensure company assets are set aside for the benefit of customers. They allege the firm as its primary lender, Solar Mosaic Inc., have violated numerous state and federal laws meant to protect consumer interests.
"Despite being aware of the large volume of and egregious nature of consumer complaints against Solar Titan, Mosaic has continued to conduct business with the company," the complaint said. "This partnership has allowed Mosaic to reap enormous profits while facing no consequences for its participation in this harmful and unlawful business scheme."
Under the order signed by Corker, Solar Titan must let Ray "oversee and manage the company."
The complaint said Kelley and Kirkland told Solar Titan employees "not to cancel contracts even when consumers have properly exercised their three-day right to rescind their contract."
It said Kelley, Atnip and Kirkland are using the funds from those canceled contracts to pay their own personal expenses.
"Kelley, Atnip, and Kirkland, having realized healthy profits from their illegal conduct, have used their ill-gotten gains to purchase or lease expensive items such as luxury vehicles, multi-million-dollar homes, large boats, and even a jet airplane," the complaint said. "They have also used this money to launch a new business endeavor, Solar Titan Charters, LLC."
On its website, Solar Titan acknowledges the court's order and directs customers on how to proceed.
Their message reads:
"Ideal Horizon Benefits LLC doing business as Solar Titan USA is currently under the control of the United States District Court of East Tennessee at Knoxville, TN. Richard Ray is the court appointed receiver with oversight responsibilities over the Company. He will provide regular updates to the Court as ordered and will provide public announcements via this website as directed by the Court. If you are a customer and wish to file a consumer complaint please go to the “Contact Us” tab of this site and inform us of your complaint.
"If you have already filed a consumer complaint please go to the “Contact Us” tab of this site and inform us of the current status of your complaint. Richard Ray, Receiver will oversee, on behalf of the US District Court, the evaluation of complaints against this business, and present his recommended solution to the Court for approval.
The complaint said Solar Titan was founded in 2019 and has been managed and/or operated by Kelley, Atnip and Kirkland since its founding.
It said Atnip, who is married to Kelly, "agreed to sign all of the company documents and act as a managing member of the business, concealing Kelley's role in managing and operating the business," because of Kelley's prior felony conviction for wire fraud.
"[They] knew that Kelley's status as a felon convicted of federal wire fraud could preclude Kelley from operating a business reliant on consumer loans because lenders could be unwilling to work with someone with a history of financial crimes," the complaint read. "Although Atnip originally handled significant administrative tasks for the business, Kelley and Kirkland persuaded Atnip to disengage from the operations."
Atnip told 10News he was a silent partner when we asked whether the company was laying off staff members. The attorneys general said he told them otherwise.
"Atnip has continuously misrepresented to various Secretaries of State and Solar Titan's business partners (including the consumer lenders) that he was the company's primary operational manager," the complaint said. "Kelley has intentionally misled business partners and creditors by failing to disclose his position as the company's primary operational manager."