Solar Panel Class Action Lawsuits: What Homeowners Should Know

As the solar industry has grown rapidly, so has the volume of consumer complaints and legal action. Class action lawsuits, attorney general investigations, and individual claims have targeted solar companies for practices ranging from misleading sales tactics to defective installations. This guide covers the current landscape and what options may be available to homeowners.

Overview: Solar Industry Litigation

The residential solar industry has seen a significant increase in legal action over the past several years. Based on our research, this trend has been driven by several factors:

• Rapid industry growth that attracted companies more focused on volume than customer satisfaction
• Aggressive door-to-door sales practices that led to widespread consumer complaints about misrepresentation
• Company bankruptcies (most notably Pink Energy/Power Home Solar) that left thousands of homeowners with underperforming systems and no warranty support See bankruptcy list →
• Growing awareness among homeowners that they may have legal recourse for deceptive practices
• State attorney general investigations prompted by volumes of consumer complaints

It's worth noting that the existence of lawsuits does not necessarily prove wrongdoing — lawsuits represent allegations, and outcomes vary. However, the patterns and volume of litigation do indicate systemic issues within certain segments of the solar industry.

Types of Solar Lawsuits

Solar-related legal actions generally fall into several categories:

Class Action Lawsuits

A class action is a lawsuit filed on behalf of a group of people (the "class") who have similar claims against the same defendant. In the solar context, a class might include all customers who signed contracts with a specific company during a certain period and were subject to the same deceptive practices.

Class actions can be efficient because they allow many similar claims to be resolved at once, but individual recoveries tend to be smaller since any settlement is divided among all class members.

Multi-District Litigation (MDL)

When numerous individual lawsuits making similar claims are filed in different courts across the country, they may be consolidated into a Multi-District Litigation for pretrial proceedings. This is more common in cases involving defective products or widespread deceptive practices.

State Attorney General Actions

State attorneys general have consumer protection authority and can bring enforcement actions against companies engaging in deceptive trade practices. These are government actions, not consumer lawsuits, but they can result in restitution for affected homeowners.

Individual Lawsuits and Arbitration

Many homeowners pursue individual claims, either through the court system or through arbitration (if required by their contract). Individual actions may result in larger recoveries per person but require each homeowner to pursue their own case.

Common Legal Claims Against Solar Companies

Based on our research into solar litigation, the most frequent legal claims include:

Notable Solar Lawsuits and Investigations

While this is not an exhaustive list, these cases illustrate the types of legal actions that have been brought against solar companies. The information below is based on publicly available records, and the inclusion of a company here does not constitute an allegation of wrongdoing by SolarPanelExit.com.

Pink Energy / Power Home Solar

One of the most prominent solar industry failures, Pink Energy (formerly Power Home Solar) filed for bankruptcy in 2022 after multiple state attorneys general investigations and thousands of consumer complaints. The company faced allegations of aggressive sales tactics, system underperformance, and failure to honor warranties. The bankruptcy left an estimated 23,000+ customers without warranty support.

State Attorney General Actions

Multiple state attorneys general have brought enforcement actions against solar companies. These investigations have targeted deceptive sales practices, particularly in the door-to-door channel. Some states have secured settlements that include restitution for affected consumers and injunctive relief requiring changes to business practices.

FTC Enforcement

The Federal Trade Commission has also taken action against solar companies for deceptive practices, including cases involving misrepresentations about costs, savings, and contract terms. FTC actions can result in monetary penalties and orders requiring companies to change their practices.

Class Action vs. Individual Lawsuit: Which Is Better?

If you're considering legal action against a solar company, understanding the difference between class actions and individual claims can help you make an informed decision.

In our assessment, the best approach depends on your specific circumstances, the strength of your individual claims, and whether your contract contains a mandatory arbitration clause. Consulting with a consumer protection attorney can help you evaluate which path may be most appropriate.

How to Join a Solar Class Action

If you're interested in joining an existing class action against a solar company, here are the steps:

1. Determine if an active class action exists: Search online for "[company name] class action lawsuit" or check websites like ClassAction.org, TopClassActions.com, or PACER (the federal court system). You can also search your state's court records.
2. Check the class definition: Each class action defines who qualifies as a class member. This typically includes criteria like the company you contracted with, the timeframe, and the type of contract or complaint.
3. Understand opt-in vs. opt-out: Some class actions require you to actively join (opt-in), while others automatically include all qualifying individuals unless you choose to exclude yourself (opt-out).
4. Contact class counsel: The law firm representing the class is typically listed in court documents. You can contact them to inquire about joining or to provide information about your experience.
5. Preserve your documents: Keep all contracts, correspondence, marketing materials, and records of your experience. These may be relevant to the case.

The Arbitration Problem

One of the biggest obstacles to solar litigation — and class actions in particular — is the mandatory arbitration clause that appears in many solar contracts. These clauses typically:

• Require you to resolve disputes through private arbitration instead of court
• Waive your right to participate in class actions (class action waiver)
• Limit the types of damages you can seek
• Specify the arbitration provider and rules (often AAA or JAMS)
• May require arbitration in a specific location

Arbitration isn't necessarily bad — it can be faster and less expensive than court litigation. However, the class action waiver component prevents homeowners from banding together, which can make it economically unfeasible to pursue smaller individual claims.

The enforceability of arbitration clauses and class action waivers varies by state and circumstance. In some cases, courts have found these clauses to be unconscionable or unenforceable. A qualified attorney can evaluate whether the arbitration clause in your specific contract is enforceable. Find a solar panel lawyer →

What to Expect from Solar Litigation

If you decide to pursue legal action — whether through a class action, individual lawsuit, or arbitration — here's what the process typically involves:

Timeline

Solar litigation is generally not a quick process. Individual arbitration cases may resolve in 6-12 months, while class actions can take 2-5 years or longer. Federal court cases involving multiple parties can be particularly lengthy.

Potential Outcomes

• Contract rescission: The court or arbitrator may cancel your contract, effectively putting you back in the position you were in before signing.
• Monetary damages: You may recover payments made under the contract, out-of-pocket expenses, and in some cases statutory or punitive damages.
• System removal: In cases of contract rescission, the solar company may be ordered to remove the equipment at their expense.
• Settlement: Most cases settle before trial. Settlements may include some combination of contract modification, reduced buyout amounts, monetary payments, or other relief.

Costs

Many consumer protection attorneys work on a contingency fee basis, meaning they only get paid if you win or settle. Class action attorneys are typically paid from the settlement fund. However, if you're pursuing individual litigation on an hourly basis, costs can be significant. Always discuss fee arrangements upfront.

Alternatives to Litigation

Legal action isn't always the best or only option. Consider these alternatives:

• Regulatory complaints: Filing complaints with your state attorney general, the FTC, the CFPB, and the BBB can prompt investigations and may result in resolution. Where to report solar scams →
• Direct negotiation: Some homeowners have successfully negotiated contract modifications, reduced buyouts, or cancellations directly with their solar company.
• Solar cancellation services: Professional services that specialize in helping homeowners exit solar contracts. Best solar cancellation companies →
• Mediation: A less adversarial alternative to arbitration where a neutral mediator helps both parties reach a resolution.
• Credit card/lender disputes: If you financed through a credit card or third-party lender, you may be able to dispute the charges under applicable consumer protection laws.

Frequently Asked Questions