Walmart sues Tesla for solar panel fires

Walmart has filed a lawsuit against Tesla for fires at the rooftop solar installations at seven locations.

Lora Kolodny had the news for CNBC:

Walmart is suing Elon Musk’s electric vehicle and clean energy company after Tesla solar panels atop seven of the retailer’s stores allegedly caught fire, according a court filing.

The Walmart suit alleges breach of contract, gross negligence and failure to live up to industry standards. Walmart is asking Tesla to remove solar panels from more than 240 Walmart locations where they have been installed, and to pay damages related to all the fires Walmart says that Tesla caused.

The Walmart suit, filed in the state of New York, alleges that: “As of November 2018, no fewer than seven Walmart stores had experienced fires due to Tesla’s solar systems – including the four fires described above and three others that had occurred earlier.” The filing details evacuations, damaged property and inventory.

Tesla’s stock dropped more than 1% after hours on the news.

Walmart claimed, among myriad complaints, that “Tesla routinely deployed individuals to inspect the solar systems who lacked basic solar training and knowledge.” In the suit, they also alleged that Tesla failed to ground its solar and electrical systems properly, and that Tesla-installed solar panels on-site at Walmart stores contained a high number of defects that were visible to the naked eye, and which Tesla should have found and repaired before they led to fires.

CNN’s Clare Duffy reported:

In recent years, Walmart (WMT) installed solar panels from Tesla Energy Operations on the more than 240 stores across the country. The two companies agreed that Walmart would lease or license its roof space to Tesla (TSLA) for the solar panels in exchange for lower energy costs, and Tesla would retain ownership of the panels and handle their maintenance, the filing states. It details fires at seven stores across the country, which Walmart contends all originated in Tesla solar panels and cost the retailer millions in repairs.

“To state the obvious, properly designed, installed, inspected, and maintained solar systems do not spontaneously combust, and the occurrence of multiple fires involving Tesla’s solar systems is but one unmistakable sign of negligence by Tesla,” the complaint states.

With the suit, Walmart is seeking to recover the costs related to the fires and have Tesla remove the systems, as well as unspecified other damages.

Jon Fingas from Engadget noted Tesla will likely fight back:

The big-box chain formally accused Tesla of breach of contract, gross negligence and failure to meet industry standards. It wanted Tesla to not only pay damages related to the first, but to remove its panels from over 240 Walmart stores.

We’ve asked Tesla for comment.

There’s a good possibility Tesla will fight back, though. The company has been struggling to revive its solar business, which installed a modest 29MW of solar power capacity in the second quarter compared to more than 200MW at the division’s peak. The last thing it needs is to lose a major deployment and suffer the negative publicity that comes with that loss.