SEC Rips Tesla’s Sketchy Accounting Practices

The Securities and Exchange Commission blasted Tesla Motors for using and sharing prohibited accounting information with investors prior to the company’s merger with SolarCity.

The California-based electric vehicle maker used “individually tailored” when it added back costs to revenue numbers calculated under a set of financial rules called GAAP, which are used to inform the SEC about a company’s yearly revenue and expenditures.

The SEC allows the use of some non-GAAP metrics, but most exotic figures that adjust expenditures are prohibited. One common non-GAAP procedure is to exclude irregular expenses, such as those related to acquisitions and other unusual circumstances.

Tesla’s business dealings are nothing if not unusual. The company jumps around from crafting electric vehicles to building solar-panel layered roofs.

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SolarCity accused of misappropriating solar company Cogenra’s trade secrets

Solar company Cogenra is suing Elon Musk’s SolarCity over the use of shingling technology the company alleges SolarCity took from Cogenra and used to create a world-record breaking solar panel.

Cogenra says it shared its “most precious and confidential trade secrets, manufacturing processes, and other intellectual property with Silevo and SolarCity” between 2010 and 2014.

Silevo is a subsidiary of SolarCity and the complaint alleges these trade secrets gave SolarCity a leg up in manufacturing its own solar cells.

“It was only by misappropriating Cogenra’s proprietary technology, including its trade secrets and other intellectual property, that SolarCity and Silevo were later able to announce a claim that they set a new world record for solar panel energy efficiency,” Cogenra said in the suit.

The complaint also says Cogenra began shopping itself around to bigger solar companies in 2014 and, according to sources who spoke to Bloomberg, one of those companies considered a potential buyer was SolarCity. The possible acquisition allegedly gave SolarCity access to classified information.

However, SolarCity calls the lawsuit “meritless” and says the whole thing began after it alerted SunPower to an ex-SolarCity employee who had unlawfully downloaded confidential information from the company and recently joined SunPower, Cogenra’s parent company, as a senior sales manager.

“Instead of taking responsibility and ensuring the return of our misappropriated trade secrets, SunPower subsidiary Cogenra raced to court to divert attention from its conduct by filing a meritless lawsuit,” SolarCity told TechCrunch. “Cogenra’s complaint fails to identify any actual trade secret that Cogenra owns, much less that SolarCity supposedly misappropriated.  We are confident the court ultimately will reject Cogenra’s claims, which are factually and legally baseless.”

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