Search Results for: XP Technology

XP Technology Retains Cause of Action in DOE Cronyism Suit

FOR IMMEDIATE RELEASE                                                                                                CONTACT:

NOVEMBER 23, 2012                                                                        Mary Beth Hutchins or Briton Bennett





WASHINGTON – Cause of Action, a government accountability organization, now represents San Francisco-based XP Technology in its November 14, 2012 lawsuit against the federal government concerning the U.S. Department of Energy’s denial of XP Technology’s loan guarantee application under the Advanced Technology Vehicles Manufacturing (AVTM) loan program.


XP Technology’s complaint, filed in the U.S. Court of Federal Claims, alleges that “corruption and negligence” pervaded DOE’s decision to award loan guarantees to Ford, Nissan, Tesla Motors, and Fisker Automotive for the development of electric vehicle technology.
“The Department of Energy has acted in an arbitrary and capricious manner at the expense of American small businesses that have sought to reduce our country’s dependence on foreign oil,” asserted Scott Douglas Redmond, XP’s lead investor.


About XP Technology:
In development for nearly a dozen years, with millions of dollars in resources already invested, XP Technology., is on a mission is to develop the safest, most affordable vehicle with the lowest total cost of operation (TCO) and the best power-to-weight ratio powered by alternative energy. The battery pack is capable of dramatically exceeding the range of any shipping electric vehicle with four passengers. However, it could reach 300 miles with the continuous and hot-swappable charge of an optional XP Auxiliary Power Unit.  For more information on XP Vehicles, please visit


About Cause of Action:

Cause of Action is a nonprofit, nonpartisan organization that uses investigative, legal, and communications tools to educate the public on how government accountability and transparency protects taxpayer interests and economic opportunity. For more information, visit


All legal inquiries should be directed to Cause of Action’s Executive Director, Dan Epstein, at 202-400-2720. Media inquiries should be brought to the attention of Mary Beth Hutchins, or Briton Bennett,



The D-Link Systems’ Consent Order Explained

On Tuesday, August 6, 2019, the U.S. District Court for the Northern District of California entered a consent order between the Federal Trade Commission (“FTC”) and D-Link Systems, Inc., a U.S. company that is a global leader in connectivity for home, small business, mid- to large-sized enterprise environments, and service providers, resolving an FTC lawsuit alleging that D-Link Systems’ security practices violated Section 5 of the FTC Act.  The D-Link Systems order marks the close of the first ever litigated FTC action over the application of Section 5 to the security practices used for Internet of Things (“IoT”) devices.  This result is good for D-Link Systems, and good for the FTC.

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Federal Records Law Must Keep Pace with Evolving Technology

Technology develops faster than law.  This maxim has implications across society, but one place it has particular purchase is in federal recordkeeping and the public’s right to access government information.  The two primary federal statutes that require government to preserve records and then allow the public to access those records are the Federal Records Act (“FRA”) and the Freedom of Information Act (“FOIA”).  Federal agencies, unfortunately, do not always live up to their obligations under these laws and government-oversight organizations turn to the courts to seek relief.  The public’s right to sue under the FOIA is well established.  However, courts rarely compel agencies to fulfil their FRA obligations.  My organization, Cause of Action Institute (“CoA Institute”), is currently involved in two important FRA lawsuits that may shape the future of agency obligations under the FRA for decades to come, as information technologies continue to change.

Both lawsuits arose from Secretaries of State failing to preserve their emails in compliance with the Federal Records Act.  Former Secretary Hillary Clinton’s email travails are well catalogued.  But former Secretary Colin Powell also used a non-governmental email account to conduct official government business.  The factual difference between these two cases is that while Secretary Clinton primarily used a personal email service with a server in her basement, Secretary Powell used an AOL account.  But Secretary Clinton also used a BlackBerry email account for the first two months of her tenure as Secretary of State.  So, from these two cases the same legal issue arises: what is an agency’s FRA obligation to recover unlawfully removed federal email records that are housed on commercial email servers?

This question is important to the future of federal recordkeeping law and public access to information because we are already seeing an explosion of non-email methods of electronic communication.  Some of these methods of communication store information locally, such as on a phone or computer, and some store them on commercial servers.  For example, FOIA requesters have been battling for access to text messages for years, agency employees use various forms of instant messaging while at work, and we’ve now seen the rise of the surreptitious use of phone applications such as Signal and Confide that do not always preserve the communications.

In Armstrong v. Bush, the D.C. Circuit recognized two cognizable private rights of action under the Federal Records Act.  First, a plaintiff may bring a case against an agency if that agency does not have the requisite recordkeeping policies in place or if the policies are insufficiently clear so that an employee does not know what type of records he is required to save.  Second, a plaintiff may bring a case to compel the head of an agency or the Archivist of the United States to recover records that have been unlawfully removed from the agency.  If the agency head or Archivist is either unable or unwilling to perform that duty, then the FRA requires them to “initiate action through the Attorney General for the recovery” of those records.  To our knowledge, no such referral to the Attorney General has ever occurred.

At stake in CoA Institute’s Clinton and Powell cases is whether a plaintiff can force the agency head and Archivist to refer the matter to the Attorney General when, through their own actions, they have failed to recover all the missing records.  In both cases the State Department asked representatives of Secretaries Clinton and Powell to recover the unlawfully removed records and return them to the agency for historical preservation and for response to FOIA requests.  In both cases those representatives responded that they were unable to obtain copies of the records that were housed on BlackBerry and AOL servers, respectively.  The State Department and Archivist have responded in the ongoing suits that those efforts are sufficient and that they are not required to use legal process or refer the matter to the Attorney General for more forceful efforts at record recovery.

CoA Institute’s case related to Secretary Clinton has already been to the D.C. Circuit once and the appellate court held that the agency is only absolved of its Federal Records Act obligations if it can establish the “fatal loss” of the records in question.  The State Department and Archivist have not made a sufficient affirmative showing that BlackBerry, and AOL in the case of Secretary Powell, do not have, and cannot recover, these email records.  They have offered no statements from either company or detailed efforts by those companies to recover and return the federal records.

Whether the district court compels the current Secretary of State and Archivist to make such an affirmative showing or requires them to refer the matter to the Attorney General for him to attempt record recovery could set an important precedent.  This decision will shape the future of agency responsibilities under the Federal Records Act and the public’s ability to have access to its government’s information as communications technology continues to change.

James Valvo is counsel and senior policy advisor at Cause of Action Institute.  He is counsel in both cases discussed in this article.  You can follow him on Twitter @JamesValvo.

Wednesday Waste: Federal Subsidies Prop Up Corporate Executives at Taxpayers’ Expense

The federal government doesn’t just provide welfare to struggling families. On the contrary, it also gives huge sums of money to some of the biggest and wealthiest businesses in the world, amounting to about $100 billion per year through federal subsidies.

Corporate subsidies, or “corporate welfare” to its opponents, are supposedly designed to lower prices and employ Americans. But such well-intentioned justifications fail to materialize and the subsidies end up lining the pockets of corporate executives at no benefit to the consumers, or propping up unsuccessful businesses that aren’t meeting market demand.

The biggest recipients of corporate welfare are not struggling businesses, but rather very successful companies. The country’s top corporate welfare recipient is Boeing, one of the largest defense contractors in the world. Boeing receives a whopping $13.4 billion from taxpayers each year. Other household names at the top include Intel, General Motors, Ford, Fiat, Nike and Shell. Each rakes in between two and six billion dollars annually. Unfortunately, when businesses solicit money from taxpayers, rather than customers, incentives change.

In a free and open economy, consumer spending, not government rewards, signals businesses to act, and businesses are incentivized to listen to consumers. When the government intervenes, it creates artificial signals that are not based on market demand. Rather, they’re incentivized to make political friends and ask for favors. This does nothing for consumers and fuels cronyism and inefficiency.

Instead of focusing resources on customer satisfaction, companies now spend incredible amounts on lobbying. In the last eight years, American businesses have spent more than $3 billion per year on lobbying, more than doubling what was spent annually in the late ‘90s. On top of traditional lobbying, companies also spend millions of dollars funding the campaigns of candidates like Donald Trump and Hillary Clinton to get a friend in the White House. Companies make generous campaign donations sometimes to maintain federal subsidies.

Despite ethics laws, favors are granted to the companies and lobbyists who have the most connections. Such corporate subsidies rarely add value to the economy, nor do they benefit consumers.

If the United States ended federal subsidies today, these problems would largely go away. Corporations would go back to making money by pleasing customers instead of pleasing politicians. If the money spent on subsidies was left in the hands of taxpayers, they would spend it wherever they think is most valuable for themselves instead of having it spent wherever the politicians think is most valuable to their personal careers. Removing federal subsidies would result in better market efficiency and more valuable goods in society. Eliminating these subsidies would also take away more than 20 percent of our current deficit spending.

Some of the inefficiencies are not visible, because we’ve never had a truly free economy. However, some of the inefficiencies are very apparent.

One of the clearest examples is the Obama-connected Solyndra scandal. The company received guaranteed loans, and an investigative report showed that the company was constantly playing politics, instead of producing services, until it went bankrupt in 2011. Even as they were going bankrupt, top CEO’s were still receiving tens of thousands in  bonuses, on top of their already high salaries.

Another lesser-known example is the government’s attempt to subsidize broadband in rural areas, which led to much poorer results than promised. Forty percent of the projects were not even started by the time they were supposed to be completed. Analyses found that the subsidies did not have an effect on rural penetration and “that about 60 percent of subsidies went to rural providers’ overhead rather than to investment.”

Regardless of the business model, the free market will always be a better solution for people overall.

Tyler Arnold is a communications associate at Cause of Action Institute

Related Documents: XP Vehicles v. Department of Energy

Cause of Action is representing XP Vehicles, a San Francisco-based electric car company  in a lawsuit against the federal government concerning the U.S. Department of Energy’s denial of XP’s loan guarantee application under the Advanced Technology Vehicles Manufacturing (AVTM) loan program.

United States Court of Federal Claims

Opposition to Motion to Dismiss (February 18, 2014)

Complaint (January 10, 2013)

United States District Court for the District of Columbia

Opposition to Defendant’s Motion to Dismiss the Official Capacity Claims (October 17, 2013)

Opposition to the Individual Capacity Defendants’ Motion to Dismiss (October 17, 2013)

Memorandum in Opposition to Defendants Motion to Dismiss Official Capacity Counts 2, 3 and 4 (July 30, 2013)

Motion to Amend Complaint (July 30, 2013)

Opposition to Individual Capacity Defendants Motion to Dismiss (July 29, 2013)

Complaint (January 10, 2013)

Bloomberg: Car Companies XP Vehicles, Limnia Sue U.S. Over Loans

Car Companies XP Vehicles, Limnia Sue U.S. Over Loans


By Tom Schoenberg on January 10, 2013
President Barack Obama’s administration played favorites on clean-energy loans while improperly blocking a carmaker and a related technology company from receiving millions in aid, according to two lawsuits.

XP Vehicles Inc. and Limnia Inc. filed complaints against the U.S. and the Energy Department today in two federal courts in Washington, seeking damages for what they say were abuses of the $25 billion Advanced Technology Vehicle Manufacturing loan program. XP Vehicles, which has dissolved, and Limnia are asking for $450 million in a case filed in the U.S. Court of Federal Claims and at least $225 million in U.S. District Court.

“Defendants used the ATVM loan program as nothing more than a veil to steer hundreds of millions of taxpayer dollars to government cronies,” according to the district court complaint.

Today’s lawsuits are the latest challenge to clean-energy loan programs administered by the Energy Department, which has come under scrutiny over a $535 million loan guarantee to now- bankrupt solar-panel maker Solyndra LLC.

“While the department does not comment on pending or potential litigation, multiple investigations spanning almost two years and involving millions of pages of documents show that decisions made on the department’s loan program were made solely on the merits after careful review by the department’s technical experts,” Damien Lavera, an Energy Department spokesman, said in an e-mail.

Koch Foundation
The companies are being represented by Daniel Epstein, executive director for a Washington-based nonprofit advocacy group. He previously worked for a foundation started by Koch Industries Inc. Chief Executive Officer Charles Koch, a billionaire contributor to Republican-leaning causes. He was also counsel for Republican U.S. Representative Darrell Issa’s House Oversight and Government Reform Committee, which is leading a probe of the department’s loan programs.

XP Vehicles, or XPV, said it applied in 2008 for a $40 million loan in an effort to mass produce an SUV-style electronic vehicle with doors and other parts made from foam. The starting price for the vehicle was to be less than $20,000.

The carmaker said it believed the review of its application would take “a matter of weeks.” After meeting with the agency in May 2009, XPV said it discovered that two of its competitors — Tesla Motors Inc. (TSLA) and Fisker Automotive Inc. — were receiving special assistance from agency staff with the loan application process.

Obama Contributor
One member of Tesla’s board at the time was Steven Westly, a campaign contributions bundler for Obama, while Fisker’s investors included Obama donors, according to the complaint.

Tesla received a $465 million loan in June 2009 with an interest rate of 1.6 percent, according to the complaint. XPV called one of Tesla’s products “an expensive electric car targeted at rich actors, journalists and businessmen, not average Americans.”

Fisker received a $528.7 million loan. The department in May 2011 blocked Fisker from receiving the bulk of the loan, after the company didn’t meet milestones for producing its first model.

Jeff Evanson, a spokesman for Palo Alto, California-based Tesla, and Roger Ormisher, a spokesman for Anaheim, California- based Fisker, didn’t immediately respond to e-mail messages seeking comment on the lawsuits.

XPV’s application was denied in August 2009. The reasons given by the agency involved vehicle specifications as well as manufacturing and sales plans, according to the complaint.

Limnia is also challenging applications for loans it sought that were denied.

The Energy Department has made five loans under the advanced-vehicles program — none since the 2011 bankruptcy of Solyndra — and $16 billion remains undistributed.

The court of federal claims case is XP Vehicles Inc. v. U.S. Department of Energy, 12-cv-00774, U.S. Court of Federal Claims (Washington). The district court case is XP Vehicles Inc. v. U.S. Department of Energy, 13-cv-00037, U.S. District Court, District of Columbia (Washington).

Amicus Briefs in Loper Bright Enterprises, Inc. v. Gina Raimondo

Amici filed 14 briefs representing 38 organizations and states in support of the fishermen’s petition for review to the Supreme Court.  Here’s a rundown of the briefs with selected quotes from each. 

West Virginia and 17 Other States  

The confused status quo has real costs for the people who live and work within our borders. Because the problems with Chevron keep multiplying, no one really knows whether it is still viable or how courts should apply its teachings. Here, four federal judges reached three different conclusions after applying the same two-step doctrine to one statutory text. That outcome reflects the most common result of the uncertainty: The lower courts uphold even highly burdensome, novel, and textually suspect rules.  

. . .  

So letting Chevron die a long death from neglect is the wrong approach. The States, our residents, and our industries are hurt along the way. The Court should intervene now to limit Chevron in a way that is consistent with the separation of powers and the principles of federalism. Otherwise, it’s time to toss it. 

David Goethel and John Haran 

Mr. Goethel feared that the expense of paying for federally-imposed at-sea monitors would force him to sell his boat and abandon his longtime profession. And that is, in the end, what he did, after his 2016 lawsuit challenging the funding mandate was dismissed as untimely. 

. . .  

While the legal issues presented by the petition are consequential, so are the practical consequences of forcing vessel owners to pay for their own rideabord regulators. At stake is nothing less than the continued existence of a storied industry and way of life. 

Pacific Legal Foundation 

[T]he Justice Department is driving a vertical split in the federal courts. By muting her Chevron arguments, the Solicitor General decreases the likelihood this Court would employ (or even acknowledge) the doctrine, and the status quo is preserved. Meanwhile, government lawyers continue to encourage overbroad readings of Chevron in the lower courts. Amicus urges the Court to take this case and end the doctrinal division wrought by the government’s inconsistent Chevron arguments.

New England Legal Foundation 

In sum, certiorari is warranted to clarify that Chevron reinforces a federal court’s independent duty to enforce the plain language of a statute, in order to decide, in this case, whether Congress “silently” authorized NMFS to require any domestic fishing vessel to pay for at-sea observers. 

Cato Institute and Liberty Justice Center 

Only officially overruling Chevron can provide much-needed clarity to lower courts. And this case presents the Chevron question squarely, offering an excellent vehicle to reconsider that decision. This Court should grant certiorari and overrule Chevron. 

Competitive Enterprise Institute and Manhattan Institute 

A recent rule issued by the National Marine Fisheries Service (“the agency”) is out of constitutional bounds. When the agency issued that rule, it tried to exercise a constitutionally enumerated power that Congress never gave it: namely, the power to impose duties. That exercise of power is categorically distinct from the exercise of the incidental powers Congress necessarily assigns to agencies that allow them to function. The agency’s attempt to exercise this never assigned power not only goes beyond the authority Congress gave it; it goes beyond any authority that Congress could legitimately give it.  

Center for Constitutional Jurisprudence 

Under the decision below, the finely tuned separation of powers design is eviscerated. This Court should grant review in this case to put an end to deference doctrines that allow the Executive to usurp both Congressional and Judicial power and to rule that Congress cannot delegate its power of the purse to an executive agency. 

Buckeye Institute and National Federation of Independent Businesses 

Given the lack of statutory support, the D.C. Circuit should not have applied Chevron deference. Had the D.C. Circuit applied the correct analysis, the NMFS would have lost, and the follow-on consequences of the agency action would have been averted . . . . This case presents the Court with an opportunity to rein in a rogue agency that has been abetted by a court that rushed to find a statutory ambiguity. 

Independent Women’s Law Center 

Judicial deference to the executive is particularly problematic in cases such as this one, where an agency has used its alleged authority to create an independent source of funding for its regulatory mission. Such self-financing cannot be squared with the Constitution’s Appropriations Clause, which limits agency spending to that which Congress has authorized. And it can have devastating consequences for the small businesses that are forced to shoulder the costs of a larger regulatory agenda. 

Right to Work Legal Defense Foundation, Inc. 

But there is no reason Chevron should continue to govern lower courts while this Court shuns it. The Court should grant the petition, reconsider Chevron, and reverse the decision below. 

. . .  

Chevron is the inevitable consequence of abandoning Article I’s text. This Court created Chevron deference based on a legal fiction, assuming Congress implicitly delegates legislative power through ambiguous or nonexistent statutory language so that an administrative agency can make legislative rules.9 The effect is that a law’s meaning is never fixed but becomes a malleable standard that the executive branch can change on a dime. 

Southeastern Legal Foundation 

This case also asks the Court to reconsider Chevron. Amicus agrees that it should. Chevron requires courts to uphold an agency’s interpretation of a statute—even if not the best interpretation—so long as that interpretation is reasonable. This approach forces courts to defer to agencies on questions of law, thus requiring the judiciary to shirk its duty to say what the law is. Time and again, Chevron forces judges to uphold interpretations that they believe are wrong. 

Christian Employers Alliance 

Many of this Court’s highest-profile disputes have stemmed from administrative agencies advancing their own agendas without apparent statutory authority or concern for its absence. When left to their own devices—or to the political calculations of the White House—agencies stretch and strain their authority to impose on the everyday lives of American citizens in ways Congress never prescribed.  … 

Chevron deference is a bad idea for many reasons. But it is especially dangerous to fundamental freedoms. The idea that bureaucrats know better than judges how to interpret the law cedes to agencies the authority this Court has reserved to Congress: the ability to resolve the most highly contentious social and cultural “decisions of vast economic and political significance.” 

Relentless Inc., Huntress Inc., Seafreeze Fleet LLC 

The small family-run businesses that make up so much of our fishing fleets, particularly in the New England and Mid-Atlantic fisheries, operate on narrow financial margins. This is unlike, for example, the energy, technology, or defense industries that are often able to engage in the expensive litigation that has a better chance to reach this Court. Indeed, the Court has not interpreted the MSA, particularly with its more searching attention to Chevron deference, in almost two generations. Some members of this Court were not in law school yet when the Court last interpreted the MSA. As Petitioners note, not only does the petition present the question of the continuing vitality of Chevron, but it also presents the question of whether America’s fishers will be subject to the unchecked discretion of bureaucrats whenever Congress is silent. 

Advancing American Freedom, Pelican Institute, America First Legal Foundation 

This case presents the question of Chevron deference dead on without any need to tack, offering an excellent opportunity to abandon this sinking ship and to offer lower courts a more seaworthy vessel for judicial review. Chevron deference has long been persuasively criticized as unconstitutional, both for violating Article III’s vesting of all judicial powers in the judiciary and for violating due process. 

. . .  

Whatever hopeful benefits might have been countenanced when Chevron was decided in 1984, nearly four decades of experience and navel gazing have done little to bind agencies to the Constitutional mast. Chevron “wrests from Courts the ultimate interpretative authority to ‘say what the law is’” and places it in the executive’s hands.