Letter Demanding Retraction Draws Attention to Investments by McCready’s Firm in Projects That Used Parts from Chinese Companies

Ninth Congressional district Democratic candidate speaks during a news conference in Charlotte, N.C., Wednesday, May 15, 2019. McCready faces Republican Dan Bishop, as well as Libertarian and Green candidates, on Sept. 10. (AP Photo/Chuck Burton)
AP Photo/Chuck Burton

A law firm representing Double Time Capital, the investment fund co-founded by Dan McCready, the Democratic nominee in the upcoming special election in North Carolina’s Ninth Congressional District, sent a letter on Wednesday to the Congressional Leadership Fund (CLF) demanding that it retract recent statements about McCready’s company.

Those statements, the letter said, are “demonstrably false, harm Double Time Capital’s business reputation, and constitute precisely the type of common law ill-will and malicious intent that North Carolina law does not countenance.”

McCready faces Republican nominee State Senator Dan Bishop in the September 10 special general election to fill the seat that has been empty since the 116th Congress convened in January. The North Carolina State Board of Elections refused to certify 2018 Republican nominee Dr. Mark Harris’s apparent 905 vote victory over McCready amidst allegations of election fraud and ballot harvesting, and in January ordered a new election.

Though the demand for retractions requested by Double Time Capital’s counsel was based on a stated desire to avoid “harm [to] Double Time Capital’s business reputation,” the nuances of the ensuing dispute may serve to bring attention to facts surrounding McCready’s business record that may not be helpful to his candidacy.

At issue is whether Double Time Capital invested in solar energy projects that used inverters manufactured by Chinese companies, and specifically by Huawei, the controversial Chinese electronics and communications conglomerate.

“In the last week, the Congressional Leadership Fund (CLF) has made multiple false and derogatory statements regarding Double Time Capital. These include but are not limited to a post on your website titled “McCready Outsourced Jobs to China, Endangered NC’s Power Grid,” and several social media posts. Your accusation of the risk to national security is a common feature in your posts,” John R. Wester, a partner in the Charlotte, North Carolina law firm of Robinson, Bradshaw & Hinson, counsel to Double Time Capital, wrote in the letter, and added:

Your statements appear to be based on a Fox News story published on its website May 28, 2019. We are putting you on notice that the Fox News story includes multiple inaccuracies, specifically regarding Double Time Capital’s relationship with Strata Solar. Fox News has been made aware, in writing, of these inaccuracies. You may not rely on what Fox News advances as factual representations or statements of fact in its story.

Moreover, even if the Fox News story were accurate, it does not support the claims that CLF has made in writing and in its social media posts. On its website, CLF claimed that “[t]he investigation by [Fox News] also shows that McCready’s company opened America’s energy infrastructure to ‘major national security threats,’ by exclusively using cheap Chinese inverters from Huawaei…” And on social media, CLF has asserted that McCready “used dodgy parts at his solar plants that 11 U.S. Senators said are a grave risk to national security” and “@McCreadyForNC’s companies built their solar farms using I,nverters exclusively from a Chinese conglomerate.”

“All of these statements are false,” Wester wrote. He continued:

The Fox News story supports none of them. The Fox News story does not claim that Double Time Capital used Chinese inverters from Huawei. Instead, it alleges that a different company, Strata Solar, later entered into an agreement with Huawei to supply string inverters for other developments having no connection whatsoever to Double Time Capital. Double Time Capital has not invested in and owns no part of Strata Solar.

On Sunday, Richard W. Smith and Krystal B. Swensdboe, attorneys with Wiley Rein, counsel to the CLF, punched back in a letter sent to Double Time Capital’s counsel, saying, “Your cleverly worded assertion that Double Time has not invested in and owns no part of Strata is of no moment; it is a matter of clear public record that Double Time has heavily invested in Strata projects, and Strata clearly buys from China.” The letter said:

Double Time’s desperate strategy of attempting to rehabilitate McCready’s campaign by lobbing contrived threats at CLF will not cause our client to abandon its goal of revealing McCready’s true colors. CLF will remain strong in the face of these attacks, will continue to engage directly in robust political debate over McCready’s two-faced approach to China, and rejects your client’s demand that it publish a retraction.

Frankly, your client’s threats are an affront to the First Amendment principles on which this country is built and insulting to the voters of North Carolina. It is disappointing that McCready would allow Double Time to employ such tactics at a moment when both he and his company should be focused on distancing themselves from those who seek to do harm to North Carolina.

CLF’s statements were true and based on reasonable interpretations of the public record. Your attempt to recharacterize them as actionable merely because you take issue with them strains credibility.

Media Hub, a University of North Carolina School of Media and Journalism project, conducted its own analysis of the controversy, and concluded that “Strata Solar has a documented history of working with various Chinese companies to carry out its solar projects. For example, Strata teamed with the Shenzhen-based solar panel company BYD to buy BYD’s solar panels beginning in 2013.”

As to the reliability of the May 28 Fox News report, Media Hub stated, “With some notable exceptions, the Fox News story is generally accurate. Some dubious claims, however, have been made by people who cite the Fox News story as a source.”

CLF’s counsel identified three specific reasons why CLF’s statements were protected by the first amendment:

First, we do not believe there can be much debate over the fact that McCready “has outsourced jobs to China.” His company, Double Time, has publicized its significant investments in dozens of projects undertaken by Strata Solar, which has itself brazenly admitted purchasing solar panels and components from multiple Chinese companies.

Indeed, the Charlotte Business Journal reported that Double Time “has invested about $80 million in 36 utility-scale solar projects across North Carolina since 2014” and “[m]uch of that has been invested in projects by Strata Solar, the state’s largest solar company.” . . .

Second, CLF’s statements that McCready’s and Double Time’s support of Strata endangers U.S. interests also appear to be well-supported by the record. In a 2017 article, Strata’s Chief Operating Officer Mike Belikoff raved about Strata’s new agreement to“exclusively use Huawei string inverters” for its projects. He praised Huawei’s product, stating that the relationship with Huawei “gave us a warm, fuzzy feeling,” and that the agreement represented a “value alignment” and a “level of trust.” . .

Third, CLF’s statements constitute core political speech about an issue of public concern that is entitled to the broadest First Amendment protections. McCready’s qualifications for public office, his claims regarding job creation and North Carolina’s solar industry, and his views on trade policy are critical campaign issues. He has inserted Double Time into the center of his campaign, including its investments in Strata, and CLF is entitled to broad protection when it engages him in the debate over how to judge his conduct. Indeed, it is precisely in this context that the United States Supreme Court held that the First Amendment “has its fullest and most urgent application.” Monitor Patriot Co. v. Roy, 401 U.S. 265, 272 (1971). (emphasis added)

“There is no question that the statements by CLF are based on a reasonable interpretation of events and sources available. They relate to an important issue that Mr. McCready has made central to his congressional campaign. There can be no doubt, therefore, that CLF’s statements are fully protected by the First Amendment. . . We trust that this letter ends the side legal discussion on these issues, and that your client’s cofounder will now opt to engage CLF as he should have initially – through the campaign in the course of public political debate,” counsel for CLF concluded.

McCready provided this exclusive comment about the controversy to Media Hub last week:

“It is disappointing but not surprising that career politician Dan Bishop and his dark money special interest allies are so afraid of my experience as a businessman that they have resorted to spreading outright lies.

My company invests in solar farms, we do not build them. We play no role in engineering, design, or equipment selection. To be very clear, we never invested in Strata Solar, we never outsourced a single job, and there is no Huawei equipment in our solar farms.

On the contrary, we are proud to have helped create American jobs. For years, politicians from both parties have failed to stand up to China, allowing China to beat up American solar manufacturing. Everything now from your iPhone to solar farms has Chinese parts — that needs to change, and I’m proud to have been part of the solution by building up North Carolina’s solar industry, helping create 700 solar construction jobs right here in North Carolina and founding another company whose entire mission was to promote American-made products and jobs.”

Wester sent a similar letter to the National Republican Congressional Commitee (NRCC) on Thursday. On Friday, the NRCC also punched back, saying:

On behalf of the National Republican Congressional Committee and Camille Gallo, this letter responds to your letter dated June 6, 2019, in which you deny Double Time Capital invested in projects that you also admit it invested in, quibble with the date on which Huawei began selling inverters in the U.S. but ignore that funds from Double Time purchased inverters from other Chinese companies prior to that date, and threaten the NRCC and Ms. Gallo with a lawsuit.

The NRCC and its employees are not distracted by your tricks or intimidated by your letter. We reject your demands and will continue informing the voters of North Carolina’s Ninth Congressional District about Double Time and its founder China Dan McCready’s support for Chinese enterprise.

Solar Strata and Double Time Capital have a business relationship that extends beyond Double Time Capital’s investment in Solar Strata solar energy projects. The founders of Solar Strata, Alex and Markus Wilkhum, both serve on board of the United Solar Initiative with Rye Barcott, who, along with Dan McCready, is co-founder of Double Time Capital.

It is unclear what impact the public exchange between Double Time Capital and CLF/NRCC will have on the outcome of the September 10 special election. The most recent poll, conducted in May before this controversy erupted, showed that the race between Democrat McCready and Republican Bishop was a statistical tie.

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