In re: Sunpower Corporation

CourtUnited States Bankruptcy Court, D. Delaware
DecidedJune 3, 2026
Docket24-11649
StatusUnknown

This text of In re: Sunpower Corporation (In re: Sunpower Corporation) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, D. Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re: Sunpower Corporation, (Del. 2026).

Opinion

IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re: Chapter 11

SUNPOWER CORPORATION, Case No. 24-11649 (CTG) Wind-Down Debtor. Related Docket No. 1544

MEMORANDUM OPINION Once a federal court enters an order, it has the authority to resolve disputes over the meaning of that order. And if a party violates the court’s order, the court has the power to enforce its prior order. The Supreme Court said as much in Travelers and the Third Circuit underscored that point in Essar Steel.1 Those points are common ground. The question now before the Court, however, is what counts as the “enforcement” or “interpretation” of the prior order. Is there a point at which the connection between the order that is allegedly being enforced, and the actual dispute between the parties, becomes too attenuated to support jurisdiction? Consider, for example, a bankruptcy case in which, in 2024, the debtor confirmed a plan under which all estate property was vested in a reorganized debtor.

What if a dispute arose over whether, in 2017 or 2018, the debtor had stolen a painting from a neighbor. Could the neighbor file a motion in bankruptcy court, in 2025, arguing that the painting was stolen, and therefore never became property of the estate, and thus never vested in the reorganized debtor? Or is such a dispute

1 Travelers Indem. Co. v. Bailey, 557 U.S. 137 (2009); In re Essar Steel Minnesota, LLC, 47 F.4th 193 (3d Cir. 2022). about whether the painting was stolen in 2017 or 2018 too distant from any question about the meaning of the plan or confirmation order to bring it within the bankruptcy court’s authority to enforce its confirmation order?

The facts of this case are slightly different from that hypothetical. The dispute in this case is about an alleged assignment of the lease of a solar power system rather than the theft of a painting. But the question about the scope of the court’s subject- matter jurisdiction is the same. And the answer is that such a dispute is too distant from the plan or confirmation order to be fairly described as one to enforce or interpret the court’s order. The Court accordingly dismisses the motion for lack of subject- matter jurisdiction.

Factual and procedural background Christine Kosydar leased a solar power system from SunPower Capital.2 Kosydar contends that the parties entered into the lease in November 2017 and the solar power system was thereafter installed at Kosydar’s home in Arizona. Kosydar argues that SunPower Capital remained the counterparty to the lease up and through the filing of these bankruptcy cases in August 2024. In these bankruptcy cases, the debtors sold substantially all of their assets in a series of asset

sales.3 No one contends, however, that Kosydar’s lease was, during the bankruptcy case, the subject of a motion to assume and assign it to the buyer (or anyone else). And the plan in these cases, confirmed in October 2024, and that became effective in

2 Debtor SunPower Capital, LLC is referred to as “SunPower Capital.” 3 See, e.g., D.I. 287, 605, 611, 859, 860, & 861. November 2024, primarily distributed the proceeds of the sales to creditors. The plan provided that all executory contracts that remained in the estate and were not otherwise assumed under the plan are rejected.4

So on Kosydar’s view of the world, the debtors have rejected her lease. The debtors’ rejection of a lease, of course, excuses the counterparty from its future performance obligations. That would presumably mean, assuming that Kosydar’s lease of the solar power system is a true lease, that unless the SunPower plan administrator wanted to come to Arizona to remove Kosydar’s solar power system, the result of the bankruptcy would be that Kosydar has obtained the solar power system without being required to make further lease payments.

The plan administrator of the SunPower estate takes a different view.5 SunPower’s position in the bankruptcy case was that its regular practice in the ordinary course of business before the bankruptcy filing was to assign system leases to a separate entity. These separate entities were essentially used as financing vehicles. These entities accordingly borrowed against those leases as a way of raising capital for the enterprise. On the plan administrator’s theory (which accords with

the telling of events in the debtors’ first-day declaration), the assignee of the leases

4 D.I. 872-1 Art. V.A. (“On the Effective Date, except as otherwise provided herein or in the Sale Orders, each Executory Contract or Unexpired Lease not previously assumed, assumed and assigned, or rejected shall be deemed automatically rejected, pursuant to sections 365 and 1123 of the Bankruptcy Code.”) The plan became effective in November 2024. D.I. 1058. 5 Mark Roberts, in his capacity as the plan administrator under the confirmed plan in the above-captioned bankruptcy case, is referred to as the “plan administrator.” was not itself a debtor in these bankruptcy cases.6 Instead, it was a non-debtor subsidiary of the debtors. The plan administrator’s position is that the debtors’ equity interest in that non-debtor subsidiary was sold to the buyer. As a result, the plan

administrator’s position is that the buyer now holds the leases, albeit indirectly through its ownership of the non-debtor subsidiary.7 And the buyer, after (for whatever reason) declining to participate in the dispute between Kosydar and the plan administrator, has now belatedly shown up saying that it has documents to prove that it is in fact the indirect owner of the lease.8 Kosydar filed a motion to “interpret and enforce” the plan and confirmation order.9 She sought an order declaring that her lease “was solely the property of the

Debtor on the Effective Date of the Plan in this case,” that “[n]o other entity was the lessor of the Lease as of the Effective Date of the Plan,” and that the “Lease was rejected by Art. [V] of the Plan as of the Effective Date.”10 She also seeks an express finding that the order is “binding and effective upon … all parties-in-interest in this case,” which would of course include the entities affiliated with the buyer who, on the plan administrator’s version of events, would be the counterparty to Kosydar’s

6 D.I. 9 ¶ 32. This declaration has not been admitted into evidence in this contested matter. It is referred to only by way of setting forth the background of the dispute. 7 D.I. 1552 at 3. 8 See D.I. 1839. The buyers to which the debtor sold the applicable assets were HA Sunstrong Capital LLC and GF Sunstrong Capital, LLC, to whom the parties refer collectively as “HASI.” The party that ultimately appeared in this bankruptcy case to respond to Kosydar’s motion is Helios II Residential Solar Fund, LLC, which is referred to as “Helios,” and is apparently affiliated with the buyer. 9 D.I. 1544. 10 D.I. 1544-2 ¶ 2. lease.11 The plan administrator filed what it described as a “limited objection” to that motion.12 Kosydar’s motion, after a series of adjournments, was heard at the February

25, 2026 hearing. It was apparent to the Court at that hearing that there were serious questions about the Court’s subject-matter jurisdiction to hear a dispute between two non-debtor entities that had something – but really very little – to do with an order the Court had entered. Because Kosydar had traveled to Wilmington for the hearing, the Court permitted Kosydar to present her evidentiary case in support of her motion. Kosydar testified on her own behalf and her counsel moved various documents into evidence without objection.

The evidentiary record is otherwise incomplete.

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In re: Sunpower Corporation, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-sunpower-corporation-deb-2026.