Widener Law weighs in on Bloom lawsuit

Delaware is asking a federal judge to dismiss a lawsuit challenging its deal with Bloom Energy.

The suit was filed by Connecticut-based Fuel Cell Energy, a potential Bloom competitor.

The suit alleges economic protectionism and discrimination.

Widener law professor David Hodas says that charge is not likely to stick.

"The other argument is that this project discriminates against interstate commerce because it's only giving subsidies for products only made in Delaware, or used in Delaware. That's perfectly appropriate. States are allowed to use their own money to provide subsidies for their own state services in the market," he says.

The plaintiff in the suit contends the deal between Bloom and the state was structured in a way that would block competition in the market.

Hodas says, on the surface, the suit seems frivolous since the company never tried to do business with Delaware in the first place.

"It's not even clear that they had the technology that would satisfy the various requirements, which included innovative technology that was essential to get the kinds of subsidies the state was going to provide," says Hodas.

There is no word as to when the judge might hand down his decision on the state's motion to dismiss.

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