Emmitt Smith Hits Back After Lawsuit Over Failed $2.5M Solar Deal

Emmitt Smith wants a tribal investment group and its attorneys sanctioned after they accused him and his business partners of misusing $2.5 million in connection with a failed solar project, arguing the group understood the financial risks when it entered the deal.

The Pro Football Hall of Famer was sued Aug. 31 in Delaware’s Chancery Court by Kituwah LLC, the tribally-owned investment and economic development arm of the Eastern Band of Cherokee Indians. The lawsuit claims that the longtime Cowboys running back, his business partner David Mosley, and their commercial real estate company 4 13 Solutions Inc. convinced Kituwah to provide a $2.5 million loan in September 2023 for a purported solar project in Texas that never came to fruition. 

According to Kituwah, it has “not recovered a penny” of the $2.5 million it is owed. The group said it investigated what happened, which led to its lawsuit, and as part of that probe it determined the defendants’ use of the $2.5 million was “essentially, like a Ponzi scheme.”

In September, Smith told the Dallas Morning News that the failure to complete the planned Project Exodus solar farm was “a loss for everyone involved.” He also rejected the idea that he deceived Kituwah “or engaged in misconduct.”

In an Oct. 9 answer to the complaint that has not been previously reported, Smith, Mosley, and 4 13 Solutions went a step further. 

“The reference to a ‘Ponzi scheme’ is unsupported by any facts and made in bad faith,” the filing says. “Plaintiff and its counsel should be sanctioned for knowingly making a false statement that accuses the 4 13 Defendants of criminal behavior.”

Under Chancery rules, sanctions could include a monetary fine or non-monetary penalties, as well as an order directing the sanctioned party to pay some or all attorneys’ fees and other expenses.

According to the filing, Smith’s firm had been “cautiously optimistic” that Kituwah would be able to obtain funding from the U.S. Department of Energy, something that would “make or break the project.”

However, the DOE “never funded a loan to Kituwah” because “the environment surrounding renewable energy financing changed significantly,” Smith argues in the filing. Kituwah’s promise to Smith’s firm that it would be able to obtain that funding “proved false,” and all parties involved understood the financial risks, including the possibility that the loan would not be repaid if the DOE financing fell through.

“Simply put, this case involves no fraud or misconduct of any nature,” the filing says. “The parties ventured into an ambitious plan that failed.”

In addition to seeking sanctions against Kituwah and its counsel, Smith, Mosley, and 4 13 Solutions are asking the court to dismiss the lawsuit permanently, award costs of the lawsuit, and grant any other relief as deemed appropriate.

A representative for Kituwah did not immediately respond to a request for comment.