Washington Post

An electric car start-up and its sister company sued the Energy Department on Thursday, claiming Secretary Steven Chu and his agency awarded money to politically favored firms and strung along their firms and others in a “fixed” race for federal funds.

In addition to complaints of cronyism, XP Vehicles and Limnia said they have evidence suggesting the Energy Department improperly shared their patented technology with competing companies that won federal funding.

XP Vehicles had sought a $40 million federal loan in 2009, proposing to make a lightweight sport-utility vehicle of space-age materials, and was ultimately rejected. Limnia had devised a rechargeable energy storage system that would power the car.

The two firms made their complaints of unfair treatment in two separate lawsuits in Washington, in the U.S. District Court and the federal claims court. They are seeking total damages of about $675 million.

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