Dividend Finance Lawsuit: Allegations, 2025 Ruling, and AG Actions

The Dividend Finance lawsuit is a consolidated federal multidistrict litigation accusing Fifth Third Bank and its Dividend Solar Finance division of hiding large fees inside residential solar loans and working with installers who misled homeowners about costs and savings. The cases were combined in October 2024 into MDL No. 3128 in the U.S. District Court for the District of Minnesota before Judge Katherine M. Menendez, and they remain active in discovery as of early 2026 after key claims survived a motion to dismiss.¹

What the Lawsuits Allege

The core allegation is about a charge plaintiffs call the “dealer fee” or “platform fee.” When a homeowner financed a solar installation through Dividend, the loan principal was allegedly inflated well above the actual cash price of the equipment and installation, and Dividend kept the difference. The Consumer Financial Protection Bureau has reported that these fees commonly ran 10% to 30% of a system’s cash price and could exceed 50%.²

One plaintiff, according to court filings, received a $70,661 loan for a system that actually cost about $44,360, meaning roughly $26,301 in undisclosed fees was baked into the principal.³ Plaintiffs argue the fee is a “finance charge” under the federal Truth in Lending Act (TILA) and should have been disclosed, and that hiding it understated the true annual percentage rate.⁴

The complaints also target the sales channel. Installer salespeople used tablets to present the loan alongside the installation contract in a single sitting. Plaintiffs allege installers were forbidden from disclosing the markup and that Dividend deliberately avoided contact with borrowers before contracts were signed. Virginia’s attorney general stated in its complaint that Dividend conducted pre-sale “welcome calls” for fewer than 2% of deals.⁵

Beyond the fee, plaintiffs allege installers misrepresented the financial and energy benefits of the systems. Homeowners were told savings would cover their loan payments from “day one,” when many lost money for years. Sales tactics allegedly included scrutinizing utility bills to “build the pain” of current energy costs, misrepresenting eligibility for the federal Investment Tax Credit, and using “one-sit close” pressure designed to prevent comparison shopping.⁵

A separate strand of harm involves systems that don’t work. The problem became acute after Power Home Solar, one of Dividend’s major installer partners and later known as Pink Energy, filed for bankruptcy on October 7, 2022, leaving customers making loan payments on installations that were defective, unfinished, or never connected to the grid.⁶

Where the Cases Stand Now

On October 3, 2024, the Judicial Panel on Multidistrict Litigation consolidated multiple federal cases into In re: Dividend Solar Finance, LLC, and Fifth Third Bank Sales and Lending Practices Litigation, MDL No. 3128, and sent them to Judge Menendez in Minnesota. The initial transfer covered five actions from Connecticut, Florida, New Jersey, and Virginia.⁷ By February 2025, cases from Illinois and Texas had been added, with at least nineteen more pending in nine other districts as potential tag-alongs.⁸ The panel was still transferring new actions into the MDL as of August 2025.⁹

Judge Menendez appointed interim co-lead plaintiffs’ counsel on December 11, 2024, drawing from Newsome Melton, Silver Golub & Teitell, and Kelly Guzzo. Williams & Connolly represents Fifth Third Bank. Plaintiffs filed a master complaint on February 7, 2025.¹⁰

As of early 2026, no class has been certified, no settlement has been reached or proposed, and there is no claims process or deadline for affected borrowers. The litigation is in discovery.³

The August 2025 Ruling

The pivotal decision so far came on August 22, 2025, when Judge Menendez granted in part and denied in part Fifth Third’s motion to dismiss the master complaint.

The court kept the TILA claims alive. It found that the platform fees fit the statutory definition of a “finance charge” because they are charges imposed by the lender in connection with extending credit, not part of a comparable cash transaction. The court rejected Fifth Third’s argument that the fees qualified as “seller’s points” exempt from disclosure, reasoning that seller’s points typically appear in transparent real estate transactions while the fees here were allegedly concealed. Plaintiffs also adequately alleged equitable tolling of the statute of limitations, given claims that Dividend instructed installers to hide the fee.¹⁰

Common law fraud claims also survived. The court found the loan documents contained “affirmative misrepresentations about how loan proceeds would be used,” enough to state a fraud claim. The court dismissed the plaintiffs’ claims under the Racketeer Influenced and Corrupt Organizations Act (RICO).³ The court ordered discovery to begin immediately.

State Attorney General Actions

The MDL also absorbs state enforcement lawsuits. Minnesota Attorney General Keith Ellison sued in March 2024 against four solar lenders including Dividend, alleging deception on more than 5,000 loans issued in Minnesota since 2017 and disguised fees totaling $35 million that raised borrower costs by 15% to 30%, with some consumers paying up to 54% more than they would have with cash or independent financing. The suit alleged violations of Minnesota’s consumer fraud, deceptive trade practices, false advertising, and regulated loan statutes, and sought civil penalties, restitution, and disgorgement.¹¹

Virginia Attorney General Jay Jones filed directly into the MDL on February 6, 2026, alleging that Dividend and Power Home Solar deceived more than 500 Virginia households into taking out over $30 million in 25-year loans for overpriced systems, with hidden fees of 15% to 16%. That complaint alleges violations of the Consumer Financial Protection Act, TILA, and the Virginia Consumer Protection Act, and seeks permanent injunctive relief, contract rescission, restitution, civil penalties, and public notification.⁵ According to the docket, that case is active.¹²

Who the Litigation Could Cover

The private class action side of the MDL grew out of cases like Kenny v. Fifth Third Bank, filed May 31, 2024, in the Eastern District of Virginia before being transferred. The proposed class in that case would include anyone who, within the year before the complaint was filed, borrowed from Fifth Third Bank or Dividend Solar Finance to purchase a solar system where the loan included a fee not paid to the installer and where the amount actually disbursed to the installer fell below the TILA statutory cap.⁴ A class has not been certified, so the ultimate scope is not yet set by the court.

Two boundaries are worth flagging. State AG actions seek relief for consumers in their own states through their own consumer protection statutes; whether an individual borrower benefits depends on the state and the outcome. And the loans at issue were originated by Dividend Solar Finance, which merged into Fifth Third Bank in August 2023 and no longer exists as a separate entity; Fifth Third is the defendant.¹³

What Affected Borrowers Can Do Now

Because no class has been certified and no settlement exists, there is nothing to sign up for and no deadline to meet. Borrowers who believe they were affected can preserve their loan documents, the original quote or contract from the installer, and any communications about system performance or savings claims. Homeowners in Minnesota or Virginia may fall within the scope of their state attorney general’s action. Anyone considering individual legal action should be aware that the equitable tolling issue is being litigated in the MDL, and that new individual federal cases have continued to be transferred into it rather than proceeding separately.⁹

1
U.S. District Court, District of Minnesota. Dividend Solar Finance, LLC, and Fifth Third Bank Sales and Lending Practices Litigation
2
Consumer Financial Protection Bureau. Issue Spotlight: Solar Financing
3
SGT Law. Federal Court Allows SGT Solar Lending Class Action to Move Forward
4
ClassAction.org. Fifth Third Bank Unlawfully Adds Hidden Finance Charges to Solar Panel Installation Loans, Class Action Alleges
5
Virginia Office of the Attorney General. Commonwealth v. Fifth Third Bank Complaint
6
North Carolina Department of Justice. Attorney General Josh Stein Calls on Five Solar Lending Companies to Suspend Loan Payments and Interest for Pink Energy Customers
7
GovInfo. In Re: Dividend Solar Finance, LLC, and Fifth Third Bank Sales and Lending Practices Litigation Transfer Order
8
Justia. In Re: Dividend Solar Finance, LLC, and Fifth Third Bank Sales and Lending Practices Litigation Transfer Order
9
Judicial Panel on Multidistrict Litigation. MDL-3128 Transfer Order
10
SGT Law. Order on Dividend Solar Fifth Third Bank Motion to Dismiss
11
Minnesota Attorney General. Attorney General Ellison Sues Solar Lending Companies Over Hidden Fees
12
CourtListener. Commonwealth of Virginia ex rel. Jay Jones, Attorney General v. Fifth Third Bank
13
Fifth Third Bank. Fifth Third Bancorp Enters Definitive Agreement to Acquire Dividend Finance