Sterling and Wilson Solar Lawsuit: Bond and Conti Settlements

The Sterling and Wilson solar lawsuit — a federal case over a $30.9 million performance bond tied to a Klickitat County, Washington solar project — ended in April 2026 with a mutual settlement between Sterling and Wilson Solar Solutions Inc. and its sureties, Fidelity and Deposit Company of Maryland and Zurich American Insurance Company. A related arbitration with the project’s construction contractor, Conti LLC, closed weeks earlier through a full payment settlement. The company told investors neither resolution carried a material financial impact.¹

What the Lawsuit Was About

Sterling and Wilson Solar Solutions, the U.S. arm of India-listed Sterling and Wilson Renewable Energy Limited, hired Conti LLC to build a solar project in Klickitat County, Washington. Fidelity and Deposit Company of Maryland and Zurich American Insurance Company issued a performance bond of roughly $30.9 million guaranteeing Conti’s obligations. When Sterling and Wilson tried to collect on that guarantee, the sureties resisted, and the dispute moved to federal court.²

Sterling and Wilson Solar Solutions, together with Sterling and Wilson International Solar FZCO, filed the case in 2022 in the U.S. District Court for the Eastern District of Washington in Yakima. It was docketed as No. 1:22-cv-03076, a diversity breach-of-contract action. Named defendants included the two sureties along with Zurich Holding Company of America Inc., Zurich Insurance Company Ltd., and Zurich Insurance Group Ltd.³

When Sterling and Wilson first disclosed the litigation to Indian stock exchanges in August 2023, it pegged the combined exposure of the bond case and the related Conti arbitration at roughly Rs. 482.55 crore, or about $58 million at the time.⁴

How Conti LLC Fit In

Conti had its own grievances against Sterling and Wilson and opened a separate arbitration. It also tried to intervene in the federal lawsuit and asked the district court to pause the surety case until the arbitration wrapped up. The district court refused.⁵

Conti appealed to the Ninth Circuit under the Federal Arbitration Act. On August 26, 2024, the Ninth Circuit dismissed the appeal for lack of jurisdiction. It noted that Conti itself conceded it could not force Sterling and Wilson or the sureties into arbitration under the bond’s terms and Washington law, and that the Conti arbitration was on track to finish before any federal trial would begin.⁵

How Both Disputes Ended

The Conti arbitration closed first. On April 3, 2026, Sterling and Wilson disclosed that it had completed all payments directed by the arbitration tribunal, formally ending the proceeding. The company called it a “full payment settlement” but did not publicly disclose the tribunal’s award amount.⁶⁷

The surety lawsuit followed. Sterling and Wilson Solar Solutions, Fidelity and Deposit Company of Maryland, and Zurich American Insurance Company signed a mutual settlement in which each party released and discharged all claims and counterclaims against the others. They filed a joint motion for dismissal, and the U.S. District Court for the Eastern District of Washington granted the dismissal order on April 20, 2026.⁸

What the Settlements Meant Financially

Sterling and Wilson told investors the surety settlement carried “no material financial impact” on its current financial position, and that the matter was fully closed with no remaining liabilities. The disclosure went to both the Bombay Stock Exchange and the National Stock Exchange of India under SEBI’s listing regulations.¹⁸

Neither the mutual release nor the Conti tribunal award figure was made public, so the specific dollars that changed hands between the parties are not on the record. What the company did confirm is that both proceedings are closed and no active major U.S. legal matter tied to the Washington project remains.

Other Sterling and Wilson Disputes Still Open

Closing the Washington bond case does not close the book on all Sterling and Wilson construction litigation. The company’s December 2024 financial review reported active disputes including a subcontractor remediation claim of roughly $56 million, wrongfully invoked bank guarantees totaling about $47 million from two customers, and a separate customer guarantee dispute worth about A$16.6 million.⁹

Sterling and Wilson also settled a separate arbitration with OEG Inc. in October 2025, agreeing to pay $2.25 million against OEG’s original claim of roughly $7 million while reserving its own counterclaims for potential future pursuit.¹⁰¹¹

Much of this legacy exposure sits under an indemnity agreement signed on December 29, 2021, between the company, former controlling shareholders Shapoorji Pallonji and Company Private Limited and Khurshed Daruvala, and Reliance New Energy Limited, which took a 40% stake in the parent company in early 2022. The former promoters agreed to indemnify Sterling and Wilson for liquidated damages, old receivables, tax disputes, and legal matters on identified past projects once net claims exceed Rs. 300 crore.¹² As of March 2025, the company’s total contingent liabilities stood at Rs. 863 crore, roughly Rs. 845 crore of which fell under that indemnity umbrella.¹³

1
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