Investing.com -- T1 Energy shares fell more than 4.4% in pre-market trading on Tuesday after short seller Fuzzy Panda Research announced a short position in the company.

Fuzzy Panda Research released a report alleging that T1 Energy is not compliant with Foreign Entity of Concern (FEOC) regulations and is ineligible for US tax credits. The firm claims that T1's sale of intellectual property to Evervolt, a Singaporean company, was designed to achieve FEOC compliance but that Evervolt has undisclosed connections to Chinese solar company Trina Solar.

The report states that Evervolt is owned by Tan Chin Piaw, who the short seller alleges has maintained business relationships with Trina Solar for over 15 years. Fuzzy Panda claims that patent databases show the intellectual property remains owned by Trina Solar, not Evervolt, and that 99% of T1's first quarter revenue came from Trina Solar.

The short seller alleges that T1 booked $41.4 million in tax credits during the first quarter of 2026 despite not having received them and questions whether the company meets requirements for these credits. Fuzzy Panda states that February 2026 IRS guidance established a July 4, 2025 deadline for intellectual property licensing agreements, while T1's agreement with Evervolt was dated December 29, 2025.

The report also claims that T1's G2 solar cell factory is behind schedule based on drone footage taken in early May showing limited construction progress. The short seller estimates the facility is 12 to 18 months behind schedule, though T1 management has stated it remains on track for a fourth quarter 2026 opening.

T1 Energy has been subpoenaed by the Department of Justice and Securities and Exchange Commission, according to the report.