"EB-5 诉讼中的 "私密性

Pursuing litigation against an associated party in the EB-5 process is made intentionally complex by issuers and developers. Investment issuers, general partners and other parties “in privity” with (meaning contractually attached to) investors make extremely complex deal structures to discourage investors from pursuing litigation. Any investor brave enough to continue with litigation may still face an uphill legal battle against an exploitative entity.

Issuers and partners generally limit the parties with which an investor is “in privity.” The further outside of privity an investor tries to litigate, the weaker a case becomes and the harder it is for a case to win. For example, investors are usually not in privity with developers, meaning developers are protected by the degree of separation between themselves and the investors. Many other third parties brought into a project by an investment issuer or developer are also not in privity with the investor. In these cases, the clauses laid out in an investor’s private placement memorandum (PPM) become extremely important, given the fact-driven nature of complex litigation. This document usually shows the investor in privity with parties such as the New Commercial Enterprise (NCE) LLC, Investment Issuers/NCE managers, general partners, and other important parties. Offering documents such as these also usually include litigation clauses, which describe the notices a Managing Member is required to issue once an investor has initiated a lawsuit against an issuer. Nevertheless, investors have successfully litigated against all parties in the EB-5 process, whether or not they are in privity with others on a variety of grounds.

Privity laws can vary from state to state, meaning that some states such as New York and Delaware have stricter laws unfavorable to investors. Unsurprisingly, these are the jurisdictions often chosen by developers and issuers, which means that any litigation an investor may pursue must take place in these jurisdictions. Investors should be prepared for a slow, methodical battle, but remain steadfast in their willingness to proceed.

Derivative Suits

For many investors, pursuing multiple litigation cases at once may be necessary to address all the wrongdoing conducted against their interests. When an investor wants to seek litigation against a party in privity with the defendant, such as the investment issuer, but not in privity with the investor directly, an investor can file a derivative suit. In this case, the investor files suit on behalf of the issuer, but only if the issuer refuses to take legal action. Most often, this occurs when an issuer has not conducted proper due diligence on developers, partners, or associated corporations with whom they have transacted business. Strong evidence in the language of the governing contracts must be brought to light to demonstrate that the third party in privity with the issuer caused the investor intentional wrongdoing, or they were directly a third-party beneficiary of the investment.