重新部署难题

Redeployment is a common reason investors pursue litigation against an investment issuer. The law and policy set by Congress and USCIS often means that when a project returns the investment capital to the NCE, the NCE manager is at liberty to“redeploy or reinvest those funds to comply with the “at risk” requirements or an investor’s sustainment period. Redeployed capital can be reinvested anywhere in the United States until an investor’s conditional residency period is over (subsequently ending the sustainment period). 

Investors usually sign away their rights against redeployment in the project’s Private Placement Memorandum (PPM). However, even if the NCE manager is not required to consult an investor before reinvesting their funds, they still must exercise sound business judgment in selecting a redeployment project, which means that an investor’s funds cannot take on unreasonable risk without justification. Just because a manager has discretion to make business decisions does not mean they can do so carelessly; they must exercise sound fiduciary duty, which compels them to act in the best interests of the investors they represent. If an investment is redeployed into an unnecessarily risky offering with little opportunity for return, the investor may make claims against the administrators of the project for corporate law violations.

Sometimes, an issuer may ask the investor to sign a Consent Solicitation Form, which asks an investor’s consent to reinvest an investor’s money into a new project. In this case, an investor may be forced to make a false choice between having their funds redeployed while maintaining their immigration eligibility or having their funds returned to them immediately and losing their immigration benefits. In these cases, an investor has a very hard time proving they were forced to redeploy, given the “choice” offered by the investment issuer. However, it is not impossible to fight redeployment cases which employ the consent solicitation form – you merely need an attorney who is experienced in arguing these cases and sophisticated in EB-5 market trends to help determine your options. 

Oftentimes, redeployment is an extraordinarily complex case for litigation. Investors should only consider litigation if they feel the NCE manager is not acting in good faith on behalf of the investors, including scenarios like:

• Redeploying all investors in the NCE regardless of specific investors not needing their funds to be reinvested
• Reinvesting investor funds into a risky project without conducting sufficient due diligence, or failing to utilize “business judgment” when conducting due diligence on a project’s developer, financiers, or other faulty party
• NCE Managers taking obscenely disproportionate amount of interest accrued on redeployed investment projects