Miami federal court Judge Darrin Gayles gave preliminary approval to the settlement. If no one objects to the terms, the agreement will move forward.
“I think what happened in having the bubble burst was good in some way,” said one resident. “It made people realize they need to pull together as a community.”
The money from Raymond James and Associates Inc. will go to contractors who are still owed for work on Northeast Kingdom projects and investors who poured in millions.
Immigrant investors allege the Quebec company knowingly transferred money to Ariel Quiros for the purchase of Jay Peak Resort.
A legal filing did not state a reason for the termination. Lawyers continue to press claims for more than $2 million in bills for his defense against a federal fraud lawsuit.
The Jay Peak owner is suing the insurer to cover his legal bills in the face of fraud allegations. But the company says Quiros should pay its cost of fighting the coverage request.
“What it means is we don’t have to go out and secure a loan,” said a town official in Jay.
The investors who are covered put in money after March 2015, when the state added a new escrow requirement.
Galloway says, “We believe the state is using the ‘relevant’ litigation exemption as a shield to prevent the public from understanding why officials failed to provide adequate oversight of the Jay Peak Projects.”
The federal judge’s one-paragraph order doesn’t say why it will be so long before the trial starts.
Federal regulators have dropped their claims against a slew of entities that received money raised through the EB-5 program, saying such penalties would lessen the amount defrauded investors might recoup.
The funds will go into a trust account held by a court-appointed receiver.
The move could enable about 35 investors to look for another EB-5 project in hopes of still getting a green card, the motion says. More than 100 other investors wouldn’t be affected.
Memos from Douglas’ commerce agency reveal mostly positive views about the massive expansion of Jay Peak and other projects. “Looking back, more (oversight) would have been better,” he says in hindsight.