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.
The latest judgments are against a slew of corporate and relief entities. The latter received “ill-gotten gains” but didn’t necessarily take actions that led to the SEC’s fraud allegations.
The lead plaintiff in the case is Alexander Daccache, of Brazil. More than 800 others could become eligible to join the suit against developers Ariel Quiros and Bill Stenger.
Contractors who have not been paid in more than a year are barely hanging on.
The CEO of a Korean firm was charged with embezzlement when he ran a related company in Vermont.
Bill Stenger denies wrongdoing and points the finger of blame at Ariel Quiros, Jay Peak’s owner.