By Marta Lillo
EB5 United has filed a lawsuit in a Florida court against EB5AN for allegedly making false statements about one of their EB-5 projects in Okeechobee and their associated regional Center, Florida EB5 Investments.
The firm submitted the claim on Mar. 4 before the Fifteenth Judicial Circuit court in Palm Beach county, arguing that the alleged false information distributed by EB5AN has led to EB-5 investors abandoning the project – the Lakefront Estates and Villas at Lakefront Project – and the firm’s reputation having been tarnished.
EB5 United CEO Scott Fuller says these statements have also raised doubts about EB5 United’s integrity, honesty, and competence.
“A couple of points of this lawsuit that I want to be on the record about is, first, that they slandered our company,” he said. “It is a malicious document with fabrications and outright lies. The second thing is, as everybody in the industry, we’ve worked hard to get these integrity measures put into the new program. And so, as much as this is about us and what it’s done to us and the damage it has caused, it’s also about trying to lift the industry. We all aspire to these integrity measures.”
EB5AN’s managing partner, Michael B. Schoenfeld, declined to comment to Eb5 Investors Magazine at this time.
EB5AN has until Apr. 1 to file a response before the court.
Alleged admission of fault by EB5AN not enough, EB5 United argues
EB5 United alleges in the lawsuit that EB5AN developed a marketing plan that “spread lies” and intended to undermine potential foreign investors’ confidence and dissuade them from participating in the EB5 United project.
“We have investors who soured on this project in particular and our organization as a whole based on this misinformation campaign instigated by EB5AN. So, losing investors is direct monetary damage,” Fuller said.
According to the lawsuit documents, EB5 United’s lead executives confronted EB5AN’s managing partner, Michael B. Schoenfeld, who reportedly verbally admitted that they were disseminating the information and that its publication shouldn’t happen.
EB5 United regards Schoenfeld’s admission of liability as a first step. However, because EB5AN allegedly has not taken any action to retract the statements, EB5 United seeks financial and moral compensation to ensure its reputation does not suffer any additional harm.
The firm also claims that EB5AN prepared a four-page summary document about the project and other of EB5 United’s past EB-5 projects. The EB5 United’s sales team learned of the summary document on Feb. 20 from a migration agent who sent them a text message including the document.
Defamation damages exacerbated by Apr. 1 fee hike deadline for EB-5, claims EB-5 United
EB5 United claims the document’s distribution has caused several qualified EB-5 investors to withdraw, question, or delay their investment in the project close to the Apr. 1 fee hike deadline. This situation is “especially damaging because it forces investors to make quick decisions to avoid the additional fees, making the timing of EB5AN’s defamatory statements particularly insidious,” according to the lawsuit.
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