Metropolis project in Downtown Los Angeles (Credit: Metropolis LA)
A federal lawsuit filed against a Los Angeles attorney accusing him of running an EB-5 scam at the Metropolis megaproject has been dropped.
LA Metropolis Condo I, a fundraising entity involved in Greenland USA’s mixed-use project in Downtown Los Angeles, dropped the suit against the lawyer, James Krug, and his one-person firm.
LA Metropolis Condo I filed the suit last month, and court records show it was dismissed by the plaintiff April 3.
The suit had alleged that Krug and his firm convinced EB-5 investors and financial services firm A&J Capital that he had taken over management of the investor-visa program at the condo development. In a letter sent to A&J Capital on March 14, Krug’s firm allegedy claimed A&J Capital had been “terminated” from the project as a result of an alleged membership vote. The letter also ordered A&J Capital to halt its operations on the project, according to the lawsuit.
Alhambra-based A&J Capital, however, had not been terminated and is still managing the federal EB-5 program, the plaintiff claimed.
Greenland USA, which was not a party to the lawsuit, declined to comment. Krug also declined to comment. The law firm representing the plaintiff, Holland & Knight, did not respond to requests for comment.
Greenland USA, the U.S. arm of the China-based Greenland Group, is developing the 3.5 million-square-foot project, which includes three massive condominium towers, 70,000 square feet of retail and a 350-key hotel. Its 38-story luxury Tower 1 was completed in April as part of “Phase 1.” One of the condo towers and the hotel component of the project hit the market earlier this year.
Under the EB-5 program, foreign investors pour money into job-creating U.S. projects in exchange for a green card. In recent years, it has become one of the most popular fundraising methods for U.S. developers, who have raised billions through it. The program was recently extended through September.
LA Metropolis Condo I was created for the purpose of raising immigrant capital — $100 million — for the development of that project’s Phase 1, according to the lawsuit.
The capital would then be allocated to an entity named Greenland LA Metropolis Development I, LLC.
Powered by WPeMatico