A federal judge was sought to vacate a decision by U.S. Homeland Security
that barred six Chinese investors from participating in the EB-5 visa
program after an Alabama hospital project they invested in was denied
recognition as a “troubled business.” By denying them access
to the visa program, the investors claim that the DHS’s decision
was “arbitrary and capricious,” and asked for it to be reversed.
In the case of Gan v. U.S. Department of Homeland Security et al, the investors
argued that the DHS exceeded its authority by failing to recognize the
overwhelming evidence of the troubled aspect of the Crenshaw Community
Hospital, and by requiring the investors to show when and how the hospital
would become profitable. The investors also pointed out that they met
the requirements of the EB-5 program by creating sixty-one new jobs, ten
per investor, as is the requisite minimum mandated for program participation.
The EB-5 Immigrant Investor Program is a U.S. visa program created under
the Immigration Act of 1990. The program requires that foreign nationals
invest a minimum of $500,000 into American projects that aim to save or
create a minimum of ten jobs. The program allows investors to then apply
for permanent residency for themselves and their family, provided all
requirements of the program are met and verified.
In a statement to the U.S. District Court for the District of Columbia,
the investors said that because the hospital qualifies as a troubled business,
the all-cash capital contribution by the investors allowed them to pool
the total jobs saved and created and distribute them among the six investors,
therefore meeting the visa requirement. Based on this assertion, the investors
asked the court to grant summary judgment.
The investors filed suit in April 2015, alleging the government failed
to prove the hospital did not experience “serious losses.”
The investors contend that the Crenshaw Community Hospital lost more than
twenty percent of its total net worth in either 2011 or 2012. The filing
went on to state that the government falsely claimed that the investors
did not put their 2013 investment at risk.
According to the complaint, the government felt that the hospital was not
a troubled business; therefore, the purported one hundred seventeen “saved”
jobs do not qualify under the EB-5 requirement to create new American
jobs, rather than simply saving jobs that may be in jeopardy.
The investors are asking the D.C. federal court to reverse the DHS’s
determination that the hospital was not a troubled business, and to throw
out their finding that their investor capital was not at risk. The investors
are also asking the court to reverse the government’s decision denying
them eligibility for the EB-5 visa program.