Judge quashes whistleblower deposition in EB-5 investor case against state

VTDigger published an article titled, “Judge quashes whistleblower deposition in EB-5 investor case against state.” The article reads in part as follows;

judge has ruled that, for now, defrauded EB-5 investors in a class action lawsuit against the state cannot take the deposition of a key whistleblower in the case.

Lamoille County Superior Court Judge Thomas Carlson quashed the plaintiffs’ request for the deposition of Douglas Hulme, citing state rules prohibiting discovery until the defense has an opportunity to respond.

The plaintiffs allege that the state was complicit in allowing 800 investors to be systematically defrauded by Bill Stenger, the CEO and President of Jay Peak, and Ariel Quiros, the owner of the resort and other properties.

Barr and Associates, which is representing the investors, has asked for depositions of 10 individuals, starting with Hulme on July 27, and the release of all records pertaining to the EB-5 program.

The Vermont Attorney General’s office asked Carlson to block the depositions and the records release in a motion on July 18.

Carlson ruled that the plaintiffs’ requests violated legal procedures.

Bill Griffin, the chief assistant Vermont Attorney General, said in an interview that it was “inappropriate” for the plaintiffs to file a request for depositions and documents before the state responded to the investors’ complaint, which was filed in June.

The AG’s response, which must be filed by September 8, will be a motion to dismiss on the grounds that the state is protected from civil lawsuits under the doctrine of sovereign immunity, Griffin said.

Three state entities and 10 individuals are named in the class action lawsuit, including members of the former Shumlin administration who are no longer in public office. The AG’s office is representing current officials named in the lawsuit, and the Vermont EB-5 Regional Center, the Agency of Commerce and Community Development and the Vermont Department of Financial Regulation.

Russell Barr, the lead attorney for the plaintiffs, says his firm wanted to get Hulme, who is now 74, on the record as soon as possible.

‘The state quashed whistleblower Douglas Hulme when he attempted to tell them the truth about Jay Peak in 2012 and they are doing so again by quashing his deposition now’, Barr said. ‘What are they so fearful of? The truth?'”

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