Point Ruston spawns another lawsuit over money, this time from foreign investors
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- Seventy‑eight EB‑5 investors sued multiple Point Ruston defendants in federal court.
- Plaintiffs allege a collective $39 million invested through AURC III was misused.
- The complaint invokes RICO, seeks damages and demands an accounting of funds.
The continued battle over lost investments at Point Ruston has sprawled into a new federal case.
On Monday, 78 foreign investors who contributed to the Point Ruston project through the U.S. EB-5 program sued multiple individuals and entities connected to the site over financial losses at the redeveloped Asarco Superfund site that straddles Tacoma and Ruston.
The program allows foreign nationals to obtain a U.S. green card by investing in a qualifying U.S. business that creates or preserves at least 10 permanent full-time jobs for U.S. workers.
The complaint contends that the plaintiffs’ collective $39 million was misused in connection with what the lawsuit called the Waterwalk at Point Ruston development project in Tacoma and Ruston.
Each plaintiff invested a half-million dollars through AURC III to finance the second phase of the mixed-use development, the filing stated, and “would be protected through a structured lending arrangement, project oversight, and adequate collateral.”
The filing stated, “Contrary to those representations, Defendants failed to protect and properly manage investor funds. Developer Defendants, Michael Cohen, his son Loren Cohen, and their affiliated entities misapplied loan proceeds, allowed project assets and collateral to be transferred or encumbered without investor knowledge or consent, permitted the project to fall into default and insolvency, and repeatedly misrepresented the status and security of Plaintiffs’ investments.”
The defendant list includes Loren Cohen, son of the site’s late developer Michael Cohen, who died in 2020. Cohen is named in the suit individually and as control person for his late father’s estate.
Defendants include the main business entity over the entire project — Point Ruston LLC, — as well as Point Ruston Phase II LLC and other LLCs that were created for the project; American United Development Group, which operates the Oregon regional EB-5 investment center; WMC III LLC of Oregon; others tied to the investment program through work as managers or legal services, and 25 unnamed individuals.
The lawsuit, citing information from receivership financial data, listed total site liabilities of approximately $153,273,957.73 against an estimated net liquidation value of $16,698,982.
It added that “the assertion of over $26.5 million in personal and affiliate claims by Loren Cohen and Cohen-affiliated entities against the receivership estate, support the inference that investor funds were not used solely for their intended purpose.”
The group contends that “AURC, AUDG, and their managers failed to conduct adequate due diligence, monitor compliance with loan obligations, enforce investor protections, or take timely action after defaults occurred, while prioritizing fee income.”
As a result, the investors contend they suffered not only “substantial” financial losses but “significant immigration-related harm, including delays, denials, and impairment of benefits sought through the EB-5 program.”
The lawsuit describes the plaintiffs as foreign nationals from China who invested roughly between 2013 and 2015.
The suit accused the defendants of running a “coordinated scheme” that “deprived Plaintiffs of both their invested capital and the immigration benefits that incentivized their participation.”
No attorneys were yet listed representing the defendants. Loren Cohen did not immediately respond to request for comment via email.
The action is the latest legal trouble to beset the upscale waterfront development. In 2023, The News Tribune reported on the entanglement of LLCs and receiverships filed to collect on debts, including the total $66 million EB-5 loan from 132 investors in AURC III to the development.
The AURC III case resulted in a more-than $91 million judgment, foreclosing on the parking garage and Waterfront Market at Ruston in 2024.
Garage’s value amid debt collection
The Point Ruston garage is a sticking point in the case, as the plaintiffs contend the property lost investment value in the process of revised site governance rules and later a court decision.
The lawsuit contends Loren Cohen “authorized or directed collateral transfers and encumbrances ... including the reclassification of the parking garage as ‘Common Parking Area’ through the Third Supplemental Declaration, which reduced collateral value by approximately $50.2 million,” among other disclosure issues.
“This impairment materially reduced the investors’ prospects of recovering their $66 million in principle and accrued interest,” the suit noted. The suit questioned AURC’s credit bid for the site “substantially exceeding the property’s assessed value, without adequate disclosure of alternatives considered, third-party bids or valuations, or an independent conflict analysis... .”
The lawsuit notes that in November 2025 "the court granted a summary judgment against AURC III regarding the parking garage, ruling that (Point Ruston Owners Association) would continue to control a majority of the parking garage as Common Parking Area. As a result, the property’s appraised ‘as-is’ value was $15.9 million; if AURC III controlled the parking garage, the appraised value would have been approximately $66.1 million.”
The latest federal case was filed in federal court under the Racketeer Influenced and Corrupt Organizations (RICO) Act. The suit contends that “racketeering activity” was tied to “hundreds of interstate and international communications, including wire transfers, investor emails, mailed offering materials, investor update letters and legal filings.”
The plaintiffs seek to collect on damages to be determined at trial, plus court and attorney costs as well as “an accounting of all funds received and disbursed by AUDG, WMC III, and AURC III in connection with the EB-5 offering and the loan.”
Debt collection continues the site, most recently with an anticipated development of vacant parcels on the Ruston side by TerraCotta Group of El Segundo, California, whose TerraCotta Credit REIT has been another creditor at the site.
