A $27 million bet on a Fort Worth nitrile glove factory has swung back hard on Colliers’ Minneapolis financing arm, which is now staring down a stack of lawsuits from frustrated community banks. Lenders say they were steered into the deal while Colliers collected hefty fees, only to be left with a busted project and scraps from the equipment sell-off. At the center of the mess is Rhino Health’s Fort Worth plant, which creditors say never made it to commercial production and whose machinery pulled in only a token bid when it was auctioned.
Banks say Colliers took fees while the factory sputtered
In court filings, lenders accuse Colliers of raising $27 million from six community banks, including a $5 million commitment from St. Cloud-based Stearns Bank, to finance equipment for the Rhino Health facility. The suits claim Colliers collected more than $2 million in fees while disclosing only $750,000 of that amount to the banks, and that Rhino received the full $27 million in February 2023. A banking expert hired by the plaintiffs described some of Colliers’ conduct as “tantamount to bank fraud,” according to the Star Tribune.
Federal support and a big-name corporate partner
The Rhino expansion came with serious government backing: contract notices and procurement records show the Department of Defense committed roughly $126 million aimed at boosting domestic glove production, per the U.S. Department of Defense. Honeywell also put money into Rhino and announced a partnership that cast the company as both investor and customer during the build-out, according to Business Wire. Those federal and corporate ties helped make the pitch look safer to small banks weighing whether to join the loan package.
The factory never hits real production
The lawsuits paint a far uglier picture of what actually happened on the ground. Plaintiffs say three of the plant’s four manufacturing lines never produced a single nitrile glove, and that the lone test run in December 2022 depended on manual workarounds instead of full automation. Contractors allegedly pulled out over unpaid bills, the site never secured permanent power, and Rhino missed rent and loan payments leading up to its lease termination in November 2023. A court-appointed receiver later shopped the equipment and received just one offer, for about $250,000, a figure bankers say will barely dent the pile of claims against the company, according to the Star Tribune.
Lawsuits multiply, RICO claim lands in federal court
The legal fight has now spilled into federal court. One plaintiff, Union Equipment Finance, removed a complaint to federal court on March 4, 2026, listing racketeering among the claims. Colliers filed a notice of removal and, in its court papers, denies the allegations, maintaining that participating banks knew about the fee arrangements and the information available to them at the time. The case is now proceeding in the U.S. District Court for the District of Minnesota, according to Justia Dockets & Filings.
Why Minneapolis lenders are paying close attention
Community banks often lean on outside firms to assemble and place loans for industrial and other growth-stage projects, and Colliers’ Minneapolis team has been a visible player in that niche as well as in broader local office and financing deals. That presence means the outcome of these lawsuits could reshape how small banks in the region judge placement risk and third-party fees going forward. Local coverage of commercial real estate has highlighted Colliers’ role in Twin Cities office and financing activity, underscoring what is at stake for the market, according to Finance & Commerce.
What to watch next
Expect a long grind of discovery and motion practice as banks press their claims over what Colliers knew and when, and as Colliers defends how it handled the deal. Any eventual trial result or settlement could serve as a cautionary tale for community banks weighing specialty industrial financings. We will keep an eye on new filings as they land in Minnesota and other courts.
