Econo Inn Corp. et al v. Administrative Appeals Office of USCIS et al
Filing
25
OPINION AND ORDER (1) Denying Plaintiffs' 18 Motion for Summary Judgment and (2) Granting Defendants' 19 Motion for Summary Judgment. Signed by District Judge Matthew F. Leitman. (HMon)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
ECONO INN CORP., et al.,
Plaintiffs,
Case No. 15-cv-10991
Hon. Matthew F. Leitman
v.
RON ROSENBERG, et al.,
Defendants.
__________________________________________________________________/
OPINION AND ORDER (1) DENYING PLAINTIFFS’ MOTION FOR
SUMMARY JUDGMENT (ECF #18) AND (2) GRANTING DEFENDANTS’
MOTION FOR SUMMARY JUDGMENT (ECF #19)
In 2001, Plaintiff Ketankumar Patel (“Patel”), a citizen of India, began
working for Plaintiff Econo Inn Corp. (“Econo Inn,” collectively with Patel,
“Plaintiffs”) as a motel manager. In 2007, Econo Inn filed an I-140 Immigration
Petition for an Alien Worker on Patel’s behalf (the “I-140 Petition”). The I-140
Petition, if granted, would have allowed Patel to obtain an employment visa and,
eventually, to apply for lawful permanent residency in the United States.
On February 27, 2009, the United States Citizenship and Immigration
Service (“USCIS”) denied the I-140 Petition. Plaintiffs appealed the denial to the
USCIS Administrative Appeals Office (the “AAO”), which ultimately affirmed the
denial on August 9, 2013. Plaintiffs thereafter filed this action challenging the
denial. (See Complaint, ECF #1.) Plaintiffs named as Defendants Ron Rosenberg,
1
Chief of the AAO, Leon Rodriguez, Director of USCIS, and Jeh Johnson, the
Secretary of Homeland Security (collectively “Defendants”). (See id.)
The parties have now filed cross-motions for summary judgment. (See ECF
##18, 19.)
For the reasons that follow, the Court will GRANT Defendants’
motion and DENY Plaintiffs’ motion.
RELEVANT FACTUAL BACKGROUND, STATUTORY AND
REGULATORY FRAMEWORK, AND PROCEDURAL HISTORY
Econo Inn is a Flint, Michigan, company that opened a motel of the same
name in 1986. (See Administrative Record, ECF #17-1 at 5, Pg. ID 98.) Patel is a
43-year-old native and citizen of India who entered the United States on July 20,
1999. (See id. at 4, Pg. ID 97.) Patel is not a lawful permanent resident of this
country. (See id.) Patel began working for Econo Inn shortly after his arrival in
the United States.
In 2001, Plaintiffs began the process of seeking a skilled worker
employment visa for Patel pursuant to the Immigration and Nationality Act (, 8
U.S.C. § 1101 et seq. (the “INA”). In Woody’s Oasis, v. Rosenberg, No. 13-cv367, 2014 WL 413503 (E.D. Mich. Feb. 4, 2014), the United States District Court
for the Western District of Michigan provided the following helpful overview of
skilled worker visa application process under the INA:
2
Under the Immigration and Nationality Act (INA), a noncitizen skilled worker may obtain a visa to work in the
United States. 8 U.S.C. § 1153(b)(3)(A)(i). Such visas
are available only if there are insufficient workers who
are able, willing, and qualified to fill the position that the
non-citizen seeks to fill, and the employment of the noncitizen would not adversely affect the wages and
conditions of U.S. workers. 8 U.S.C. § 1182(a)(5)(A)(i).
Authority to administer the INA has been delegated to
the Department of Homeland Security and sub-delegated
to the USCIS. 8 U.S.C. §1103(a)(1); 8 C.F.R. § 2.1.
If an employer seeks to employ a non-citizen skilled
worker, the employer and non-citizen must follow a
three-step process. See Matovski v. Gonzalez, 492 F.3d
722, 726-27 (6th Cir. 2007). First, the employer must
file an application with the DOL, and obtain a
certification from the DOL stating that there are
insufficient qualified, able, and willing U.S. workers to
fill the position. 8 U.S.C. § 1153(b)(3)(C); 1182
(a)(5)(A)(i)(I). As part of the certification, the DOL
establishes the wage that the prospective employer must
pay the prospective employee (the proffered wage). 8
U.S.C. § 1182(p).
If the DOL approves the labor certification, the employer
must then file an I-140 petition with the USCIS. See
Matovski, 492 F.3d at 727. The relevant regulation
provides that the employer must show that it has the
ability to pay the proffered wage starting on the date that
the employer filed its application with the DOL (the
priority date) and continuing until the USCIS approves
the petition. 8 C.F.R. § 204.5(g)(2). Evidence of the
ability to pay may take the form of annual reports, federal
tax returns, or audited financial statements. Id. In some
instances, additional evidence such as profit/loss
statements, bank account records, or personnel records
may be used to establish the ability to pay. Id.
3
Finally, the non-citizen may apply for adjustment of
status while the I-140 application is pending or after it is
approved. 8 U.S.C. § 1255(a)(3). Approval of the
application for adjustment of status is contingent upon
approval of the employer’s I-140 petition. 8 U.S.C. §
1255(a).
Woody’s Oasis, 2014 WL 413503 at *2-3.
On April 30, 2001, Econo Inn filed an Application for Alien Employment
Certification (the “Certification Application”) with the Department of Labor (the
“DOL”) on Patel’s behalf. (See Admin. R., ECF #17-1 at 8, Pg. ID 101.) Econo
Inn sought to hire Patel as the full-time manager for its motel. (See id.) The DOL
approved the Certification Application and set the “proffered wage” for Patel (that
is, the Wage Econo Inn would be required to pay Patel) at $43,800 per year. (See
Oct. 31, 2012, AAO Decision, ECF #17-4 at 147, Pg. ID 1068.)
Following the DOL’s certification, Econo Inn filed the I-140 Petition with
USCIS seeking to classify Patel as an alien beneficiary eligible for an immigration
visa based on his employment as the motel’s manager. (See Admin. R., ECF #17-1
at 4, Pg. ID 97.) Patel also filed an I-485 Application to Adjust Status in which he
sought to change his legal status from an undocumented immigrant to a lawful
permanent resident pending the approval of the I-140 Petition. (See Admin. R.
ECF #17-4 at 247, Pg. ID 1168.)
4
On December 26, 2008, USCIS notified Econo Inn that it had not provided
sufficient evidence of its ability to pay Patel’s proffered $43,800 wage, as Econo
Inn was specifically required to do under an applicable federal regulation, 8 C.F.R.
§ 204.5(g)(2) (the “Ability to Pay Regulation”). (See Admin. R., ECF #17-4 at
138, Pg. ID 1059.) USCIS requested that Econo Inn supplement the I-140 Petition
with, among other things, audited financial statements, business tax returns,
shareholder information, and Patel’s Internal Revenue Service (“IRS”) W-2 forms
dating back to 2001. (See Admin. R., ECF #17-1 at 66-67, Pg. ID 159-60) Econo
Inn then supplemented the I-140 Petition with (1) Patel’s 2007 and 2008 W-2
forms (see id. at 73-75, Pg. ID 166-67); (2) Patel’s June 2008 payroll vouchers (see
id. at 77-79, Pg. ID 169-71); (3) a statement from Econo Inn’s certified public
accountant (see id. at 80-82, Pg. ID 172-74); (4) Econo Inn’s operating cash flow
statements and monthly bank statements from 2001-2007 (see Admin R., ECF #171 at 84 – ECF #17-2 at 110, Pg. ID 182-479); (5) Econo Inn’s complete tax returns,
including shareholder filings from 2001-2007 (see Admin R., ECF #17-2 at 11273; Pg. ID 481-542); and (6) the personal tax returns for Econo Inn’s sole
shareholder, Dilip Patel. (See Admin R., ECF ##17-2 – 17-4, Pg. ID 550-1012.)
USCIS reviewed Econo Inn’s supplemental documents and denied the I-140
Petition on the basis that Econo Inn failed to establish its ability to pay Patel’s
proffered wage.
(See Admin. R., ECF #17-4 at 139, Pg. ID 1060.)
5
USCIS
concluded that “after a complete review of the record, the evidence does not
establish that the petitioner had the ability to pay the offered wage when the
priority date was established (April 30, 2001), or that it continued to have such
ability through to the present.” (Id.)
On March 31, 2009, Econo Inn appealed USCIS’s decision to the AAO, and
the AAO upheld the I-140 Petition’s denial on October 31, 2012. (See Oct. 31,
2012, AAO Decision, ECF #17-4 at 151, Pg. ID 1072.) Econo Inn then filed a
motion to reopen and a motion to reconsider with the AAO (the “Motion for
Reconsideration”). (See Aug. 9, 2013, AAO Decision, ECF #1-2 at 5, Pg. ID 19.)
On August 9, 2013, the AAO ruled on the Motion for Reconsideration and
affirmed the portion of its earlier decision in which it had concluded that Econo
Inn failed to establish its ability to pay Patel’s proffered wage.1 (See id.)
On March 16, 2015, Plaintiffs filed this action against the Defendants. (See
Compl., ECF #1.)
Plaintiffs ask this Court to reverse the AAO’s decision
affirming the denial of the I-140 Petition.
The parties have now filed cross-motions for summary judgment. (See ECF
##18, 19.)
Pursuant to Local Rule 7.1(f)(2), the Court concludes that oral
argument would not aid its decision on the summary judgment motions, and for the
1
The AAO withdrew the portion of its October 31, 2012, decision concluding that
Econo Inn had failed to establish that Patel qualified for the management position.
(See Aug. 9, 2013, AAO Decision, ECF #1-2 at 6, Pg. ID 20.) That portion of the
decision is not at issue in this case.
6
reasons stated below, it grants Defendants’ motion for summary judgment and
denies Plaintiffs’ motion.
ANALYSIS
Plaintiffs raise two main arguments in their motion for summary judgment.
First, Plaintiffs argue that the Ability to Pay Regulation is ultra vires to the INA
and that the Defendants therefore may not deny the I-140 Petition on the ground
that Econo Inn failed to satisfy that regulation. (See Pls.’ Br., ECF #18 at 9-10, Pg.
ID 1204-05.) Second, Plaintiffs argue that even if the Ability to Pay Regulation is
valid, the Defendants arbitrarily and capriciously concluded that Econo Inn lacked
the ability to pay Patel’s proffered wage. (See id.) Defendants counter that the
proffered wage requirement is not ultra vires to the INA and that they reasonably
determined that Econo Inn had failed to demonstrate its ability to pay the proffered
wage. (See Defs.’ Br., ECF #19 at 13, 20, Pg. ID 1274, 1281.)
A.
The Ultra Vires Challenge to the Ability to Pay Regulation
1.
Standard of Review
“In determining whether an agency regulation is ultra vires, [a federal court]
appl[ies] the two step Chevron2 analysis.” Garfias-Rodriguez v. Holder, 702 F.3d
504, 525 (9th Cir. 2012) (en banc); see also Hachem v. Holder, 656 F.3d 430, 438
(6th Cir. 2011) (applying Chevron test to determine “whether or not the regulation
2
Chevron, U.S.A., Inc. v. Natural Resources Def. Council, Inc., 467 U.S. 837, 84243 (1984).
7
conflicts with the enabling statute”). Under Chevron’s first step, a federal court
“first look[s] at the statute upon which the regulation is based.” Hachem, 656 F.3d
at 438. If the court determines that “‘Congress has directly spoken to the precise
question at issue,’ then that is the end of the inquiry.” Id. (quoting Chevron, 467
U.S. at 842-43). “The unambiguously expressed intent to Congress controls.” Id.
However, “if the statute is silent or ambiguous with respect to the specific issue,”
then a federal court must proceed to the second step of the Chevron analysis and
determine whether the agency has provided a “permissible construction of the
statute.” Id. (quoting Chevron, 467 U.S. at 842-43). In conducting the second step
of this analysis, a reviewing court “may not substitute its own construction [of the
statute] for the reasonable interpretation of an agency.” Hosp. Corp. of America,
348 F.3d 136, 141 (6th Cir. 2003) (quoting Peoples Fed. Sav. & Loan Ass’n of
Sidney v. Comm’r Internal Revenue, 948 F.2d 289, 300 (6th Cir. 1991)).
2.
The Ability to Pay Regulation Is Reasonable Under Chevron and
Is Not Ultra Vires to the INA
Under Chevron, the first question with respect to Plaintiffs’ ultra vires
challenge to the Ability to Pay Regulation is: does the INA expressly or
unambiguously require an employer seeking an employment visa on behalf of an
alien beneficiary to demonstrate its ability to pay that employee’s proffered wage?
It does not. Thus, this Court must proceed to Chevron’s second step to determine
8
whether the Ability to Pay Regulation rests upon a reasonable construction of the
INA.
The Ability to Pay Regulation provides as follows:
Any petition filed by or for an employment-based
immigrant which requires an offer of employment must
be accompanied by evidence that the prospective United
States employer has the ability to pay the proffered wage.
The petitioner must demonstrate this ability at the time
the priority date is established and continuing until the
beneficiary obtains lawful permanent residence.
Evidence of this ability shall be either in the form of
copies of annual reports, federal tax returns, or audited
financial statements . . . . In appropriate cases, additional
evidence, such as profit/loss statements, bank account
records, or personnel records, may be submitted by the
petitioner or requested by the Service.
8 C.F.R. § 204.5(g)(2).
The Ability to Pay Regulation has its origin in the 1977 Board of
Immigration Appeals’ (the “BIA”) ruling in Matter of Great Wall, 16 I. & N. Dec.
142, 1977 WL 39236 (Bd. Immigration App. Mar. 16, 1977).3 In Matter of Great
Wall, the BIA upheld the denial of a petition for a skilled worker visa on the
ground that the employer-application failed to demonstrate the employer’s ability
to pay the proffered wage.
See id.
The BIA explained that requiring a
3
According to the AAO, the Ability to Pay Regulation “codifies” the Matter of
Great Wall decision. See In re [Identifying Information Redacted by Agency],
2014 WL 4294327, at *4 (Dep’t. Homeland Sec. Aug. 6, 2014) (citing Matter of
Great Wall for the proposition that “consideration of whether the petitioner has the
ability to pay the proffered wage should necessarily focus on the circumstances as
of the date of filing, later codified at 8 C.F.R. § 204.5(g)(2)”).
9
demonstration of present ability to pay was fully consistent with the relevant
provisions of the INA:
At the time that Section 212(a)(14) was originally
enacted, the drafters of the Immigration and Nationality
Act stated that the purpose of the provision was “to
provide strong safeguards for American labor and to
provide American labor protection against an influx of
aliens entering the United States for the purpose of
performing skilled or unskilled labor where the economy
of individual localities is not capable of absorbing them
at the time they desire to enter this country.” [] H.R. Rep.
No. 1365, 82nd Cong. 2nd Session (1952), reprinted in
(1952) U.S. Code Cong. & Ad. News 1705. . . .
Section 204(a) of the Act requires the filing of a visa
petition for classification under section 203(a)(6). Section
204(b) states, among other things, “After an investigation
of the facts in each case, and after consultation with the
Secretary of Labor with respect to petitions to accord a
status under Section 203(a)(3) or (6), the Attorney
General shall, if he determines that the facts stated in the
petition are true and that the alien in behalf of whom the
petition is made is . . . eligible for a preference status
under Section 203(a), approve the petition . . . .” []
When a sixth-preference petition is filed,4 it seeks to
establish that the employer is making a realistic job offer
to an alien who is qualified, and that the proposed
employment will not displace United States workers at
the time the petition is filed. I do not feel, nor do I
4
At the time of the Matter of Great Wall decision, sixth-preference visas were
available to aliens capable of performing skilled or unskilled labor of a permanent
nature “for which a shortage of employable and willing persons exists in the
United States.” 8 U.S.C. § 1153(a)(6) (1982).
10
believe the Congress intended, that the petitioner, who
admittedly could not pay the offered wage at the time the
petition was filed, should subsequently become eligible
to have the petition approved under a new set of facts
hinged upon probability and projections, even beyond the
information presented on appeal.
Matter of Great Wall, 1977 WL 39236 at *2-3.
Twelve years after Matter of Great Wall, the United States Court of Appeals
for the District of Columbia Circuit examined that decision and concurred with the
BIA’s construction of the INA. See Masonry Masters, Inc. v. Thornburgh, 875
F.2d 898, 899-90 (D.C. Cir. 1989). The court in Masonry Masters explained that
requiring a prospective employer to demonstrate a present ability to pay is
“clearly” within the INS’s authority “because it relates to whether [the] job offer is
realistic.” Id.
The court concluded that the ability-to-pay requirement was
“rational.” Id.5
In the years since Masonry Masters was decided and the Ability to Pay
Regulation was adopted, a number of federal courts have deemed the ability-to-pay
requirement reasonable and have rejected arguments – like those Plaintiffs make
here – that the Ability to Pay Regulation is ultra vires to the INA. For instance, in
Rizvi v. Dep’t of Homeland Sec. ex rel. Johnson, --- Fed. App’x---, 2015 WL
5
The precise issue in Masonry Masters was whether the determination of the
applicant’s ability to pay should be made by the INS (USCIS’s predecessor) or by
the DOL. But the court’s statement that the INS “clearly” had the authority to
make the determination is certainly relevant to whether the requirement that an
applicant demonstrate an ability to pay is ultra vires to the INA.
11
5711445, at *2 (5th Cir. Sept. 30, 2015), the United States Court of Appeals for the
Fifth Circuit explained:
Appellants' final contention is that the regulation that
requires an employer to demonstrate its ongoing ability
to pay the prevailing wage is ultra vires of the statute,
which provides that “[a]ny employer desiring and
intending to employ ... an alien entitled to classification
under . . . 1153(b)(3) . . . may file a petition with the
attorney general for such classification.” The regulation
in question, 8 C.F.R. § 204.5(g)(2), allegedly
impermissibly expands on this provision by adding
requirements of an employer's ability to pay from the
priority date until the petition is granted and by
restricting
what
evidence
is
probative.
Assuming arguendo that this issue need not have been
administratively exhausted, the contention fails. Other
provisions
of
the
INA, e.g. 8
U.S.C.
§§
1182(a)(5)(A) (requiring
DOL
certification, inter
alia, that an alien's wages will not adversely affect the
wages of similarly situated U.S. workers), and 1103(a)(3)
(Secretary of Homeland Security authorized to
promulgate regulations and perform other acts deemed
necessary for carrying out his authority), also bear on the
propriety of the regulation. Viewed in the proper
context, the challenged regulation serves purposes in
accord with the statutory duty to grant immigrant status
only where the interests of American workers will not be
harmed; showing the employer's ongoing ability to pay
the prevailing wage is one reasonable way to fulfill this
goal.
Likewise, in Woody’s Oasis, the court rejected an ultra vires challenge to the
Ability to Pay Regulation and held that USCIS’s application of the regulation was
fully “consistent with its statutory and regulatory authority.” Woody’s Oasis, 2014
WL 413503, at *3-5.
12
The Court finds Matter of Great Wall and the judicial decisions discussed
above to be persuasive. As the BIA and federal courts have concluded, a rule
and/or regulation requiring an employer-applicant to demonstrate a present ability
to pay the proffered wage is reasonable means of insuring that skilled worker visa
applications are for legitimate, existing employment opportunities, and the
requirement is not inconsistent with the INA. Accordingly, the Court rejects
Plaintiffs’ ultra vires challenge to the Ability to Pay Regulation.
B.
The I-140 Petition’s Denial
1.
Standard of Review
The parties’ motions before the Court are styled as summary judgment
motions. The Sixth Circuit has explained that “the use of summary judgment is
inappropriate for judicial review of an administrative action under the
Administrative Procedure Act,” such as the Defendants’ denial of the I-140
Petition here. Donaldson v. United States, 109 Fed. App’x 37, 39-40 (6th Cir.
2004); see also Alexander v. Merit Sys. Protection Bd., 165 F.3d 474, 480-81 (6th
Cir. 1999). Nonetheless, a district court may still “enter judgment on a summary
judgment motion so long as the court applies the proper standard of review and
does not consider evidence outside the administrative record.” Woody’s Oasis,
2014 WL 413503, at *2 (citing Alexander, 165 F.3d at 480-81).
13
Under the Administrative Procedures Act (the “APA”), a court should set
aside an agency decision if it is “arbitrary, capricious, an abuse of discretion, or
otherwise not in accordance with the law.” 5 U.S.C. § 706(2)(A). “Review under
the APA is deferential and a court must not ‘substitute its judgment for that of the
agency.’” Taco Especial v. Napolitano, 696 F. Supp. 2d 873, 877 (E.D. Mich.
2010) (quoting Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463
U.S. 29, 43 (1983)). The agency, however, “must examine the relevant data and
articulate a satisfactory explanation for its action including a rational connection
between the facts found and the choice made.” Motor Vehicle Mfrs. Ass’n, 463
U.S. at 43 (internal quotations and citation omitted).
2.
Defendants Reasonably Concluded That Econo Inn Failed to
Demonstrate Its Ability to Pay the Proffered Wage
USCIS uses “three primary methods” to determine whether an employer can
pay the proffered wage in an I-140 petition:
First, an employer can show that he is already employing
the alien beneficiary at a wage equal to that specified in
the Form ETA–750. Second, an employer can show that
its yearly net income exceeds the expected yearly wage
specified in the Form ETA–750. Finally, an employer
can show that its net current assets exceed the expected
yearly wage specified in the Form ETA–750.
Taco Especial, 696 F. Supp. 2d at 878 (internal citations omitted). And “if an
employer fails to meet any of the three criteria, the USCIS has the discretion to
14
consider any other evidence provided by the petitioner and may use it to find that
an employer has the ability to pay the proffered wage.” Id.
Here, USCIS reasonably determined that Econo Inn failed to establish its
ability to pay under any of the three “primary methods.” Indeed, it was undisputed
that Econo Inn was not already employing Patel at the proffered wage at the time
the Petition was filed, and Plaintiffs ultimately conceded – and admit now – that
“net income and net current assets as reported on [Econo Inn’s] tax returns did not
fully cover the proffered wage.” (Aug. 9, 2013, AAO Decision, ECF # 1-2 at 3, Pg.
ID 17; see also Pls.’ Br., ECF # 18 at 23, Pg. ID 1218.)
USCIS also reasonably determined that the additional documentation
submitted by Econo Inn did not establish Econo Inn’s ability to pay Patel the
proffered wage. For instance, USCIS reasonably rejected Plaintiffs’ argument that
Econo Inn’s bank statements demonstrated its ability to pay. As USCIS explained,
those statements “show the amount in an account on a given date, and cannot show
the sustainable ability to pay a proffered wage.” (Oct. 31, 2012, AAO Decision,
ECF # 17-4 at 150, Pg. ID 1071.) Likewise, USCIS fairly noted that Plaintiffs
failed to submit evidence “to demonstrate that the funds reported on [Econo Inn’s]
bank statements somehow reflect additional available funds that were not reflected
on its tax returns….” (Id.) Moreover, USCIS reasonably declined to accept Econo
Inn’s unaudited financial statements and properly deemed irrelevant the assets
15
owned by Econo Inn’s controlling shareholder (rather than by Econo Inn, itself).
(Id.)
Finally, USCIS carefully considered the totality of Econo Inn’s
circumstances and reasonably concluded that those circumstances did not establish
Econo Inn’s ability to pay:
USCIS may consider the overall magnitude of the
petitioner’s business activities in its determination of the
petitioner’s ability to pay the proffered wage. See Matter
of Sonegawa, 12 I & N Dec. 612. . . .
***
In the instant case, the petitioner has been in business
since 1986, and claims to employ eight workers. Its gross
receipts averaged $432,111 since 2001; the petitioner has
only shown marginal growth. The petitioner has not
established historical growth, the occurrence of any
uncharacteristic business expenditures or losses, the
petitioner’s reputation within its industry, or whether the
beneficiary is replacing a former employee or an
outsourced service. Although counsel claims that the
petitioner incurred management expenses because the
beneficiary was not yet working for it prior to 2007, it
has not been established who performed these duties,
whether duties were the same as certified on the Form
ETA 750, or how much the petitioner needed to pay for
these services. Going on record without supporting
documentary evidence is not sufficient for purposes of
meeting the burden of proof in these proceedings. Matter
of Soffici, 122 I. & N. Dec. 158, 165 (Comm’r 1998)
(citing Matter of Treasure Craft of California, 14 I. & N.
Dec. 190 (Reg’l Comm’r 1972)).
Moreover, the income tax forms indicate that the
petitioner has paid under $75,000 in wages and salaries
to its eight employees, which lead us to believe more
16
likely than not, that the petitioner, could not support nine
employees if only eight employees were paid an average
combined wages and salaries of $48,457 since 2001.
Thus, assessing the totality of the circumstances in this
individual case, it is concluded that the petitioner has not
established that it had the continuing ability to pay the
proffered wage.
(Oct. 31, 2012, AAO Decision, ECF # 17-4 at 151, Pg. ID 1072.)
Plaintiffs attack USCIS’s conclusion on several grounds, but none establish
that USICS acted arbitrarily or capriciously. Plaintiffs first argue that USCIS
failed to consider the totality of Econo Inn’s financial circumstances6 as required
under Matter of Sonegawa, 12 I. & N. Dec. 612 (Bd. Immigration App. 1967)
(reviewing the totality of circumstances in assessing ability to pay). But that is
demonstrably false. As the excerpt above makes clear, USCIS cited Matter of
6
Plaintiffs assert that certain USCIS memoranda and manuals – specifically,
USCIS Memorandum, Determination of Ability to Pay Under 8 C.F.R.§
204.5(g)(2) (May 4, 2004), and the USCIS Adjudicator’s Field Manual –
impermissibly restricted the scope of USCIS’s review of Econo Inn’s finances.
(See Pls.’ Reply Br., ECF #24 at 4-5, Pg. ID 1330-31.) Plaintiffs complain that the
memoranda and manuals provide “adjudicators the discretion to reject the very
evidence that the regulation permits petitioners to submit.” (Id. at 7, Pg. ID 1333.)
This argument fails for two reasons. First, the Ability to Pay Regulation states that
USCIS may consider “additional evidence, such as profit/loss statements, bank
account records, or personnel records” in “appropriate cases.” 8 C.F.R. §
204.5(g)(2) (emphasis added). The regulation does not require USCIS to consider
these pieces of evidence. Second (and in any event), USCIS evaluated every single
document Econo Inn submitted with its I-140 Petition and did consider the totality
of Econo Inn’s financial circumstances – even when it was not required to do so.
Thus, the manuals’ guidance had no bearing on USCIS’s rejection of Econo Inn’s
I-140 Petition in this case.
17
Sonegawa and expressly considered the totality of Econo Inn’s financial
circumstances.
Plaintiffs further criticize USCIS for failing to give proper weight to Econo
Inn’s “substantial backing” from its “sole shareholder.” (Pls.’ Br., ECF # 18 at 24,
Pg. ID 1219.) But the sole shareholder and the corporation are separate legal
entities, and Plaintiffs have offered no reason to believe that the shareholder’s
assets would necessarily be available to satisfy the corporation’s obligations –
including the payment of Patel’s proffered wage.
Plaintiffs also complain that USCIS disregarded the analysis of Plaintiffs’
accountant who, after “exclud[ing] depreciation and amortization expenses,”
concluded that Econo Inn did have the ability to pay the proffered wage. (Pls.’ Br.,
ECF #18 at 24, Pg. ID 1219.) But as this Court concluded in Taco Especial,
USCIS does not act arbitrarily when it insists that depreciation and amortization
expenses be factored into the ability-to-pay calculus. See Taco Especial, 696 F.
Supp. 2d at 880-82.
Next, Plaintiffs assert that USCIS overlooked the fact that Econo Inn “has
been in business for nearly 30 years, has remained solvent during that time, and
has always met its financial obligations.” (Pls.’ Br., ECF #18 at 23, Pg. ID 1218.)
A business’s longevity, however, is not itself an adequate basis for establishing the
business’s ability to pay a prospective employee’s proffered wage. See Woody’s
18
Oasis, 2014 WL 413503, at *5 (“Plaintiffs merely point to Woody’s Oasis’s
longevity and recent expansion. However, these factors provide no reason to
believe that Woody’s Oasis could find the extra money to pay [the employee’s]
salary”). In any event, USCIS did consider Econo Inn’s business history, but it
noted that Econo Inn “did not submit evidence to establish its historical growth, the
occurrence of any uncharacteristic business expenditures or losses, [or] [its]
reputation within the industry.” (Aug. 9, 2013, AAO Decision, ECF #1-2 at 5, Pg.
ID 19.) USCIS did not act reasonably when it determined that Econo Inn’s history
failed to establish its ability to pay Patel’s proffered wage.
Finally, Plaintiffs argue that USCIS’s focus on Econo Inn’s net income and
net assets was misplaced because “a profitable company may show no [net] taxable
income because it transfers its profit into other expenditures, such as salaries” to
reduce its tax liability. (See Pls.’ Br., ECF #18 at 22, Pg. ID 1217 (citing Constr.
& Design Co. v. USCIS, 563 F.3d 593, 595-96 (7th Cir. 2009).) But Plaintiffs
point to no evidence that Econo Inn, in fact, shifted any of its profits into other
expenditures as a way to reduce it tax liabilities, nor do Plaintiffs identify a specific
source of funds that would be available to pay Patel’s proffered wage. They have
thus failed to show error in USCIS’s consideration of net income and net assets.
See Taco Especial, 696 F. Supp. 2d at 880. (“[T]he employer bears the burden of
19
proof in establishing ability to pay and must show where the extra money would be
coming from.” (internal quotations and citation omitted)).
CONCLUSION
For the reasons stated above, IT IS HEREBY ORDERED that the
Plaintiffs’ motion for summary judgment (ECF #18) is DENIED and the
Defendants’ motion for summary judgment (ECF #19) is GRANTED.
s/Matthew F. Leitman
MATTHEW F. LEITMAN
UNITED STATES DISTRICT JUDGE
Dated: November 9, 2015
I hereby certify that a copy of the foregoing document was served upon the
parties and/or counsel of record on November 9, 2015, by electronic means and/or
ordinary mail.
s/Holly A. Monda
Case Manager
(313) 234-5113
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