Tongatapu Woodcraft Hawaii, Ltd. v. Feldman

• Decision Date: 03 July 1984
• Docket Number: No. 83-1826,83-1826
• Citation: 736 F.2d 1305
• Parties: TONGATAPU WOODCRAFT HAWAII, LTD., Plaintiff-Appellee, v. Sam I. FELDMAN, * District Director, Immigration and Naturalization Service; et al., Defendants-Appellants.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1305

736 F.2d 1305

TONGATAPU WOODCRAFT HAWAII, LTD., Plaintiff-Appellee, v. Sam I. FELDMAN, ^* District Director, Immigration and Naturalization Service; et al Defendants-Appellants No. 83-1826.

United States Court of Appeals Ninth Circuit.

Submitted Dec. 12, 1983.

Submission Withdrawn May 4, 1984.

Resubmitted July 3, 1984.

Decided July 3, 1984.

William Thompson, III, Honolulu, Hawaii, for plaintiff-appellee.

R. Michael Burke, Asst. U.S. Atty., Honolulu, Hawaii, for defendants-appellants.

Appeal from the United States District Court for the District of Hawaii.

Before WRIGHT, CHOY, and POOLE, Circuit Judges.

CHOY, Circuit Judge:

Tongatapu Woodcraft Hawaii, Ltd. (Tongatapu) employs woodcarvers who dress in native garb and sell their wares to passing tourists. After failing to secure qualified workers domestically, Tongatapu applied to the Immigration and Naturalization Service (INS or Service) to obtain sixth preference visas for two experienced woodcarvers from Tonga. The INS granted the petitions but later revoked them on the ground that Tongatapu made material misrepresentations in its certification to the Department of Labor. Tongatapu then brought a declaratory judgment action against the INS, seeking reinstatement of the petitions. The district court granted summary judgment for Tongatapu, holding that the INS action was arbitrary and capricious or constituted an abuse of discretion. INS now appeals, and we reverse and remand.

I. BACKGROUND

Tongatapu is a very small Hawaii firm with the stated purpose of placing Tongan woodcarvers in areas with high tourist traffic, such as the International Market Place in Waikiki. Tongatapu expected its carvers to not only carve wood and sell the carvings but also to explain the carving technique and the cultural significance of the carvings to passersby.

Tongatapu employs Maake Molitoni and Viliami Veatupu, two Tongan brothers with eight years of woodcarving experience. Molitoni and Veatupu entered the United States as non-immigrant visitors in January 1980. They remained after their visitor permits expired that spring. In the summer of 1980, Tongatapu petitioned the INS for sixth preference visas, which are issued to "qualified immigrants who are capable of performing specified skilled or unskilled labor, not of a temporary or seasonal nature, for which a shortage of employable and willing persons exists in the United States." Immigration and Nationality Act Sec. 203(a)(6), 8 U.S.C. Sec. 1153(a)(6).

In the course of its application to the INS, Tongatapu in April 1981 obtained a certification from the Department of Labor stating that there were not sufficient domestic workers available to perform the woodcarving jobs and that the brothers' performance of those jobs would not adversely affect the wages and working conditions of similarly employed domestic workers. See id. Sec. 212(a)(14), 8 U.S.C. Sec. 1182(a)(14). In applying for that certification, Tongatapu estimated annual net revenues of $50,000 and indicated that it would be paying the woodcarvers $5 per hour. Tongatapu also unsuccessfully attempted to recruit domestic applicants, using the procedures specified in 20 C.F.R. Sec. 656.21.

In due course, in June 1981 the INS approved the visa petitions submitted on behalf of Molitoni and Veatupu. Those petitions were forwarded to the American consulate in Fiji, which has ultimate authority to grant visas, but no visas were ever issued.

In January 1982, an INS investigator filed a report on the petitions submitted by Tongatapu that concluded as follows:

Investigation disclosed that TONGATAPU WOODCRAFT HAWAII, LTD., was created in order that 6th preference visa petitions could be submitted in behalf of SUBJECT MAAKE SOAKI MOLITONI and SUBJECT VILIAMI HAME VEATUPU. An on site inspection revealed information on SUBJECTS' visa petitions and labor certifications to be inaccurate. Examination of the corporation's records indicate a substantial loss since the corporation began. It would be impossible for the corporation to pay the wages indicated on [the labor certification application].

By letter dated March 10, 1982, the INS notified counsel for Tongatapu of the Service's intent to revoke the sixth preference visa petitions on the ground that "[Tongatapu] would be unable to meet the salary specifications of the certified job offers." The Service made that determination on the basis of rents paid by Tongatapu to International Market Place totalling $1724 over a five-month period, indicating annual revenue of $27,590 given that International Market Place's rent is 15% of gross sales.

After a hearing, the INS revoked Tongatapu's visa petitions on August 25, 1983. Prior to this date, Veatupu had already been deported to Fiji. He has not returned to the United States. As to Molitoni the appeal is moot. He has been granted permanent residence as the spouse of a United States citizen and thus he no longer needs a sixth preference visa.

II. ACTUAL FRAUD ON THE INS

In its brief, the Government asserts that Tongatapu consists of three people, two being the aliens in question and the third being Molitoni's wife, a Canadian national. It implies that Tongatapu was formed in order to defraud the INS. Had the Government proved this contention below, Molitoni and Veatupu would be deportable under section 212(a)(19), 8 U.S.C. Sec. 1182(a)(19). Castaneda-Gonzalez v. INS, 564 F.2d 417, 425 (D.C.Cir.1977).

In the INS's letter of intent to revoke and in all administrative proceedings below, however, the sole ground asserted by the INS for revocation of the visa petitions was the financial condition of Tongatapu. A reviewing court must judge the propriety of an agency's actions solely on the grounds invoked by the agency. Patel v. INS, 638 F.2d 1199, 1201 (9th Cir.1980); Castillo-Felix v. INS, 601 F.2d 459, 462 n. 6 (9th Cir.1979); see Federal Power Commission v. Texaco, Inc., 417 U.S. 380, 397, 94 S.Ct. 2315, 2326, 41 L.Ed.2d 141 (1974). We cannot uphold the Service's decision on this asserted ground.

III. STANDARD OF REVIEW

The Government argues that the alien has the burden of proof in any administrative proceedings regarding visa status pursuant to Sec. 291 of the Act, 8 U.S.C. Sec. 1361, which reads:

Whenever any person makes application for a visa or any other document required for entry, or makes application for admission, or otherwise attempts to enter the United States, the burden of proof shall be upon such person to establish that he is eligible to receive such visa or such document, or is not subject to exclusion under any provision of this chapter, and, if an alien, that he is entitled to the nonimmigrant, quota immigrant, or nonquota immigrant status claimed, as the case may be.

It is important to note that a visa petition is not the same thing as a visa. An approved visa petition is merely a preliminary step in the visa application process. 1A Gordon & Rosenfeld, Immigration Law and Procedure Sec. 3.5(j). It does not guarantee that a visa will be issued, nor does it grant the alien any right to remain in the United States. Joseph v. Landon, 679 F.2d 113, 115 (7th Cir.1982); Amarante v. Rosenberg, 326 F.2d 58, 61 (9th Cir.1964).

The INS may revoke an approved visa petition "at any time" when it finds "good and sufficient cause." Sec. 205 of the Act, 8 U.S.C. Sec. 1155; 8 C.F.R. Sec. 205.3. Despite the burden that Sec. 205 places on the Government, a proceeding to revoke a visa petition, like the petition itself, is a part of the application process and falls under Sec. 291 of the Act, 8 U.S.C. Sec. 1361. Thus, once the INS has produced some evidence to show cause for revoking the petition, the alien still bears the ultimate burden of proving eligibility. The alien's burden is not discharged until the visa is issued.

Under the Administrative Procedure Act, 5 U.S.C. Sec. 706(2)(A), a court may set aside a determination of the INS as arbitrary, capricious, or an abuse of discretion. The determination must be made on the administrative record before the Service. Navarro v. District Director, 574 F.2d 379, 383 (7th Cir.), cert. denied, 439 U.S. 861, 99 S.Ct. 182, 58 L.Ed.2d 170 (1978). We have held it an abuse of discretion for the Service to act "if there is no evidence to support the decision or if the decision was based on an improper understanding of the law." Song Jook Suh v. Rosenberg, 437 F.2d 1098, 1102 (9th Cir.1971), quoted in Joseph v. Landon, 679 F.2d 113, 116 (7th Cir.1982); see Loza-Bedoya v. INS, 410 F.2d 343, 346 (9th Cir.1969). The term "no evidence," however, cannot be read literally. Digilab, Inc. v. Secretary of Labor, 357 F.Supp. 941, 942 (D.Mass.1973) ("The term 'no evidence' as stated in [Song Jook Suh ] cannot be interpreted to mean 'any' evidence, no matter how little."), remanded on other grounds, 495 F.2d 323 (1st Cir.), cert. denied, 419 U.S. 840, 95 S.Ct. 70, 42 L.Ed.2d 67 (1974). It seems clear, then, that the Service retains at least the burden of producing substantial evidence supporting its determination. See Kee Yiu Leong v. O'Shea, 363 F.2d 426, 427-28 (9th Cir.1966). Any less would read the "good and sufficient cause" requirement out of section 205.

IV. FACTUAL SUPPORT REQUIRED TO SUSTAIN THE INS DECISION

We now address the issue of what evidence must be presented by the INS to sustain its decision to revoke the visa petitions on the ground that the petitioner company, Tongatapu, was not economically viable.

The approval of two federal agencies is necessary to obtain sixth preference visa status for "qualified immigrants who are capable of performing specified skilled or unskilled labor not of a temporary or seasonal nature for which a shortage of employable and willing persons exists in the United States," Immigration and Nationality Act, Sec. 203(a)(6), 8 U.S.C. Sec. 1153(a)(6). The Department of Labor ("DOL") must certify that insufficient domestic workers are available to perform the job and that the...