Chamber of Commerce of the United State of Am. v. United States Dep't of Homeland Sec., 20-cv-07331-JSW

CourtUnited States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Northern District of California
Writing for the CourtJEFFREY S. WHITE, United States Distinct Judge.
Decision Date15 September 2021
PartiesCHAMBER OF COMMERCE OF THE UNITED STATE OF AMERICA, et al., Plaintiffs, v. UNITED STATES DEPARTMENT OF HOMELAND SECURITY, et al., Defendants.
Docket Number20-cv-07331-JSW

CHAMBER OF COMMERCE OF THE UNITED STATE OF AMERICA, et al., Plaintiffs,
v.

UNITED STATES DEPARTMENT OF HOMELAND SECURITY, et al., Defendants.

No. 20-cv-07331-JSW

United States District Court, N.D. California

September 15, 2021


ORDER GRANTING PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT AND DENYING DEFENDANTS' CROSS-MOTION FOR SUMMARY JUDGMENT RE: DKT. NOS. 140, 144

JEFFREY S. WHITE, United States Distinct Judge.

Now before the Court for consideration are the cross-motions for summary judgment filed by Plaintiffs[1] and Defendants, United States Department of Homeland Security ("DHS") and Alejandro Mayorkas, in his official capacity as Secretary of Homeland Security ("Secretary Mayorkas") (collectively "DHS").[2]

The Court has considered the parties' papers, relevant legal authority, the record in this case, including the amicus brief filed by U.S. Tech Workers in support of DHS's motion, and the parties' arguments at the hearing held on September 10, 2021. The Court HEREBY GRANTS Plaintiffs' motion and DENIES DHS's cross-motion.

BACKGROUND

A. Procedural History.

On October 19, 2020, Plaintiffs filed their original complaint and asked the Court to set aside two interim final rules promulgated by DHS and by the Department of Labor: Strengthening Wage Protections for the Temporary and Permanent Employment of Certain Aliens in the United States, 85 Fed. Reg. 63, 872 (Oct. 8, 2020) ("DOL IFR"); Strengthening the H-IB Nonimmigrant Visa Classification Program, 85 Fed. Reg. 63, 918 (Oct. 8, 2020) ("DHS IFR").

The Plaintiffs moved for a preliminary injunction and for partial summary judgment on their claims that Defendants violated the Administrative Procedure Act's ("APA") notice and comment procedures. The parties subsequently stipulated to advance the trial on the merits of those claims, pursuant to Federal Rule of Civil Procedure 65(a)(2), and stipulated to stay the Defendants' obligation to respond to the remaining claims. (Dkt. No. 51.) The notice and comment claims required the Court to consider whether "good cause" existed to excuse the APA's normal notice and comment period. DHS and DOL each relied on the COVID-19 pandemic to support the position that good cause existed. The parties also agreed the Court could rely solely on the interim final rules and materials cited therein as the administrative record.

On December 1, 2020, the Court granted Plaintiffs' motion and denied Defendants' cross-motion, set aside the interim final rules, and entered partial judgment on the notice and comment claims, pursuant to Federal Rule of Civil Procedure 54(b). See Chamber of Commerce v. U.S. Dep't of Homeland Sec, 504 F.Supp.3d 1077 (N.D. Cal. 2020). Defendants did not appeal that decision.

On March 19, 2021, Plaintiffs filed an amended complaint ("FAC") and a notice of filing, which included a request for leave to amend or to supplement under Rule 15. Plaintiffs dropped their claim against the DHS IFR and asserted claims challenging the DOL's final rule, Strengthening Wage Protections for the Temporary and Permanent Employment of Certain Aliens in the United States, 86 Fed. Reg. 3, 608 (Jan. 14, 2021) (the "DOL Final Rule"), and a new and different rule promulgated by DHS, which affects the manner in which H-1B visa applications will be processed: Modification of Registration Requirement for Petitioners Seeking to File Cap-Subject H-IB Petitions, 86 Fed. Reg. 1676 (Jan. 8, 2021) (the "Final Rule").[3]

On April 15, 2021, over DHS's objection, the Court granted Plaintiffs leave to file the FAC. (Dkt. Nos. 79-80, 91.) The parties now move for summary judgment on the claims relating to the Final Rule.

B. Factual Background.

On April 7, 2019, former DHS Secretary Kirstjen M. Nielsen announced her resignation and left office on April 10, 2019. President Trump did not nominate a replacement until September 10, 2020, when he nominated Chad H. Wolf ("Mr. Wolf) for the position. The facts surrounding Mr. Wolfs accession to the role of Acting Secretary of DHS are set forth in the Court's order granting a preliminary injunction in Immigrant Legal Rights Center v. Wolf and the Court shall not repeat then in detail here. 491 F.Supp.3d 520, 531-33 (N.D. Cal. 2020) ("ILRC").

In brief, before Secretary Neilsen resigned, she issued an order that purported to amend the order of succession for Acting Secretary pursuant to authority granted to her by the Homeland Security Act, 6 U.S.C. section 113(g)(2) (the "April 9 Order"). The purported amendment had the effect of promoting Kevin McAleenan to the role of Acting Secretary. Mr. McAleenan putatively served as Acting Secretary from April 10, 2019, until November 13, 2019, when he resigned. On or about November 8, 2019, Mr. McAleenan issued an order that purported to further amend the order of succession, which promoted Mr. Wolf to the position of Acting Secretary. Id. at 529-33. In that capacity, Mr. Wolf "reviewed and approved" the Final Rule and "delegate[ed] the authority to electronically sign [the Final Rule] to Ian J. Brekke, ... the Senior Official Performing the Duties of the General Counsel for DHS, for purposes of publication in the Federal Register." 86 Fed. Reg. at 1732; see also Id. at 1735.

The H-1B visa category enables employers in the United States to hire qualified foreign professionals in specialty occupations. See 8 U.S.C. §§ 1184(i)(1), 1101(a)(15)(H)(i)(b); see also 8 C.F.R. § 214.2(h)(4)(ii). An employer must certify that it will pay an H-1B employee "wages that are at least - ... the actual wage level paid by the employer to all other individuals with similar experience and qualifications for the specific employment in question; or ... the prevailing wage level for the occupational classification in the area of employment." 8 U.S.C. § 1182(n)(1)(A)(i)(I)-(II); see also 20 C.F.R. § 655.731(a).

As of April 2019, in order to petition for an H-1B visa, an employer must first register with DHS. See 8 C.F.R. § 214.2(h)(8)(iii)(A)(1). If the registration is selected, the employer submits a petition in "such form and containing such information" as prescribed by the Secretary of DHS, who approves or denies the petition "after consultation with the appropriate agencies of the Government." 8 U.S.C. § 1184(c)(1).[4] Subject to some exceptions, the number of H-1B visas approved each year is capped at 65, 000, with an additional 20, 000 visas approved for foreign graduates of U.S. master's or higher degree graduate programs. Id. §§ 1184(g)(1)(A)(vii), 1184(g)(5)(C). Individuals employed by, or who have received an offer of employment from, an institution of higher education, a nonprofit entity related to or affiliated with an institution of higher education, and nonprofit research organizations and government research organizations are exempted from the cap. Id. § 1184(g)(5)(A)-(B).

Individuals "who are subject to the [visa cap] shall be issued visas (or otherwise provided nonimmigrant status) in the order in which petitions are filed for such visas or status." Id., § 1184(g)(3). However, the number of petitions filed each year regularly exceeds the visa cap. See 86 Fed. Reg. at 1, 717-18 table 3, and 1, 717...

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