Fogo De Chao (Holdings) Inc. v. U.S. Dep't of Homeland Sec.

Decision Date21 October 2014
Docket NumberNo. 13–5301.,13–5301.
PartiesFOGO DE CHAO (HOLDINGS) INC., Appellant v. UNITED STATES DEPARTMENT OF HOMELAND SECURITY, et al., Appellees.
CourtU.S. Court of Appeals — District of Columbia Circuit

Carl W. Hampe argued the cause for appellant. With him on the brief was Steve Chasin.

Gisela A. Westwater, Senior Litigation Counsel, U.S. Department of Justice, argued the cause for appellees. With her on the brief were Stuart F. Delery, Assistant Attorney General, and Aram A. Gavoor, Trial Attorney. R. Craig Lawrence, Assistant U.S. Attorney, entered an appearance.

Before: KAVANAUGH, MILLETT and WILKINS, Circuit Judges.

Opinion

Opinion for the Court filed by Circuit Judge MILLETT.

Dissenting opinion filed by Circuit Judge KAVANAUGH.

MILLETT, Circuit Judge:

Fogo de Chao (Holdings), Inc., operates numerous Brazilian steakhouse restaurants, known as churrascarias, in Brazil and the United States. According to Fogo de Chao, a critical component of its success has been the employment in each of its restaurants of genuine gaucho chefs, known as churrasqueiros, who have been raised and trained in the particular culinary and festive traditions of traditional barbecues in the Rio Grande do Sul area of Southern Brazil.

But of late, Fogo de Chao's efforts to bring authentic Brazilian churrasqueiro chefs into its United States restaurants have hit a legal roadblock. Federal immigration law provides what are known as L–1B visas to qualifying multinational businesses, which permit them to temporarily transfer foreign employees possessing “specialized knowledge” into the United States. From 1997 to 2006, the Department of Homeland Security granted Fogo de Chao over 200 L–1B visas for its churrasqueiros. In 2010, Fogo de Chao sought to transfer another churrasqueiro chef, Rones Gasparetto, to the United States, reasoning that his distinctive cultural background and extensive experience cooking and serving meals in the churrasco style constitute “ specialized knowledge.” The Administrative Appeals Office within the Department of Homeland Security concluded, however, that Gasparetto's cultural background, knowledge, and training could not, as a matter of law, constitute specialized knowledge. Unable to discern either (i) a sufficiently reasoned path in the Appeals Office's strict bar against culturally based skills, or (ii) substantial evidence supporting its factual finding that Gasparetto did not complete the company training program, we reverse and remand the district court's grant of summary judgment to the government.

I. Background
A. Statutory and Regulatory Framework

1. In 1970, Congress amended the Immigration and Nationality Act, 8 U.S.C. §§ 1101 et seq., to create a nonimmigrant visa program for qualifying employees of multinational companies that are being transferred to the United States. See Pub.L. No. 91–225, 84 Stat. 116, 116 (1970). As amended, the Act provides that a temporary, nonimmigrant visa may be issued to an alien who, after being employed continuously by the sponsoring employer for at least one year in the three years preceding his or her application, seeks to enter the United States to continue working for that employer (or an affiliate) “in a capacity that is managerial, executive, or involves specialized knowledge [.] 8 U.S.C. § 1101(a)(15)(L).1 A visa granted to an employee whose work entails specialized knowledge is commonly referred to as an L–1B visa, while a visa for managerial or executive employees is known as an L–1A visa. The “specialized knowledge” L–1B visa is at issue in this case.

The 1970 Act did not define “specialized knowledge,” and the term has been subject to varying regulatory definitions. By 1987, the formal regulatory definition of “specialized knowledge” was “knowledge possessed by an individual whose advanced level of expertise and proprietary knowledge of the organization's product, service, research, equipment, techniques, management, or other interests of the employer are not readily available in the United States labor market.” 52 Fed.Reg. 5738, 5752 (Feb. 26, 1987) (codified at 8 C.F.R. § 214.2(l )(1)(ii)(D) (1988) ).

In 1990, Congress displaced that regulation with its own statutory definition, providing that an employee has specialized knowledge “if the alien has a special knowledge of the company product and its application in international markets or has an advanced level of knowledge of processes and procedures of the company.” 8 U.S.C. § 1184(c)(2)(B) ; see also Immigration Act of 1990, Pub.L. No. 101–649, § 206(b)(2)(B), 104 Stat. 4978, 5023.

The Immigration and Naturalization Service has since promulgated a regulatory definition of “specialized knowledge” that essentially tracks the new statutory language, defining it as “special knowledge possessed by an individual of the petitioning organization's product, service, research, equipment, techniques, management, or other interests and its application in international markets, or an advanced level of knowledge or expertise in the organization's processes and procedures.” 8 C.F.R. § 214.2(l )(1)(ii)(D).2

2. Under the current regulations, a company seeking to classify an alien as eligible for an L–1B visa must file a petition with the Secretary. 8 C.F.R. § 214.2(l )(2)(i). Included with the petition must be:

(ii) Evidence that the alien will be employed in [a] * * * specialized knowledge capacity, including a detailed description of the services to be performed[;]
(iii) Evidence that the alien has at least one continuous year of full-time employment abroad with a qualifying organization within the three years preceding the filing of the petition[; and]
(iv) Evidence that the alien's prior year of employment abroad was in a position that * * * involved specialized knowledge and that the alien's prior education, training, and employment qualifies him/her to perform the intended services in the United States; however, the work in the United States need not be the same work which the alien performed abroad.

Id. § 214.2(l )(3).

While no other regulatory definition of “specialized knowledge” has been promulgated, internal agency memoranda have provided additional guidance. Specifically, in March 1994, James Puleo, the Acting Executive Associate Commissioner of the Immigration and Naturalization Service, issued a memorandum elaborating on the proper interpretation of “specialized knowledge.” The Puleo Memorandum counseled that common dictionary definitions of the key terms “special” and “advanced” should be used. “Special” thus signifies “surpassing the usual; distinct among others of a kind” or “distinguished by some unusual quality; uncommon; noteworthy.” Memorandum of James A. Puleo, Acting Executive Assoc. Comm'r, Immigration and Naturalization Service, Interpretation of Special Knowledge at 1 (March 9, 1994), reproduced in J.A. 42 (quoting Webster's II New Riverside University Dictionary and Webster's Third New International Dictionary ). While an employee's knowledge need not be proprietary or unique, the Puleo Memorandum explained, the knowledge must still be different or uncommon and not generally found in the particular industry. Id. Knowledge might be found to be special where, for example, [t]he alien beneficiary has knowledge of a foreign firm's business procedures or methods of operation” such that “the United States firm would experience a significant interruption of business in order to train a United States worker to assume those duties.” Id. at 2, J.A. 43.3

In 2004, Fujie Ohata, the Director of Service Center Operations for United States Citizenship and Immigration Services (“the Service”), issued another memorandum providing guidance on whether and when chefs' or specialty cooks' skills would qualify as “specialized knowledge.” Memorandum of Fujie O. Ohata, Director, Service Center Operations, United States Citizenship and Immigration Services, Interpretation of Specialized Knowledge for Chefs and Specialty Cooks Seeking L–1B Status (Sept. 9, 2004), reproduced in J.A. 48–51. The Ohata Memorandum advised that “Chefs or Specialty Cooks generally are not considered to have ‘specialized knowledge’ for L–1B purposes.” Id. at 1, J.A. 48. The relevant question, the Ohata Memorandum elaborated, is “not only how skilled the chef is and whether or not his or her skills are common to other chefs, but also the role the chef plays within the petitioning organization and the impact his or her services would have on the operations of the U.S.-based affiliate.” Id at 2, J.A. 49. A chef's “ancillary” duties, such as singing in a themed restaurant, may also give rise to specialized knowledge. Id. The inquiry turns on an assessment of “the length and complexity of in-house training required to perform such duties” in order to determine “the amount of economic inconvenience, if any, the restaurant would undergo were it required to train another individual to perform the same duties.” Id.

Echoing the Puleo Memorandum, Ohata stressed that, to qualify as “specialized knowledge” of the relevant product or process, the employee's skill “must be of the sort that is not generally found in the particular industry, although it need not be proprietary or unique.” Ohata Memorandum at 2, J.A. 49. In that regard, [r]ecipes and cooking techniques that can be learned by a chef through exposure to the recipe or cooking techniques for a brief or moderate period of time generally do not constitute specialized knowledge.” Id. at 3, J.A. 50.

Ultimately, then, the petitioner's burden is to show through probative evidence that the proposed visa beneficiary's knowledge is (a) uncommon or not generally shared by practitioners in the alien's field of endeavor; (b) not easily or rapidly acquired, but is gained from significant experience or in-house training, and (c) is necessary and relevant to the successful conduct of the employer's operations.” Ohata Memorandum at 4, J.A. 51.

B. Factual Background

Fogo de Chao owns numerous...

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