Garavito v. U.S. I.N.S.

• Decision Date: 07 March 1990
• Docket Number: No. 89-1777,89-1777
• Citation: 901 F.2d 173
• Parties: Jose GARAVITO, et al., Plaintiffs, Appellants, v. UNITED STATES IMMIGRATION AND NATURALIZATION SERVICE, Defendant, Appellee. . Heard
• Court: U.S. Court of Appeals — First Circuit

Page 173

901 F.2d 173

Jose GARAVITO, et al., Plaintiffs, Appellants, v. UNITED STATES IMMIGRATION AND NATURALIZATION SERVICE Defendant, Appellee.

No. 89-1777.

United States Court of Appeals First Circuit.

Heard March 7, 1990.

Decided April 17, 1990.

Patrick D. O'Neill with whom Martinez, Odell, Calabria & Sierra, Hato Rey, P.R., was on brief, for plaintiffs, appellants.

Miguel A. Fernandez, Asst. U.S. Atty., with whom Daniel F. Lopez Romo, U.S. Atty., Hato Rey, P.R., and Hans Burgos-Gandia were on brief, for defendant, appellee.

Before BREYER, TORRUELLA and SELYA, Circuit Judges.

BREYER, Circuit Judge.

On June 20, 1987, the appellant, Jose Garavito, a lawyer from Colombia who owns a gasoline service station in San Juan, Puerto Rico, entered the United States with a B-1 visa, a visa that the law makes available to an "alien" who is "visiting the United States temporarily for business." 8 U.S.C. Sec. 1101(a)(15)(B); see 22 C.F.R. Sec. 41.12 (providing for classification symbols). He subsequently asked the Immigration and Naturalization Service ("INS") to change his visa "classification" to category E-2, a classification available to an "alien," as well as to his "spouse and children," provided he comes from a country with an appropriate treaty and he comes here

solely to develop and direct the operations of an enterprise in which he has invested ... a substantial amount of capital.

8 U.S.C. Sec. 1101(a)(15)(E)(ii). See also 8 U.S.C. Sec. 1258 ("The Attorney General may ... authorize a change from any nonimmigrant classification to any other nonimmigrant classification...."); 8 C.F.R. Sec. 248.1 (providing for changes between nonimmigrant classifications). The INS denied the request for the change in classification. The appellant claims that the denial is "arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law," and therefore unlawful under the Administrative Procedure Act, 5 U.S.C. Sec. 706(2)(A).

While we recognize that the INS has broad discretionary authority to decide when, or whether, a change in visa classification is proper, see, e.g., Patel v. INS, 738 F.2d 239, 242 (7th Cir.1984); Wing Ding Chan v. INS, 631 F.2d 978, 980-81 (D.C.Cir.1980), cert. denied, 450 U.S. 921, 101 S.Ct. 1371, 67 L.Ed.2d 349 (1981), we believe that, in this instance, its determination is indeed an "abuse of discretion." That is because one important reason the INS gave for denying the visa change rests upon an obviously false factual premise, namely that the appellant, in 1987, obtained a visa to visit the United States "for pleasure," rather than the "for business" visa that he actually obtained. In the circumstances of this case, that factual mistake is not simply harmless; rather, it could well determine the outcome.

The key background facts are the following:

1. The appellant, as we have said, is a citizen of Colombia, a nation that has a treaty with the United States entitling its citizens to enter the United States for commercial purposes. He is an attorney; he has a wife and two children; he owns an apartment and an office suite in Colombia.

2. In 1983 the appellant came to Puerto Rico to visit his brother, an American citizen. The appellant went to the INS offices, where the INS explained how he could stay in the United States, as a commercial investor, if he invested a "substantial amount of capital."

3. The appellant organized an investment corporation, acquired a gasoline service station, and invested $80,000 in the enterprise. In October 1983 the INS consequently changed his visa classification to "E" (but, by mistake, gave him a one year "E-1" foreign trade visa, instead of the proper "E-2" investor visa).

4. In June 1984 the appellant, who was in Curacao at the time, went to the American consulate to obtain an "E" visa, permitting him to reenter the United States. The consulate told him it could not give him the visa because he did not have with him the papers that showed he had invested $80,000 in an American commercial enterprise. Appellant then flew to San Juan and asked the immigration officers at the airport for an "E" visa. They admitted him provisionally, and in December the INS approved a "waiver," thereby permitting the appellant to remain in the United States with an "E-2" visa classification. The INS also permitted his wife and his children to come to San Juan with the same visa classification. The visa was valid until the end of 1986.

5. Between 1985 and 1987 the appellant's business in San Juan employed five to six persons. It took in revenues of $700,000 to $1 million annually.

6. In December 1986, the appellant left the United States, and returned in June 1987. He obtained a "B-1," "visiting ... for business" visa. In September he again applied to change the classification to "E-2" investor. This time, however, the INS denied his request; and it denied reconsideration of that denial.

In determining the significance of these background facts, we have examined the reasons the INS gave for denying the change of visa status. It gave four reasons for its initial denial. First, it said that the appellant had "been working without authorization from this Service." Second, it said that he had to show that he had not invested "in a marginal enterprise, solely for the purpose of earning a living," and he had not made this showing. Third, it said that he had not shown his investment was "substantial," and of an amount sufficient to permit him to function as an investor and not "simply as a skilled or unskilled worker." Fourth, it said that when he entered the United States in June, he had not done so as "a bona fide nonimmigrant visitor for pleasure " (emphasis added), and he had therefore used his "tourist " visa as a "bridge" to enter without going to the American Embassy to get his visa. The INS seemed to find this last reason particularly important, for it quoted language from an administrative decision saying that the "B-2, visitor for pleasure, nonimmigrant category is not a 'catch all classification available to all who wish to come to the United States for whatever purposes....' " (Emphasis added.) Immediately thereafter, the appellant submitted a request for reconsideration, accompanied by massive documentation of the scope and legitimacy of his business, and an explanation of why he did not go to the American Embassy in Colombia for the visa, namely that he had the relevant documentation in San Juan and thought it was easier to request a change of status there. The INS, while conceding that the documentation "might have overcome the issue of marginality and substantiality of investment," denied reconsideration.

We believe the INS must reconsider appellant's visa application because its denial of the application rests upon a mistake of fact. The INS opinion rests in significant part upon its belief that appellant entered the United States in 1987 using, not a "business" visa, but a "pleasure" visa. The INS in effect concedes the mistake. The only possible question is whether the mistake is significant--whether it is likely to have affected the outcome. In our view, the mistake is important enough to warrant a fuller reconsideration than the INS has given, for the following reasons:

First, the mistake is important in respect to the work-related reason that the INS provided for the denial. The only evidence in the record that the appellant improperly engaged in work consists of a four-sentence "special agent" report. According to the report, on January 8, 1988, two special agents went to appellant's service station and saw him "taking a client out to his car." The agents "oriented" the appellant about the 1986 immigration law, and "noticed during the orientation that [he] was answering the telephone and giving other employees instructions on what to do."

Given the fact that INS regulations say that "a temporary visitor for pleasure ... may not engage in any employment," 8 C.F.R. Sec. 214.1(e), one can understand how the INS might have concluded that appellant violated the law on the false assumption that he was a pleasure...