Itserve Alliance, Inc. v. Cissna

Decision Date10 March 2020
Docket NumberCivil Action No. 18-2350 (RMC)
Citation443 F.Supp.3d 14
Parties ITSERVE ALLIANCE, INC., et al., Plaintiffs, v. L. Francis CISSNA, Director, United States Citizenship and Immigration Services, Defendant.
CourtU.S. District Court — District of Columbia

Jonathan D. Wasden, Law Office of Jonathan D. Wasden, Fairfax Station, VA, Bradley Bruce Banias, Barnwell Whaley Patterson & Helms, LLC, Charleston, SC, for Plaintiffs.

Brian J. Field, U.S. Attorney's Office for the District of Columbia, Washington, DC, for Defendant.


ROSEMARY M. COLLYER, United States District Judge

By tradition and law, the United States has welcomed foreign workers with specialized training to work temporarily in this country as needed by U.S. employers. The workers in specialty occupations do not come as immigrants; they are given visas for three years to work here. Because non-immigrant H-1B visas are intentionally for a short term, the Immigration and Naturalization Service (INS), in accord with the law, simplified and streamlined the application and approval process in a way inapplicable to immigrants. These H-1B visas have allowed the growth of a business model whereby U.S. employers obtain H-1B visas for foreign workers who are trained in information technology (IT) and provide such persons as temporary workers to other U.S. companies that need IT assistance for a period.

In 2003, Congress established the Citizenship and Immigration Service (CIS) and transferred visa authority to it.1 CIS has recently withdrawn INS guidance memos and adopted its own guidance, which has caused the H-1B approval process to slow dramatically and resulted in a high level of rejected visa petitions from employers in the IT industry but not others.

Approximately thirty-three cases have been filed in this District challenging the handling of H-1B visa applications by CIS, a constituent agency of the Department of Homeland Security (DHS). Although not "related" within the meaning of Local Civil Rule 40.5(a)(3), the cases have been consolidated before this Court with the agreement of the assigned Judges for briefing on three legal issues under Local Civil Rule 40.5(e) :

1. the authority of CIS to grant visas for less than the requested three-year period;
2. the authority of CIS to deny visas to companies that place employees at third-party locations either because the third party is determined to be the employer or because specific and detailed job duties are not provided with the visa application; and
3. the related statute of limitations issues raised by the government.

See 3/6/2019 Minute Order Referring Case for Limited Purpose (Consolidation Order), ERP Analysts v. Cissna , No. 19-cv-300. Question 2 concerns the employer-employee relationship, the availability of work for a temporary foreign worker, and the foreign worker's maintenance of status. Plaintiffs allege that CIS is applying new versions of these requirements, without engaging in rulemaking, to H-1B applicants that are IT consulting firms and not to other U.S. employers.

The Court finds, as discussed below, that:

1. The 1991 Regulation was adopted by INS through notice-and-comment rulemaking and the statute of limitations ran out long before this case was filed. It is subject only to an as-applied challenge.
2. CIS issued a 2010 Guidance Memorandum (CIS 2010 Guidance Memo), also referred to as the Neufeld Memo, from which comes a new employer-employee relationship set of requirements. It is timely challenged on an as-applied basis but not as a facial challenge.
3. CIS issued a 2018 Policy Memorandum, PM-602-0157 (CIS 2018 Policy Memo). It can be challenged either facially or as applied.
4. The current CIS interpretation of the employer-employee relationship requirement is inconsistent with its regulation, was announced and applied without rulemaking, and cannot be enforced.
5. The CIS requirements that employers (1) provide proof of non-speculative work assignments (2) for the duration of the visa period is not supported by the statute or regulation and is arbitrary and capricious as applied to Plaintiffs' visa petitions. These requirements were also announced and applied without rulemaking and cannot be enforced.
6. CIS's itinerary requirement was superseded by a later statute that permits employers to place H-1B visa holders in non-productive status and is, therefore, no longer enforceable.
7. CIS has the authority to grant visas for less than the requested three-year period but must provide its reasoning behind any denials, in whole or in part.

Both Plaintiffs' and Defendant's motions for summary judgment will be granted in part and denied in part.2


The Immigration and Nationality Act (INA), 8 U.S.C. § 1101 et seq. , specifically allows U.S. employers to apply for visas for foreign workers to come to the United States to work permanently (immigrants) or to come to the United States for temporary employment (nonimmigrants). The differences are material in that the former are applying to remain in the United States and the latter are planning to work here on a temporary basis. This distinction has existed since November 1990, when Congress adopted the Immigration Act of 1990, which changed the INA's employment-based visa categories. See Pub. L. No. 101-649, 104 Stat. 4978 (1990). As a result, an employer seeking an employment-based immigrant visa in order to hire a foreign worker who plans to stay in this country has been required to submit much more information and undergo greater examination than that required for temporary nonimmigrant visas.

Critical to understanding the facts is a change in immigration-based enforcement adopted in 2003 when it was moved from INS to CIS. CIS initially adopted and followed pre-existing and long-standing INS guidance memos and regulations. It has recently superseded the INS guidance with its own guidance memos but issued no regulations. CIS defends its guidance and practices as consistent with the law and regulations.

It is useful to know that the Plaintiffs here are all petitioning employers that seek H-1B visas for foreign workers who have expertise in the IT industry. Most Plaintiffs are consulting firms that may place a visa holder with multiple clients over the course of a three-year visa.

A. H-1B Visas

H-1B3 visas are nonimmigrant visas for temporary workers coming to the United States to work in a specialty occupation. The law admits, temporarily and as nonimmigrants, "an alien ... who is coming temporarily to the United States to perform services ... in a specialty occupation described in section 1184(i)(1) of this title ..., who meets the requirements for the occupation specified in section 1184(i)(2) of this title." 8 U.S.C. § 1101(a)(15)(H)(i)(b). For these purposes, a specialty occupation requires a "theoretical and practical application of a body of highly specialized knowledge, and [the] attainment of a bachelor's or higher degree in the specific specialty (or its equivalent) as a minimum for entry into the occupation in the United States," 8 U.S.C. § 1184(i)(1)(A)-(B) ; see also Royal Siam Corp. v. Chertoff , 484 F.3d 139, 144 (1st Cir. 2007) ("Congress has laid out eligibility standards for the granting of H-1B specialty occupation visas.") (citing 8 U.S.C. § 1101(a)(15)(H)(i)(b) ).

The first step when petitioning for an H-1B visa is for the U.S. employer to file a Labor Condition Application with the Department of Labor (DOL). In that application, the employer must attest that certain wages and working conditions for foreign workers will be similar to domestic employees. An employer petitioning for an H-1B visa to admit a nonimmigrant worker does not need to test the local employment market and first hire any qualified, willing, and able U.S. worker. Nor does the 1990 Act require the employer to provide documentary evidence in support of the Labor Condition Application when submitting it to DOL for approval. Rather, U.S. employers are required to "attest" to five labor conditions concerning pay rates, working conditions, labor peace, notice to employees and DOL, and agreement with DOL enforcement, specifically:

1. [The U.S. employer] will pay the alien(s) and other individuals employed in the occupational classification at the place of employment prevailing wages or actual wages whichever are greater;
2. it will provide working conditions that will not adversely affect the working conditions of U.S. workers similarly employed;
3. there is no strike or lockout in the course of a labor dispute in the occupational classification at the place of employment;
4. it has publicly notified the bargaining representative of its employees in the occupational classification at the place of employment of its intent to employ an H-1B alien worker(s), or, if there is no bargaining representative, that it has posted such notice at the place of employment; and
5. the employer must provide the information required in the application about the number of aliens sought, occupational classification, job duties, wage rate and conditions under which the aliens will be employed, date of need, and period of employment.

Interim Final Rule, 56 Fed. Reg. 54720, 54720-21 (October 27, 1991) ; see also 20 C.F.R. §§ 655.731 - 655.735. The information required in a Labor Condition Application was also included in the statute. See 8 U.S.C. § 1182(n)(1)(A)(i)(I) and (II), (n)(1)(B), (n)(1)(C), and (n)(1)(D).

The Interim Final Rule quoted above was published by DOL in 1991 to provide a regulatory process to handle Labor Condition Applications authorized by Congress in 1990. See Interim Final Rule, 56 Fed. Reg. 54720. DOL recognized that the H-1B visa is temporary and that lengthy preapproval inquiries would consume this time. Id. at 54721 ("The Department believes that Congress ... intended to provide greater protection than under prior law for U.S. and foreign workers without interfering with an employer's ability to obtain the H-1B workers it needs on a timely basis. ...

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