Matter Of Chawathe

• Decision Date: 20 October 2010
• Docket Number: Interim Decision #3700
• Parties: Matter of CHAWATHE
• Court: U.S. DOJ Board of Immigration Appeals

25 I&N Dec. 369

Matter of CHAWATHE

Interim Decision #3700

U.S. Department of Justice Executive Office

for Immigration Review Board of Immigration Appeals

Decided October 20, 2010¹

U.S. Department of Homeland Security U.S. Citizenship and Immigration Services Administrative Appeals Office

(1) For purposes of establishing the requisite continuous residence in naturalization proceedings pursuant to section 316(b) of the Immigration and Nationality Act, 8 U.S.C. § 1427(b) (2006), a publicly held corporation may be deemed an "American firm or corporation" if the applicant establishes that the corporation is both incorporated in the United States and trades its stock exclusively on U.S. stock exchange markets.

(2) When an applicant's employer is a publicly held corporation that is incorporated in the United States and trades its stock exclusively on U.S. stock markets, the applicant need not demonstrate the nationality of the corporation by establishing the nationality of those persons who own more than 51% of the stock of that firm. Matter of Warrach, 17 I&N Dec. 285, 286-87 (Reg. Comm'r 1979), clarified.

(3) In most administrative immigration proceedings, the applicant must prove by a preponderance of evidence that he or she is eligible for the benefit sought.

(4) Even if the director has some doubt as to the truth, if the petitioner submits relevant, probative, and credible evidence that leads the director to believe that the claim is "more likely than not" or "probably" true, the applicant has satisfied the standard of proof. Matter of E-M-, 20 I&N Dec. 77, 79-80 (Comm'r 1989), followed.

(5) If the director can articulate a material doubt, it is appropriate for the director to either request additional evidence or, if that doubt leads the director to believe that the claim is probably not true, deny the application or petition.

ON BEHALF OF APPLICANT: Pro se

BEFORE: Perry Rhew, Chief, Administrative Appeals Office

The application to preserve residence for naturalization purposes was denied by the Acting District Director, San Francisco, California, and is nowbefore the Administrative Appeals Office ("AAO") on appeal. The appeal will be sustained.

The primary question presented in this matter is whether a publicly traded corporation may be considered an "American firm or corporation," pursuant to section 316(b) of the Immigration and Nationality Act, 8 U.S.C. § 1427(b) (2006), when its stock ownership is widely dispersed and there is no readily available means to determine the nationality of its owners.² Upon review, the AAO concludes that a publicly held corporation may be deemed an "American firm or corporation" for purposes of section 316(b) of the Act if the applicant establishes that the corporation is both incorporated in the United States and trades its stock exclusively on U.S. stock markets.

I. FACTUAL AND PROCEDURAL HISTORY

The applicant is an employee of ChevronTexaco Corporation who was granted permanent resident status on June 26, 2000, as a member of a profession holding an advanced degree or having exceptional ability. Expecting to file an application for naturalization as a United States citizen in the future, the applicant filed an Application to Preserve Residence for Naturalization Purposes (Form N-470) with his local immigration office in San Francisco, California, on January 30, 2003. The applicant seeks to preserve his residence for naturalization purposes under section 316(b) of the Act as a lawful permanent resident who will be temporarily absent from the United States for the purpose of employment with an "American firm or corporation."

In order to be naturalized as a United States citizen, the Act requires in part that a person reside continuously in the United States as a lawful permanent resident for at least 5 years prior to filing an application for naturalization, and that the person be physically present in the United States for at least one half of the required residency period. See generally section 316 of the Act. Section 316(b) of the Act provides that an absence from the United States for a continuous period of 1 year or more shall break the continuity of the required 5-year period of continuous residence.

However, section 316(b) of the Act also provides that no period of absence from the United States shall break the continuity of residence if the applicant proves to the satisfaction of the Secretary of Homeland Security that he or she

has been physically present and residing in the United States after being lawfully admitted for permanent residence for an uninterrupted period of at least one year and... is employed by an American firm or corporation engaged in whole or in part in the development of foreign trade and commerce of the United States, or a subsidiary thereof more than 50 per centum of whose stock is owned by an American firm or corporation....

In the present matter, the director determined that the applicant had failed to establish that his employer, ChevronTexaco Corporation, was an "American firm or corporation" as required by the Act. The director determined further that the applicant had failed to establish that his temporary overseas employer, Saudi Arabian Texaco, qualified as a ChevronTexaco Corporation "subsidiary" under section 316(b) of the Act. The director denied the application for preservation of residence for naturalization purposes on this basis.

On appeal, the applicant asserts that his employer, ChevronTexaco Corporation (hereafter referred to as ChevronTexaco), was incorporated in the State of Delaware and qualifies as an "American firm or corporation" under section 316(b) of the Act. The applicant also asserts that Saudi Arabian Texaco is owned and controlled by ChevronTexaco and therefore qualifies as a "subsidiary of an American corporation."

II. "AMERICAN FIRM OR CORPORATION"

For purposes of section 316(b) of the Act, the nationality of a firm or corporation has traditionally been determined through tracing the percentage of individual ownership interest in a firm or corporation, and by tracing the nationality of the persons having principal ownership interests (more than 50%) in the firm or corporation. The Immigration and Naturalization Service Regional Commissioner stated in Matter of Warrach, 17 I&N Dec. 285, 286-87 (Reg. Comm'r 1979), that

when it is shown that 51 percent or more of the stock of the employer corporation is owned by a foreign firm, such firm is a "foreign corporation" within the meaning of section 316(b). The fact that a firm is incorporated under the laws of a state of the United States does not necessarily determine that it is an American firm or corporation. The nationality of such firm would be determined by the nationality of those persons who own more than 51 percent of the stock of that firm.

Thus, under the principles set forth in Matter of Warrach, ChevronTexaco's incorporation in the State of Delaware does not establish that ChevronTexaco is an "American firm or corporation." Rather, the applicant must also demonstrate that more than 50% of ChevronTexaco is owned by persons who are United States citizens. The applicant in the present matter provided no evidence to establish who the individual ChevronTexaco stockholders are, or to establish the percentage of ownership interests held by each stockholder. Nor did the applicant provide evidence or information to establish the nationality of each stockholder or owner of the corporation. The applicant therefore failed to establish that ChevronTexaco is an "American corporation" as defined in Matter of Warrach.

The AAO notes that the principles set forth in Matter of Warrach apply well to traditional situations involving closely held companies or corporations. However, the Warrach principles fail to address or to take into account the difficulties of tracing the ownership interests and nationalities of modern, publicly held corporations that have thousands of stockholders and capital stock that is traded on a daily basis on the stock markets.³

The present record contains a copy of ChevronTexaco Corporation's 2002 Securities and Exchange Commission ("SEC") Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, (SEC Form 10-K). An SEC Form 10-K is the report that publicly held corporations file with the SEC on an annual basis; the report provides a comprehensive overview of a corporation's business and financial condition and includes audited financial statements. See generally U.S. SEC, Quick Answers, Form 10-K, http: //www.sec.gov/answers/form 10k.htm(last modified June 26, 2009).

In the present matter, the submitted SEC Form 10-K reflects that ChevronTexaco is incorporated in the State of Delaware and that ChevronTexaco stock is traded on the New York Stock Exchange, located in New York, New York, and on the Pacific Stock Exchange, located in San Francisco, California. The AAO notes that the Restated Certificate of Incorporation of ChevronTexaco Corporation, dated October 9, 2001, reflects that ChevronTexaco stock is traded publicly, and that "[t]he total of shares of all classes of stock which the Corporation shall have authority to issue is four billion one hundred million (4, 100, 000, 000), of which one hundred million (100, 000, 000) shares shall be Preferred Stock... and four billion (4, 000, 000, 000) shares shall be Common Stock."

The AAO recognizes that the widely dispersed ownership of publicly held corporations makes it extremely difficult, if not impossible, for an applicantunder section 316(b) of the Act to trace the interests and nationalities of its stockholders. As in this case, a publicly traded corporation may issue billions of shares of stock which are traded daily by the general public.

Examining a question relating to the nationality of a corporation and section 319(b) of the Act, 8 U.S.C. § 1430 (2006), a 1995 Legal Opinion by the Immigration and Naturalization Service, Office of the General Counsel (now...