Comment: Sue the B1s1a1ds

Table of Contents

1. Introduction
2. Core Issues
3. Jurisdiction and Standing
4. Relief 
5. Conclusion

1. Introduction
===========

On Friday, April 29th, USCIS slammed the industry with “EB5 Questions and Answers” (“Q&As” hereinbelow) just a couple of hours before conducting a sham “listening session”. The EB5 industry is now disabused of the notion that USCIS is a reasonable agency trying to faithfully implement the law, instead, USCIS is currently better described as an out-of-control outlaw agency with no respect for the law.  Only aggressive tactics against USCIS and mediation of federal judges who understand and respect the law will force the hand of this agency and stop USCIS from killing the EB5 industry.

ILW is a law publisher — not a law firm. What follows are preliminary thoughts that occur to us. We send them out in the hope of spurring creativity and thinking from sharp legal minds in the EB5 industry. We hope that many legal luminaries will improve upon these preliminary ideas, add many new significant ideas and approaches of their own and compel the USCIS to answer them in multiple Federal courts over the next several days.

2. Core Issues
==========

(A) The EB5 Reform Act is simply a minor amendment to the INA, an amendment to the EB5 provisions of the INA in particular, to which the EB5 Reform Act adds several integrity provisions. The INA does not disappear upon enactment of the EB5 Reform Act, nor do the INA’s EB5 provisions disappear, rather a few provisions get added to the INA, largely integrity-related provisions, which Congress contemplates strengthening the EB5 RC program with, not killing RCs with. The INA commands USCIS to enable and foster job creation through immigrant investment, especially through RCs. USCIS cannot stop job creation through contrived and twisted interpretations of Congress’s language - for USCIS to stop job creation through RCs is, in and of itself, a violation of the EB5 provisions of the INA. 

(B)  Assuming, arguendo, that there is a clash or apparent clash between the INA and the EB5 Reform Act, the legal principle is that as many provisions of both statutes be implemented as is possible. Throwing the baby out with the bathwater is not permitted. If USCIS specified a short and specific timeline (such as 60 days) within which all the I-956s must be adjudicated—that would resolve any statutory clash that USCIS may perceive. In the absence of such a short and specific timeline, USCIS’s redesignation process is unlawful (in that USCIS does not permit effectuation of as many parts of the federal statutes as is possible) and must be set aside.

(C) Moreover, question #6 in the Q&As retroactively (and impermissibly) disqualifies tens of thousands of investors, here’s how. USCIS says that investors in previously designated RCs “may still establish eligibility by demonstrating … job creation”. However, USCIS’s redesignation process leaves investors high and dry, and with no recourse, in case JCEs/NCEs/RCs who do not wish to be redesignated refuse to provide job creation information to said investors, and justify breaking their contracts through force majeure, due to USCIS’s Q&As. JCEs/NCEs/RCs who do not wish to be redesignated cannot be compelled by said investors and/or by USCIS to incur the cost of compiling job creation documents, if these entities had entered into contracts with investors in the reasonable belief that USCIS would not compel them to get redesignated. Should JCEs/NCEs/RCs claim force majeure on the grounds of USCIS’s recent action, we suspect that many courts would sustain force majeure. USCIS pays lip service to pre-enactment I-526s’s eligibility, but de facto destroys the ability of investors to continue with their immigration petitions. Essentially, USCIS has interceded in the contracts that investors had with JCEs/NCEs/RCs and has eradicated investors’ ability to get the information needed to secure immigration benefits. Since this is a unilateral action by USCIS to destroy immigration benefits, and is also contrary to the plain language of the EB5 Reform Act which grandfathers previous investors, it is ultra vires.

(D) RCs and investors cannot be separated because business plans unite them both. In protecting already filed business plans, Congress has protected both RCs and investors equally—by protecting RC designations until the investors’ immigration benefits are secure (the EB5 Reform Act states that approved business plans “shall be binding for the purposes of the adjudication of subsequent petitions"). USCIS cannot take this Congressionally-mandated protection away from investors and RCs with a sweeping, peremptory and autarchic action such as dedesignation of business plans. Dedesignation of RCs can only be done on a case by case basis, upon USCIS’s finding (supported by facts) that attestations made by RCs are not compliant with the EB5 Reform Act. In other words, the grandfathering provisions of the EB5 Reform Act protect RC designations, as a collateral consequence of protecting prior investors’ immigration benefits. This, too, establishes the lawlessness and illegitimacy of USCIS’s Q&A and its redesignation procedure.

(E) The worst of it is that there exists a simple, alternative method of implementing the EB5 Reform Act. Attestations, combined with audits as needed (random, statutorily mandated, as well as targeted) is a well established method of implementing similar statutes. Dedesignation is a sweeping, peremptory and autarchic action by USCIS, and is a fig-leaf to mask USCIS’s shocking inefficiency in processing anything in any reasonable period of time. Courts should not take anything seriously if stated by USCIS, when USCIS openly admits to taking 5 to 10 YEARS (!!!) to process a simple form such as an I-924. 

3. Jurisdiction and Standing
====================

(A) Perhaps, USCIS’s contemplated redesignation procedure is a substantive rule. If so, the APA requires notice and a comment period for such rule - none was given, making USCIS’s action unlawful.

(B) USCIS published the Q&As less than 3 hours before their “listening session” of apparently hundreds of stakeholders participating in the call who were not aware of the Q&A prior to the call nor were these given sufficient time to discuss the Q&As with counsel. This violates both the spirit and the letter of what the APA contemplates for stakeholder feedback. The call was a sham, a farce and a fraud (USCIS knows this full well, that is why it announced another engagement for late May).

(C) Failure to provide a short and specific timeline (such as 60 days) for adjudicating I-956s may itself be an APA violation. Publishing the Q&As while withholding the form I-956 may also be an APA violation.

(D) Investors and investor associations likely have standing to challenge USCIS in courts on the redesignation procedure. We encourage AIIA and the several Chinese investor associations to become co-plaintiffs, to help RCs find investors willing to be plaintiffs, and to file motions to intercede as appropriate. Investor associations claim to be champions of investors, well, previous investors need the investor associations most now (because, make no mistake, dedesignations of RCs will inevitably result in tens of thousands of investors failing to get immigration benefits despite the grandfathering provisions of the EB5 Reform Act, since the businesses concerned will simply not exist to provide the job creation information necessary for I-829 approval).

(E) Litigants should consider state laws that protect investors. Tens of thousands of immigrant investors relied on business plans that were approved. When USCIS makes the existence of RCs who wrote the business plans impossible, there may be resources in some state laws against USCIS’s action. It may be worth examining whether it is possible to sue USCIS based on a state law, whether in State court or Federal court.

(F) There is no reason multiple fora cannot be tried - it is a matter of finding a sympathetic judge - especially where investor and immigrant rights have been cruelly, unfairly, and unlawfully, violated.


4. Relief 
======

(A) The Behring litigation is a good start, getting a Temporary Restraining Order against USCIS’s illicit behavior is an excellent idea.

(B) We do not know why Negotiated Rulemaking has not yet been sought by the EB5 industry right away, perhaps a court could be persuaded to order Neg Reg to commence on a parallel track while accepting I-526s for legacy RCs from May 16th onward.

(C) Declarative judgment against USCIS may be a possibility, where a court can be requested to take judicial notice of the long trail of USCIS abuses and USCIS’s repeated violations of statutes. There are Federal judges that care about the law and are aware of the abuse of immigrants by USCIS. Such judicial notice should hopefully result in holding USCIS to a higher standard of proof by Federal Judges.

(D) Perhaps USICS can be compelled to accept Forms I-924 and I-924A until a lawful form I-956 has been issued. Given that the Q&As were issued without issuing form I-956, perhaps one can make a reasonable assumption that form I-956 will likely be unlawful when issued (and perhaps OMB can be persuaded to take a close look at I-956 before approving it). Perhaps the courts should appoint a Special Master to supervise USCIS’s form makers to ensure that form I-956 complies with the EB5 Reform Act, as well as the INA itself.

(E) A General point: Arguments based on the plain language of the statute are likely more effective at getting immediate relief from federal courts than arguments based on Congressional intent. 

5. Conclusion
==========
Business plans join RCs and investors in a sacred union that is vital to both their lives. Congress has ratified this amalgam and has protected this agglutination in the EB5 Reform Act. USCIS cannot unilaterally annul tens of thousands of such symbioses by dedesignating business plans without doing irreparable damage to both RCs and the lives and families of their investors. What Congress has joined let no agency tear asunder. 

Repeating: ILW is a law publisher — not a law firm. The above are preliminary thoughts that occur to us. We send them out in the hope of spurring creativity and thinking from sharp legal minds in the EB5 industry. We hope that many legal luminaries will improve upon these preliminary ideas, add many new significant ideas and approaches of their own and compel the USCIS to answer them in multiple Federal courts over the next several days.

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