Behring’s case against DHS challenging the validity of the 2019 EB-5 Immigrant Investor Program Modernization Rule is currently pending in federal district court. The next court date is May 6, 2021 when the court is expected to issue a final ruling.
When last in court on March 25, 2021, US magistrate judge converted Behring’s motion for a preliminary injunction to that of summary judgment on the legal issue whether the 2019 EB-5 Modernization Rule is invalid because it was promulgated by acting DHS officials who were appointed in violation of the Federal Vacancies Reform Act of 1998 (“FVRA”). The court asked the parties to submit written briefs on the applicability of the de facto officer doctrine and on the appropriate remedies should the court vacate the rule.
In the interim, on April 1, 2021, DHS notified the court that newly appointed DHS Secretary Alejandro Mayorkas made a last-minute ratification of the action of former acting DHS secretary Kevin McAleenan, i.e. affirming the EB-5 Final Rule. Mayorkas stated that this was done in recognition of recent court decisions holding that acting DHS officials, including McAleenan, were unlawfully appointed, and therefore, any actions taken by them are invalid.
Notably, DHS Mayorkas has not ratified any of the other actions invalidated by the other courts.
Behring Argues the Federal Vacancies Reform Act of 1998 Does Not Allow Ratification
Behring, through its attorneys at Greenberg Traurig, has notified the court that it does not agree the ratification is valid and submitted arguments against DHS’s ratification and de facto officer defense. The next court date is May 6, 2021 unless the magistrate judge decides to rule on the briefs alone without further oral argument.
In short, Behring argues that the FVRA does not allow prior actions of an unlawfully appointed official in violation of the FVRA to be ratified. Congressional anticipated such post-hoc efforts by the Executive Branch to try to correct prior violations, and in enacting the FVRA in 1998, Congress expressly stated in the Act that if “any person” performs “any function or duty” of a vacant office covered by the FVRA, without validly serving as an acting officer under the FVRA or an agency’s succession statute (here, the Homeland Security Act (HSA)), then that action “shall have no force or effect” and “may not be ratified.” See 5 U.S.C. § 3348(d)(1)-(2).
Here, McAleenan’s designation as Acting Secretary of DHS was not in compliance with the order of succession in effect as authorized under the HSA. This has been confirmed by 5 other courts. Moreover, McAleenan’s actions in promulgating the 2019 Rule changing the investment criteria for the EB-5 Program was a “function or duty” under the FVRA, i.e. those function or duties that were expressly designated as non-delegable. In the 2019 EB-5 Rule, Acting DHS Secretary asserted that the exclusive authority to change the EB-5 investment criteria resides exclusively in the DHS Secretary. Thus, McAleenan’s actions fall within the express provisions of the FVRA and may not be subsequently ratified.
Even if the DHS Secretary’s ratification is accepted by the court as valid, it does not impact Behring’s additional claims that the 2019 EB-5 Rule violated the Administrative Procedure Act and the Regulatory Flexibility Act when, among other problems, DHS failed to adequately consider the economic effects the 2019 EB-5 Rule as well as the failure to consider the absence of certainty created by an unworkable TEA designation process.
Behring wholly supports comprehensive EB-5 reform, but such reform must provide meaningful change to enhance the EB-5 Program, viz. by reducing USCIS processing times, solving retrogression, protecting against child age-out, and implementing integrity measures to strengthen investor protections. The 2019 EB-5 Modernization Rule is unsustainable in its current form and fails to cure address these issues.
Behring hopes that a favorable decision from the court will provide EB-5 stakeholders a new opportunity to work with Congress and DHS to find a meaningful solution to these challenges.
An overview of Behring’s USCIS lawsuit can be viewed here Click here.
If the EB-5 regulations are invalidated and the $500,000 investment amount is restored, it is likely only for a limited time. The sunset date for the EB-5 Regional Center Program is June 30, 2021. New legislation is expected to change the required investment amounts.
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Litigation Update Posts
Judge Approves Behring’s Settlement With USCIS
Yesterday, the judge approved the settlement with USCIS secured by Behring Regional Center and other EB-5 industry plaintiffs, officially closing the case. The judge’s approval places the EB-5 regional center program on solid ground and enables EB-5 investors to file their I-526E petitions with greater confidence. Watch Behring’s on-demand webinar to learn more about what …
USCIS Flip Flops and Admits that EB-5 Program’s 2021 Expiration Potentially Invalid
In an extremely odd turn of events in court yesterday for Behring’s second hearing in its lawsuit to stop USCIS from deauthorizing EB-5 Regional Centers, USCIS flip flops on their position regarding last years EB-5 Regional Center program expiration and appeared to agree with Behring that the EB-5 Regional Center Program did not lapse after …
2nd Hearing Update: USCIS “May Have Committed Legal Error”
Yesterday, Behring Regional Center had its second hearing before the US District Court for the Northern District of California in its third lawsuit against USCIS. The hearing was scheduled after the Judge Chhabria requested both parties to file supplemental briefs to address further the question whether Congress intended to cancel the existing Regional Center Program ...
Court Schedules New Hearing in Behring’s Case Against USCIS
The court scheduled a second hearing in Behring’s preliminary injunction lawsuit against USCIS’s recent deauthorization of regional centers. The hearing is set for Thursday, June 2nd at 12:30pm. The court specifically requested that USCIS address the relevance of Senator Grassley’s statements made about the RIA. Watch his statement here. Behring holds that Grassley’s statements have no bearing on …
U.S. Congress Issues Letter to USCIS Clarifying Immediate Reauthorization of EB-5 Regional Centers
Today, May 9, 2022, Congress issued a bipartisan letter to DHS clarifying Congress’s intent regarding the 2022 Integrity and Reform Act, stating that existing Regional Centers do not need to be recertified under the law. Recently announced on its website, USCIS wrongly interpreted the statute, claiming that because Congress repealed Section 610 of the Departments ...
Summary and Analysis of the 2022 EB-5 Reform and Integrity Act
Below we are outlining the summary terms within the new EB-5 Reform and Integrity Act of 2022. We are also hosting a webinar event to discuss the new changes. A replay is available for those who register after the broadcast date. {{ vc_btn: title=Register+for+Webinar&color=danger&align=center&enable_fancy_box=no&link=url%3Ahttps%253A%252F%252Fmy.demio.com%252Fref%252FDblwsg21yxUD4yR2 }} ***New EB-5 Bill Officially Out. Download here.*** ***Read our White ...
FAQ on Behring’s 2022 USCIS Lawsuit
Last June, Behring won a landmark lawsuit against USCIS, vacating the 2019 EB5 Modernization Rule. This Rule created increased risk and uncertainty to make the Program unworkable. After its implementation, new filings dropped by 99%. On June 22, 2021, the federal court agreed with Behring that the 2019 Rule was unlawfully implemented by acting officials …
EB-5 Litigation Update Post #11: Behring Files Second EB-5 Lawsuit Against USCIS. EB-5 Regional Center Program Expiration Contrary to Law
Over the weekend, Behring Regional Center filed a second lawsuit against DHS and USCIS, and including the Department of State (DOS), because these agencies have wrongfully canceled the EB-5 regional center program and are unlawfully withholding adjudication of pending EB-5 petitions and visa applications. One of our investors informed us that the law firm Wasden ...
EB-5 Litigation Update Post #10: DHS Has Dropped Their Appeal in Behring Regional Center v. Wolf, et al Lawsuit
In June 2021, Behring won its lawsuit against DHS, reversing the EB-5 regulations that were implemented in November 2019. In August 2021, DHS filed a motion to appeal the court's ruling. Today, January 5, 2022, the Department of Homeland Security withdrew its appeal of the Behring Regional Center LLC v. Alejandro N. Mayorkas, et al ...
EB-5 Litigation Update Post #9: DHS Files Notice of Appeal in Behring Regional Center v Wolf
Today, DHS filed its notice of appeal on the last day before the 60-day window expired in Behring Regional Center v. Wolf et al. This is not cause for alarm, and EB-5 investors should not make hasty decisions and feel they must rush to make new EB-5 investments. Contrary to some reports already floating around, …
EB-5 Litigation Update Post #8: USCIS reinstates Form I-526 from April 2019 with $500,000 investment amount: Too little too late for some.
Background: Behring Regional Center Vs. Chad Wolf et al. In November 2019, the EB-5 Immigrant Investor Program experienced regulation changes that would prove to instantly stall the program from being used to invest, create jobs and immigrate. The new regulations included new regulations and increased investor and operating requirements. Most notably, the minimum investment amount …
EB-5 Litigation Update Post #7: Behring Wins EB-5 Lawsuit, Court Vacates 2019 EB-5 Modernization Rule, $500,000 TEAs
Behring Regional Center Secures Major Legal Win Against DHS: Court Vacates 2019 EB-5 Modernization Rule Download - Read the Decision Today, the US District Court for the Northern District of California ruled in favor of Behring Regional Center, vacating the 2019 EB-5 Modernization Rule. The court agreed that DHS had no authority to implement the ...
EB-5 Litigation Update Post #6: May 13, 2021 Hearing
Behring Regional Center had its final EB-5 hearing on May 13, 2021 before the US District Court for the Northern District of California in its lawsuit against DHS and USCIS. In Behring Regional Center vs. Wolf, et al, Behring seeks to block the 2019 EB-5 Modernization Rule that derailed the EB-5 Program’s reasonable operability and ...
EB-5 Litigation Update Post #5: Behring’s Litigation Glossary
Behring’s case against DHS is still pending. The government is expected to file a brief to reply to Behring’s arguments against the validity of DHS’s recent attempt to ratify the 2019 EB-5 Modernization Rule on April 22, 2021…
EB-5 Litigation Update Post #3: Behring seeks to overturn EB-5 Regs in USCIS lawsuit
Behring is in the news again for our latest efforts to improve the EB-5 industry in its EB-5 lawsuit against USCIS. This time is different though. We are not just innovating to offer better EB-5 investments, but to save the industry as a whole. After the new EB-5 rules started in November 2019, the industry ...
EB-5 Litigation Update Post #2: Biden’s Announced Immigration Priorities Gives Hope for Behring’s Push for a Revitalized EB-5 Program
Not wasting any time, on his first day as the 46th US President, Biden signed 17 Executive Orders and unveiled his priorities for immigration reform. Six orders addressed immigration. He immediately repealed the travel ban on majority-Muslim countries. He also halted construction of the border wall near the border with Mexico. Importantly, Biden announced proposed legislation to…
EB-5 Litigation Update Post #1: Behring challenges DHS authority to Enact EB-5 Modernization Rules
Behring argues, in part, that the EB-5 Modernization Rule is invalid because the purported heads of DHS and USCIS had not been duly appointed under the Presidential nomination and Senate consent process at the time they promulgated the Rule. The claim stems from the continued controversy at DHS and USCIS where a series of officials have taken on the positions only to resign later…
EB-5 Litigation Updates Page
Behring Regional Center's EB-5 Litigation Updates Get the latest updates straight from the source. Welcome to Behring’s EB-5 Litigation Updates page. Here, we aim to provide EB-5 stakeholders frequent updates about Behring Regional Center’s litigation against the Department of Homeland Security (DHS), U.S. Citizenship and Immigration Services (USCIS) and the Department of State (DOS), ...
Behring’s Lawsuit to Vacate the 2019 EB-5 Modernization Regulations
Welcome to Behring’s Lawsuit to Vacate 2019 EB-5 Modernization Regulations Page. Here, we aim to provide stakeholders in the EB-5 Program with the case background and updates on Behring’s lawsuit against the DHS, USCIS and DOS stemming from the adverse effects of their unilateral termination of the EB-5 Regional Center Program. See all of the ...