Litigating an EB-5 Petition Denial

Q. Can all EB-5 petition denials be litigated in federal court?
A.  The answer is yes for I-526s and I‑924s. The answer is also yes for regional center terminations. The answer is more complicated for I-829s. As discussed below, in most cases, I-829s must be renewed before an immigration judge in removal proceedings rather than appealed directly to federal court.

Q. Is it necessary to file an appeal with the AAO before proceeding to federal court?
A.  No. For all EB-5 petitions, there is no mandatory administrative appeal. As such, Supreme Court precedent, holds that an investor or regional center can file a declaratory judgment in federal court without proceeding through the AAO appeal route.

Q. Even though it is not necessary to appeal to the AAO, is it usually advisable?
A.  In my opinion, no. In the EB-5 space, the AAO is mostly a policy arm of the IPO. The percentage of EB-5 appeals overturned by the AAO is small. In addition, the AAO experiences lengthy delays. In my experience, the best chance of getting a positive result – – and getting it in a reasonable period of time – – is in federal court.

Q. Is it advisable to file a motion to reopen a denied decision before appealing to federal court?
A.  The answer depends on how good the administrative record is. If there is a very complete administrative record, including where appropriate one or more expert opinions, a motion to reopen is more likely to be harmful than beneficial. The reason is that a motion to reopen usually produces a more thorough and well-reasoned denial decision than the original decision issued by the adjudicator. It is always preferable to go to federal court challenging a poorly reasoned, poorly written and often inaccurate decision. In rare instances, if a motion to reopen is accompanied by new and previously unavailable evidence, it may result in the decision being overturned and therefore obviating the necessity of litigation.

Q. In which district court should the complaint be filed?
A.  It can always be filed in the District Court of the District of Columbia. It can also be filed where the plaintiff resides or where the activity occurred. It can also be filed in the district court having jurisdiction over the Service Center office that issued the denial. In our cases, we evaluate the relevant law at the circuit court level as well as the mix of judges at the district court level before making a decision in which venue to file. Being able to choose the venue is a big advantage.

Q.  Who represents the government in the litigation?
A.  The government is represented either by a U.S. Attorney or an attorney in the Office of Immigration Litigation. In either case, there is often a big advantage in being able to discuss the case with an attorney on the other side. In our experience, there are many cases where the government’s attorney will advocate to the client (USCIS) that it should consider settlement (approving the petition) rather than litigating (and having the possibility of a negative precedent).

Q. What is the name of the complaint that is filed in federal court?
A.  It is a declaratory judgment complaint. The federal court judge is being requested to issue a legal opinion overturning the petition denial based on the administrative record.

Q. How is the case usually decided?
A.  It is usually decided on cross motions for summary judgment. This means that both the plaintiff and the government file briefs with the court requesting the court to rule in its favor based on the undisputed facts in the record. It is highly likely that the litigation will either settle before a judicial decision or else there will be a judicial decision based on the cross motions for summary judgment and without oral argument.

Q. What are the chances that the government will retaliate against a plaintiff that files a complaint in federal court?
A.  Our office has filed large numbers of federal court complaints. We have never seen any evidence of retaliation.

Q. What are the chances that a successful plaintiff will receive payment of attorney’s fees from the government?
A. Under the Equal Access to Justice Act, a federal court judge can award attorney’s fees if the government’s position in connection with the decision or the litigation is not “substantially justified.”

Q. What is a mandamus complaint?
A.  Unlike the declaratory judgment, which seeks to have a decision of USCIS overturned, a mandamus complaint is filed simply to get a court to compel USCIS to make a decision. That decision can be an approval, a denial or an RFE. It is normally – – although not necessarily – – filed when a petition is pending beyond published processing times.

Q.  What is the usual result of filing a mandamus complaint?
A.  A high percentage of mandamus complaints result in a decision being issued on the petition long before a federal court judge ever issues a decision. There are at least two reasons for this. One is that the government attorney does not want to be put in a position of having to explain to a federal court judge why the agency has been unable to render a decision after an inordinately lengthy period of time. Secondly, a decision granting the mandamus can result in an award of attorney’s fees.

Q. If an I-829 petition is denied, is it possible to appeal directly to federal court?
A.  Most cases have held that the I-829 petition must be renewed before an immigration judge in removal proceedings rather than appealed directly to federal court. This is definitely the case if removal proceedings have already been initiated.

Q. If the I-829 petition is renewed before an immigration judge, who has the burden of proof?
A.  The government has the burden of proof.

Q. If the immigration judge denies the I-829 petition, can the denial be appealed directly to federal court?
A.  No. The denial results in an order of removal, which must be appealed to the Board of Immigration Appeals. A denial by the Board of Immigration Appeals can be appealed through a petition for review in the circuit court of appeals.’