Durable Manufacturing Company v. LABR

In the

United States Court of Appeals

For the Seventh Circuit

No. 08-4122

D URABLE M ANUFACTURING C O ., et al.,

Plaintiffs-Appellants,

v.

U NITED S TATES D EPARTMENT OF L ABOR,

E MPLOYMENT AND T RAINING

A DMINISTRATION, et al.,

Defendants-Appellees.

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 08 C 2782—Amy J. St. Eve, Judge.

A RGUED JUNE 5, 2009—D ECIDED A UGUST 18, 2009

Before M ANION, R OVNER, and T INDER, Circuit Judges.

M ANION, Circuit Judge. Fourteen unrelated Illinois

businesses and fifteen aliens sued the Employment and

Training Administration of the Department of Labor

(“DOL”) and the Bureau of Citizenship and Immigration

Services of the Department of Homeland Security (“DHS”),

2 No. 08-4122

challenging a regulation promulgated by DOL that effec-

tively invalidated labor certifications that had been

issued to the plaintiffs. Following cross-motions for

summary judgment, the district court entered judgment

in favor of DOL and DHS. The plaintiffs appeal. We affirm.

I.

Under § 203(b)(3)(A)(i) and (iii) of the Immigration

and Nationality Act, Congress has made available a

number of employment-based visas for aliens who

qualify as skilled or unskilled workers. 8 U.S.C.

§ 1153(b)(3)(A)(i), (iii). An employer seeking to hire such

a worker may file a visa petition (called a Form I-140

Petition for Immigrant Worker, 8 C.F.R. § 204.5(a)) with

DHS on the alien’s behalf. Id. § 1154(a)(1)(F).1 Before a

visa may be issued, however, the Secretary of Labor

must have issued a labor certification in conformity with

8 U.S.C. § 1182(a)(5)(A)(i). Id. § 1153(b)(3)(C). That

section provides as follows:

1

Although this provision states that the petition should be

filed with the “Attorney General,” the authority to adjudicate

immigrant visa petitions was transferred to the Director of the

Bureau of Citizenship and Immigration Services (an agency

within DHS) by the Homeland Security Act of 2002, Pub. L.

No. 107-296, § 451(b), 116 Stat. 2135, 2196 (codified at 6 U.S.C.

§ 271(b)). Under 6 U.S.C. § 557, references in federal law to

any agency or officer whose functions have been transferred

to DHS shall be deemed to refer to the Secretary of DHS

or other official or component to which the functions were

transferred.

No. 08-4122 3

Any alien who seeks to enter the United States for the

purpose of performing skilled or unskilled labor is

inadmissible, unless the Secretary of Labor has deter-

mined and certified to the Secretary of State and the

Attorney General that (I) there are not sufficient

workers who are able, willing, qualified (or equally

qualified in the case of an alien described in clause (ii))

and available at the time of application for a visa

and admission to the United States and at the place

where the alien is to perform such skilled or unskilled

labor, and (II) the employment of such alien will not

adversely affect the wages and working conditions

of workers in the United States similarly employed.

Id. § 1182(a)(5)(A)(i)(I)-(II).

Based on that statute, DOL has promulgated regulations

pertaining to the labor certification process. 20 C.F.R.

§§ 656.1-.41. Previously, with one exception not relevant

here, § 656.30 provided that approved labor certifications

were “valid indefinitely.” Id. § 656.30(a) (2006). Following

notice and comment rulemaking procedures,2 however,

§ 656.30 was amended on May 17, 2007 (with an effec-

tive date of July 16, 2007)3 to provide:

For certifications resulting from applications filed

under this part and 20 CFR part 656 in effect prior

to March 28, 2005, the following applies: (1) An ap-

proved permanent labor certification granted on or

2

See 71 Fed. Reg. 7656-60 (February 13, 2006).

3

See 72 Fed. Reg. 27,946 (May 17, 2007).

4 No. 08-4122

after July 16, 2007 expires if not filed in support of a

Form I-140 petition with the Department of Homeland

Security within 180 calendar days of the date the

Department of Labor granted the certification. (2) An

approved permanent labor certification granted

before July 16, 2007 expires if not filed in support of

a Form I-140 petition with the Department of Home-

land Security within 180 calendar days of July 16, 2007.

20 C.F.R. § 656.30(b)(1)-(2) (2009). According to DOL, one

reason for the new regulation was to curb the growing

black market in labor certifications, wherein indefinitely

valid labor certifications were traded and sold to the

highest bidder. 71 Fed. Reg. 7659. Another reason for

creating a finite validity period for labor certifications

was to “more closely adhere[]” to the command of

8 U.S.C. § 1182(a)(5)(A)(i)(I) that DOL gauge the suf-

ficiency of the supply of able, willing, qualified, and

available workers at the time of the visa application. 72

Fed. Reg. 27,924. DOL further explained that “[l]abor

market conditions are subject to rapid change, and it is

consistent with DOL’s mandate under [§ 1182(a)(5)(A)(i)(I)]

to require a retest of the market after the passage of [180

days].” Id. Moreover, DOL concluded that “[t]he imposi-

tion of a validity period is a logical mechanism by which

the Department can ensure that the information upon

which a determination was based remains legitimate.”

72 Fed. Reg. 27,925.

Between March 2001 and May 2007, fourteen unaffili-

ated Illinois businesses filed applications for labor certi-

fications on behalf of fifteen potential alien employees.

No. 08-4122 5

Thirteen of the fifteen applications were approved

before the amended § 656.30(b) took effect on July 16, 2007;

the other two applications were approved after that date.4

After eight of the alien workers’ visa petitions 5 were

rejected by DHS because of expired labor certifications,

the fourteen businesses and fifteen aliens filed suit

against DOL and DHS in the Northern District of Illinois.

In their complaint, the plaintiffs sought a declaratory

judgment that DOL’s promulgation of the amended

§ 656.30(b) was beyond its authority or, alternatively, that

retroactive application of the amended regulation is

unlawful. The eight plaintiffs who had their visa petitions

denied also sought a writ of mandamus against DHS

to compel the agency to process their visa petitions.

Following cross-motions for summary judgment, the

district court granted summary judgment in favor of the

defendants and denied the same for the plaintiffs. The

plaintiffs appeal.

II.

“We review de novo the district court’s disposition of

cross-motions for summary judgment, while construing

the evidence and all reasonable inferences in favor of the

4

These were the applications of Dijuje Group, Inc. and Country

Landscaping & Supply filed on behalf of Bolivar Bautista

Castelan and Manuel Quintana, respectively

5

Of the fifteen potential immigrant employees, ten filed visa

petitions and five did not.

6 No. 08-4122

party against whom the motion under consideration is

made.” Rickher v. Home Depot, Inc., 535 F.3d 661, 664 (7th

Cir. 2008). Summary judgment is appropriate if “there is

no genuine issue as to any material fact and . . . the movant

is entitled to judgment as a matter of law.” Fed. R. Civ. P.

56(c).

A.

The plaintiffs first assert that DOL’s amendment of

§ 656.30 to limit the validity of labor certifications was

beyond the scope of its statutory authority.6 DOL responds

that it was acting within its authority when it amended

§ 656.30. The Supreme Court instructs that “[a]lthough

agency determinations within the scope of delegated

authority are entitled to deference, it is fundamental ‘that

an agency may not bootstrap itself into an area in which

it has no jurisdiction.’ ” Adams Fruit Co., Inc. v. Barrett,

6

The plaintiffs do not contend that DOL lacks statutory

authority to issue regulations pertaining to labor certifications

in general. In fact, they assume in their briefs that such

authority exists. We will proceed under that assumption for

the purposes of this opinion, and thus we need not resolve

the question we left unanswered in Production Tool Corp. v.

Employment & Training Administration, 688 F.2d 1161, 1167 n.1

(7th Cir. 1982), and Industrial Holographics, Inc. v. Donovan, 722

F.2d 1362, 1366 n.6 (7th Cir. 1983): whether DOL’s regulations

are legislative rules promulgated pursuant to an implied

congressional delegation of power or merely interpretive

rules issued through DOL’s inherent authority.

No. 08-4122 7

494 U.S. 638, 650 (1990) (quoting Fed. Mar. Comm’n v.

Seatrain Lines, Inc., 411 U.S. 726, 745 (1973)). Accordingly,

this circuit reviews de novo an agency’s determination

of the scope of its own jurisdiction. N. Illinois Steel

Supply Co. v. Sec’y of Labor, 294 F.3d 844, 847 (7th Cir.

2002). We examine the text and purpose of a statute to

determine whether a regulation falls within the scope of

the authority the statute delegates. See Am. Hosp. Ass’n

v. Schweiker, 721 F.2d 170, 176-78 (1983).

Under § 1182(a)(5)(A)(i), the Secretary of Labor must

make two substantive determinations before issuing a

labor certification: 1) there is an insufficient number of

able, willing, qualified, and available workers (herein-

after “sufficient workers determination”); and 2) em-

ployment of the alien will not adversely affect the

wages and working conditions of similarly situated

workers. Of key importance here, when making the

sufficient workers determination, the Secretary must

certify that the supply of such workers is insufficient at

a specific point in time: “at the time of application for

a visa and admission to the United States.” 8 U.S.C. § 1182

(a)(5)(A)(i)(I). By declaring approved labor certifications

indefinitely valid without any linkage to the filing of a

visa petition, the earlier version of § 656.30(a) did not

apply the statutory provision that the sufficient workers

determination be made “at the time of application for a

visa.” Section 656.30 was amended so that a labor certi-

fication expires if not filed in support of a visa applica-

tion within 180 days of the certification’s approval.

Thus, DOL implemented § 1182(a)(5)(A)(i)(I) by im-

posing a time limit between the certification and the visa

application. Put another way, DOL’s imposition of that

8 No. 08-4122

time limitation on the validity of a labor certification

ensures that the sufficient workers determination reflects

the state of the labor market at the time the anticipated

employee’s application for a visa and admission is made.

Assuming that DOL possessed statutory authority to

promulgate regulations pertaining to labor certifications,

then the amended § 656.30(b) is within the scope of

DOL’s authority because it complies with the explicit

language from § 1182(a)(5)(A)(i)(I).

In addition, the amendment is consistent with one of

the overarching purposes behind labor certifications:

protection of the domestic labor force from job competition.

Prod. Tool Corp., 688 F.2d at 1168. Section 656.30(b) limits

the validity of approved labor certifications: if, within

180 days of issuance, an approved certification is not filed

in support of a petition for a visa and admission, it be-

comes void. Thus, the amended § 656.30(b) ensures that the

snapshots of the labor market taken when labor certifica-

tions are approved are not stale appraisals of the labor

market when the visa petitions are filed. This protects

Americans who are currently able, willing, qualified, and

available to fill certain skilled and unskilled positions

from having to compete with aliens who were issued

labor certifications (and are now applying for visas) at a

time when the domestic work force was insufficient to

fill such positions.

As the plaintiffs point out, merely because an ap-

proved labor certification is filed in support of a visa

application within the amended § 656.30(b) time frame

does not ensure that, at the time of a visa’s issuance by

DHS (the process can take a while), the current labor

No. 08-4122 9

market is roughly the same as it was at the time the

labor certification was issued. But that is an issue for

Congress and DHS to address. The point remains that

the new § 656.30(b) advances, to some degree, the congres-

sional purpose of protecting American workers.7

In sum, we conclude that the promulgation of § 656.30(b)

was within DOL’s statutory authority because it com-

ports with the textual mandate of § 1182(a)(5)(A)(i)(I) for

DOL to ascertain the sufficiency of workers at the time

an application for a visa is made, and it furthers one of

the congressional purposes behind the labor certifica-

tion requirement.8

7

The plaintiffs rely on Medellin v. Bustos, 854 F.2d 795 (5th Cir.

1988), to argue that the amendment is outside of DOL’s author-

ity because it intrudes upon turf committed solely to DHS’s

administration, i.e., management of the visa petition process.

This case is materially distinguishable from Medellin. In

Medellin, the Fifth Circuit held that a DOL operating instruc-

tion had in effect rewritten the relevant statute (the current

§ 1182(a)(5)(A)(i)) because there was no statutory language

suggesting DOL could limit a labor certification to the alien

originally named in the application, 854 F.2d at 798. Here,

however, there is indeed statutory language clearly directing

that DOL’s sufficient workers determination be linked in time

to the filing of a visa application. Hence, the amendment

was consistent with the statutory division of administrative

authority between DOL and DHS.

8

The plaintiffs do not challenge the reasonableness of DOL’s

interpretation of § 1182(a)(5)(A)(i)(I) in its promulgation of

(continued...)

10 No. 08-4122

B.

Alternatively, the plaintiffs argue that even if DOL had

the statutory authority to promulgate the amended

§ 656.30(b), that regulation has an impermissibly retroac-

tive effect as applied to them. We review de novo the

question of whether a law operates retroactively. Faiz-

Mohammad v. Ashcroft, 395 F.3d 799, 801 (7th Cir. 2005).

In Landgraf v. USI Film Products, 511 U.S. 244 (1994), the

Supreme Court set forth the analytical framework for

determining whether a statute is retroactive.9 First, we

ask whether Congress has spoken clearly regarding

whether the law should apply retroactively. Landgraf, 511

U.S. at 257, 280. When, as here, an administrative rule is

at issue, the inquiry is two-fold: whether Congress has

expressly conferred power on the agency to promulgate

rules with retroactive effect and, if so, whether the

agency clearly intended for the rule to have retroactive

effect. Bowen v. Georgetown Univ. Hosp., 488 U.S. 204, 208

8

(...continued)

§ 656.30(b), so we have no occasion to reach the issue. For

that reason, no Chevron (U.S.A. Inc. v. Natural Resources

Defense Council, Inc., 467 U.S. 837 (1984)) analysis, which is

the level of deference we would apply given the plaintiffs’

assumption, see supra note 6, is required in this case.

9

The Landgraf analysis applies equally to administrative rules.

See Mejia v. Gonzales, 499 F.3d 991, 997 (9th Cir. 2007); Bruh

v. Bessemer Venture Partners III L.P., 464 F.3d 202, 213 (2d Cir.

2006); Nat’l Mining Ass’n v. Dep’t of Labor, 292 F.3d 849, 859

(D.C. Cir. 2002).

No. 08-4122 11

(1988); Clay v. Johnson, 264 F.3d 744, 749 (7th Cir. 2001).

We are unaware of any express statutory provision in-

dicating congressional approval of retroactive rule-

making by DOL in regard to labor certifications. Therefore,

we proceed to the second Landgraf step, which is to ask

whether the regulation has retroactive effect. 511 U.S. at

269-70, 280. A law is not retroactive merely because it is

applied to conduct before the law was passed or

upsets expectations based in prior law. Id. at 269. Rather,

a law has retroactive effect if it “would impair rights a

party possessed when he acted, increase a party’s liability

for past conduct, or impose new duties with respect to

transactions already completed.” Id. at 280. Instead of

being a “simple or mechanical task,” id. at 268, the deter-

mination of whether a law operates retroactively

requires a “commonsense, functional judgment about

‘whether the new provision attaches new legal conse-

quences to events completed before its enactment,’ ” Martin

v. Hadix, 527 U.S. 343, 357-58 (1999) (quoting Landgraf,

511 U.S. at 270). That judgment is informed by consider-

ations of notice, reliance, and settled expectations.

Landgraf, 511 U.S. at 270. If § 656.30(b) operates retroac-

tively, the traditional presumption against the applica-

tion of retroactive laws dictates that it cannot be applied

in this case. Id. at 280.

With regard to the two labor certifications that DOL

approved after the new regulation took effect on July 16,

2007, it is clear that § 656.30(b) has no retroactive effect.

The filing of an application for a labor certification is

simply a preliminary step for obtaining a labor certifica-

12 No. 08-4122

tion. Because it is not a final determination or event, no

new legal consequences would affect the application as

a result of the amended § 656.30(b). See Labojewski v.

Gonzales, 407 F.3d 814, 822 (7th Cir. 2005) (holding

that an application for a visa petition, which was a prereq-

uisite to the filing of an application for adjustment of

status, could not be considered a “ ‘completed transaction’

that gives rise to vested rights or settled expectations

for purposes of the presumption against retroactivity”);

see also Bellsouth Telecomms., Inc. v. Se. Tel., Inc., 462 F.3d

650, 660-61 (6th Cir. 2006) (stating that “filing an applica-

tion with an agency does not generally confer upon

the applicant an inviolable right to have the agency rule

on the application pursuant to the regulations in effect at

the time of filing”); Pine Tree Med. Assocs. v. Sec’y of Health

& Human Servs., 127 F.3d 118, 121 (1st Cir. 1997) (holding

that “the mere filing of an application is not the kind of

completed transaction in which a party could fairly

expect stability of the relevant laws as of the transaction

date”); Chadmoore Commc’ns, Inc. v. FCC, 113 F.3d 235, 241

(D.C. Cir. 1997) (finding that no right vested upon the

filing of plaintiff’s application for an extended imple-

mentation period to construct a mobile radio system).

The thirteen aliens whose labor certifications were

approved prior to July 16, 2007, argue that their labor

certifications were valid permanently and thus gave

them a vested right to file employment-based visa peti-

tions supported by such certifications at any time. They

contend the amended § 656.30(b) is impermissibly retro-

active because it impaired such a right. Not so. Any

right that might have been created with respect to the

No. 08-4122 13

time period of validity of the labor certifications would

have come from the earlier version of § 656.30(a) promul-

gated by DOL. That version simply stated that ap-

proved labor certifications were valid “indefinitely.” The

plaintiffs’ characterization of their labor certifications

as permanently valid is unfounded. In common usage,

the term “indefinite” means “having no exact limits;

indeterminate in extent or amount; not clearly fixed.”

W EBSTER’S T HIRD N EW INTERNATIONAL D ICTIONARY 1147

(2002). Thus, labor certifications approved under the

old regulation were not valid permanently, but only so

long as no definite period of validity was fixed by DOL.

By definition, then, any “right” that the plaintiffs may

have obtained to file their approved labor certifications

in support of visa petitions at any time they chose was co-

extensive with the duration of the “indefinite” regulation.

When DOL amended § 656.30(b) essentially to establish

a 180-day time limit for previously approved labor certifi-

cations, the plaintiffs’ right to the certifications’ indefinite

validity ended. Therefore, upon the approval of the

updated § 656.30(b), the plaintiffs did not possess any

vested right that the amended regulation could im-

pair.10 Similarly, any expectations that the plaintiffs

10

The plaintiffs rely on Maceren v. District Director, INS, 509

F.2d 934 (9th Cir. 1974), in support of their retroactivity argu-

ment, but that case is materially distinguishable. In Maceren,

an alien was denied a visa because the labor certification

supporting his preference petition expired due to the promul-

gation of a new rule by DOL. 509 F.2d at 937-38. The new

regulation, which placed a one-year validity period on all

(continued...)

14 No. 08-4122

had regarding the continued validity of their labor certifi-

cations were not settled due to the unfixed character

of the old regulation. Accordingly, we hold that applica-

tion of the new § 656.30(b) has no retroactive effect in

this case.

III.

We conclude that § 656.30(b) falls within the scope of

DOL’s statutory authority to promulgate regulations

pertaining to the labor certification process. Further, we

hold that § 656.30(b) does not operate retroactively. For

these and all foregoing reasons, we A FFIRM the judg-

ment of the district court.

10

(...continued)

labor certifications, rendered the alien’s previously approved

labor certification invalid immediately without any op-

portunity to preserve its validity. Id. After balancing the

inequities of retroactive application of the regulation against

the statutory interests, the Ninth Circuit held that retroactive

application of the regulation was improper. Id. at 939-41.

By contrast, in this case the plaintiffs’ labor certifications

were not rendered invalid on the effective date of § 656.30(b);

rather, the plaintiffs were afforded 180 days in which they

could preserve the validity of their previously approved labor

certifications. This was the same 180-day limitation attached

to certifications approved after July 16, 2007.

8-18-09