Petition for Writ of Certiorari — Golden Rainbow Freedom Fund v. Ashcroft

Supreme Court brief2002

Ask Donna

What actually matters in this document.

Text

Supreme

FILEDE™

it) 911674 my 1 3 2003

Ooo od eee ;

No. te Je eme SL Tis)

In The

Supreme Court of the Gnited States

GOLDEN RAINBOW FREEDOM FUND,

Petitioner,

JOHN P. ASHCROFT,

Respondent.

On Petition For A Writ Of Certiorari

To The United States Court Of Appeals

For The Ninth Circuit

PETITION FOR A WRIT OF CERTIORARI

CHARLES E. ALBERTSON

Counsel of Record

FORSBERG & UMLAUF, PS.

900 Fourth Avenue, Ste. 1700

Seattle, Wash. 98164

(206) 689-8500

COCKLE LAW BRIEF PRINTING CO. (800) 225-6964 X

OR CALL COLLECT (402) 342-2831 ~

Go ps

QUESTIONS PRESENTED

Petitioner Golden Rainbow Freedom Fund is a

Washington limited partnership engaged in the develop-

ment of commercial real estate. Its primary sources of

investment capital are immigrant investors who are

granted visas under the Immigrant Investor Pilot Pro-

gram, established by the Congress in 1995 and adminis-

tered by the Immigration and Naturalization Service

(INS). An immigrant investor visa applicant invests

$500,000 in an approved program and is granted condi-

tional permanent residence. At the end of a two-year

period, the immigrant applies to have his or her status

adjusted to permanent resident. If the INS determines

that the investor has complied with the approved program

and the statutory purpose of the program, the conditional

status is removed. Petitioner’s investment program was

approved by the INS, as were the individual investor’s visa

petitions that incorporated the program. Based on those

approvals, petitioner invested several million dollars in

the development of a number of properties, and peti-

tioner’s investors moved to the United States, many with

their families. Beginning in 1997, however, the INS

radically changed the regulatory standards for the

program, and announced the new standards in the course

of internal adjudications instead of by notice and comment

rulemaking as required by the Administrative Procedure

Act. The INS then directed that the new standards be

applied retroactively to a backlog of visa petitions pending

before the agency. The application of these new standards

adversely affected petitioner’s investors as they sought to

adjust their status, since they had invested in petitioner’s

fund in good-faith reliance on the INS’ prior approval of

both the investment program and their individual visa

QUESTIONS PRESENTED -— Continued

petitions. As a result, petitioner has suffered an outflow of

investment capital as its investors seek to withdraw their

funds in the expectation that they will face removal

proceedings by the INS, and has had to curtail its devel-

opment activities and commence liquidation of several of

its investment properties.

The questions presented, as to which the courts of

appeal are in conflict, are:

1. May an administrative agency effect a substantial

change in its regulatory standards, without prior notice of

and an opportunity to comment on the proposed changes

as required by the Administrative Procedure Act, 5 U.S.C.

§ 551(4) and 5 U.S.C. § 553, when that change contradicts

the plain language of the regulations and reverses a long-

standing and well-established interpretation of the

agency’s regulations?

2. Does an agency approval of an investment

program, the subsequent approval of numerous visa

petitions incorporating that investment program, and the

resulting investment of several million dollars in reliance

on those approvals, constitute a “well-established interpre-

tation” of the agency’s regulations?

3. Did the INS’ retroactive application of new

regulatory standards to the petitioner’s already-approved

investment program constitute arbitrary and capricious

decisionmaking?

iii

RULES 29.6 AND 14.1 STATEMENT

Petitioner Golden Rainbow Freedom Fund is a limited

partnership organized under the laws of the State of

Washington. American Retirement, Inc., owns more than

ten percent of the interest of the Fund.

Respondent John D. Ashcroft is the Attorney General

of the United States.

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED..................csccsscssscssscessee i

RULES 29.6 AND 14.1 STATEMENT ....................... ili

Fs CO FAs NE EID ciccccccccnsneveicsccscccosanenncszcns Vv

I I is cai cstiacesnasbsasddinsticsensenaailoninmanane 1

TIE disisininen snosaincniinineneaicinaaitiaipnainditanliieass 1

CONSTITUTIONAL AND STATUTORY PROVI-

I iia sascd catcpaisiniin.ciskaiesnniibdiadapeniccendiinamnia 1

I IITTT itdnvasundsnacknhosinnieabensinenonmngiaieaiinicaibbeniante 2

BD. TIGRE TARTTOUIIG wiieccissccnncsncsssccidsscnsessncss 2

Be I FE vc dceniccnccassintninnsecssnnssntinniiincsse 12

REASONS FOR GRANTING THE PETITION ......... 13

A. The Circuits Are Split Over the Standard

Required for Rulemaking When An Agency

Changes Its Interpretation of a Statute......... 14

B. The INS’ Retroactive Application of the Jzu-

mii Decisions to the Petitioner and Its

Investors Constitutes Arbitrary and Capri-

cious Decisionmaking ...................s.ceeceeeeeeeeees 22

1. Retroactive Application of New Rules Is

Not Favored Under the Law.................... 22

2. The INS Lacks Statutory Authority to

Engage in Retroactive Rulemaking......... 23

CRANES eticnisssiieneisinidatnindictatdeininiammdauenneninia 25

TABLE OF AUTHORITIES

Page

CASES

Alaska Professional Hunters Ass’n, Inc. v. FAA, 177

F.3d 1030 (D.C. Cir. 1999)........0000.... 14, 15, 16, 18, 19, 21

Appalachian Power Co. v. EPA, 208 F.3d 1015 (D.C.

RoR OIE ksscsisssisahinacpeyisceohesnsaiiaaiadediaie: Giliedaiiaee en 17

Bowen v. Georgetown University Hospital, 488 U.S.

BP CIE tntndssinscncinciiatadicanstisemniiiemaneniann ee aan 23, 24

Chief Probation Officers v. Shalala, 118 F.3d 1327

ee Ss DEN e P snessneccnpcnibieddgvataniinadaangcesiuseiad arm nen eae 14

Landgraf v. USI Film Products, 511 U.S. 244

CFD <coceisssensceignglissiensiiikisititaniilildedseasiiailueiieaandsadaaneaaaauiiaa 23, 24

Lynce v. Mathis, 519 U.S. 433 (1997).........ccecceeeseseceeeeeeee 23

Matter of Ho, Interim Decision 3362 (July 31, 1998)......... 8

Matter of Hsiung, Interim Decision 3361 (July 31,

ED cisichnicinencsuisinphnibicidinisitatlbaducaniniieaaeiam ian pamatediei. area 8

Matter of Izumii, Interim Decision 3360 (July 13,

PUNE insscsivitnihtnanibeisttiidnica sdecimibiiteialdiiaama iia hoor ek aa passim

Matter of Soffici, Interim Decision 3359 (June 30,

TD nicshibaiisiaietansiiaiiaaiiitablinabicitiaeaiacin Death acd ae E 8, 10

Paralyzed Veterans of America v. D.C. Arena L.P,

hy ge ae {RRR n nT vn NE ae 16

Pfaff v. HUD, 88 F.3d 739 (9th Cir. 1996) ............. 18, 19, 21

R.L. Investment Limited Partners v. INS, 273 F.3d

re Ce Re Eiichi atest A hadessanioraaiaesss 13

R.L. Investment Limited Partners v. INS, 86

F.Supp2d 1014 (D.Hawai’i 2009) ........... cee 13, 14

TABLE OF AUTHORITIES — Continued

Page

Shalala v. Guernsey Memorial Hospital, 514 U.S.

BF CBG ED ccecccccassnsscncscnssesemnesienssilbinistnaienibiniemebbnaiiaiaiimniiemaian 19

Shell Offshore, Inc. v. Babbitt, 238 F.3d 622 (5th

COP, SBD E) ccccccssassencssemnsnleecsteniiensimimeianesaaiieiinan 19, 21

STATUTES

S UTE. & TRI ccccsccccsccsincsnisncsccsetannemudaain 1, 2, 24

BB WEG. § TEBELED accscceccessssteciomsentsenssteuntnnemmmmnnniins l

Section 610, Department of Justice and Related

Agencies Appropriations Act, 1993, Pub.L. 102-

SOE, DOG Glee. BEB, BG sciessccnesietnnensctnscsitiinnsatcemmaitinebaiaien 3

REGULATIONS

GG Fed. Beets GRIT vxscscsecscrtscissssstninenennnieaaagaaie 2

SS OG, Bees, Ba rccccncecsensssinsensssisistiistnentamenatacamannae 3

PETITION FOR A WRIT OF CERTIORARI

Petitioner Golden Rainbow Freedom Fund respect-

fully petitions for a writ of certiorari to review the judg-

ment of the United States Court of Appeals for the Ninth

Circuit in this case.

OPINIONS BELOW

The Memorandum Decision of the court of appeals

(App. 1-3)' and the order denying petition for rehearing

(App. 9) are unreported. The opinion and judgment of the

District Court (App. 4-8) were not reported. The four

decisions of the INS Administrative Appeals Office that

form the basis for the agency actions at issue are reported

as Interim Decisions 3359, 3360, 3361, and 3362.

JURISDICTION

The judgment of the court of appeals was entered on

February 11, 2002. The jurisdiction of this Court is

invoked under 28 U.S.C. § 1254(1).

}

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED

Reprinted in an appendix to this petition (App. 10-28)

are pertinent provisions of Section 1153(b)(5) of Title 8,

United States Code; Sections 551(4) and (5) and Sections

* “App.” Refers to the separately bound appendix to this petition.

553(b) and (c) of Title 5; and Sections 204.6(e), (j), and (m)

of Title 8, Code of Federal Regulations.

STATEMENT

A. Statutory Background

This case concerns the INS’ administration of a visa

program intended to encourage investment in the United

States by potential immigrants. Section 203(b)(5) of the

Immigration and Naturalization Act of 1990, 8 U.S.C.

§1153(b)(5), created a new preference allocation of visas for

a category of immigrants described in the statute as

“employment creation” immigrants, commonly referred to

as the “EB5 visa.” Under Section 203(b)(5), visas were set

aside for potential immigrants who had invested, or were

in the process of investing, a specified amount of money in

a new or ongoing enterprise, and which would create full-

time employment for at least 10 “qualified employees.” An

immigrant is granted conditional permanent resident

status for a period of two years. If the immigrant remains

eligible for the two-year period, by maintaining the

investment and its resulting job creation activity, he or she

may petition to have the conditional status removed at the

end of the two-year period, by filing an I-829 petition. The

INS promulgated final rules implementing the immigrant

investor provisions of Section 203(b)(5) on November 29,

1991, 56 Fed. Reg. 60897.

The “Immigrant Investor Pilot Program” (hereinafter

the “Pilot Program”), in effect a sub-program of the EB5

program, was established by the Congress in 1992. It

differs from the original program in that it is intended to

encourage potential immigrants to invest in “regional

i ae

centers,” entities organized “for the promotion of economic

growth, including increased export sales, improved

regional productivity, job creation, and increased domestic

capital investment.” Section 610, Department of Justice

and Related Agencies Appropriations Act, 1993, Pub.L.

102-395, 106 Stat. 1828, 1874 (hereinafter 1993 Appro-

priations Act). The regional center can be a company, a

branch of government, or other entity established for the

purpose of investing immigrant capital into designated

areas approved by the INS. The requirement in the

original program that each individual investment create

ten jobs for qualifying employees was expressly relaxed,

with investors in a “regional center” instead permitted to

set forth in their applications evidence of indirect job

creation by their investments. The INS promulgated an

Interim Rule governing the Immigrant Investor Pilot

Program on August 24, 1993, 58 Fed. Reg. 44606.

The Interim Rule also provides that, in lieu of strict

adherence to the “10 jobs created” requirement of the

original immigrant investor program, “reasonable method-

ologies” could be used to estimate the number of jobs

created by investment in a regional center. These method-

ologies may include multiplier tables, feasibility studies,

analyses of foreign and domestic markets for the goods

and services to be exported, and “other economically or

statistically valid forecasting devices which indicate the

likelihood that the business will result in increased

employment.” 8 C.F.R. § 204.6(m)(3)(v).

In addition to the INS’ published regulations cited

above, additional guidance on the EB5 program was

provided by legal opinions published by the INS’ Office of

General Counsel. An opinion from that office dated

September 10, 1993, encouraged the formation of venture

capital funds, or similar entities that serve as conduits for

investing immigrant investor capital into regional centers,

by concluding that pooled investment programs fully

satisfied the letter and spirit of the employment-creation

statute. The opinion also concluded that an investor’s

capital was placed “at risk,” for purposes of 8 C.FR.

§204.6(j)(2), even if the investor and the enterprise in

which he or she invested had an agreement for the sale of

the investor’s interest in the enterprise (such as by

redemption, third-party purchase, or otherwise) after the

two-year conditional period had been satisfied. Jd. This

further encouraged immigrant investment, by permitting

the creation of specific, known “exit strategies” for the

investor.

In another opinion dated June 27, 1995 the General

Counsel encouraged the extension of credit to immigrant

investors by concluding that the INS’ regulations did not

require that the indebtedness of an investor (such as a

promissory note backed by the investor’s own assets) meet

the requirements of a secured transaction under Article 9

of the Uniform Commercial Code.

Further guidance was also provided, on a case-by-case

basis, to individuals who were organizing investment

programs for potential immigrant investors. In the specific

case of petitioner, for example, the INS’ Chief of Immi-

grant Branch Adjudications, in answer to a query from the

organizer of GRFF, stated in a letter dated August 10,

1995 that venture capital funds were a qualifying invest-

ment under the Pilot Program, if a petitioning alien could

show that “the fund infuses capital into export-generating

businesses, which, in turn, create jobs.”

Petitioner’s subsequent application to the INS for

designation as a “regional center” in the Pilot Program

described petitioner’s business plan (development or

renovation of commercial/warehouse properties for sale or

lease to manufacturing and export-oriented companies),

the organizational structure of GRFF (a series of limited

partnerships open to ten investors for an investment of

$500,000 each, payable either in cash or by a substantial

down payment with the balance evidenced by the terms of

a subscription agreement), and projected the number of

new jobs that would be created by a typical development

project financed by the Fund. All of the current investors

have fally invested $500,000.

On February 5, 1996, the INS’ Acting Assistant

Commissioner, Adjudications, designated petitioner as a

“regional center” under the Immigrant Investor Pilot

Program. A subsequent amendment to petitioner’s

“regional center” designation clarified petitioner’s primary

investment program as being development in (1) the City

of Seattle’s Neighborhood Reinvestment Area, an aging

industrial area located immediately south of downtown

Seattle, which had been designated by the State of

Washington and the federal government as a “Community

Empowerment Zone” (“CEZ”) and (2) the “Enterprise

Community” (“EC”), designated and administered by the

U.S. Department of Housing and Urban Development,

encompassing portions of Seattle’s Central Area, South-

east Area, Duwamish Area and Delridge Area. On October

25, 1996, the INS approved the amended applications and

again designated petitioner as a regional center under the

Immigrant Investor Pilot Program.

Between August, 1996, and mid-1998, approximately

90 immigrants who were potential investors in petitioner’s

regional center applied for visas at overseas consular

posts. The applications supporting these petitions con-

tained substantially the same information regarding

petitioner: documentation of its designation as a “regional

center,” its most recent audited financial statements,

copies of the applicable limited partnership agreement,

and the most current information on the unemployment

rate in the regional center. Throughout this period,

petitioner received repeated assurances that its invest-

ment program was in full compliance with the law,

principally through the continued approval of these

immigrant investor’s visa petitions. In addition, on

October 20, 1997, the INS’ Office of Adjudications distrib-

uted a memorandum to its field offices to guide them in

their adjudication of petitions filed by immigrant inves-

tors. These guidelines reiterated the INS’ prior practice of

approving immigrant investors’ participation in invest-

ment funds with the same features as exist in the Fund,

including redemption agreements, reasonable manage-

ment fees, and promissory notes.

Of the approximately 90 applicants for permanent

resident status under petitioner’s investment program, the

INS approved approximately 40 of the petitions, and

conditioned the petitioners’ permanent resident status for

the statutory two-year period. Based on those approvals,

the investors released their funds to petitioner, moved

themselves and their families from their home countries,

and established residence in the United States. Most are

now nearing the end of their two-year conditional resi-

dence period, or have already completed the conditional

residence period and have I-829 petitions pending before

the INS to have the conditions removed. Petitioner, in

turn, invested those pooled funds in the architecture,

engineering, and construction costs necessary to refurbish

or construct commercial properties.

In 1996, the INS had become concerned about features

of some investment programs that were being submitted

for its approval, and whether those features complied with

the program’s statutory authority. These features included

passive versus active participation in an investment,

pooled investments, and the use of promissory notes.

It was initially thought these concerns could be dealt

with by drafting and issuing written guidance to the INS’

field offices, but the INS program officer was advised by

the agency’s General Counsel that such changes to

program standards had to be accomplished by means of a

rulemaking proceeding, and that she thereupon began

drafting regulations. Accordingly, the program officer

prepared an initial draft of the regulations, totaling 37

pages, on December 17, 1996; a 59-page draft on January

15, 1997; and a 66-page draft on March 21, 1997. To date,

the INS has never promulgated those regulations

Instead of commencing a rulemaking proceeding,

however, the INS opted for a more expedient approach to

changing the rules governing the EB5 program. On or

about December 1, 1997, the INS instructed its field offices

and State Department consulates overseas to stop the

processing of immigrant investor petitions, pending the

issuance of guidance on adjudicating the complex financial

arrangements found in some visa petitions. This “guid-

ance” was provided by the issuance of a memorandum by

the General Counsel on December 19, 1997, which

examined many of these “complex financial arrangements”

and re-defined the agency’s interpretations of such

matters as the “fair market value” of a promissory note

used as part of an investment, prohibited the payment of

management fees or commissions to the promoters of

investment programs, effectively banned the use of pooled

investment funds as an investment vehicle, and made

other changes to the agency’s past rulings on features of

the EB5 program.

Then, a number of pending visa petitions were

“certified” to the INS’ Administrative Appeals Office

(AAO), a branch of the same agency division that adjudi-

cates visa petitions, for adjudication as “precedent

decisions” pursuant to the standard set forth in the |

General Counsel’s memorandum. Under the INS’ regula-

tions, these “precedent decisions” would then be binding

on subsequent adjudications by INS officers and employ-

ees.

The result of this process was that in late June and

July 1998, the Associate Commissioner for Examinations

issued four “precedent decisions” that were to guide the

adjudication of the remaining petitions. Matter of Soffici,

Interim Decision 3359 (June 30, 1998); Matter of Izumit,

Interim Decision 3360 (July 13, 1998); Matter of Ho,

Interim Decision 3362 (July 31, 1998); Matter of Hsiung,

Interim Decision 3361 (July 31, 1998). These decisions are

referred to collectively as the Jzumii decisions.

Each of the Jzumii decisions added requirements for

visa petitioners that went beyond the scope of the existing

law, contradicted provisions of the promulgated regula-

tions, and contradicted the INS’ established precedent on

these matters. For example, before the Jzumii decisions,

an EB5 petitioner’s investment in a “pooled investment

fund” (where multiple investors invested in a fund, which

in turn invested in more than one commercial enterprise

a SN Eee

in a regional center) would be approved, whereas after the

Izumii decisions, it would not — even if an investor (such

as petitioner’s) had kept his or her money in the fund for

two years, in reliance on the INS’ original approval of their

petition.

Similarly, before the Izumii decisions, if part of an

investment was in the form of a promissory note, there

was no requirement that any security interest in the note

be perfected in accordance with Article 9 of the UCC, or

indeed in accordance with any requirement. But after

Izumii, such notes were required to be perfected in

accordance with the immigrant’s home jurisdiction — even

if the original promissory note had originally been unse-

cured when the investment was approved at the beginning

of the petitioner’s two-year conditional residence period.

Before the Izumii decisions, if part of an investment

was in the form of a promissory note, the only requirement

in the INS’ regulations was that it be valued at “fair

market value.” After Izumii, a promissory note was

required to be discounted to present value, and further

discounted to reflect the potential cost of enforcing a U.S.

judgment in a foreign court — even if the undiscounted

note was approved at its then fair market value at the

beginning of the investor’s conditional residence period.

Before the Jzumii decisions, investment programs

containing redemption or “buy-back” features were

approved by the INS, whereas after Jzumii, investment

programs containing such redemption features are not

approved — and this prohibition has been and will be

applied to investors whose investment programs had been

approved by the INS at the time their visas were approved

and they commenced their two-year conditional residence

period.

Before the Jzumii decisions, visa petitioners were

required to submit documentation, in a manner specifi-

cally prescribed in the INS’ regulations, of the source of

their investment funds. After the /zumii decisions, visa

petitioners were required to submit much more extensive

documentation, sufficient to trace the source of every

dollar they had invested — even though the agency had

approved their original documentation at the time their

visa was approved, and even if compliance with the new

requirement meant that an immigrant had to return to

their home country several years after leaving, and

reconstruct their financial history from scratch.

Before the Izumii decisions, the INS regulations

allowed an investor to be a limited partner, as defined in

the Uniform Limited Partnership Act. After the Jzumii

decisions, investors were required to be “actively engaged”

in management, which could void their status as limited

partners.

Following the issuance of the Jzumii decisions, the

INS proceeded to apply the new standards to several

hundred petitions that were backlogged before the agency

with striking results — of the 587 petitions immediately

adjudicated pursuant to the Jzumii decisions, all but two

were denied. In the case of the petitions of the Fund’s

investors, the new requirements added by the Jzumii

decisions were invoked to deny or revoke their petitions on

a number of grounds. Among the grounds cited by the INS

were: (1) the prohibition, first announced in Jzumii, on

payment of management fees to the Fund, although such

fees had been fully disclosed to, and approved by, the INS

when the petition was filed; (2) the prohibition, also first

announced in Jzumii, on redemption or “buy-back”

features in the petitioner’s investment program; (3) the

requirement, first announced in Jzumii, that the promis-

sory note utilized by the investor be discounted to present

value; and (4) the failure of the petitioner to meet the

requirement, first announced in Jzumii and Matter of

Soffici, that he be able to trace the source of all funds used

for his investment.

The adjudications of visa petitions submitted on

behalf of the Fund’s investors resulted in the immediate

revocation of approximately 30 petitions that had already

been approved. Because petitioner’s investment contract

and escrow agreement required those investors’ funds to

be released by the escrow agent to the fund upon approval

of their respective visa petitions, many of the investors

whose petitions were revoked demanded (and received) the

return of their money from petitioner. Of the approxi-

mately 40 investors who were granted conditional resi-

dence before the Jzumii decisions, 10 grew fearful of losing

their permanent resident status at the end of their two-

year period, and demanded the return of their funds.

Petitioner refunded between $2 million and $3 million to

those investors, and that in order to meet those demands

and anticipated future demands, has placed several of its

investment properties on the market. This financial

burden, due wholly to the INS’ abrupt revision of the

standards governing the EB5 program, has had a direct

and adverse effect on the Fund’s ability to carry on its

property development activities.

Moreover, the INS has refused to allow either

petitioner or its investors to re-structure their investment

program in a manner that would comply with the new

requirements. For example, all of petitioner’s investors

have made a full cash investment in the fund — thereby

eliminating the INS’ disfavor, first announced in the

Izumi decisions, of investment program in which inves-

tors could make a partial down payment, with a promis-

sory note for the balance. However, since the INS has

announced that the individual investments must

be judged as they were originally made (although |

judged retroactively under the subsequently-adopted

Izumui standards), and therefore cannot be re-structured.

B. Proceedings Below

On May 12, 1999, petitioner filed its Complaint and

Motion for Preliminary Injunction in the United States

District Court for the Western District of Washington. The

complaint alleged that the INS’ adoption of new standards

to govern the immigrant investor visa program violated

the Administrative Procedure Act’s notice-and-comment

requirements for promulgation of substantive rules.

Petitioner also alleged that the new standards were

contrary to the legislation authorizing the immigrant

investor program, that the revision of the program

standards was arbitrary and capricious and violated due

process, and also constituted an uncompensated taking of

the economic worth of the GRFF.

After briefing by the parties, the District Court denied

petitioner’s motion for a preliminary injunction by order

dated August 19, 1999. On August 10, 2000 petitioner filed

a motion for summary judgment. On August 11, 2000 the

INS filed a cross-motion for summary judgment. The

District Court issued an order granting the INS’ motion for

summary judgment, and denying petitioner’s motion for

ee TT |

summary judgment on September 13, 2000. On September

18, 2000, the Clerk of the District Court entered judgment

in favor of the INS and against petitioner, pursuant to the

Court’s September 13, 2000 Order. On November 16, 2000,

petitioner filed a notice of appeal. On January 18, 2001,

appellant filed a motion with the Court of Appeals for the

Ninth Circuit that its appeal be heard by the same panel

and at the same time as the appeal in a related case

currently before the court, R.L. Investment Limited

Partners v. Immigration and Naturalization Service, No.

00-15627. The Court of Appeals granted that motion on

January 31, 2001, and oral argument was heard on

November 6, 2001.

The Court of Appeals, in an unpublished memoran-

dum decision dated November 26, 2001, affirmed the

District Court’s decision on the basis of its decision in the

R.L. Investment Limited Partners v. INS, 273 F.3d 874 (9th

Cir. 2001). The latter decision expressly adopted the

reasoning of the District Court decision in R.L. Investment

Limited Partners v. INS, 86 F.Supp2d 1014 (D.Hawai’i

2000).

REASONS FOR GRANTING THE PETITION

This court should grant review because the circuits

are split as to the standard for what constitutes an

administrative agency’s settled interpretation of its

statutory authority, the departure from which requires

rulemaking under the Administrative Procedure Act, and

because the Ninth Circuit reached a decision in this case

that is erroneous as a matter of statutory interpretation.

A. The Circuits Are Split Over the Standard

Required for Rulemaking When An

Agency Changes Its Interpretation of a

Statute

The District Court below rejected petitioner’s conten-

tion that the INS’ prior memoranda, rulings, and approv-

als of visa petitions for petitioner’s investors did not

constitute a consistent expression of agency policy, which

required rulemaking in order to effect a change in that

policy. App. at 5. It based this holding on the Ninth Circuit

decision in Chief Probation Officers v. Shalala, 118 F.3d

1327 (9th Cir. 1997), which held inter alia that changes in

regulatory agency interpretations, “which themselves did

not go through formal rulemaking procedures, cannot be

regulations having the force of law. The prior approvals

simply represented the Agency’ prior (short-lived)

interpretation of the statute.” 118 F.3d at 1334. The rule of

Chief Probation Officers in its simplest form, is that new

declarations of policy do not trigger the APA’s rulemaking

requirement uhiess they explicitly contradict an existing

regulation that has the force of law. 118 F.3d at 1334.

Accordingly, the district court held that the INS was free

to change its interpretation of the statute without going

through a rulemaking proceeding. App. at 7. The district

court in R.L. Investment Limited Partners, reached the

same conclusion, 86 F.Supp.2d at 1025, which was then

adopted by the court of appeals in affirming both peti-

tioner’s appeal and the appeal in R.L. Investment Limited

Partners, 273 F.3d 874; App. at 2.

By contrast, in Alaska Professional Hunters Ass’n, Inc.

v. FAA, 177 F.3d 1030 (D.C. Cir. 1999), the Court of

Appeals for the District of Columbia Circuit undertook a

much more pragmatic and realistic analysis of how an

individual or a business entity relies on the “common law”

of an administrative agency in structuring its business,

and how a change in that “administrative common law”

triggers the requirement of notice and comment rulemak-

ing under the APA.

In Alaska Professional Hunters Ass’n the appellants

were hunting and fishing guides in Alaska who flew light

aircraft as part of their guiding services. Since 1963,

guides in the state had been consistently advised by the

Alaska Region of the FAA that they were not governed by

the agency’s regulations for commercial pilots, but were

instead only subject to the general rules governing private

aviation. In 1998, however, the FAA’s headquarters in

Washington, believing that the Alaska Region’s long-

standing advice was premised on an erroneous reading of

an old Civil Aeronautics Board decision, caused a “Notice

to Operators” to be published in the Federal Register. That

Notice informed Alaska guid: pilots that they were now

subject to the commercial av ation regulations. The guides

sought judicial review, alleging that the FAA was trying to

evade its rulemaking obligations under the APA. The

FAA's principal defense was that the “Notice to Operators”

was merely an interpretive rule, and therefore exempt

from the notice and comment procedures of the APA.

The D.C. Circuit disagreed, ruling that “[w]hen an

agency has given its regulation a definitive interpretation,

and later significantly revises that interpretation, the

agency has in effect amended its rule, something it may

not accomplish without notice and comment.” 177 F.3d at

1034. Nor was the court swayed by the agency’s argument

that the Alaska Region’s advice to the guide pilots repre-

sented a “local enforcement omission, in conflict with the

agency's policy in the rest of the country,” finding that

Those regulated by an administrative agency are

entitled to ‘know the rules by which the game

will be played.’ See, Holmes, Holdsworth’s

English Law, 25 Law Quarterly Rev. 414 (1909).

Alaska guide pilots and lodge operators relied

on the advice FAA officials imparted to them -

they opened lodges and built up businesses de-

pendent on aircraft, believing their flights were

subject to [general aviation requirements] only.

Cf. Paralyzed Veterans, 117 F.3d at 587. That ad-

vice became an authoritative departmental in-

terpretation, an administrative common law

applicable to Alaskan guide pilots. The FAA's

current doubts about the wisdom of the regula-

tory system followed in Alaska for more than

thirty years does not justify disregarding the

requisite procedures for changing that system.

177 F.3d at 1035.

The district court sought to distinguish the rule of

Alaska Professional Hunters on the grounds that the EB5

program did not have the same “long-standing history as

the system in [Alaska Professional Hunters],” and that the

lack of any “binding decisions” regarding the EB5 program

did not set forth a “settled course of adjudication from

which an irrational departure is not allowed.” App. at 6.

However, the interpretations of the EB5 regulations that

were relied upon by petitioner and its investors were both

long-standing and specific to petitioner’s program. These

interpretations were not “informal nonauthorative”

declarations, as were the “prior interpretations” alleged by

the appellants in Paralyzed Veterans of America v. D.C.

Arena L.P., 117 F.3d 579, 587 (D.C. Cir. 1997) (speech by

mid-level agency official).

The district court’s dismissal of the consequences of

the INS’ decision making, by characterizing it as “non-

binding” also overlooks the real effects of the agency’s

prior actions. In a more recent case, the D.C. Circuit

addressed an agencys argument that a “guidance”

document it had issued was not subject to the APA’s

rulemaking requirements because it was not “binding.” In

Appalachian Power Co. v. EPA, 208 F.3d 1015 (D.C. Cir.

2000), the court of appeals noted that:

A “legislative rule” is one the agency has duly

promulgated in compliance with the procedures

laid down in the statute or in the Administrative

Procedure Act. If this were all that “binding”

meant, EPA’s Periodic Monitoring Guidance

could not possibly qualify: it was not the product

of notice and comment rulemaking in accordance

with the Clean Air Act, 42 U.S.C. § 7607(d), and

it has not been published in the Federal Register.

But we have also recognized that an agency’s

other pronouncements can, as a practical matter,

have a binding effect. .. . If an agency acts as if a

document issued at headquarters is controlling

in the field, if it treats the document in the same

manner as it treats a legislative rule, if it bases

enforcement actions on the policies or interpreta-

tions formulated in the document, if it leads pri-

vate parties or State permitting authorities to

believe that it will declare permits invalid unless

they comply with the terms of the document,

then the agency’s document is for all practical

purposes “binding.”

——

208 F.3d at 1021 (footnotes and citations omitted). Here,

petitioner clearly viewed the INS’ designation of it as a

Regional Center as binding, in that any failure to comply

with the terms of the approved business plan could result

in termination of its participation in the Immigrant

Investor Pilot Program. 8 C.F.R. §204.6(m)(6). Equally, the

visa holders who invested in petitioner’s Regional Center

on the basis of the INS’ approval of their applications

viewed the terms of their visas as “binding.”

The district court’s findings also disregarded the

important fact that, over the course of nearly five years,

petitioner and its investors made large, and largely

irretrievable, investments in the form of property

purchases, architecture and engineering fees, and con-

struction costs in justifiable reliance on the agency’s

opinion letters and memoranda; the designation of the

petitioner as a Regional Center by the INS; and the

numerous approvals of program-specific visa petitions

submitted by petitioner’s investors by the INS.

A result similar to Alaska Professional Hunters Ass’n

was reached by the Ninth Circuit itself in Pfaff v. HUD, 88

F.3d 739 (9th Cir. 1996), which invalidated a new rule that

the Department of Housing and Urban Development

(HUD) had announced by adjudication, because the rule

was found to be broad, general, and prospective in applica-

tion, and because it was inconsistent with and departed

abruptly from HUD’s previous interpretations. The court

of appeals was especially troubled that “HUD has made

inconsistent and misleading representations to those

regulated ... and, in so doing, has led them down the

garden path.” 88 F.3d at 747. It went on to state:

The disadvantage to adjudicative procedures is

the lack of notice they provide to those subject to

the agency’s authority. While some measure of

retroactivity is inherent in any case-by-case

development of the law, and is not inequitable

Se ROR ee ene =

AS eR NO Re eee. neoene

per se, this problem grows more acute the fur-

ther the new rule deviates from the one before it.

Adjudication is best suited to incremental devel-

opments to the law, rather than great leaps for-

ward. The APA contains numerous mechanisms,

such as the notice and comment rulemaking pro-

cedure, by which the public is given notice of

proposed changes before they occur. See generally

APA § 552, 553, 557. For this reason, the Su-

preme Court has concluded that “rulemaking is

generally a better, fairer, and more effective

method of announcing a new rule than ad hoc

adjudication.” Community Television of S. Cal. v.

Gottfried, 459 U.S. 498, 511 103 S. Ct. 885, 893,

74 L. Ed. 2d 705 (1983).

Id. at 748. Significantly, even though Pfaff was decided

before the court of appeals decision in Chief Probation

Officers v. Shalala, it has not been overruled by that court.

Indeed, the court in Chief Probation Officers analyzed

several of its precedents in light of this Court’s decision in

Shalala v. Guernsey Memorial Hospital, 514 U.S. 87

(1995), and it did not overrule, distinguish, or even discuss

Pfaff.

The Fifth Circuit in Shell Offshore, Inc. v. Babbitt, 238

F.3d 622 (5th Cir. 2001) has explicitly adopted the ap-

proach of the D.C. Circuit in Alaska Professional Hunters

Ass’n. In Shell, the Interior Department’s Minerals

Management Service (MMS) had followed a policy since

1988 of allowing oil and gas lessees on the Outer Conti-

nental Shelf to deduct from their royalty payments the

costs of transporting oil and gas to the market. In the case

of producers such as Shell, which also owned its own

pipeline system, this transportation cost was represented

by the tariff that Shell had filed with the pipeline regula-

tory authority, the Federal Energy Regulatory Commission

(FERC). MMS’ policy from 1988 to approximately 1993

was to accept any pipeline tariff filed with FERC as being

“approved” by FERC. Beginning in 1994, however, MMS

questioned whether FERC actually had jurisdiction over

some of the pipelines that were being utilized by offshore

producers. Accordingly, MMS informed its lessees, by

sending “Dear Payor” letters to them, of an additional

requirement — that of disallowing the “tariff exception” for

transportation costs, unless the lessees first petitioned for

and received from FERC a determination of jurisdiction.

The Fifth Circuit found that the new MMS policy did

not directly or expressly contradict MMS’ existing regula-

tion setting forth the “approved by FERC” tariff policy.

Rather, the court of appeals found that it contradicted its

prior consistent interpretation of the regulation, 238 F.3d at

629, and that the change in policy had te be preceded by

notice and comment rulemaking. The court of appeals

found that the prior policy was substantive in nature, and

that the change in policy was substantive as well:

Even though Interior never set forth its interpre-

tation of section 206.105(b)(5)’s “approved. by

FERC” in a written statement, it was undeniably

its long established and consistently followed

practice to accept tariffs filed with FERC as “ap-

proved” for purposes of section 206.105(b)(5). An

agency that, as a practical matter, has enacted a

new substantive rule cannot evade the notice and

comment requirements of the APA by avoiding

written statements or other “official” interpreta-

tions of a given regulation. If a new agency policy

represents a significant departure from long

established and consistent practice that substan-

tially affects the regulated industry, the new pol-

icy is a new substantive rule and the agency is

obliged, under the APA, to submit the change for

notice and comment. If Interior wishes to change

its established practices and procedures in a

manner that so significantly affects OCS lessees,

it must give them notice and an opportunity to

comment on the proposed change. Interior’s new

practice may be a reasonable change in its over-

sight practices and procedures, but it places a

new and substantial requirement on many OCS

lessees, was a significant departure from long

established and consistent past practice, and

should have been submitted for notice and

comment before adoption. Interior’s new -inter-

pretation of “approved by [FERC]” in section

206.105(b)(5) accordingly meets the require-

ments for a new legislative rule under the APA.

238 F.3d at 630 (emphasis added, footnotes omitted).

The lesson to be drawn from the Alaska Professional

Hunters Ass’n, Pfaff and Shell Offshore cases is clear: If

the INS decides that its existing regulatory negime for the

EB5 program is not accomplishing the statutory purpose,

it is of course entitled to change the rules — but in the

manner provided for by the APA, and not with retroactive

application to those who have in good faith relied upon the

agency's prior pronouncements. The rigid rule set forth by

“he Ninth Circuit in Chief Probation Officers v. Shalala

invites abuse by administrative agencies that may enact

substantial changes in the programs they administer if, by

artful drafting, they are able to pass off their new policies

as mere changes in interpretations of existing regulations,

rather than the substantive changes that they actually

effect.

This Court should accept review of this case to resolve

the conflicts that exists between the circuits. To leave this

conflict unresolved will lead to forum-shopping among the

different circuits. In some cases, it will lead to inconsistent

results even for parties in the same geographical area,

depending on which court they seek review in.

B. The INS’ Retroactive Application of the

Izumii Decisions to the Petitioner and Its

Investors Constitutes Arbitrary and Ca-

pricious Decisionmaking

The INS clearly signaled its intention to apply the

Izumii decisions in adjudicating petitions to adjust

previously filed petitions and petitions to remove condi-

tions from the permanent resident status of, among

others, the petitioner’s investors. This Court should bar

the application of those decisions to petitioner’s investors

who are in the process of petitioning for the removal of

their conditional status. Because the investment program

of those investors was approved by the INS under its then-

existing regulations when their I-526 petitions were

approved, and they made substantial investments on the

basis of those approvals, the application of this new

regulatory regime to those investors in the adjudication of

their I-829 petitions constitutes the retroactive application

of the new agency policy. As such, it is an arbitrary and

capricious action under the APA.

1. Retroactive Application of New Rules

Is Not Favored Under the Law

There is a presumption against the retroactive

application of new laws that “‘is deeply rooted in our

jurisprudence, and embodies a legal doctrine centuries

older than our Republic’. . .. The specific prohibition on ex

post facto laws is only one aspect of the broader constitu-

tional protection against arbitrary changes in the law. In

both the civil and the criminal context, the Constitution

places limits on the sovereign’s ability to use its law

making power to modify bargains it has made with its

subjects.” Lynce v. Mathis, 519 U.S. 433 (1997) (quoting

Landgraf v. USI Film Products, 511 U.S. 244, 265 (1994)).

Moreover, the APA itself defines “rules” as having only

“future effect.” 5 U.S.C. § 551(4).

2. The INS Lacks Statutory Authority to

Engage in Retroactive Rulemaking

Retroactive rulemaking is therefore disfavored, and

the requirements for allowing it are quite high. A statute

authorizing rulemaking “will not, as a general matter, be

understood to encompass the power to promulgate

retroactive rules unless that power is conveyed by Con-

gress in express terms. [citation omitted] Even where

some substantial justification for retroactive rulemaking is

presented, courts should be reluctant to find such author-

ity absent an express statutory grant.” Bowen v. George-

town University Hospital, 488 U.S. 204, 208-09 (1988). The

Immigration and Naturalization Act of 1990, which was

comprehensively revised and enacted two years after the

Supreme Court’s decision in Bowen, contains no such

express authority.’ Presumably, Congress was aware of

* The only rulemaking authority that specifically addresses the

immigrant investor program is Section 203(b)(5)(C) of the Immigration

and Naturalization Act, which authorizes the Attorney General, in

consultation with the Secretary of Labor and the Secretary of State, to

(Continued on following page)

Bowen when it passed the INA in 1990 and chose to not

grant retroactive rulemaking authority to the INS.

Since there is no express authority for retroactive

rulemaking, this Court must determine whether the new

rule will have retroactive effect. Landgraf, supra, set forth

the “judicial default rules” for this determination: A new

rule 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.” Landgraf, 511 U.S. at

280, 114 S.Ct. at 1505. The new standards set forth in the

Izumii_ decisions, which imposed several additional

requirements that impair the rights and increase the

liability of petitioner’s investors regarding actions they

have undertaken over the past two years, clearly meet this

test.

In particular, application of the “income tracing” rules

enunciated in Izumii to petitioner’s investors who hold

conditional permanent resident status, and are faced with

petitioning in the near future to have their conditional

status removed, represents one of the most egregious

abuses of the INS’ rulemaking by adjudication. In most

cases, those petitioners invested their funds more than

two years ago, and the INS expressed no qualms about the

source of those funds when it approved their petitions.

Now, they are faced with reconstructing banking transac- |

tions that took place several years ago, in another country,

involving banks and other financial institutions that they

may no longer have any relationships with. It is precisely

prescribe regulations increasing the dollar amount of capital to be

invested by an immigrant investor. 8 U.S.C. § 1153(b\5)(C).

Oe llLlmlmltt—~—“—C—S

this sort of injustice that the rule against retroactive

rulemaking is supposed to prevent.

Finally, the INS has made no showing of what

statutory interest will be advanced by applying the Izumii

decisions retroactively, other than cryptic references to

“some investment programs” being used to circumvent the

Immigration and Naturalization Act.

CONCLUSION

For the foregoing reasons, the petition for writ of

certiorari should be granted.

Respectfully submitted,

CHARLES E. ALBERTSON

Counsel of Record

FORSBERG & UMLAUF, PS.

900 Fourth Avenue, Ste. 1700

Seattle, Wash. 98164

App. 1

NOT FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

GOLDEN RAINBOW No. 00-36020

FREEDOM FUND, a D.C. No.

Washington Limited CV-99-00755-JCC

Partnership, MEMORANDUM’

Plaintiff-Appellant,

(Filed Nov. 26, 2001)

JOHN ASHCROFT,”

Attorney General of the

United States,

)

Defendant-Appellee. )

Appeal from the United States District Court

for the Western District of Washington

John C. Coughenour, District Judge, Presiding

Argued and Submitted November 6, 2001

San Francisco, California

Before. FERNANDEZ, RYMER, and WARDLAW, Circuit

Judges.

* This disposition is not appropriate for publication and may not be

cited to or by the courts. of this circuit except as provided by Ninth

Circuit Rule 36-3.

“ John Ashcroft is substituted for his predecessor, Janet Reno, as

Attorney General of the United States. Fed. R. App. P. 43(c)(2).

App. 2

Golden Rainbow Freedom Fund, a Washington limited

partnership, brought this action for the purpose of

challenging the Immigration and Naturalization Service’s

implementation of the Immigrant Investor Program, 8

U.S.C. § 1153(b)(5), and the associated Immigrant Inves-

tor Pilot Program, Pub. L. No. 102-395, § 610, 106 Stat.

1874 (1992), as amended Pub. L. No. 105-119, § 116(a),

111 Stat. 2467 (1997), and Pub. L. No. 106-396, § 402, 114

Stat. 1647 (2000). The district court granted summary

judgment to the INS and Golden Rainbow appealed. We

affirm.

First, we agree with Golden Rainbow that it has

standing to assert is own claim for harm that it has

allegedly suffered by reason of the position of the INS. See

Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61, 112 S.

Ct. 2130, 2136, 119 L. Ed. 2d 351 (1992); Yesler Terrace

Cmty. Council v. Cisneros, 37 F.3d 442, 445-46 (9th Cir.

1994); Pac. N.W. Generating Coop. v. Brown, 38 F.3d 1058,

1065-66 (9th Cir. 1994). That is true, even to the extent

that its harm flows from the INS’s actions toward third

parties — the immigrant investors.’ See Parks Sch. of Bus.,

Inc. v. Symington, 51 F.3d 1480, 1487-88 (9th Cir. 1995).

Second, we affirm the district court’s decision on the

merits for the reasons set forth in our decision in R.L.

Investment Limited Partners v. INS, No. 00-15627, slip op.

15813 (9th Cir. Nov. 20, 2001).

However, one question raised here, but not properly

raised in R.L., requires special notice. That is retroactiv-

' At argument, Golden Rainbow made it clear that it does not

purport to represent those parties themselves on appeal.

App. 3

ity. Clearly, retroactivity is the rule in adjudication,-and

“[elvery case of first impression has a retroactive effect,

whether the new principle is announced by a court or by

an administrative agency.” SEC v. Chenery Corp., 332 U.S.

194, 203, 67 S. Ct. 1575, 1581, 91 L. Ed. 1995 (1947). Of

course, the mischief that a retroactive rule corrects must

be balanced against the harm it might cause. See id.;

Montgomery Ward & Co., Inc. v. FTC, 691 F.2d 1322,

1328, 1333 (9th Cir. 1982).

No doubt, Golden Rainbow and the alien investors did

rely on the non-precedential position of the INS, and may

suffer on that account. But there had been no formal

determination at the time, and they had to know that any

initial approval was conditional. There could be no closure

until there had been a second petition for removal of the

condition, and a showing of compliance was required at

that time. See 8 U.S.C. § 1186b(c)(1) & (d)(1). The long and

short of it is that they lost their gamble that Golden

Rainbow’s creative financing approach would manage to

get through the whole process. The INS finally acted to

prevent a perversion of the program contemplated in the

statutes and the regulations. The mischief that was

avoided far outweighed any detriment to Golden Rainbow

or anyone else. In other words, retroactivity was not

inappropriate.

AFFIRMED.

App. 4

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF WASHINGTON

AT SEATTLE

GOLDEN RAINBOW FREEDOM CASE NO.

FUND, C99-0755C

Plaintiff, ORDER

v. (Filed Sep. 13, 2000)

JANET RENO,

Defendant.

This matter comes before the Court on the parties

cross-motions for summary judgment. The material facts

in this case are not disputed by the parties and are laid

out in the underlying briefs. For the reasons detailed

below, Defendant’s motion for summary judgment is

GRANTED and Plaintiffs motion for summary judgment

is DENIED.

I. SUMMARY JUDGMENT

Rule 56 states that a party is entitled to summary

judgment “if the pleadings, depositions, answers to

interrogatories, and admissions on file, together with the

affidavits, if any, show that there is no genuine issue as to

any material fact and that the moving party is entitled to

a judgment as a matter of law.” Fed.R.Civ.P. 56(c). The

nonmoving party, if it has the burden of proof at trial, -

must present evidence sufficient to raise a genuine issue

for trial. See Celotex Corp v. Catreet, 477 U.S. 317, 322

(1986). See also Adickes v. S.H. Kress & Co., 398 U.S. 144,

154 (1970). In determining whether an issue of fact exists,

all evidence and reasonable inferences must be viewed in

the light most favorable to the nonmoving party. See

Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986).

App. 5

Il. DISCUSSION

The central issue in this case is whether the INS (the

“Service”) legitimately issued adjudicatory decisions that

were merely “interpretive” and therefore exempt from the

rulemaking notice and comment procedure of the Adminis-

trative Procedure Act (“APA”). This is certainly net the

first time that a court has been confronted with the

rulemaking v. interpretive decision issue that arises out of

numerous administrative actions, nor is this the first time

a federal court has issued a ruling regarding the immi-

grant investor statute that is presently before this

Court. See R.L. Investment Limited Partners v. INS, 86

F.Supp.2d 1014 (D.Hawaii 2000). This Court finds judge

Mollway’s analysis and holding, that INS’s issuance of the

precedent decisions (“Izumii”) did not violate the APA or

involve rulemaking, to be highly persuasive. Id.

Plaintiff argues that the INS substantially changed

various key provisions of the Immigrant Investor Pilot

Program regulations by way of the Jzumii decisions.

Although it is clear to this Court that the plaintiff de-

signed its program based upon a different interpretation of

the governing regulations than that applied by Izumii, and

although the plaintiff received prior positive feedback from

the Service regarding its program design, the law is clear

that the “prior approvals simply represented the Agency’s

prior (short-lived) interpretation of the statute .. . [which]

[t]he Agency was free to change.” Chief Probation Officers

v. Shalala, 118 F.3d 1327, 1334 (9th Cir. 1997).

Unlike the “facially-clear” regulation in Patel that was

passed after a comment period in which the Service

expressly discarded the very requirement that was later

sought to be added by way of an adjudicatory decision, the

regulations at issue in this case already contained kernels

of guidance upon which the Administrative Appeals Office

App. 6

issued decisions interpreting the language in light of the

specific facts of the selected cases before it. Patel v. INS,

638 F.2d 1199 (9th Cir. 1980). The Service must be

allowed to apply the intent of Congress as put forth in

skeleton, albeit never completely comprehensive, language

of the statute with due regard for the practicalities of

administering that intent on a case-by-case basis. This is

precisely why the Supreme Court mandates that, “consid-

erable weight should be accorded to an executive depart-

ment’s construction of a statutory scheme it is entrusted to

administer, and the principle of deference to administra-

tive interpretations.” Chevron U.S.A., Inc. v. Natural

Resources Defense Council, Inc., 467 U.S. 837, 844 (1984).

The 9th Circuit makes it clear that “there is no steadfast

rule of unreviewability in the immigration context,”

nevertheless, it also stated that, “[oJur review is especially

deferential in the context of immigration policy.” Socop-

Gonzalez v. INS, 208 F.3d 838, 845 (9th Cir. 2000), Jang v.

Reno, 113 F.3d 1074, 1077 (9th Cir. 1997). Plaintiffs

attempts to build a list of instances where the Service had

developed what it argues is a “consistent expression of

agency policy, the abrupt departure from which is not”

allowed, simply fails when analyzed according to the law.

Plaintiffs brief pg. 4. The Immigrant Investor Pilot

Program did not have the same long-standing history as

the system in Alaska Professional Hunters Ass’n, Inc. v.

FAA, 177 F.3d 1030 (D.C. Cir. 1999), nor had there been

any binding decisions regarding the program that set forth

a settled course of adjudication from which an irrational

departure is not allowed. Socop-Gonzalez at 844. Until

there is a binding decision, this Court must heed the

admonishment of the 9th Circuit to reject “the rigid view

that an agency may not alter its interpretation in light of

administrative experience.” Pacific First Federal Savings

14 bia Nabe hn diss acai ait

App. 7

Bank v. Commission of IRS, 961 F.2d 800, 804 (9th Cir.

1992).

Contrary to what the plaintiff claims, “[a]djudicated

cases may and do, of course, serve as vehicles for the

formulation of agency policies, which are applied and

announced therein.” NLRB v. Wyman-Gordon Co., 394

U.S. 759, 765 (1969). The simple fact that the present

policy of the INS is different from that of an earlier policy,

as the plaintiff argues, does not automatically mean that

the Service must submit it to the public for notice and

comment. Administrative agencies are accorded the

ability, within certain guidelines, to announce and apply

new standards through adjudication without submitting

them to notice and comment. NLRB v. Bell Aerospace Co.,

416 U.S. 267, 290-5 (1974). This Court finds that by

issuing the Jzumii decisions the Service did not abuse its

discretion in choosing to rely upon the APA “interpretive”

decisions exception to the notice and comment procedure.

Furthermore, the retroactive application of the Izumii

decisions, as applied to Plaintiff, will not be disturbed.

Therefore, the Court GRANTS Defendant’s motion for

summary judgment, and DENIES Plaintiffs motion for

summary judgment.

SO ORDERED this 12 day of September, 2000.

/s/ John C. Coughenour

John C. Coughenour

Chief United States

District Judge

App. 8

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF WASHINGTON

AT SEATTLE

GOLDEN RAINBOW FREEDOM

FUND,

Plaintiff,

JANET RENO,

Defendant.

CASE NO. C99-755C

JUDGMENT ON

DECISION BY

THE COURT

(Filed Sep. 18, 2000)

This action came on for consideration before the court,

United States District Judge John C. Coughenour presid-

ing. The issues having been duly considered and a decision

having been duly rendered,

IT IS ORDERED AND ADJUDGED

The Court GRANTS Defendant’s motion for summary

judgment, and DENIES

Plaintiffs motion for summary judgment.

DATED this 18th day of September, 2000.

BRUCE RIFKIN

Clerk of the Court

/s/ Stacy Lee Stapleton

By Stacy Lee Stapleton,

Deputy Clerk of Court

App. 9

NOT FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

GOLDEN RAINBOW ) No. 00-36020

FREEDOM FUND, a ) D.C. No.

Washington Limited ) CV-99-00755-JCC

Partnership, ) ORDER DENYING

Plaintiff-Appellant, |) PETITION FOR REHEAR-

v. ) ING AND PETITION FOR

JOHN ASHCROFT, REHEARING EN BANC

Attorney General of the

United States, ) (Filed Feb. 11, 2002)

Defendant-Appellee.

Before: FERNANDEZ, RYMER, and WARDLAW, Circuit

Judges. |

The panel has unanimously voted to deny the appel-

lant’s petition for rehearing. The petition for rehearing en

banc was circulated to the judges of the court, and no

judge requested a vote for en banc consideration.

The petition for rehearing and the petition for

rehearing en banc are DENIED.

App. 10

5 U.S.C. Sec. 551. Definitions

* * *

e (4) “rule” means the whole or a part of an agency

statement of general or particular applicability

and future effect designed to implement, inter-

pret, or prescribe law or policy or describing the

organization, procedure, or practice requirements

of an agency and includes the approval or pre-

scription for the future of rates, wages, corporate

or financial structures or reorganizations thereof,

prices, facilities, appliances, services or allow-

ances therefor or of valuations, costs, or account-

ing, or practices bearing on any of the foregoing;

e (5) “rule making” means agency process for formu-

lating, amending, or repealing a rule;

* * *

5 U.S.C. Sec. 553. Rule making

* * *

¢ (b) General notice of proposed rule making shall

be published in the Federal Register, unless per-

sons subject thereto are named and either person-

ally served or otherwise have actual notice thereof

in accordance with law. The notice shall include —

° (1) a statement of the time, place, and nature

ef public rule making proceedings;

° (2) reference to the legal authority under

which the rule is proposed; and

App. 11

(3) either the terms or substance of the pro-

posed rule or a description of the subjects and

issues involved. Except when notice or hear-

ing is required by statute, this subsection

does not apply —

* (A) to interpretative rules, general

| statements of policy, or rules of agency

organization, procedure, or practice; or

* (B) when the agency for good cause

finds (and incorporates the finding

and a brief statement of reasons there-

for in the rules issued) that notice and

public procedure thereon are impracti-

cable, unnecessary, or contrary to the

public interest.

° (c) After notice required by this section, the

agency shall give interested persons an opportu-

nity to participate in the rule making through

submission of written data, views, or arguments

with or without opportunity for oral presentation.

After consideration of the relevant matter pre-

sented, the agency shall incorporate in the rules

adopted a concise general statement of their basis

and purpose. When rules are required by statute

to be made.on the record after opportunity for an

agency hearing, sections 556 and 557 of this title

apply instead of this subsection.

* * *

App. 12

8 U.S.C. Sec. 1153. Allocation of immigrant visas

a. *

(b) Preference allocation for employment-based

immigrants

Aliens subject to the worldwide level specified in

section 1151(d) of this title for employment-based

immigrants in a fiscal year shall be allotted visas

as follows:

* *

° (5) Employment creation

e (A) In general

Visas shall be made available, in a

number not to exceed 7.1 percent of

such worldwide level, to qualified

immigrants seeking to enter the

United States for the purpose of en-

gaging in a new commercial enter-

prise —

(i) which the alien has estab-

lished,

(ii) in which such alien has in-

vested (after November 29,

1990) or, is actively in the proc-

ess of investing, capital in an

amount not less than the

amount specified in subpara-

graph (C), and

(iii) which will benefit the

United States economy and

create full-time employment for

not fewer than 10 United

States citizens or aliens law-

App. 13

fully admitted for permanent

residence or other immigrants

lawfully authorized to be em-

ployed in the United States

(other than the immigrant and

the immigrant’s spouse, sons,

j or daughters).

* (B) Set-aside for targeted employment

areas

¢ (i) In general

Not less than 3,000 of the visas

made available under this

paragraph in each fiscal year

shall be reserved for qualified

immigrants who establish a

new commercial enterprise de-

scribed in subparagraph (A)

which will create employment

in a targeted employment area.

* (ii) “Targeted employment

area” defined

In this paragraph, the term

“targeted employment area”

means, at the time of the in-

vestment, a rural area or an

area which has experienced

high unemployment (of at least

150 percent of the national

average rate).

¢ (iii) “Rural area” defined

In this paragraph, the term

“rural area” means any area

other than an area within a

metropolitan statistical area or

App. 14

within the outer boundary of

any city or town having a popu-

lation of 20,000 or more (based

on the most recent decennial

census of the United States).

e (C) Amount of capital required

(i) In general

Except as otherwise provided

in this subparagraph, the

amount of capital required un-

der subparagraph (A) shall be

$1,000,000. The Attorney Gen-

eral, in consultation with the

Secretary of Labor and the Sec-

retary of State, may from time

to time prescribe regulations

increasing the dollar amount

specified under the previous

sentence.

(ii) Adjustment for targeted

employment areas

The Attorney General may, in

the case of investment made in

a targeted employment area,

specify an amount of capital

required under subparagraph

- (A) that is less than (but not

less than '% of) the amount

specified in clause (i).

(iii) Adjustment for high em-

ployment areas

In the case of an investment

made in a part of a metropoli-

App. 15

tan statistical area that at the

time of the investment —

e (I) is not a targeted employment area,

and

(II) is an area with an unemployment

rate significantly below the national

average unemployment rate, the At-

torney General may specify an amount

of capital required under subpara-

graph (A) that is greater than (but not

greater than 3 times) the amount

specified in clause (i).

* * *

8 C.F.R. § 204.6 Petitions for employment creation

aliens.

* * *

(e) Definitions. As used in this section:

Capital means cash, equipment, inventory, other

tangible property, cash equivalents, and indebtedness

secured by assets owned by the alien entrepreneur,

provided that the alien entrepreneur is personally and

primarily liable and that the assets of the new commercial

enterprise upon which the petition is based are not used to

secure any of the indebtedness. All capital shall be valued

at fair market value in United States dollars. Assets

acquired, directly or indirectly, by unlawful means (such

as criminal activities) shall not be considered capital for

the purposes of section 203(b)(5) of the Act.

App. 16

Commercial enterprise means any for-profit activity

formed for the ongoing conduct of lawful business includ-

ing, but not limited to, a sole proprietorship, partnership

(whether limited or general), holding company, joint

venture, corporation, business trust, or other entity which

may be publicly or privately owned. This definition

includes a commercial enterprise consisting of a holding

company and its wholly-owned subsidiaries, provided that

each such subsidiary is engaged in a for-profit activity

formed for the ongoing conduct of a lawful business. This

definition shall not include a noncommercial activity such

as owning and operating a personal residence.

Employee means an individual who provides services

or labor for the new commercial enterprise and who

receives wages or other remuneration directly from the

" new commercial enterprise. In the case of the Immigrant

Investor Pilot Program, “employee” also means an individ-

ual who provides services or labor in a job which has been

created indirectly through investment in the new commer-

cial enterprise. This definition shall not include independ-

ent contractors.

Full-time employment means employment of a

qualifying employee by the new commercial enterprise in a

position that requires a minimum of 35 working hours per

week. In the case of the Immigrant Investor Pilot Pro-

gram, “full-time employment” also means employment of a

qualifying employee in a position that has been created

indirectly through revenues generated from increased

exports resulting from the Pilot Program that requires a

minimum of 35 working hours per week. A job-sharing

arrangement whereby two or more qualifying employees

share a full-time position shall count as full-time employ-

ment provided the hourly requirement per week is met.

App. 17

This definition shall not include combinations of part-time

positions even if, when combined, such positions meet the

hourly requirement per week.

High employment area means a part of a metropolitan

statistical area that at the time of investment:

(i) Is not a targeted employment aree; and

(ii) Is an area with an unemployment rate signifi-

cantly below the national average unemployment rates.

Invest means to contribute capitai. A contribution of

capital in exchange for a note, bond, convertible debt,

obligation, or any other debt arrangement between the

alien entrepreneur and the new commercial enterprise

does not constitute a contribution of capital fer the

purposes of this part.

New means established after November 29, 1990.

Qualifying employee means a United States citizen, a

lawfully admitted permanent resident, or other immigrant

lawfully authorized to be employed in the United States

including, but not limited to, a conditional resident, a

temporary resident, an asylee, a refugee, or an alien

remaining in the United States under suspension of

deportation. This definition does not include the alien

entrepreneur, the alien entrepreneur’s spouse, sons, or

daughters, or any nonimmigrant alien.

Regional center means any economic unit, public or

private, which is involved with the promotion of economic

growth, including increased export sales, improved

regional productivity, job creation, and increased domestic

capital investment.

App. 18

Rural area means any area not within either a

metropolitan statistical area (as designated by the Office

of Management and Budget) or the outer boundary of any

city or town having a population of 20,000 or more.

Targeted employment area means an area which, at

the time of investment, is a rural area or an area which

has experienced unemployment of at least 150 percent of

the national average rate.

Troubled business means a business that has been in

existence for at least two years, has incurred a net loss for

accounting purposes (determined on the basis of generally

accepted accounting principles) during the twelve- or

twenty-four month period prior to the priority date on the

alien entrepreneurs Form I-526, and the loss for such

period is at least equal to twenty percent of the troubled

business’s net worth prior to such loss. For purposes of

determining whether or not the troubled business has

been in existence for two years, successors in interest to

the troubled business will be deemed to have been in

existence for the same period of time as the business they

succeeded.

* * *

(j) Initial evidence to accompany petition. A petition

submitted for classification as an alien entrepreneur must

be accompanied by evidence that the alien has invested or

is actively in the process of investing lawfully obtained

capital in a new commercial enterprise in the United

States which will create full-time positions for not fewer

than 10 qualifying employees. In the case of petitions

submitted under the Immigrant Investor Pilot Program, a

petition must be accompanied by evidence that the alien

has invested, or is actively in the process of investing,

App. 19

capital obtained through lawful means within a regional

center designated by the Service in accordance with

paragraph (m)(4) of this section. The petitioner may be

required to submit information or documentation that the

Service deems appropriate in addition to that listed below.

(1) To show that a new commercial enterprise has

been established by the petitioner in the United States,

the petition must be accompanied by:

(i) As applicable, articles of incorporation, certificate

of merger or consolidation, partnership agreement,

certificate of limited partnership, joint venture agreement,

business trust agreement, or other similar organizational

document for the new commercial enterprise;

(ii) A certificate evidencing authority to do business

in a state or municipality or, if the form of the business

does not require any such certificate or the State or

municipality does not issue such a certificate, a statement

to that effect; or

(iii) Evidence that, as of a date certain after Novem-

ber 29, 1990, the required amount of capital for the area in

which an enterprise is located has been transferred to an

existing business, and that the investment has resulted in

a substantial increase in the net worth or number of

employees of the business to which the capital was

transferred. This evidence must be in the form of stock

purchase agreements, investment agreements, certified

financial reports, payro!l] records, or any similar instru-

ments, agreements, or documents evidencing the invest-

ment in the commercial enterprise and the resulting

substantial change in the net worth, number of employees.

aii ie ilo,

App. 20

(2) To show that the petitioner has invested or is

actively in the process of investing the required amount of

capital, the petition must be accompanied by evidence that

the petitioner has placed the required amount of capital at

risk for the purpose of generating a return on the capital

placed at risk. Evidence of mere intent to invest, or of

prospective investment arrangements entailing no present

commitment, will not suffice to show that the petitioner is

actively in the process of investing. The alien must show

actual commitment of the required amount of capital.

Such evidence may include, but need not be limited to:

(i) Bank statements showing amount(s) deposited in

United States business account(s) for the enterprise;

(ii) Evidence of assets which have been purchased

for use in the United States enterprise, including invoices,

sales receipts, and purchase contracts containing sufficient

information to identify such assets, their purchase costs,

date of purchase, and purchasing entity;

(iii) Evidence of property transferred from abroad for

use in the United States enterprise, including United

States Customs Service commercial entry documents, bills

of lading, and transmit insurance policies containing

ownership information and sufficient information to

identify the property and to indicate the fair market value

of such property;

(iv) Evidence of monies transferred or committed to

be transferred to the new commercial enterprise in

exchange for shares of stock (voting or non-voting, com-

mon or preferred). Such stock may not include terms

requiring the new commercial enterprise to redeem it at

the holder’s request; or

App. 21

(v) Evidence of any loan or mortgage agreement,

promissory note, security agreement, or other evidence of

borrowing which is secured by assets of the petitioner,

other than those of the new commercial enterprise, and for

which the petitioner is personally and primarily liable.

(3) To show that the petitioner has invested, or is

actively in the process of investing, capital obtained

through lawful means, the petition must be accompanied,

as applicable, by:

(i) Foreign business registration records;

(ii) Corporate, partnership (or any other entity in

any form which has filed in any country or subdivision

thereof any return described in this subpart), and personal

tax returns including income, franchise, property (whether

real, personal, or intangible), or any other tax returns of

any kind filed within five years, with any taxing jurisdic-

tion in or outside the United States by or on behalf of the

petitioner;

(iii) Evidence identifying any other source(s) of

capital; or

(iv) Certified copies of any judgments or evidence of

all pending governmental civil or criminal actions,

governmental administrative proceedings, and any private

civil actions (pending or otherwise) involving monetary

judgments against the petitioner from any court in or

outside the United States within the past fifteen years.

(4) Job creation — (i) General. To show that a new

commercial enterprise will create not fewer than ten (10)

full-time positions for qualifying employees, the petition

must be accompanied by:

———————————————

App. 22

(A) Documentation consisting of photocopies of

relevant tix records, Form I-9, or other similar documents

for ten (10) qualifying employees, if such employees have

already been hired following the establishment of the new

commercial enterprise; or

(B) Acopy of a comprehensive business plan showing

that, due to the nature and projected size of the new

commercial enterprise, the need for not fewer than ten

(10) qualifying employees will result, including approxi-

mate dates, within the next two years, and when such

employees will be hired.

(ii) Troubled business. To show that a new commer-

cial enterprise which has been established through a

capital investment in a troubled business meets the

statutory employment creation requirement, the petition

must be accompanied by evidence that the number of.

existing employees is being or will be maintained at no

less than the pre-investment level for a period of at least

two years. Photocopies of tax records, Forms I-9, or other

relevant documents for the qualifying employees and a

comprehensive business plan shall be submitted in

support of the petition.

(iii) Immigrant Investor Pilot Program. To show that

the new commercial enterprise located within a regional

center approved for participation in the Immigrant

Investor Pilot Program meets the statutory employment

creation requirement, the pe’ on must be accompanied

by evidence that the investment will create full-time

positions for not fewer than 10 persons either directly or

indirectly through revenues generated from increased

exports resulting from the Pilot Program. Such evidence

may be demonstrated by reasonable methodologies

ae ee ee ae ee? a

App. 23

including those set forth in paragraph (m)(3) of this

section.

(5) To show that the petitioner is or will be engaged

in the management of the new commercial enterprise,

either through the exercise of day-to-day managerial

control or through policy formulation, as opposed to

maintaining a purely passive role in regard to the invest-

ment, the petition must be accompanied by:

(i) A statement of the position title that the peti-

tioner has or will have in the new enterprise and a

complete description of the position’s duties;

(ii) Evidence that the petitioner is a corporate officer

or a member of the corporate board of directors; or

(iii) If the new enterprise is a partnership, either

limited or general, evidence that the petitioner is engaged

in either direct management or policy making activities.

For purposes of this section, if the petitioner is a limited

partner and the limited partnership agreement provides

the petitioner with certain rights, powers, and duties

normally granted to limited partners under the Uniform

Limited Partnership Act, the petitioner will be considered

sufficiently engaged in the management of the new

commercial enterprise.

(6) If applicable, to show that the new commercial

enterprise has created or will create employment in a

targeted employment area, the petition must be accompa-

nied by:

(i) In the case of a rural area, evidence that the new

commercial enterprise is principally doing business within

a civil jurisdiction not located within any standard

metropolitan statistical area as designated by the Office of

App. 24

Management and Budget, or within any city or town

having a population of 20,000 or more as based on the

most recent decennial census of the United States; or

(ii) In the case of a high unemployment area:

(A) Evidence that the metropolitan statistical area,

the specific county within a metropolitan statistical area,

or the county in which a city or town with a population of

20,000 or more is located, in which the new commercial

enterprise is principally doing business has experienced

an average unemployment rate of 150 percent of the

national average rate; or

(B) A letter from an authorized body of the govern-

ment of the state in which the new commercial enterprise

is located which certifies that the geographic or political

subdivision of the metropolitan statistical area or of the

city or town with a population of 20,000 or more in which

the enterprise is principally doing business has been

designated a high unemployment area. The letter must

meet the requirements of 8 CFR 204.6(i).

* * *

(m) Immigrant Investor Pilot Program — (1) Scope.

The Immigrant Investor Pilot Program is established

solely pursuant to the provisions of section 610 of the

Departments of Commerce, Justice, and State, the

Judiciary, and Related Agencies Appropriation Act, and

subject to all conditions and restrictions stipulated in that

section. Except as provided herein, aliens seeking to

obtain immigration benefits under this paragraph con-

tinue to be subject to all conditions and restrictions set

forth in section 203(b)(5) of the Act and this section.

errs ene

Sarwe x

ba RRS Es fa ) SY aC

App. 25

(2) Number of immigrant visas allocated. The annual

allocation of the visas available under the Immigrant

Investor Pilot Program is set at 300 for each of the five

fiscal years commencing on October 1, 1993.

(3) J equirements fur regional centers. Each regional

center wishing to participate in the Immigrant Investor

Pilot Program shall submit a proposal to the Assistant

Commissioner for Adjudications, which:

(i) Clearly describes how the regional center focuses

on a geographical region of the United States, and how it

will promote economic growth through increased export

sales, improved regional productivity, job creation, and

increased domestic capital investment;

(ii) Provides in verifiable detail how jobs will be

created indirectly through increased exports;

(iii) Provides a detailed statement regarding the

amount and source of capital which has been committed to

the regional center, as well as a description of the promo-

tional efforts taken and planned by the sponsors of the

regional center;

(iv) Contains a detailed prediction regarding the

manner in which the regional center will have a positive

impact on the regional or national economy in general as

reflected by such factors as increased household earnings,

greater demand for business services, utilities, mainte-

nance and repair, and construction both within and

without the regional center; and

(v) Is supported by economically or statistically valid

forecasting tools, including, but not limited to, feasibility

studies, analyses of foreign and domestic markets for the

goods or services to be exported, and/or multiplier tables.

App. 26

(4) Submission of proposals to participate in the

Immigrant Investor Pilot Program. On August 24, 1993,

the Service will accept proposals from regional centers

seeking approval to participate in the Immigrant Investor

Pilot Program. Regional centers that have been approved

by the Assistant Commissioner for Adjudications will be

eligible to participate in the Immigrant Investor Pilot

Program.

(5) Decision to participate in the Immigrant Investor

Pilot Program. The Assistant Commissioner for Adjudica-

tions shall notify the regional center of his or her decision

on the request for approval to participate in the Immi-

grant Investor Pilot Program, and, if the petition is

denied, of the reasons for the denial and of the regional

center’s right of appeal to the Associate Commissioner for

Examinations. Notification of denial and appeal rights,

and the procedure for appeal shall be the same as those

contained in 8 CFR 103.3.

(6) Termination of participation of regional centers.

To ensure that regional centers continue to meet the

requirements of section 610(a) of the Appropriations Act,

the Assistant Commissioner for Adjudications shall issue a

notice of intent to terminate the participation of a regional

center in the pilot program upon a determination that the

regional center no longer serves the purpose of promoting

economic growth, including increased export sales,

improved regional productivity, job creation, and increased

domestic capital investment. The notice of intent to

terminate shall be made upon notice to the regional center

and shall set forth the reasons for termination. The

regional center must be provided thirty days from receipt

of the notice of intent to terminate to offer evidence in

opposition to the ground or zrounds alleged in the notice of

App. 27

intent to terminate. If the Assistant Commissioner for

Adjudications determines that the regional center’s

participation in the Pilot Program should be terminated,

the Assistant Commissioner for Adjudications shall notify

the regional center of the decision and of the reasons for

termination. The regional center may appeal the decision

within thirty days after the service of notice to the

Associate Commissioner for Examinations as provided in 8

CFR 103.3.

(7) Requirements for alien entrepreneurs. An alien

seeking an immigrant visa as an alien entrepreneur under

the Immigrant Investor Pilot Program must demonstrate

that his or her qualifying investment is within a regional

center approved pursuant to paragraph (m)(4) of this

section and that such investment will create jobs indi-

rectly through revenues generated from increased exports

resulting from the new commercial enterprise.

(i) Exports. For purposes of paragraph (m) of this

section, the term “exports” means services or goods which

are produced directly or indirectly through revenues

generated from a new commercial enterprise and which

are transported out of the United States;

(ii) Indirect job creation. To show that 10 or more

jobs are actually created indirectly by the business,

reasonable methodologies may be used. Such methodolo-

gies may include multiplier tables, feasibility studies,

analyses of foreign and domestic markets for the goods or

services to be exported, and other economically or statisti-

cally valid forecasting devices which indicate the likeli-

hood that the business will result in increased

employment.

App. 28

(8) Time for submission of petitions for classification

as an alien entrepreneur under the Immigrant Investor

Pilot Program. Commencing on October 1, 1993, petitions

will be accepted for filing and adjudicated in accordance

with the provisions of this section if the alien entrepreneur

has invested or is actively in the process of investing

within a regional center which has been approved by the

Service for participation in the Pilot Program.

(9) Effect of termination of approval of regional

center to participate in the Immigrant Investor Pilot

Program. Upon termination of approval of a regional

center to participate in the Immigrant Investor Pilot

Program, the director shall send a formal written notice to

any alien within the regional center who has been granted

lawful permanent residence on a conditional basis under

the Pilot Program, and who has not yet removed the

conditional basis of such lawful permanent residence, of

the termination of the alien’s permanent resident status,

unless the alien can establish continued eligibility for

alien entrepreneur classification under section 203(b)(5) of

the Act.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.