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Dram LLC v. Johnson

United States District Court, Northern District of Illinois

March 24, 2015

Dram LLC, et al., Plaintiffs,
v.
Jeh Johnson, et al., Defendants.[1]

ORDER

Ronald A. Guzmán, United States District Judge.

For the reasons stated below, Plaintiffs’ motion for summary judgment [37] is denied and Defendants’ motion for summary judgment [33] is granted. The case is dismissed for lack of standing. In the event that Plaintiffs have standing, the Court would uphold the AAO’s decision on the merits. Civil case terminated.

MEMORANDUM OPINION AND ORDER

This case involves the denial of a visa petition by the United Stated Citizenship and Immigration Services (“USCIS”). Plaintiffs seek approval of the visa petition so they can employ Shoji Takahashi (“Takahashi”) as a chef. Plaintiffs contend that Defendants’ denial of the petition was arbitrary and capricious, an abuse of discretion and otherwise not in accordance with the law.

Facts

On November 9, 2004, Dram LLC filed an application for labor certification (Form ETA 750) for a Chef position at $17.00 per hour at its restaurant located at 2020 West Division in Chicago. (Administrative Record (“AR”) 507.) Dram LLC stated that the position required a high school degree with two years experience in the job offered. (Id.) On October 13, 2006, the Department of Labor (“DOL”) certified Dram LLC’s application. (AR 506.) Based on the approved labor certification, Dram LLC filed a Form I-140 immigrant visa petition with USCIS on March 5, 2007 seeking to classify Plaintiff Takahashi as a third preference employment-based immigrant. (AR 500.) In support of the petition, Dram LLC filed tax returns for Dram of Chicago, Inc. along with a letter from Takahashi’s prior employer stating that he “worked at Matsu Sushi from Jan. 311996 to Jan. 11999” as a “chef.” (AR 511-83.)

After reviewing Dram LLC’s I-140 petition, USCIS issued to Dram LLC’s attorney a request for evidence (“RFE”), directing the company to provide evidence of its ability to pay the proffered wage rate by providing the company’s tax returns, and if applicable, the company’s pay statements for Takahashi. (AR 499.) USCIS acknowledged receipt of the tax returns for Dram of Chicago, Inc., but stated that Dram LLC could not use the tax returns of an unrelated entity as evidence of Dram LLC’s ability to pay the proffered wage rate. (Id.) On March 19, 2009, Dram LLC’s attorney responded to the RFE by filing additional tax returns for Dram of Chicago, Inc. (AR 358-98, 407-25) along with individual tax returns for Miae Lim, the owner of Dram of Chicago, Inc. and Dram LLC. (AR 426-58.) Dram LLC’s attorney also submitted W-2 wage statements for Takahashi showing that he was employed by Dram of Chicago, Inc. in 2007 and 2008. (AR 399-400.) In addition, the attorney filed Dram of Chicago, Inc.’s Application for Permanent Employment Certification (ETA Form 9089) for the position of “Sushi Chef” at a wage rate of $11.62 per hour, which DOL certified on April 13, 2007. (AR 483, 485-86, 493.)

Regarding the identity of the petitioning employer, Dram LLC’s attorney stated that Dram LLC “should have been terminated a while ago” (AR 325), citing a letter dated March 19, 2009 from Dram LLC’s registered agent explaining that it was intended that the company’s status lapse, but due to an erroneous filing with the State of Illinois, the company was still an active entity. (AR 495.) The attorney also stated that “Dram of Chicago, Inc. was created to replace Dram LLC therefore it operates under the same address, same dba name of Mirai Sushi, has the same owner and clients, ” which the attorney argued made Dram of Chicago, Inc. the successor-in-interest of Dram LLC. (AR 326.)

On April 7, 2009, USCIS denied Dram LLC’s I-140 petition. (AR 320.) USCIS explained that Dram LLC’s documents failed to demonstrate that the company merely changed its name to “Dram of Chicago, Inc., ” since both entities were still registered as an active company and corporation, respectively, with the State of Illinois. (AR 320-21.) USCIS did not consider the April 2007 labor certification for Dram of Chicago, Inc. because the certification expired before counsel submitted it in response to the RFE. (AR 321.)

On May 11, 2009, Dram LLC appealed USCIS’s decision to the Administrative Appeals Office (“AAO”). (AR 312.) In support of the appeal, Dram LLC’s attorney argued that Miae Lim owned both Dram LLC and Dram of Chicago, Inc., which were created to conduct the same business known as “Mirai Sushi.” (AR 305.) Dram LLC’s attorney stated that Dram of Chicago, Inc. held the restaurant’s liquor license and Dram LLC held the operating trademark, which purportedly explained why neither company could be dissolved and continued jointly to operate the Mirai Sushi restaurant. (Id.) The company’s attorney further stated that “the companies are merged together and are interdependent, relying on each other for success.” (Id.) The attorney concluded that “[s]ince both technically operate for the same purpose, and each relies on the other for business, it appears as though they are interchangeable, and should be treated as a cohesive partnership, doing business as Mirai Sushi.” (AR 306.)

On June 16, 2011, Dram LLC’s new counsel filed with the AAO a letter and additional materials, including Dram of Chicago Inc.’s tax returns, in support of the I-140 petition appeal. (AR 196-302.) Dram LLC’s new counsel asserted, contrary to the statements of prior counsel, that Dram of Chicago, Inc. was not created to replace Dram LLC. (AR 196.) Rather, the new counsel stated that Dram LLC and Dram of Chicago, Inc. were established concurrently to operate the same restaurant, Mirai Sushi, which has remained in operation at the same location since 1999. (AR 196-97.) Nevertheless, counsel stated that Dram of Chicago, Inc. was the entity that operated the restaurant and filed the relevant tax returns. (AR 197.) Thus, counsel argued that “Dram of Chicago, Inc.” should have been listed on the relevant immigration forms as the sponsoring employer, but “Dram LLC” was mistakenly identified as the employer by former counsel. (Id.) The new counsel argued alternatively that Dram of Chicago, Inc. also qualified as a successor-in-interest to Dram LLC because the corporation and company ran the restaurant in concert. (Id.)

On June 30, 2012, the AAO dismissed Dram LLC’s appeal because the company did not establish an ability to pay the proffered wage rate, or, alternatively that Dram of Chicago, Inc. was the successor-in-interest of Dram LLC. (AR 186-95.) The AAO rejected current counsel’s argument that Mirai Sushi filed the original labor certification application because “Dram LLC” was listed on Form ETA-750 as the sponsoring employer. (AR 189, 507, 509.) The AAO stated that a new employer wishing to establish itself as a successor to a prior employer’s labor certification application must provide evidence of the transfer of ownership by showing that “the successor not only purchased assets from the predecessor, but also the essential rights and obligations of the predecessor necessary to carry on the business.” (AR 192.) Applying this standard to Dram LLC’s case, the AAO stated that the record evidence showed that Dram LLC and Dram of Chicago, Inc. remained separate legal entities throughout their existences. (Id.) Dram LLC did not provide any documentary evidence showing that Dram of Chicago, Inc. purchased the assets of Dram LLC or that the two entities merged. (Id.) Although Miae Lim owned both legal entities, the AAO stated that the common ownership of two separate legal entities alone is not sufficient to establish that one is the successor of the other. (Id.)

The AAO identified an additional defect with the I-140 petition. (AR 193-94.) The AAO found that the petitioner failed to establish that beneficiary Takahashi possessed the required qualifying experience listed on the labor certification application. (AR 194.) Dram LLC’s labor certification application stated that the chef position required two years of experience in the job offered. (AR 194, 507.) The regulation requires the employer to establish the beneficiary’s work experience by providing a letter from a prior employer with a detailed description of the beneficiary’s experience. (AR 194) (citing 8 C.F.R. § 204.5(l)(3)(ii)(A).) The AAO found that the petitioner failed to meet this standard because Takahashi’s experience letter did not describe in any detail his prior work experience. (Id.)

On August 2, 2013, the AAO reopened Dram LLC’s I-140 petition proceedings. (AR 175.) The AAO identified multiple defects in the company’s petition, including a failure to establish an actual existing entity qualifying as an employer, the beneficiary’s lack of qualifying work experience, and the employer’s inability to pay the proffered wage rate. (AR 176-84.) The AAO provided Dram LLC thirty days to submit additional evidence in support of the I-140 petition. (AR 185.) In response to the AAO’s motion to reopen, Dram LLC’s counsel argued that Dram LLC, Dram of Chicago, Inc., and Mirai Sushi, Inc. “were created in order to run the Mirai Sushi restaurant and were interrelated at all times.” (AR 45.) As a result, counsel argued that the three entities formed an “association, ” and because “these businesses were all created in order to work together with one another[, ] . . . income from any of the entities should be used in order to determine whether the Mirai Sushi restaurant has the ability to pay the prevailing wage.” (AR 46.) Although Dram LLC was listed as the petitioning employer on the Form I-140 petition, counsel argued that Dram of Chicago, Inc. “could have also been used to the same effect as they all operate as an association to run Mirai Sushi.” (Id.)

On December 30, 2013, the AAO again upheld USCIS’s denial of Dram LLC’s I-140 petition. (AR 22.) On January 2, 2014, the AAO issued an amended decision. (AR 1.) Regarding the proper labor certification application supporting the I-140 petition, the AAO noted that Dram of Chicago, Inc. filed a new labor certification application (ETA Form 9089), dated April 13, 2007 in response to USCIS’s initial request for evidence. (AR 3, 485-94.) Although Dram of Chicago, Inc. requested that the corporation’s new labor certification application replace Dram LLC’s prior labor certification (AR 485), the AAO determined that the DOL rejected this request for refiling because the second labor certification was not identical to Dram LLC’s first labor certification. (AR 4.) The educational requirements were different in the two labor certification applications. (AR 4, 486, 507.) Therefore, under DOL’s regulations, the agency did not accept the second labor certification application as a replacement of the first application, as evidenced by the fact that DOL did not assign the second application the original date of filing from the first application. (AR 4, 483, 506; see also 20 C.F.R. §§ 656.17(d)(1)-(4).)

In addition, USCIS could not accept the second labor certification (ETA Form 9089) dated April 13, 2007 (AR 485-93), as a stand-alone filing in support of the Form I-140 petition because the second labor certification had expired under DOL’s regulation before Dram of Chicago, Inc. filed it with USCIS. (AR 4-5; see also 20 C.F.R. ยง 656.30(b)(2).) Therefore, ...


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