Immigration Cheated Us, Investors Say

LOS ANGELES (CN) - Eighteen immigrants claim in court that the United States improperly denied them residency after they spent $11.5 million to create jobs for almost 300 Americans.

The 18 plaintiffs say they joined together to create a limited partnership that raised nearly $12 million to renovate unused office and warehouse space in Riverside County, 60 miles from downtown Los Angeles. They say their investments created "a minimum of 278 new jobs for U.S. workers."

Plaintiffs from China, Malaysia, South Korea, Vietnam, the United Kingdom, India, Iran, Canada and the Netherlands accuse Department of Homeland Security Secretary Janet Napolitano and two underlings of denying residency under the I-526 program.

The plan grants legal residency to a person and his or her immediate family for investing $500,000 or more in this county to create at least 10 jobs for U.S. workers.

Under the plan, foreign nationals fill out a conditional version of DHS's I-526 form to obtain an immigration visa. The applicant must show that he or she has made the $500,000 investment or is actively in the process of investing that much money to "create fulltime positions for not fewer than 10 persons either directly or indirectly," according to immigration law.

The applicant has 2 years to file a second petition that removes the conditional status and grants permanent residency.

Lead plaintiff Courtney Carlsson says the plan - part of the Immigration and Nationality Act of 1990 - was intended to attract foreign capital and encourage economic development in rural or economically depressed areas.

The law made 10,000 immigration visas available for foreign investors. Those who invested outside of rural or targeted economically repressed areas were required to invest $1 million, according to 60-age federal complaint.

A 1993 amendment allowed applicants to apply a methodology recognizing jobs created indirectly by their investments.

The Department of Homeland Security may cancel a conditional visa within 2 years if the person fails to meet investment conditions or breaks the law. Otherwise, the department must adjudicate the permanent residency application within 90 days of the petition or interview, under the law. Once approved, the immigrant and his or her immediate family are granted permanent residency.

The plaintiffs say the defendant U.S. Citizenship & Immigration Services approved their American Life Development Co. in 2009. The company's scope included commercial and industrial, warehouse, office retail and civic development, which received amended approval in 2010.

The immigrants say they created a limited partnership called 14575 Innovation Drive in 2011 to buy the commercial space. The plan was to attract 24 immigrant-investors and raise $12 million. So far, they've spent more $6 million to buy the property, and another $609,000 to make improvements, they say.

The plaintiffs say they have attracted 23 investors and raised $11.5 million. As they planned to spend another $600,000 to make more improvements and buy adjacent property for $2.4 million, DHS revoked their permanent residency petitions, according to the complaint.

The group says ICE, a creature of the Department of Homeland Security, began going after them in April this year, after the granting eight of the plaintiff's petitions in late 2011.

DHS issued notices of intent to revoke (NOIR) for the approved petitions and requests for evidence (RFE) on the petitions it hadn't yet approved. Both memos were "virtually identical in content and argument," the immigrants claim.

"Defendants' NOIRs and RFEs contain numerous factual errors. They assume incorrectly that Innovation LP had not purchased the property; its funds had not been used to renovate the property; its funds were held in an escrow account; and that plaintiffs' capital was not infused into the business and the renovations," according to the complaint. (22)

ICE questioned virtually everything the immigrants had done, according to the complaint.

It "faulted plaintiffs for not presenting a business plan that stated when tenants would occupy the building, the costs and nature of the property's purchase and renovation and a market analysis for leasing the property. Defendants, however, largely ignored the detail provided in the I-526 petition and supporting documents that this was a plan to purchase a specific property which would then be leased to one or more tenants," the complaint states.

"'[I]t is not appropriate to take credit for the employment impacts created by the unrelated business ventures of future tenants,'" rejection letters stated.

The rejection reflected a new tactic by the agency, implemented after the immigrants' petitions had been filed and approved and after their money had been spent on the properties, the plaintiffs say.

Their attorney, Ira Kurzban, with the Miami firm of Kurzban Kurzban Weinger Tetzeli and Pratt, says he corrected the errors made in the USCIS memos.

Kurzban told the defendants that the immigrants already had a tenant leasing the property - Container Connection of Southern California - with its management and logistics operations housed in the renovated warehouse. Kurzban also detailed how the immigrants spent their investments, according to the complaint.

The government responded by revoking the immigrants' petitions, faulting them for "spending only $7.75 million thus far and not the $11.5 million in accumulated capital. Defendants revoked and denied the petitions because there is no "assurance that the entire amount of the petitioners' and [Innovation LP's] capital will in fact be used to carry out the business of the commercial enterprise and placed at risk for the purpose of generating a return," the immigrants say, citing the USCIS's response.

They claim the government also faulted them for raising only $11.5 million instead of $12 million, for having only one tenant rather than the number they forecast, and their decision to expand by purchasing an adjoining property.

"None of these changes, however, are material, nor are they 'discrepancies.' They are all completely consistent with the regulations that do not contemplate that a project will be completed at the [petition] stage," the complaint states.

The government claimed that analyses the immigrants relied on for their business plan were faulty. The group disagrees.

"The regional center was approved for investments in commercial/industrial development; mixed-use development; light industry/warehouse; office space; and retail development among others. The defendants confuse the purpose of the regional center with the creation of jobs by the tenants. The 'reasonable methodologies' look to indirect job creation through the tenants' employment irrespective of whether that economic activity is the same as the regional center's approved economic investment clusters. It is unlikely that they would be the same in any case. Although defendants disavow the use of the tenant-methodology here, the result is the same. Defendants simply disregard accepted reasonable methodologies because they no longer believe they can count jobs created by tenants in a real estate renovation project," the immigrants say in their complaint.

The immigrants seek declaratory and injunctive relief for improper retroactive application, arbitrary and capricious action in violation of immigration laws and the Administrative Procedure Act, exceeding statutory authority and due process.

They specifically seek immigration documents for themselves and their children so they can remain in the United States for the duration of the proceedings.

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