Controlled Air, Inc. v. Barr ( 2020 )

20-780
Controlled Air, Inc. v. Barr
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED
BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1.
WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY
MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE
NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY
OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
At a stated Term of the United States Court of Appeals for the Second Circuit, held at the
Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York on the
22nd day of October, two thousand twenty.
Present: ROSEMARY S. POOLER,
RAYMOND J. LOHIER, JR.,
WILLIAM J. NARDINI,
Circuit Judges.
_____________________________________________________
CONTROLLED AIR, INC., KRISHNENDU MUKHERJEE,
Plaintiffs-Appellants,
v. 20-780-cv
WILLIAM P. BARR, ATTORNEY GENERAL,
LAURA B. ZUCHOWSKI, DIRECTOR, UNITED STATES
CITIZENS AND IMMIGRATION SERVICES-VERMONT
SERVICE CENTER,
Defendants-Appellees. 1
_____________________________________________________
Appearing for Appellant: Glenn L. Formica, New Haven, CT.
Appearing for Appellee: Joshua S. Press, Trial Attorney, Civil Division, United States
Department of Justice (Jeffrey Clark, Acting Assistant Attorney
General, William C. Peachey, Director, Aaron S. Goldsmith,
Senior Litigation Counsel, on the brief), Washington, DC.
1
The Clerk of Court is directed to amend the caption as above.
Appeal from the United States District Court for the District of Connecticut (Arterton, J.).
ON CONSIDERATION WHEREOF, IT IS HEREBY ORDERED, ADJUDGED,
AND DECREED that the judgment of said District Court be and it hereby is AFFIRMED.
Controlled Air, Inc. and Krishnendu Mukerjee (collectively, “Controlled Air”) appeal
from the March 3, 2020 judgment of the United States District Court for the District of
Connecticut (Arterton, J.) dismissing their complaint challenging a denial by U.S. Citizenship
and Immigration Services (“USCIS”) of a nonimmigrant highly skilled work visa under 8 U.S.C.
§ 1101(a)(15)(H)(i)(b) (“H-1B visa”) for failure to state a cause of action under Federal Rule of
Civil Procedure 12(b)(6). We assume the parties’ familiarity with the underlying facts,
procedural history, and specification of issues for review.
Controlled Air provides heating and cooling services. Krishnendu Mukherjee is a citizen
of India and a prospective employee of Controlled Air, who at the time of the district court’s
decision, was in the United States on a student visa and in a training program at Controlled Air,
which sought an H-1B visa for him to work after his training. USCIS denied Controlled Air’s
application for an H-1B visa for Mukherjee because the application listed a start date of
employment that fell withing the prior fiscal year for which visas had already been awarded.
Controlled Air sued, alleging that USCIS erred because the start date had to correspond to the
date on the Labor Condition Application (“LCA”) that Controlled Air had previously filed with
the Department of Labor. Controlled Air argued that the denial violated the Administrative
Procedure Act (“APA”) and the equal protection guarantee under the Fifth Amendment and
asked the district court to declare that Controlled Air satisfied the requirements for an H-1B visa
and to order USCIS to re-adjudicate the visa petition.
“We review de novo a district court’s grant of a motion to dismiss under Rule 12(b)(6),
construing the complaint liberally, accepting all factual allegations as true, and drawing all
reasonable inferences in the plaintiff’s favor.” Coal. for Competitive Elec., Dynergy Inc. v.
Zibelman, 906 F.3d 41, 48-49 (2d Cir. 2018) (internal quotation marks and formatting omitted).
The district court did not err in dismissing Controlled Air’s APA claim because it was
neither arbitrary nor capricious for USCIS to deny an H-1B petition for the 2020 fiscal year that
indicated a start date during the 2019 fiscal year. See 5 U.S.C. § 706(2)(A) (Under the APA, we
must “hold unlawful” any agency decision that is “arbitrary, capricious, an abuse of discretion,
or otherwise not in accordance with law”); see also Karpova v. Snow, 497 F.3d 262, 267-68 (2d
Cir. 2007) (noting that the arbitrary and capricious standard of review is “narrow” and
deferential to the agency). The regulations provide that an H1-B petition “may not be filed earlier
than 6 months before the date of actual need for the beneficiary’s services or training.” 8 C.F.R.
§ 214.2(h)(2)(i)(I). As the district court noted, this means that the earliest an employer may file
for an H1-B for the following fiscal year (starting October 1) is April 1 of the preceding fiscal
year. April 1, then, is the beginning of the H-1B petition season each year, and if an employer
submits a petition that day, it must list a proposed start date of October 1. USCIS’s optional
checklist and online guidance for the H-1B fiscal year 2020 petition season stated that the start
date must be October 1, 2019.
Here, Controlled Air listed an August 2019 start date for Mukherjee, and it argued that it
was required to match a previously filed LCA with the Department of Labor that indicated that it
needed a technician starting that month. However, as the district court found, neither the statute,
regulations, nor guidance dictates that the date must be the same. Controlled Air’s argument that
using different start dates on the H-1B petition and LCA would require it to commit perjury is
meritless. The LCA is a prerequisite to the H-1B petition, but addresses a different issue: the
LCA seeks information about when the employer will have a need to fill a position, while the H-
1B petition seeks information about a specific beneficiary for the upcoming fiscal year. There is
no requirement that the H-1B start date match that of the LCA.
Nor are we persuaded by Controlled Air’s arguments that USCIS’s online instructions
and checklists were improper regulations that did not go through the proper notice and comment
periods. Regardless of the online guidance that petitioners should not indicate a start date before
October 1, the regulations require USCIS to limit H-1B petitions pursuant to a congressionally
mandated cap per fiscal year. Controlled Air submitted a petition with a start date during the
2019 fiscal year, after USCIS had stopped accepting such petitions for that year. The 2019 fiscal
year filing period began on April 1, 2018, and the yearly numerical limit on H-1B petitions was
reached on April 6, 2018. As to the online USCIS guidance, the APA exempts from its notice
and comment requirements “interpretative rules, general statements of policy, or rules of agency
organization, procedure, or practice.” 5 U.S.C. § 553(b)(A). The notice and comment procedure
is necessary only when an agency seeks to establish substantive legal rules. See Chrysler Corp. v.
Brown, 441 U.S. 281, 301-02 (1979). USCIS’s online guidance provided “interpretive”
examples of its controlling regulations, and as the district court found, did “nothing more than
explain how USCIS applies the regulations governing the H-1B filing process.” App’x at 14 n.3;
see Azar v. Allina Health Servs., 139 S. Ct. 1804, 1811 (2019) (“Under the APA, substantive
rules are those that have the force and effect of law, while interpretive rules are those that merely
advise the public of the agency’s construction of the statutes and rules which it administers.”).
Controlled Air next argues that the regulatory scheme is ambiguous and USCIS’s
interpretation of it is not entitled to deference; the district court disagreed. The Government
argues that the scheme is clear that petitions for employment during the incorrect fiscal year will
be denied, but even assuming that the regulations are ambiguous, we should defer to USCIS’s
interpretation. When an agency interprets its own genuinely ambiguous regulations, we defer to
that interpretation if it is reasonable and “reflect[s] an agency’s authoritative, expertise-based,
fair, or considered judgment.” Kisor v. Wilkie, 139 S. Ct. 2400, 2414 (2019) (internal quotation
marks and alterations omitted). Here, as the district court correctly found, the regulations are
ambiguous as they do not state whether an employer can submit a petition for the prior fiscal
year during the application season for the upcoming fiscal year. See 8 U.S.C. § 1184(g)(l)(A)(vii)
(“The total number of aliens who may be issued [H-1B] visas or otherwise provided
nonimmigrant status during any fiscal year . . . may not exceed . . . 65,000.”); see also 8 C.F.R. §
214.2(h)(8)(i)(A) (restating cap in 8 U.S.C. § 1184(g)(l)(A)(vii)); id. § 214.2(h)(2)(i)(I)
(providing that an H-1B petition “may not be filed earlier than 6 months before the date of actual
need for the beneficiary’s services or training”). USCIS’s online guidance for fiscal year 2020
petitions stating that the employment start date must be October 1, 2019 is a fair interpretation of
the regulations given that USCIS must comply with the congressionally mandated yearly cap.
Accordingly, the district court correctly found that USCIS’s denial of Controlled Air’s petition
was neither arbitrary nor capricious. 2
Controlled Air also challenges the district court’s dismissal of its Fifth Amendment
claim, arguing that it was treated differently than other corporations and required to “meet a
higher standard of eligibility for classification of an H1B worker.” App’x at 83. “To prove a
violation of the Equal Protection Clause, . . . a plaintiff must demonstrate that he was treated
differently than others similarly situated as a result of intentional or purposeful discrimination.”
Phillips v. Girdich, 408 F.3d 124, 129 (2d Cir. 2005). Controlled Air failed in its complaint to
identify any other company that was treated differently, i.e., a company whose application was
accepted despite identifying an employment date before October 1, 2019. See Hu v. City of New
York, 927 F.3d 81, 92 (2d Cir. 2019) (noting that a petitioner bringing an equal protection claim
as a “class of one” must identify a “comparator” (internal quotation marks omitted)). It argues on
appeal that discovery would have allowed it to find such an entity. But “[a] plaintiff who has
failed adequately to state a claim is not entitled to discovery.” Main St. Legal Servs., Inc. v. Nat’l
Sec. Council, 811 F.3d 542, 567 (2d Cir. 2016). We find no error with the district court’s
dismissal of its Fifth Amendment claim.
We have considered the remainder of Controlled Air’s arguments and find them to be
without merit. Accordingly, the order of the district court hereby is AFFIRMED.
FOR THE COURT:
Catherine O’Hagan Wolfe, Clerk
2
As the Government explains in its brief, see Appellees’ br. at 10 n.11, the H-1B application
process was substantially revised for fiscal year 2021. In relevant part, the Department of
Homeland Security (“DHS”) issued a final rule explaining that a “petitioner will be able to
register prior to April 1, then if selected, may request the certification of an LCA by [the
Department of Labor (“DOL”)] prior to filing an H-1B petition. As noted above, petitioners will
have at least 90 days to file days to file [an H-1B] petition . . . . Therefore, petitioners could
choose to submit an LCA to DOL on or after April 1, which would allow for an LCA validity
period beginning October 1.” 84 Fed. Reg. 888, 912 (Jan. 31, 2019). DHS has also updated its
regulations to explain that a petitioner must include October 1 as the requested employment start
date on Form 1-129.”