On August 23, 2021, USCIS filed a Notice of Appeal challenging the California District Court’s ruling in the Behring Regional Center LLC v. Chad Wolf, et.al lawsuit. What does this appeal mean and what do EB-5 stakeholders need to know?
To recap – what is the Behring Regional Center LLC v. Chad Wolf, et.al lawsuit about again? Behring Regional Center filed suit against USCIS seeking to have the 2019 EB-5 Immigrant Investor Program Modernization Rule (“Modernization Rule”) invalidated on numerous grounds, including violations of the Federal Vacancies Reform Act (“Vacancies Act”). On June 22, 2021, a California judge ruled in favor of Behring Regional Center finding that the former acting Department of Homeland Security Secretary, Kevin McAleenan, was not properly serving in his position under the Vacancies Act when he effectuated the Modernization Rule, which raised the EB-5 investment from $500,000 to $900,000.
What does USCIS’ Notice of Appeal mean? USCIS is challenging the California District Court’s decision that vacated the Modernization Rule on June 22, 2021.
Who filed the Notice of Appeal? The Notice of Appeal was filed by new Secretary of Homeland Security Alejandro Mayorkas, Acting Director of USCIS Tracy Renaud, and USCIS Policy Branch Chief of the Immigrant Investor Program, Edie Pearson, in their official capacities.
Will new investors be required to invest $900,000 any time soon because of this appeal? No, we believe that is very unlikely. Although USCIS filed a Notice of Appeal to challenge the District Court’s decision invalidating the Modernization Rule, thereby returning the TEA investment level to $500,000, it will take many months for the Ninth Circuit Appellate Court to reach a final decision. The Appellate Court will set a briefing schedule for the parties and a date for oral arguments. Once oral arguments are heard, the Appellate Court must then render a decision in the appeal. Once the Appellate Court renders its decision, the case may go back to the District Court for further review. We do not anticipate a decision in the Appellate case to be reached before 2022.
What is USCIS’ overarching goal in filing the appeal? EB5 Capital believes that USCIS wants the Appellate Court to overturn the California District Court’s decision to preserve the agency’s ability to set policy, including its ability to ratify regulations that would otherwise be invalid under the Vacancies Act.
What is the main takeaway for investors who plan to file their I-526 petitions after the Regional Center program is reauthorized? We expect the Regional Center program to be reattached to the Continuing Resolution and extended in late September 2021, without any substantive changes to the Program. We expect the investment amount to remain at $500,000 in the short-term, and the aforementioned Notice of Appeal should have no immediate effect on that.