Nayak v. Joseph B. Edlow

Background

Plaintiffs Anand Nayak, Vinod Khatri, and Pratik Sureshbhai Patel alleged that each invested at least $800,000 in a targeted employment area project under the EB-5 immigrant investor program. Each filed a Form I-526E petition with United States Citizenship and Immigration Services (USCIS) seeking a path to lawful permanent residence. When they filed their amended complaint, the petitions had been pending approximately 15 months for Nayak, 26 months for Khatri, and 10 months for Patel.

The plaintiffs did not challenge any USCIS decision. Instead, they sued under the Administrative Procedure Act, which permits a court to require an agency to act when it has unreasonably delayed a required action. They alleged that the delays prolonged the period during which their investment capital remained at risk and caused additional immigration, travel, employment, and family-related harms.

Joseph B. Edlow, the USCIS Director, moved to dismiss under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). He argued that a federal immigration statute removed jurisdiction over the claim and that the plaintiffs had not plausibly alleged unreasonable delay.

Court’s analysis

The court declined to resolve the jurisdictional argument because it concluded that the amended complaint failed for another reason. It instead analyzed whether the plaintiffs plausibly alleged unreasonable delay under the six-factor test from Telecommunications Research & Action Center v. Federal Communications Commission, commonly called the TRAC factors.

The first factor considers whether the agency follows a reasonable system for deciding cases and how long the delay has lasted. The court found that USCIS’s described inventory-management system, which generally uses filing order while accounting for rural prioritization and visa availability, could qualify as a reasonable system. The plaintiffs’ allegations that USCIS handled petitions out of order and granted unexplained expedited processing were based on information and belief and lacked specific supporting examples. The court also found that 10- to 26-month delays were generally shorter than delays courts had found unreasonable, although Khatri’s wait was approaching the range that raised greater concern.

The second factor considers Congress’s indication of the expected processing speed. The court said that the 180-day statutory expression of congressional intent and the 120-day fee-study benchmark favored the plaintiffs to some extent, but were aspirational rather than enforceable deadlines.

The third and fifth factors consider health, welfare, and prejudice. The court recognized that the plaintiffs’ capital remained at risk and that this was a concrete economic interest. But it concluded that this shared harm, along with the other alleged consequences, did not make delays of 10 to 26 months unreasonable at this stage.

The fourth factor considers the effect of moving the plaintiffs ahead of other petitioners. The court found that this factor favored the government because ordering immediate adjudication could displace earlier-filed or higher-priority petitions. The court said this factor would carry less weight against a plaintiff as the plaintiff’s wait became longer and fewer petitioners would be displaced.

The sixth factor considers agency impropriety. The court said this factor did not favor dismissal, but did not need to decide whether it affirmatively favored the plaintiffs because the other factors did not establish unreasonable delay.

Disposition

After weighing the factors, the court held that the amended complaint did not plausibly allege unreasonable delay at that time. The court emphasized that the ruling did not permit the petitions to remain unaddressed indefinitely and that the balance could change as the waiting periods increased.

The court granted Edlow’s motion to dismiss and dismissed the First Amended Complaint without prejudice. The court also dismissed the plaintiffs’ claim for fees under the Equal Access to Justice Act without prejudice because they had not prevailed at that point.