245 F. Supp. 3d 1239
N. Mar. I.2017Background
- Congress enacted the Consolidated Natural Resources Act (CNRA) creating a temporary CW-1 transitional worker classification for CNMI and charged DHS with establishing a system to allocate CW-1 permits that must be reduced annually and end by Dec. 31, 2019.
- DHS promulgated interim regulations and reserved the annual numerical CW-1 cap to be published each fiscal year by Federal Register notice rather than through repeated notice-and-comment rulemaking.
- For FY2016 DHS set the CW-1 cap at 12,999 and announced the cap was reached May 5, 2016; CUC filed renewal petitions after that date for 13 workers and USCIS rejected and returned the petitions and fees.
- Plaintiffs (CUC and 13 CW-1 workers) sued claiming (1) unlawful failure to adjudicate renewals (entitling workers to up to 240 days’ continued employment), (2) improper avoidance of APA notice-and-comment for annual caps, (3) arbitrary/capricious cap-setting under the CNRA, and (4) due process and equal protection violations from the timing/six-month rule and first-to-file system.
- The government moved to dismiss under Rule 12(b)(1) and (6). The court held it had jurisdiction to review DHS cap-setting but dismissed all four claims with prejudice for failure to state a claim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Reviewability of DHS cap-setting (APA §701(a)(2)) | CNRA does not preclude review; DHS has discretion but statute provides standards. | DHS action is committed to agency discretion and thus nonreviewable. | Court: statute and regulations provide meaningful standards; APA review is available. |
| Whether USCIS rejection of renewals was a nonfinal procedural rejection (entitling workers to 240 days) | Rejections were not final denials under APA §558 and 8 C.F.R. §274a.12(b)(20); timely filing should trigger 240-day work authorization. | Rejection upon cap exhaustion functions as a final determination/denial and is not eligible for 240-day continuing employment. | Court: rejection functioned as a final denial; no 240-day employment entitlement. |
| APA notice-and-comment for annual caps | DHS should have used notice-and-comment for each annual cap publication. | Good cause existed to dispense with annual notice-and-comment because flexibility and timeliness required by CNRA. | Court: DHS provided reasoned explanation; dispensing with annual notice-and-comment was justified. |
| Standing / substantive claims re: cap methodology and constitutional claims (due process/equal protection) | Plaintiffs were legally wronged/adversely affected by cap methodology and timing rules; equal protection and due process violated. | Plaintiffs lack a legally protected right to admission; CNRA grants DHS discretionary allocation authority; classifications are rationally related to legitimate ends. | Court: Plaintiffs lack a legally protected right and did not plead a cognizable constitutional violation; claims dismissed for failure to state a claim. |
Key Cases Cited
- Leite v. Crane Co., 749 F.3d 1117 (9th Cir. 2014) (distinguishing facial and factual Rule 12(b)(1) attacks)
- Pride v. Correa, 719 F.3d 1130 (9th Cir. 2013) (standard for facial jurisdictional attack)
- Savage v. Glendale Union High Sch., 343 F.3d 1036 (9th Cir. 2003) (court may consider evidence on factual jurisdictional attacks)
- Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 (1994) (party asserting federal jurisdiction bears the burden)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (plausibility standard under Rule 12(b)(6))
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility pleading standard)
- Heckler v. Chaney, 470 U.S. 821 (1985) (agency action committed to agency discretion exception to APA review)
- Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402 (1971) (narrowness of nonreviewability and review standards)
- Massachusetts v. EPA, 549 U.S. 497 (2007) (agency discretion and rulemaking deference)