National Venture Capital Association v. Duke, Civil Action No. 2017-1912

Background

DHS promulgated the International Entrepreneur Rule (IE Final Rule) in January 2017 to allow certain foreign entrepreneurs to be paroled into the U.S. for up to 30 months (with possible re-parole), using specific eligibility criteria to guide discretionary parole decisions.
The IE Final Rule was published with notice-and-comment and was set to take effect July 17, 2017 (180 days after publication); DHS anticipated processing several thousand applications and charging fees to cover costs.
Following President Trump’s January 25, 2017 Executive Order limiting parole use, DHS issued a Delay Rule on July 11, 2017 that postponed the IE Final Rule’s effective date to March 14, 2018, and signaled that rescission was "highly likely."
DHS issued the Delay Rule without advance notice-and-comment, invoking the APA’s "good cause" exception and providing only an after-the-fact comment period.
Plaintiffs (two foreign entrepreneurs, two U.S. startups, and the National Venture Capital Association) sued, arguing DHS lacked good cause to bypass notice-and-comment; the district court considered cross-motions for summary judgment on the administrative record.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Standing — lost opportunity to apply for parole	The Krishnas lost a concrete injury: the opportunity to apply under the IE Rule.	Foreign nationals lack standing to challenge immigration policy; parole is discretionary so losing the opportunity is not an injury.	Held: Plaintiffs have standing; loss of a meaningful opportunity to pursue a discretionary benefit is a cognizable injury and is redressable by vacating the Delay Rule.
APA notice-and-comment requirement	Delay Rule is a final agency action and DHS must follow §553; no good cause existed to skip notice-and-comment.	The good-cause exception applies because immediate delay was needed to avoid wasting resources and prevent confusion/reliance.	Held: DHS failed to show good cause; the Delay Rule was promulgated without adequate justification and is procedurally defective.
Agency delay / self-created urgency	Agency could have initiated notice-and-comment during the six months after the Exec. Order; it cannot claim good cause created by its own delay.	DHS claimed it needed time to consider the Executive Order and leadership changes before acting.	Held: Agency’s unexplained six-month delay undermines any good-cause claim; even absent forfeiture, DHS’s stated rationales are insufficient.
Remedy — vacatur or remand/stay	Vacatur of the Delay Rule would restore the IE Final Rule and plaintiffs’ opportunity.	DHS requested a stay to avoid expense and disruption while it considers rescission.	Held: Court vacated the Delay Rule (no stay). Vacatur is the normal remedy for lack of notice-and-comment and here would not be disruptive.

Key Cases Cited

Lujan v. Defenders of Wildlife, 504 U.S. 555 (standing framework)
CC Distributors, Inc. v. United States, 883 F.2d 146 (D.C. Cir. 1989) (lost opportunity to pursue a benefit can be a cognizable injury)
Patel v. USCIS, 732 F.3d 633 (6th Cir. 2013) (loss of opportunity to receive immigration benefit is concrete injury)
Clean Air Council v. Pruitt, 862 F.3d 1 (D.C. Cir. 2017) (agency bound by its legislative rule until properly amended or revoked)
Sorenson v. FCC, 755 F.3d 702 (D.C. Cir. 2014) (good-cause findings reviewed closely; exception is narrow)
Environmental Defense Fund, Inc. v. EPA, 716 F.2d 915 (D.C. Cir. 1983) (agency delay undermines good-cause invocation)
Allina Health Services v. Sebelius, 746 F.3d 1102 (D.C. Cir. 2014) (deficient notice is a fundamental flaw supporting vacatur)
Allied-Signal, Inc. v. U.S. Nuclear Regulatory Comm’n, 988 F.2d 146 (D.C. Cir. 1993) (factors for remand vs. vacatur)