Cultural and Life Experiences May Constitute Specialized Knowledge for L-1B Visa Status: D.C. Circuit

Practical Law Legal Update 6-585-6631 (Approx. 6 pages)

Cultural and Life Experiences May Constitute Specialized Knowledge for L-1B Visa Status: D.C. Circuit

by Practical Law Labor & Employment

Background

Fogo de Chao, Inc. (Fogo de Chao) operates Brazilian steakhouses in Brazil and the US. Part of the company's success and signature has been to employ churrasqueiros, gaucho chefs who are raised and trained in traditional barbecue in Southern Brazil's Rio Grande do Sul region.

The Immigration and Nationality Act (INA) provides that temporary L-1B nonimmigrant visas can be granted to an individual who:

Worked for a particular employer abroad for one year within the three years before seeking entry to the US.
Seeks to enter the US to continue working for that employer or a related entity:
- in a managerial or executive capacity (L-1A status); or
- in a position involving specialized knowledge (L-1B status).

(INA § 101(a)(15)(L) (8 U.S.C. § 1101(a)(15)(L)).)

In 1990, Congress amended the INA to define specialized knowledge as the beneficiary's special knowledge of the company's product and application to international markets or advanced knowledge of the company's processes (INA § 214(c)(2)(B) (8 U.S.C. § 1184(c)(2)(B))). The regulation promulgated by the Immigration and Naturalization Service (INS), the USCIS's predecessor agency, essentially mirrored the statutory text (8 C.F.R. § 214.2(l)(1)(ii)(D)). USCIS and the INS issued two non-binding memoranda interpreting the term specialized knowledge.

The first, issued in 1994 (Puleo Memorandum), advised that common dictionary definitions of "special" and "advanced" should be used by agency officers interpreting the specialized knowledge category. The Puleo Memorandum stressed that although proprietary or unique knowledge is not required, the beneficiary's knowledge must be different or uncommon, and not generally found in the industry.

In 2004, USCIS issued a memorandum (Ohata Memorandum) that advised that although chefs are not generally considered to have specialized knowledge for L-1B status, the employer can show the beneficiary qualifies if it provides evidence that the beneficiary's knowledge:

Is uncommon or not generally shared by practitioner's in the beneficiary's field.
Not easily or quickly learned without significant experience or in-house training.
Necessary and relevant to the sponsoring employer's business.

From 1997 to 2006, Fogo de Chao was granted more than 200 L-1B visas to transfer specialized knowledge chefs to its restaurants. In 2010, Fogo De Chao sought to transfer chef Rones Gasparetto from Brazil to the US, providing a CEO letter and exhibits, as well as additional information when requested by USCIS. Gasparetto's visa was denied by the USCIS because Fogo de Chao had not shown that his skills were not so uncommon or complex that other chefs could not master them.

Fogo de Chao filed a complaint challenging the denial of the visa. USCIS administratively reopened the proceeding of its own motion and the district court stayed its proceedings pending the USCIS review. Fogo de Chao submitted additional documents to USCIS, including an affidavit from its CEO, noting that a number of churrasqueiros' duties can not be taught to non-Brazilian employees in a short time period or at all. USCIS once again denied Fogo de Chao's visa petition and the AAO affirmed the decision, concluding that:

Gasparetto's background and training did not, as a matter of law, constitute specialized knowledge.
Fogo de Chao failed to establish that Gasparetto had completed two years of training and one year of employment as a churrasqueiro.
Fogo de Chao had not established that its churrasqueiros required specialized knowledge.

After the AAO's decision, the district court granted summary judgment to the government:

Deferring to the AAO's regulatory interpretation of specialized knowledge.
Concluding that since the AAO determined that Fogo de Chao had submitted insufficient documentation regarding Gasparetto's completion of the training program, the AAO's error regarding its treatment of Gasparetto's cultural knowledge was rendered harmless.
Rejecting Fogo de Chao's claims that USCIS departed from precedent without going through notice and comment rulemaking and had prejudged Fogo de Chao's petition.

Fogo de Chao appealed the decision to the DC Circuit.

Outcome

The DC Circuit reversed the district court's grant of summary judgment to the government, holding that:

The AAO erred in categorically prohibiting all culturally-acquired knowledge supporting a specialized knowledge determination.
The AAO failed to provide substantial evidence to support its conclusion that Gasparetto did not complete Fogo de Chao's training program.
Fogo de Chao's other legal challenges should be rejected.

The DC Circuit noted that although substantial deference is typically given to an agency's interpretations of a statute it administers and its own regulations, less deference should be given in this case because the USCIS, through the legacy INS, paraphrased the statutory language rather than interpreting the statute to formulate a regulation. However, the interpretation deserves respect to the extent of its persuasive power.

In holding that the AAO erred in categorically prohibiting all culturally-acquired knowledge supporting a specialized knowledge determination, the DC Circuit noted that:

USCIS did not provide a reasoned analysis of why "specialized knowledge" bars all knowledge acquired through one's culture and life experience.
Nothing in the statute excludes culturally-acquired knowledge as a form of "specialized knowledge."
While the mere status of being from a region alone is not "specialized knowledge," actual knowledge acquired through culture and experience may distinguish the individual from other employees who must learn those skills.
Evidence showed that Gasparetto gained much of his relevant skills through experiences participating in churrasco in Brazil.
A lack of express reference to culture in the L-1B visa program does not mean that culture cannot be considered when determining "specialized knowledge."
The AAO departed from policy guidance and rejected Fogo de Chao's relevant evidence of the economic inconvenience that would result from the rejection of Gasparetto's visa.
Fogo de Chao's arguments that the AAO's decision was inconsistent with previous USCIS decisions or precedent were without merit because:
- although Fogo de Chao argued that the over 200 other visas approved featured similar circumstances, it did not provide evidence to prove that point;
- approval of a visa application on one occasion does not create entitlement to further approvals; and
- Fogo de Chao did not demonstrate how prior interpretations of the specialized knowledge standard differed from the AAO's interpretation in this case.

The DC Circuit noted that:

The AAO did not provide substantial evidence to support its conclusion that Gasparetto did not complete the necessary training program.
An agency may not ignore uncontradicted evidence without explanation.
The AAO's factual conclusions that a churrasqueiro does not require specialized knowledge were remanded for further explanation.
Fogo de Chao did not adequately prove that USCIS's decision-makers prejudged the Gasparetto decision, as it based its claim on an isolated statement in a court filing reciting the agency's litigation position.
It could not affirm the AAO's decision because USCIS's inadequate reasoning precluded the court from finding that the agency would have resolved the Gasparetto petition in the same manner minus its errors.

Practical Implications

USCIS has applied increasingly strict scrutiny on L-1B petitions over the past several years, resulting in a lack of clarity and understanding of what actually qualifies as "specialized knowledge." In this case, the DC Circuit held that there was insufficient evidence to ban cultural background and life experiences from constituting "specialized knowledge" for the purposes of receiving L-1B status. In addition, the DC Circuit calls upon USCIS to follow its own guidance memoranda, particularly the Puleo and Ohata Memoranda, in interpreting the specialized knowledge category, and requires USCIS to apply greater analysis than merely repeating the agency's regulations, which simply echo the statute. Employers that petition for L-1B workers can look to this decision for guidance on what might fall under the umbrella of specialized knowledge.

Cultural and Life Experiences May Constitute Specialized Knowledge for L-1B Visa Status: D.C. Circuit | Practical Law