dismissed EB-1C Case: Transportation

(b)(6)
Matter of E-S-A-S- , Inc. 
U.S. Citizenship 
and Immigration 
Services 
MATTER OF E-S-A-S- , INC. 
APPEAL OF TEXAS SERVICE CENTER DECISION 
Non-Precedent Decision of the 
Administrative Appeals Office 
DATE: SEPT . 21 , 2015 
PETITION: FORM I-140, IMMIGRANT PETITION FOR ALIEN WORKER 
The Petitioner , a transportation company doing business as 1 seeks to employ the 
Beneficiary as its general manager under the immigrant classification of a multinational executive or 
manager. See Immigration and Nationality Act (the Act) § 203(b)(l)(C) , 8 U.S.C. § 1153(b)(1)(C). 
The Director, Texas Service Center, denied the petition. The matter is now before us on appeal. The 
appeal will be dismissed. 
I. LAW 
Section 203(b) of the Act states in pertinent part: 
(1) Priority Workers.- Visas shall first be made available ... to qualified immigrants 
who are aliens described in any of the following subparagraphs (A) through (C): 
* * * 
(C) Certain multinational executives and managers. An alien is described in this 
subparagraph if the alien, in the 3 years preceding the time of the alien's application for 
classification and admission into the United States under this subparagraph, has been 
employed for at least 1 year by a firm or corporation or other legal entity or an affiliate 
or subsidiary thereof and the alien seeks to enter the United States in order to continue to 
render services to the same employer or to a subsidiary or affiliate thereof in a capacity 
that is managerial or executive. 
The language of the statute is specific in limiting this provision only to those executives and managers 
who have previously worked for a firm, corporation or other legal entity, or an affiliate or subsidiary of 
that entity, and who are coming to the United States to work for the same entity, or its affiliate or 
subsidiary. 
1 The record indicates that the petitioner also operates "a bakery and gift shop , named 
2 
(b)(6)
Matter of E-S-A-S- , Inc. 
A United States employer may file Form I-140 to classifY a beneficiary under section 203(b)(l)(C) of 
the Act as a multinational executive or manager. The regulation at 8 C.F.R. § 204.50)(5) states: 
No labor certification is required for this classification ; however, the prospective 
employer in the United States must furnish 
a job offer in the form of a statement 
which indicates that the alien is to be employed in the United States in a managerial 
or executive capacity. Such letter must clearly describe the duties to be performed by 
the alien. 
II. ISSUE ON APPEAL: ABILITY TO PAY 
At issue in this proceeding is the Petitioner's ability to pay the Beneficiary's proffered wage from 
the petition's filing date onward . The regulation at 8 C.F.R. § 204.5(g)(2) states, in pertinent part: 
Ability of prospective employer to pay wage. Any petition filed by or for an 
employment-based immigrant which requires an offer of employment must be 
accompanied by evidence that the prospective United States employer has the ability 
to pay the proffered wage. The petitioner must demonstrate this ability at the time the 
priority date is established and continuing until the beneficiary obtains lawful 
permanent residence. Evidence of this ability shall be either in the form of copies of 
annual reports, federal tax returns, or audited financial statements . . . . In appropriate 
cases, additional evidence , such as profit/loss statements, bank account records, or 
personnel records, may be submitted by the petitioner or requested by the Service. 
A. Facts 
The Petitioner filed Form I-140 on February 24, 2014. The evidence of record shows that the 
Petitioner is structured as a C corporation. On the petition form, the Petitioner claimed to have been 
established in to have a gross annual income of $63,641, and to currently employ seven 
workers. The Petitioner indicated that the Beneficiary's salary will be $25,000 per year. The 
Petitioner left blank the line marked "Net Annual Income." The Petitioner has employed the 
Beneficiary since 2007. 
The Petitioner submitted copies of its IRS Forms 1120, U.S. Corporation Income Tax Returns, for 
2010, 2011 and 2012. 
The Petitioner's president , stated in a letter dated February 14, 2014, that the 
company faced many challenges as a result of the 2008 economic crisis. She added: 
owes its survival to two major factors. First has been the 
[Beneficiary 's] unrelenting leadership .. . Second has been the support provided by 
[parent entity] , which has given financial support to allow 
to avoid incurring debt to external creditors. During the period January 2011 
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Matter of E-S-A-S-, Inc. 
through March 2012 we provided funds in excess of $19,000 to assist our Florida 
subsidiary during this difficult time. 
The Director issued a request for evidence (RFE) on August 4, 2014, instructing the Petitioner to 
submit required financial documentation from 2013 to establish its ability to pay the Beneficiary 
$25,000 per year, as well as evidence of compensation paid to the Beneficiary in 2013. In response, 
the Petitioner submitted a copy of its 2013 IRS Form 1120 return and other financial documents. 
The Director denied the petition on January 14, 2015. In the denial notice, the Director noted that 
"the petitioner paid the Beneficiary $8,250.00" in 2013, and that the Petitioner's tax return for that 
year shows a loss of $33,418, as well as current liabilities that exceeded its current assets by $1,176. 
The Director cited case law to support the finding that, because the Petitioner is a distinct legal 
entity, U.S. Citizenship and Immigration Services (USCIS) cannot take into account the assets of 
outside individuals or entities when determining the Petitioner's ability to pay the proffered wage. 
The cited cases were Matter of M, 8 I&N Dec. 24 (BIA 1958) and Matter of Aphrodite Investments 
Ltd., 17 I&N Dec. 530 (Comm'r 1980). 
On appeal, the Petitioner submits copies of previously submitted correspondence, indicating that the 
parent entity intends to support the petitioning company. In an accompanying brief, the Petitioner 
states that the evidence regarding the parent entity constitutes "'additional evidence' that its ability 
to pay rested in part on the continuing financial support of its UK-based affiliate." The Petitioner 
disputes the relevance of the case law cited by the Director, and asserts that the Director should have 
relied instead on Full Gospel Portland Church v. Thornburgh, 730 F. Supp. 441 (D.D.C. 1988), 
which the Petitioner had cited in the RFE response. 
The Petitioner submits a 2014 profit and loss statement, and contends that this document shows a 
significant increase in the Petitioner's income. 
B. Analysis 
For the reasons discussed above, we find that the Petitioner has not established its ability to pay the 
Beneficiary's proffered wage as of the petition's filing date. 
In determining the Petitioner's ability to pay the proffered wage, USCIS will first examine whether 
the Petitioner employed the Beneficiary at the time the priority date was established. If the 
Petitioner establishes by documentary evidence that it employed the Beneficiary at a salary equal to 
or greater than the proffered wage, this evidence will be considered prima facie proof of the 
Petitioner's ability to pay the Beneficiary's salary. In the present matter, the Petitioner employed the 
Beneficiary, but has not established that it paid the Beneficiary the full proffered wage from the 
February 24, 2014 filing date. 
4 
Matter of E-S-A-S-, Inc. 
If the Petitioner did not pay the Beneficiary an amount at least equal to the proffered wage, we will 
then next examine the petitioner's net income figure as reflected on its federal income tax return. 
Reliance on federal income tax returns as a basis for determining a petitioner's ability to pay the 
proffered wage is well established by judicial precedent. Elatos Restaurant Corp. v. Sava, 632 F. 
Supp. 1049, 1054 (S.D.N.Y. 1986) (citing Tongatapu Woodcraft Hawaii, Ltd. v. Feldman, 736 F.2d 
1305 (9th Cir. 1984)); see also Chi-Feng Chang v. Thornburgh, 719 F. Supp. 532 (N.D. Texas 
1989); K.C.P. Food Co., Inc. v. Sava, 623 F. Supp. 1080 (S.D.N.Y. 1985); Ubeda v. Palmer, 539 F. 
Supp. 647 (N.D. Ill. 1982), aff'd, 703 F.2d 571 (7th Cir. 1983). 
In K.C.P. Food Co., Inc. v. Sava, the court held the Immigration and Naturalization Service (now 
USCIS) had properly relied on the petitioner's net income figure, as stated on the petitioner's 
corporate income tax returns, rather than on the petitioner's gross income. 623 F. Supp. at 1084. The 
court specifically rejected the argument that the Service should have considered income before 
expenses were paid rather than net income. 
For a C Corporation, USCIS considers net income to be the figure shown on Line 28 of IRS Form 
1120. At the time of filing, the Petitioner's most recent federal income tax return corresponded to 
2012. The most recent federal income tax return available at the time of the director's decision was 
the Petitioner's 2013 return. 
• The Petitioner's 2012 Form 1120 showed net income of -$32,286. 
• The Petitioner's 2013 Form 1120 showed net income of -$33,418. 
Therefore, for the years 2012 and 2013, the Petitioner did not have sufficient net income to pay the 
proffered wage. Earlier returns likewise showed five-figure net income losses for 2010 and 2011. 
Because the Petitioner's net income does not make up the difference between the Beneficiary's 
actual compensation and the proffered wage, we will review the Petitioner's net current assets. Net 
current assets are the difference between the Petitioner's current assets and current liabilities.2 A 
corporation's year-end current assets are shown on Schedule L, lines 1 through 6, and include cash­
orr-hand. Its year-end current liabilities are shown on lines 16 through 18. If the total of the 
Petitioner's end-of-year net current assets and the wages paid to the Beneficiary are equal to or 
greater than the proffered wage, then the Petitioner is expected to be able to pay the proffered wage 
using those net current assets. 
• In 2013, the Form 1120 showed net current assets of -$1,156. 
• In 2012, the Form 1120 showed net current assets of -$654. 
2 Current assets consist of items having (in most cases) a life of one year or less, such as cash, marketable securities, 
inventory and prepaid expenses. Current liabilities are obligations payable (in most cases) within one year, such as 
accounts payable, short-term notes payable, and accrued expenses (such as taxes and salaries). Joel G. Siegel & Jae K. 
Shim, Dictionary of Accounting Terms 118 (3d ed., Barron's Educ. Series 2000). 
5 
Matter of E-S-A-S-, Inc. 
Therefore, for 2013, the Petitioner did not have sufficient current assets to pay the difference 
between the Beneficiary's actual compensation and the proffered wage. 
The above information shows that the Petitioner has not established its continuing ability to pay the 
Beneficiary the proffered wage as of the filing date through actual wages paid to the Beneficiary, net 
income, or net current assets. 
On appeal, the Petitioner submits a profit and loss statement showing net income of $52,569.74 
during calendar year 2014, the result of what the Petitioner calls "a doubling of income, to $257,176, 
from the $100,150 realized in 2013" (emphasis in original). The regulation at 8 C.F.R. § 204.5(g)(2) 
requires evidence of ability to pay to be in the form of annual reports, federal tax returns, or audited 
financial statements. The profit and loss statement takes none of these forms, and does not show the 
Petitioner's ability to pay the Beneficiary's full proffered wage as of February 24, 2014. 
The Petitioner acknowledges that it was unable, on its own, to pay the Beneficiary's proffered wage 
at the time of filing. The appeal rests primarily on the contention that the Director should have taken 
the parent entity's assets and income into consideration. The Petitioner has submitted photocopies 
of pay receipts, showing that the foreign parent company paid the Beneficiary in December 2013 and 
during 2014. British tax documents indicate earlier payments, including £11,600 paid to the 
Beneficiary during the tax year ending April 5, 2014.3 
The regulation at 8 C.F.R. § 204.5(g)(2) requires the Petitioner to submit "evidence that the 
prospective United States employer has the ability to pay the proffered wage." The foreign parent 
company is not the prospective United States employer. 
The Petitioner quotes language from Full Gospel Portland Church v. Thornburgh: 
New divisions in businesses or new parishes of larger churches may not themselves 
be financially profitable, but if documents show that they may rely on the larger body 
for support, it is arbitrary and capricious for the INS not to consider the resources of 
the larger organization in making its evaluation of ability to pay. 
Full Gospel Portland Church v. Thornburgh, 730 F. Supp. at 450. The Petitioner claims: "In the 
instant case we have exactly the same situation; the Director has arbitrarily and capriciously 
dismissed relevant proof." 
Although we may consider the reasoning of the Full Gospel decision, we are not bound to follow the 
published decision of a United States district court, even in cases arising within the same district. 
See Matter of K-S-, 20 I&N Dec. 715 (BIA 1993 ). More directly on point is the decision in Sitar 
Restaurant v. Ashcroft, 2003 WL 22203713 *2, (D. Mass. 2003). The court noted that the employer in 
that case had not rebutted the contention that nothing in the governing regulation, 8 C.F.R. § 204.5, 
3 At the exchange rate on that date, available at http://www.xe.com/currencytables/?from=GBP&date=2014-04-05, the 
sum was equal to $19,231.06 U.S. dollars. (Printout of exchange rate information added to record June I 0, 20 15). 
Matter of E-S-A-S-, Inc. 
permits us to consider the financial resources of individuals or entities who have no legal obligation 
to pay the wage. The court added that immigration authorities did not err when they limited 
consideration to "assets under Petitioner's legal control." !d. at *4. 
With regard to the Petitioner's own resources, the Petitioner cites Matter of Sonegawa, 12 I&N Dec. 
612 (Reg'l Comm'r 1967). Describing that case, the Petitioner asserts that, although "an expensive 
change of premises" had temporarily affected the employer's finances, "the totality of the 
circumstances" supported a finding in that petitioner's favor. 
The Petitioner has not established a fact pattern comparable to Sonegawa. The petitioning entity in 
Sonegawa had been in business for over 11 years and routinely earned a gross annual income of 
about $ i 00,000. During the year in which the petition was filed in that case (1966), the employer 
changed business locations and paid rent on both the old imd new locations for five months. There 
were substantial moving costs and also a period of time when the employer was unable to do regular 
business. The Regional Commissioner determined that the employer's prospects for a resumption of 
successful business operations were well established. The Petitioner in Sonegawa was a fashion 
designer whose work had been featured in Time and Look magazines. Her clients included Miss 
Universe, movie actresses, and society matrons. Her clients had been included in lists of the best­
dressed California women. The Petitioner lectured on fashion design at design and fashion shows 
throughout the United States and at colleges and universities in California. The Regional 
Commissioner's determination in Sonegawa was based in part on the employer's sound business 
reputation and outstanding reputation as a couturieure. 
As in Sonegawa, USCIS may, at its discretion, consider evidence relevant to a petitioner's financial 
ability that falls outside of a petitioner's net income and net current assets. USCIS may consider 
such factors as the number of years the petitioner has been doing business, the established historical 
growth of the petitioner's business, the overall number of employees, the occurrence of any 
uncharacteristic business expenditures or losses, the petitioner's reputation within its industry, 
whether the Beneficiary is replacing a former employee or an outsourced service, or any other 
evidence that USCIS deems relevant to the petitioner's ability to pay the proffered wage. 
In the case now before us, the Petitioner has not established any of the mitigating circumstances that 
characterize Sonegawa. The Petitioner's income tax returns for 2010 through 2013 all show five­
figure net income losses. Those losses exceeded $30,000 per year in 2011, 2012 and 2013. The 
Petitioner claimed seven employees as of February 2014, but paid only $26,107 in salaries in 2013. 
The Petitioner has not established a history of viability and profitability, offset by extraordinary, 
identifiable, one-time expenses as in Sonegawa. 
The unaudited profit and loss statement submitted on appeal does not establish that the Petitioner's 
prior history of unprofitability was the result of uncharacteristic expenditures or losses. 
Furthermore, the figures in the new statement do not appear to take into account the Petitioner's 
continued reliance on funds from the foreign entity. Therefore, the new statement does not have the 
same weight as it would for a self-sufficient company. It does not show that the Petitioner is a 
Matter of E-S-A-S-, Inc. 
profitable company. Rather, it shows that the foreign entity has absorbed sufficient expenses to 
allow the Petitioner to show a profit on paper. The Petitioner has not shown that the 2014 profit and 
loss statement is a more reliable indicator of its baseline state, under Sonegawa, than the several 
years of income tax returns that preceded it. 
Accordingly, we find that the Petitioner has not demonstrated that the petitioning U.S. employer was 
able to pay the Beneficiary's proffered salary of$25,000 per year as ofthe petition's filing date. For 
this reason, USCIS cannot approve this petition. 
III. CONCLUSION 
We will dismiss the appeal for the above stated reasons. In visa petition proceedings, it is the 
petitioner's burden to establish eligibility for the immigration benefit sought. Section 291 of the Act, 
8 U.S.C. § 1361; Matter ofOtiende, 26 I&N Dec. 127, 128 (BIA 2013). Here, the Petitioner has not 
met that burden. 
ORDER: The appeal is dismissed. 
Cite as Matter ofE-S-A-S-, Inc., ID# 13557 (AAO Sept. 21, 20154)