dismissed EB-3 Case: Restaurant

U.S. Department of Homeland Security 
20 Mass. Ave., N.W., Rm. A3042 
Washington, DC 20529 
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U. S. Citizenship 
and Immigration 
PUBLIC COPY 
Office: VERMONT SERVICE CENTER Date: MAR 2 g 2006 
EAC 04 131 51242 
PETITION: Immigrant petition for Alien Worker as a Skilled Worker or Professional pursuant to section 
203(b)(3) of the Immigration and Nationality Act, 8 U.S.C. $ 1153(b)(3) 
ON BEHALF OF PETITIONER: 
INSTRUCTIONS: 
This is the decision of the Administrative Appeals Office in your case. All documents have been returned to 
the office that originally decided your case. Any further inquiry must be made to that office. 
Robert P. Wiemann, Director 
Administrative Appeals Office 
Page 2 
DISCUSSION: The Acting Director, Vermont Service Center, denied the preference visa petition that is 
now before the Administrative Appeals Office on appeal. The appeal will be dismissed. 
The petitioner is a restaurant. It seeks to employ the beneficiary permanently in the United States as a night 
manager. As required by statute, a Form ETA 750, Application for Alien Employment Certification, 
approved by the Department of Labor accompanied the petition. The acting director determined that the 
petitioner had not established that it had the continuing ability to pay the beneficiary the proffered wage 
beginning on the priority date of the visa petition and denied the petition accordingly. 
On appeal, counsel submits a brief. 
Section 203(b)(3)(A)(i) of the Immigration and Nationality Act (the Act), 8 U.S.C. 9 1153(b)(3)(A)(i), 
provides for granting preference classification to qualified immigrants who are capable, at the time of 
petitioning for classification under this paragraph, of performing skilled labor (requiring at least two years 
training or experience), not of a temporary nature, for which qualified workers are not available in the United 
States. 
Section 203(b)(3)(A)(ii) of the Immigration and Nationality Act (the Act), 8 U.S.C. 8 1153(b)(3)(A)(ii), 
provides for granting preference classification to qualified immigrants who hold baccalaureate degrees and 
are members of the professions. 
The regulation at 8 C.F.R. tj 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 in the form of copies of annual reports, federal tax returns, or audited financial 
statements. 
The petitioner must demonstrate the continuing ability to pay the proffered wage beginning on the priority 
date, the day the Form ETA 750 was accepted for processing by any office within the employment system of 
the Department of Labor. See 8 C.F.R. 4 204.5(d). Here, the Form ETA 750 was accepted for processing on 
April 18, 2001. The proffered wage as stated on the Form ETA 750 is $673.36 per hour, which equals 
$35,014.72 per year. 
On the petition, the petitioner stated that it was established during 1991 and that it employs 11 workers. The 
petition states that the petitioner's gross annual income is $42,6337.00 [sic] and that its net annual income is 
$19,385. On the Form ETA 750, Part B, signed by the beneficiary, the beneficiary claimed to have worked 
for the petitioner since November 2000. Both the petition and the Form ETA 750 indicate that the petitioner 
will employ the beneficiary in Bristol, Connecticut. 
In support of the petition, counsel submitted the 2000 tax return o nd an undated letter. 
Page 3 
The 2000 tax return shows that 
 incorporated on August 1, 1998 and that it reports taxes based 
on the calendar year and cash convention accounting. During 
 declared a loss of $45,985. 
The corresponding Schedule L shows that at the end of that yea 
 current assets of $14,959 
and no current liabilities, which yields net current assets of $14,959. Because the priority date of the instant 
petition is April 18, 2001 evidence pertinent to the petitioner's finances during previous years is not directly 
relevant to the petitioner's continuing ability to pay the proffered wage beginning on the priority date. 
The undated letter is fro- and states 
 does business as - 
 hat letter also states that the loss sustained b 
 unng 2000 was due to construction 
work on the road in front of the restaurant during that year. Finally, 
 that during 2001 the 
petitioner earned a profit of $19,385. 
relationship to the petitioner was not stated in that letter. 2000 tax return 
however, lists him as the preparer of that return. No evidence was then provided in support of 
assertions that the petitioner an are the same company,' that the petitioner's loss during 2000 
was due to construction impeding access to the restaurant, or that the petitioner earned a profit during 2001. 
The petition in this matter was submitted on March 29, 2004. On that date the petitioner's 2001 and 2002 
returns should have been available and its 2003 return may have been available as well. Counsel did not, 
however, provide any of those returns with the petition. Counsel also failed to provide any evidence of the 
wages allegedly paid to the beneficiary. 
The acting director determined that the evidence submitted did not establish that the petitioner had the 
continuing ability to pay the proffered wage beginning on the priority date and, on September 8,2004, denied 
the petition. 
In the decision of denial the acting director noted that the petitioner claimed, on the petition, to employ 11 
workers. The acting director observed that the Wage and Salary expense of $86,044 shown at Line 13 of the 
petitioner's 2000 tax return does not seem adequate to compensate 11 workers. 
On appeal, counsel submits (1) partly legible copies of the 2001 and 2003 Form 1120 U.S. Corporation 
Income Tax Returns o , (2) partly legible copies of several pages of 2002 tax 
return, and (3) a brief. 
2001 return shows that it declared taxable income before net operating loss deductions and 
special deductions of $19,385 during that year. The corresponding Schedule L shows that at the end of that 
year the petitioner had current assets of $1 1,390 and no current liabilities, which yields net current assets of 
$1 1,390. 
The pages provided from 
 2002 return are not entirely legible, but appear to show that during 
that year the petitioner 
 $36,480 as its taxable income before net operating loss deductions 
and special deductions. The Schedule L from that return, although again not entirely legible, appears to show 
The same mailing address is used by both, though that is insufficient to establish that they are the same entity. 
that at the end of that year the petitioner had net current assets of $13,497 and no current liabilities, which 
yields net current assets of $13,497. 
2003 return shows that the petitioner declared taxable income before net operating loss 
deductions and special deductions of $10,146 during that year. The corresponding Schedule L shows that at 
the end of that year the petitioner had current assets of $19,050 and no current liabilities, which yields net 
current assets of $19,050. 
On appeal counsel states that a previous petition was approved based on the same 2000 return submitted in 
this case. The previous petition to which counsel refers is not before this office. This office notes, however, 
that if the priority date of the previous petition was prior to 2001, then the 2000 petition was directly relevant 
to that case, although it is not directly relevant to the instant case, as was explained above. 
Counsel also stated, "The corporate tax year ends June 30, 2001 ." All of the returns submitted indicate that 
the petitioner reports taxes pursuant to the calendar year. 
As to the perceived discrepancy between the number of workers the petitioner allegedly employs and the 
- - - 
salary andwage expense ok counsel asserts that many of the petitioner's employees are part- 
time, that wait staff positions are entitled to very low minimum wages, and that restaurant staff typically has a 
high turnover. Counsel states that, therefore, no discrepancy exists between the number of workers the 
petitioner employs and the amount of its wage and salary expense. 
This office is convinced by counsel's explanation of the apparent discrepancy cited by the acting director. 
The remaining issue is whether the petitioner has demonstrated the continuing ability to pay the proffered 
wage beginning on the priority date. 
Counsel states, 
The enclosed tax return for the year 2001 show [sic] the employer's receipts were $426,437 
compared to $334,994 the year before which is a sizeable increase. The employer could have 
allocated resources differently with regard to the prevailing wage. 
Counsel is apparently asserting that the increase in the petitioner's gross receipts demonstrates its continuing 
ability to pay the proffered wage beginning on the priority date and that the petitioner could have spent funds 
differently if it had been obliged to pay the proffered wage. 
A petitioner's gross receipts, however, or an increase in its gross receipts, are not an index of its ability to pay 
additional wages. Unless the petitioner can show that hiring the beneficiary would somehow have reduced its 
expenses2 or otherwise increased its net in~ome,~ the petitioner is obliged to show the ability to pay the 
The petitioner might be able to show, for instance, that the beneficiary would replace another named employee, thus 
obviating that other employee's wages, and that those obviated wages would be sufficient to cover the proffered wage. 
The petitioner might be able to demonstrate, rather than merely allege, that employing the beneficiary would contribute 
more to the petitioner's revenue than the amount of the proffered wage. 
Page 5 
proffered wage in addition to the expenses it actually paid during a given year. The petitioner is obliged to 
show that it had sufficient funds remaining to pay the proffered wage after all expenses were paid. That 
remainder is the petitioner's net income. In K.C.P. Food Co., Inc. v. Sava, 623 F. Supp. at 1084, the court 
held that the Immigration and Naturalization Service, now CIS, had properly relied on the petitioner's net 
income figure, as stated on the petitioner's income tax returns, rather than the petitioner's gross income. The 
court specifically rejected the argument that CIS should have considered income before expenses were paid 
rather than net income. 
Counsel's unsupported assertion or implication that the petitioner could have reallocated assets as necessary 
to pay the proffered wage is unconvincing. Again, assertions of counsel are not evidence and are insufficient 
to sustain the burden of proof. See INS v. Phinpathya, supra, and Matter of Ramirez-Sanchez, supra. Absent 
competent evidence to the contrary, amounts spent on other business expenses during a given year will not be 
considered to have been available to pay the proffered wage. 
Counsel asserts that the petitioner is paying the beneficiary $10 per hour and must show the ability to pay 
$17.72 per hour. Counsel reasons that, therefore, the petitioner is obliged to show only the ability to pay the 
difference between the two, which counsel calculates to be approximately $15,000 per year. Counsel states 
that the tax returns show sizeable increases and therefore demonstrate the petitioner's ability to pay that 
additional amount. 
However, the petitioner has submitted no evidence to demonstrate the amount it paid to the beneficiary during 
any of the salient years. The only indication of wages paid to the beneficiary is counsel's statement. The 
assertions of counsel, however, are not evidence and are not entitled to any evidentiary weight. See INS v. 
Phinpathya, 464 U.S. 183, 188-89 n.6 (1984); Matter of Ramirez-Sanchez, 17 I&N Dec. 503 (BIA 1980); 
Unsupported assertions of counsel are, therefore, insufficient to sustain the burden of proof. 
Counsel states, "Furthermore, "LLC" ventures are able to borrow or lend their own money to fund the 
corporation." Although counsel's meaning is unclear, he may be stating that the owner or owners of an LLC 
may, if they wish, contribute to the company to pay its debts and obligations. 
That the petitioner's owners may, if they wish, contribute capital to the petitioner is not germane. The 
petitioner is a limited liability company (LLC). Its owners enjoy the same limited liability as the owners of a 
corporation. It is a legal entity separate and distinct from its owners. See Matter of M, 8 I&N Dec. 24 (BIA 1958; 
AG 1958). The debts and obligations of the company are not the debts and obligations of the owners or anyone 
else.4 
Because an LLC is a separate and distinct legal entity from its owners and shareholders, and the owners and 
others are not obliged to pay its debts, the income and assets of the owners and others and their ability, if they 
wished, to pay the company's debts and obligations, are irrelevant to this matter. Nothing in the governing 
regulation, 8 C.F.R. tj 204.5, permits CIS to consider the financial resources of individuals or entities with no 
legal obligation to pay the wage. Sitar v. Ashcroft, 2003 WL 22203713 (D.Mass. Sept. 18, 2003). The assets 
4 
 Although this general rule might be amenable to alteration pursuant to contract or otherwise, no evidence appears in the 
record to indicate that the general rule is inapplicable in the instant case. 
Page 6 
of the petitioner's shareholders or of other enterprises cannot be considered in determining the petitioner's 
ability to pay the proffered wage. See Matter of Aphrodite Investments, Ltd., 17 I&N Dec. 530 (Comm. 
1980). The petitioner must show the ability to pay the proffered wage out of its own funds. The income and 
assets of the petitioner's owner shall not be further considered. 
Finally, counsel states that Matter of Sonegawa, 12 I&N Dec. 612 (Reg. Comrn. 1967) "takes a far more liberal 
view of the ability to pay the proffered wage [than the decision of denial.] Counsel observes that the case has not 
been overturned, but offers no argument to demonstrate that the decision in that case should influence the 
decision in this matter. 
Matter of Sonegawa, supra, however, relates to petitions filed during uncharacteristically unprofitable or difficult 
years but only withn a framework of significantly more profitable or successful years. During the year in which 
the petition was filed in that case the petitioner changed business locations and paid rent on both the old and new 
locations for five months. The petitioner suffered large moving costs and a period of time during which the 
petitioner was unable to do regular business. 
In Sonegawa, the Regional Commissioner determined that the petitioner's prospects for a resumption of 
successful business operations were well established. The petitioner was a fashion designer whose work had been 
featured in Time and Look magazines. Her clients included Miss Universe, movie actresses, and society matrons. 
The petitioner's 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 petitioner's sound 
business reputation and outstanding reputation as a couturiere. 
Counsels is correct that, if losses or low profits are uncharacteristic, occur within a framework of profitable or 
successful years, and are demonstrably unlikely to recur, then those losses or low profits may be overlooked 
in determining the ability to pay the proffered wage. Here, the petitioner is a new business, and has never 
posted a large profit. No unusual circumstances have been shown to exist in this case to parallel those in 
Sonegawa, nor has it been established that 2000, 2001, and 2003' were uncharacteristically unprofitable year 
for the petitioner. Assuming that the petitioner's business will flourish, with or without hiring the beneficiary, is 
speculative. 
In determining the petitioner's ability to pay the proffered wage during a given period, CIS will examine 
whether the petitioner employed the beneficiary during that period. If the petitioner establishes by 
documentary evidence that it employed the beneficiary at a salary equal to or greater than the proffered wage, 
the evidence will be considered prima facie proof of the petitioner's ability to pay the proffered wage. In the 
instant case, the petitioner did not establish that it employed and paid the beneficiary. 
If the petitioner does not establish that it employed and paid the beneficiary an amount at least equal to the 
proffered wage during a given period, the AAO will, in addition, examine the net income figure reflected on 
the petitioner's federal income tax return, without consideration of depreciation or other expenses. CIS may 
rely on federal income tax returns to assess a petitioner's ability to pay a proffered wage. Elatos Restaurant 
* The submitted portion of the petitioner's 2002 tax return was insufficient to determine whether the petitioner declared 
a profit or a loss during that year or the size of that profit or loss. 
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), affd, 703 F.2d 571 (7th Cir. 1983). 
Finally, no precedent exists that would allow the petitioner to add back to net cash the depreciation expense 
charged for the year. Chi-Feng Chang at 537. See also Elatos Restaurant, 623 F. Supp. at 1054. 
The petitioner's net income is not the only statistic that may be used to show the petitioner's ability to pay the 
proffered wage. If the petitioner's net income, if any, during a given period, added to the wages paid to the 
beneficiary during the period, if any, do not equal the amount of the proffered wage or more, the AAO will 
review the petitioner's assets as an alternative method of demonstrating the ability to pay the proffered wage. 
The petitioner's total assets, however, are not available to pay the proffered wage. The petitioner's total 
assets include those assets the petitioner uses in its business, which will not, in the ordinary course of 
business, be converted to cash, and will not, therefore, become funds available to pay the proffered wage. 
Only the petitioner's current assets, the petitioner's year-end cash and those assets expected to be consumed 
or converted into cash within a year, may be considered. Further, the petitioner's current assets cannot be 
viewed as available to pay wages without reference to the petitioner's current liabilities, those liabilities 
projected to be paid within a year. CIS will consider the petitioner's net current assets, its current assets net 
of its current liabilities, in the determination of the petitioner's ability to pay the proffered wage. 
The proffered wage is $35,0 14.72 per year. The priorit date is A ril 18, 2001. Although counsel submitted 
only an undated letter from a tax preparer to show that and the petitioner are the same entity, 
this office notes that the returns is the same as that of the petitioner. On the 
balance, this office finds 
 tax returns to be those of the petitioner. 
During 2001 the petitioner declared taxable income before net operating loss deductions and special 
deductions of $19,385. That amount is insufficient to pay the proffered wage. At the end of that year the 
petitioner had net current assets of $1 1,390. That amount is also insufficient to pay the proffered wage. The 
petitioner has submitted no reliable evidence of any other funds available to it during 2001 with which it 
could have paid the proffered wage. The petitioner has not demonstrated the ability to pay the proffered wage 
during 200 1. 
The portion of the petitioner's 2002 tax return submitted shows that the petitioner declared a loss. The 
petitioner is unable, therefore, to show the ability to pay any portion of the proffered wage out of its profits 
during that year. A the end of that year the petitioner had net current assets of $13,497. That amount is 
insufficient to pay the proffered wage. The petitioner has submitted no reliable evidence of any other funds 
available to it during 2002 with which it could have paid the proffered wage. The petitioner has not 
demonstrated the ability to pay the proffered wage during 2002. 
During 2003 the petitioner declared taxable income before net operating loss deductions and special 
deductions of $10,146. That amount is insufficient to pay the proffered wage. At the end of that year the 
petitioner had net current assets of $13,497. That amount is also insufficient to pay the proffered wage. The 
petitioner has submitted no reliable evidence of any other funds available to it during 2003 with which it 
could have paid the proffered wage. The petitioner has not demonstrated the ability to pay the proffered wage 
during 2003. 
The petitioner failed to demonstrate that it had the ability to pay the proffered wage during 2001, 2002, and 
2003. Therefore, the petitioner has not established that it had the continuing ability to pay the proffered wage 
beginning on the priority date. 
The burden of proof in these proceedings rests solely upon the petitioner. Section 291 of the Act, 8 U.S.C. 
fj 1361. The petitioner has not met that burden. 
ORDER: The appeal is dismissed.