dismissed L-1A Case: Furniture

U.S. Citizenship 
and Immigration 
Services 
MATTER OF S-H-F- INC 
Non-Precedent Decision of the 
Administrative Appeals Office 
DATE: OCT. 30, 2017 
APPEAL OF CALIFORNIA SERVICE CENTER DECISION 
PETITION: FORM I-129, PETITION FOR A NONIMMIGRANT WORKER 
The Petitioner, a furniture store, seeks to extend the Beneficiary's temporary employment' as its chief 
executive officer (CEO) under the L-1 A nonimmigrant classification for intracompany transferees. 
See Immigration and Nationality Act (the Act) section 101(a)(15)(L), 8 U.S.C. § 1101(a)(15)(L). 
The L-1 A classification allows a corporation or other legal entity (including its affiliate or subsidiary) to 
transfer a qualifying foreign employee to the United States to work temporarily in a managerial or 
executive capacity. 
The Director of the California Service Center denied the petition, concluding that the record did not 
establish, as required, that it will employ the Beneficiary in a managerial or executive capacity under 
the extended petition. The Director further found that the evidence of the Petitioner's financial status 
did not warrant approval of the petition. The Petitioner filed a motion to reconsider, which the 
Director denied. 
The matter is now before us on appeal. In its appeal, the Petitioner submits additional evidence and 
a brief similar to the one submitted previously on motion. The Petitioner contends that the Director 
erred by misinterpreting policy and by selectively examining the evidence. 
Upon de novo review, we will dismiss the appeal. 
I. LEGAL FRAMEWORK 
To establish eligibility for the L-1A nonimmigrant visa classification, a qualifying organization must 
have employed the beneficiary "in a capacity that is managerial, executive, or involves specialized 
knowledge," for one continuous year within three years preceding the beneficiary's application for 
admission into the United States. Section 101(a)(l5)(L) of the Act. In addition, the beneficiary 
1 The Petitioner previously filed a "'new office" petition on the Beneficiary's behalf, approved for the period from 
January 31,2016 until January 30,2017. A "new office" is an organization that has been doing business in the United 
States through a parent, branch, affiliate, or subsidiary for less than one year. 8 C.F.R. § 214.2(1)( I )(ii)(F). The 
regulation at 8 C.F.R. § 214.2(1)(3)(v)(C) allows a "new office" operation one year within the date of approval of the 
petition to support an executive or managerial position. 
Matter ofS-H-F- Inc 
must seek to enter the United States temporarily to continue rendering his or her services to the same 
employer or a subsidiary or affiliate thereof in a managerial or executive capacity. !d. 
A petition seeking to extend a previously approved petition for a new office must include, among 
other evidence, a statement of the duties that the beneficiary has performed and will perform under 
the extended petition; a statement describing the staffing of the new operation; and evidence of the 
financial status ofthe United States operation. See 8 C.F.R. § 214.2(1)(14)(ii). 
II. U.S. EMPLOYMENT IN A MANAGERIAL OR EXECUTIVE CAPACITY 
The Director found that the Petitioner did not establish that it will employ the Beneficiary in a 
managerial or executive capacity. On appeal, the Petitioner asserts that the Director erroneously 
required all, rather than most, of the Beneficiary's duties to be managerial or executive in nature. 
The record does not support the Petitioner's assertion. 
A managerial capacity is an assignment within an organization in which the employee primarily 
manages the organization, or a department, subdivision, function, or component of the organization, 
and exercises discretion over the day-to-day operations of the activity or function for which the 
employee has authority. A manager must also supervise and control the work of other supervisory, 
professional, or managerial employees, or manage an essential function within the organization, or a 
department or subdivision of the organization, and function at a senior level within the 
organizational hierarchy or with respect to the function managed. Section 101(a)(44)(A) ofthe Act. 
An executive capacity is an assignment within an organization in which the employee primarily 
directs the management of the organization or a major component or function of the organization; 
establishes the goals and policies of the organization, component, or function; exercises wide 
latitude in discretionary decision-making; and receives only general supervision or direction from 
higher-level executives, the board of directors, or stockholders of the organization. Section 
101(a)(44)(B) ofthe Act. 
If staffing levels are used as a factor in determining whether an individual is acting in a managerial 
or executive capacity, U.S. Citizenship and Immigration Services (USCIS) must take into account 
the reasonable needs of the organization, in light of the overall purpose and stage of development of 
the organization. See section 101(a)(44)(C) ofthe Act. 
A. Duties 
When examining the managerial or executive capacity of the Beneficiary, we will look first to the 
Petitioner's description of the Beneficiary's job duties. The Petitioner's description of the job duties 
must clearly describe the duties to be performed by the Beneficiary and indicate whether such duties 
are in a managerial or executive capacity. See 8 C.F.R. § 214.2(l)(3)(ii). 
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Matter ofS-H-F-lnc 
The definitions of managerial and executive capacity each have two parts. First, the Petitioner must 
show that the Beneficiary will perform certain high-level responsibilities. Champion World. Inc. v. 
INS, 940 F.2d 1533 (9th Cir. 1991) (unpublished table decision). Second, the Petitioner must prove 
that the Beneficiary will be primarily engaged in managerial or executive duties, as opposed to 
ordinary operational activities alongside the Petitioner's other employees. See Famizv Inc. v. USCIS, 
469 F.3d 1313, 1316 (9th Cir. 2006); Champion World, 940 F.2d 1533. 
The Petitioner submitted a table listing various tasks and the time that the Beneficiary would devote 
to each one. The Petitioner stated that the Beneficiary "will be responsible for overseeing the 
following" tasks during the first four years of the company's operation: 
Tasks %Time 
Sales Department 60% 
Review and analyze sales and activity reports, potential sales, and 10% 
performance data to measure productivity and goal achievement to 
determine areas of cost reduction need and program improvement 
Direct, design, and implement strategic plans in a cost-effective and 10% 
time-efficient manner 
Manage integrated project plans to ensure successful on-time, on- 10% 
budget delivery of products by developing scope of work documents 
for all projects to define tasks, deliverables, cost estimates, and timing 
Help customers choose the best products that will answer their needs 5% 
Stay alert to new trends 5% 
Determine staff requirements, hire personnel, oversee training of new 10% 
personnel through staff, and monitor management personnel activities 
and reports of lower level personnel submitted by managers 
Direct and approve service and product strategies, price policies, and 10% 
discounts in order to ensure required competitive level, cost recovery, 
and profitability expected by the company. 
Administrative Department 24% 
Establish and communicate goals and objectives 4% 
Work on the setting up of a strategy for being time efficient and, 5% 
therefore, reduce costs 
Plan a weekly meeting to coordinate the operations of the company 3% 
Prepare Financial forecasts and analysis 4% 
Prepare customs documents 4% 
Prepare financial statements 4% 
Marketing Department 16% 
Promote the company through social media 3% 
Develop new innovative marketing campaigns to increase the customer 8% 
base 
Direct a competitive analysis 5% 
Matter ofS-H-F-lnc 
The Petitioner stated that the duties of the sales department would fall to a sales manager, two sales 
representatives, three store managers, and a warehouse worker. (We will discuss these workers 
further in the "Staffing" section below.) The Petitioner named no subordinate personnel responsible 
for the administrative and marketing departments. Instead, the Petitioner stated that it planned to 
employ an administrative assistant and a marketing consultant in its fifth year of operation. The 
Petitioner must establish eligibility at the time of filing, as required by 8 C.F .R. § 103 .2(b )(1 ). 2 We 
must therefore consider the state of the company at the time of filing, rather than the Petitioner's 
long-term plans. 
Asked for more information about the Beneficiary's duties, the Petitioner stated that. in the year 
preceding the filing of the petition, she exercised her managerial authority by opening a store in 
Wisconsin, closing a store in California, and exploring other expansion plans in the Midwest 
assisted by business consultants. 
The Director denied the petition, stating that the Beneficiary "is primarily assisting with the day to 
day non-supervisory duties of the business," performing non-qualifying tasks such as helping 
customers and preparing customs documents and financial statements. 
On motion from that decision, the Petitioner stated that the Director "cherry pick[ ed]" three non­
qualifying activities that, together, occupy only 13% of the Beneficiary's time, and that all of the 
remaining "duties are managerial in nature." In the decision denying the Petitioner's motion, the 
Director disputed the Petitioner's characterization of the initial decision, and stated that "USCIS has 
reviewed all evidences in the file." 
On appeal, the Petitioner maintains that the Director had identified only three non-managerial duties, 
and that "[t]he remaining 87% of the job duties ... must be managerial, or the Service would have 
listed them along with the three non-managerial duties cited in its decision.'' The Petitioner asserts 
that the Director erred because the Beneficiary's duties need only be primarily, not exclusively, 
managerial. (The Petitioner had previously referred to the Beneficiary's position as both managerial 
and executive, but on appeal the Petitioner claims only that the position is managerial.) We agree 
that "primarily" does not mean "exclusively," but the Director did not find that 87% of the 
Beneficiary's duties are managerial. The Director cited three non-qualifying activities as examples, 
rather than an exhaustive list of all such activities. However, as discussed further below, these are 
not the only non-managerial duties that the Beneficiary would be required to perform. 
The Petitioner has indicated that the Beneficiary devotes 40% of her time to the administrative and 
marketing departments, neither of which have any subordinate employees. The Petitioner asserts 
that the Beneficiary's responsibilities in those departments constitute managerial oversight but the 
Petitioner has not shown that the Beneficiary is overseeing any subordinates who perform the non-
2 A petitioner can include projections for up to one year in the future if the petition is for a new office that has been doing 
business for less than one year. See 8 C.F.R. § 214.2(1)(3 )(v)(C). But the matter under review is not a new office 
petition. The one-year startup period covered by the Petitioner's earlier new office petition cannot be extended. 
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Matter ofS-H-F- Inc 
managerial duties of those departments. Therefore, it appears that the Beneficiary herself performs 
all marketing and administrative functions, including non-qualifying duties associated with those 
functions. The amount of time spent on such duties could be significant, given the Petitioner's claim 
that she allocates 40% of her time to these two departments. 
As an illustrative example, the Petitioner has stated that the Beneficiary devotes 8% of her time to 
overseeing the development of marketing campaigns. The Petitioner's business plan states that the 
company "promotes its website by engaging in online Search Engine Optimization campaigns" and 
maintaining "profiles on digital platforms," but does not specify who performs the operational 
activities relating to these functions. If the Beneficiary develops the campaigns herself, then she is 
performing marketing work rather than a managerial function. If she delegates the work, then the 
Petitioner has not told us who actually performs the marketing work. (None of the submitted job 
descriptions mention the performance, as opposed to planning, of marketing activities.) Also, the 
record does not contain enough evidence to show how much time goes into performing marketing 
duties or managing their performance. 
Some other listed functions are so vaguely described that we cannot determine whether or not they 
are managerial or executive. "Stay alert to new trends'' is an example. The Petitioner states that the 
Beneficiary devotes 5% of her time to this activity but does not say what this entails. Apart from not 
defining what it means to "[ s ]tay alert," the Petitioner does not specify whether the trends are in 
inventory selection, marketing, decoration, or other aspects of running furniture stores. This duty 
was listed among the Beneficiary's "Sales Department" duties, which also include helping customers 
with choosing products. 
Based on the foregoing, a significant portion of the Beneficiary's time would potentially be allocated 
to non-qualifying duties associated with the sales, administrative, and marketing departments, rather 
than to managing those departments. 
B. Staffing 
Beyond the required description of the job duties, USCIS reviews the totality of the record when 
examining a beneficiary's claimed managerial or executive capacity, including the company's 
organizational structure, the duties of subordinate employees, the presence of other employees to 
relieve a beneficiary from performing operational duties, the nature of the business, and any other 
factors that will contribute to understanding a beneficiary's actual duties and role in a business. 
The Petitioner identified the following staff on an organizational chart: 
CEO (the Beneficiary) 
Regional Manager 2 Independent Business Consultants 
[also called Midwest Sales Manager] 
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Matter ofS-H-F- Inc 
MN WI 
I I 
Full Time Store Manager and Sales 1 Full Time Sales 
[same person as Regional Manager] 
I I 
1 Part Time Sales 
1 Part Time Sales 
I 
1 Part Time Warehouse 
I 
1 Full Time Warehouse 
Quarterly federal and state tax forms from September 2016, three months before the filing date, 
identified five employees (three in two in The regional manager's name 
does not appear in tax records for the third quarter of 2016. The individual identified as the part time 
warehouse worker in Minnesota is named on tax documents for the store in Wisconsin, where he 
earned $180 during the third 
quarter of 2016. 
The Petitioner's business plan indicated that the company "will hire one Sales Manager ... [and] 
three Store Managers in Year 1 ," but the organizational chart showed only one store manager and no 
sales manager. Regarding its current staffing, the Petitioner stated: 
[T]he Mid-West Sales Manager position is primarily engaged in managing the 
MN retail store, taking care of the daily sales and weekly sales reports/ 
inventory reports for both and stores. This position also 
manages the inventory system and supervises the full-time warehouse worker, 
recruits and trains the other positions and oversees certain aspects of the 
store operations. 
Also, the Sales Representative takes care of that store's daily sales and 
reports regarding weekly inventory sales. There is also a part-time sales 
representative at this store as well. 
The two business consultants are engaged in the marketing, budget, and research for 
the business and while not on payroll, their work is managed by the beneficiary. 
The above statement and organizational chart indicate that both consultants worked for the Petitioner 
at the same time, but elsewhere, the Petitioner indicates that one consultant left in June 2016, the 
same month that the other consultant began working for the Petitioner. The consultant's listed duties 
are as follows: 
• Research and Evaluate market 
• Plan marketing strategies 
• Budget plans 
Matter ofS-H-F- Inc 
• Provide monthly social media reports 
• Discuss and plan for social media marketing strategies, Facebook, and Google 
search 
• Research for new retail location, evaluate the neighborhood, household income, 
and surrounding competitions [sic] 
The job description gives the consultant authority to "[p ]Ian marketing strategies,'' but does not say 
who performs the operational work to implement the strategies, such as designing promotional 
materials and purchasing advertisements. Similarly, the discussion of social media does not include 
making posts on social media, only discussing, planning, and reporting. The Petitioner did not 
submit contracts, agreements, or other evidence to specify the services the consultant was to provide 
to the Petitioner. The Petitioner did not submit evidence of payment, such as IRS Forms 1099-
MISC, Miscellaneous Income, to show that it actually paid either consultant the amount specified in 
the job description. 
The Director concluded: "Based on the organizational structure provided, it appears that [the 
Beneficiary] is primarily assisting with the day to day non-supervisory duties of the business." On 
motion and again on appeal, the Petitioner says little about the Beneficiary's subordinates except to 
refer to "the beneficiary's subordinate professional employees." 
The statutory definition of "managerial capacity" allows for both "personnel managers'· and 
"function managers." See sections 10l(a)(44)(A)(i) and (ii) of the Act. Personnel managers are 
required to primarily supervise and control the work of other supervisory, professional. or 
managerial employees. The statute plainly states that a "first line supervisor is not considered to be 
acting in a managerial capacity merely by virtue of the supervisor's supervisory duties unless the 
employees supervised are professional." Section 101(a)(44)(A) of the Act. If a petitioner claims 
that a beneficiary directly supervises other employees, those subordinate employees must be 
supervisory, professional, or managerial, and the beneficiary must have the authority to hire and fire 
those employees, or recommend those actions, and take other personnel actions. Sections 
101(a)(44)(A)(ii)-(iii) ofthe Act. 
To determine whether the Beneficiary manages professional employees, we must evaluate whether 
the subordinate positions require a baccalaureate degree as a minimum for entry into the field of 
endeavor. C.f 8 C.F.R. § 204.5(k)(2) (defining "profession" to mean "any occupation for which a 
United States baccalaureate degree or its foreign equivalent is the minimum requirement for entry 
into the occupation"). Section 101 (a)(32) of the Act states that ''[t]he term prof'ession shall include 
but not be limited to architects, engineers, lawyers, physicians, surgeons, and teachers in elementary 
or secondary schools, colleges, academies, or seminaries." 
In this instance, the Petitioner states that "the beneficiary does in fact manage professional 
employees," but has not specified which employees are professionals. The Petitioner has not 
established that any of the subordinate employee positions require at least a bachelor's degree and 
therefore has not supported its claim that the Beneficiary supervises professionals. 
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Matter ofS-H-F-lnc 
The only subordinate with identified supervisory or managerial duties is the regional manager, with 
the following duties: 
• Manages MN retail store 
• Take care [of] daily sales 
• Weekly sales report for both and stores 
• Manage inventory system 
• Supervise Full Time Warehouse Worker 
• Manage warehouse workers['] working schedule 
• Train warehouse worker about the products 
• Make sure warehouse working [sic] is working under a safe environment 
• Recruit and hire part-time warehouse worker, and assign hours 
• Recruit and hire store sales representative 
• Train store sales representative about the company, products and how 
to use sales and merchant system 
• Assign 
hours for full time and part time sales Representative 
• Travel to store frequently to supervise and make sure everything goes 
well 
Many ofthe above listed duties are supervisory, but the store has no identified full time 
sales worker, and the regional manager's duties clearly include front-line sales work. (This 
employee's compensation includes a sales commission, also consistent with non-managerial, non­
supervisory sales work.) Further, given the other issues regarding the Beneficiary's duties, it is not 
evident that the Beneficiary spends a majority of her time overseeing the regional manager's work, 
such that she would be primarily directing the work of a supervisor.. 
Further, based on the number of employees and their work schedules, there is some question as to 
whether the Petitioner has sufficient staff to carry out the day-to-day store operations at two 
locations. If we use staffing levels as a factor in determining whether an individual is acting in a 
managerial or executive capacity, then we must take into account the reasonable needs of the 
organization in light of the organization's overall purpose and stage of development. See section 
101(a)(44)(C) of the Act. To establish that the reasonable needs of the organization justify a 
beneficiary's job duties, a petitioner must specifically articulate why those needs are reasonable in 
light of its overall purpose and stage of development. The Petitioner has not explained how the 
company's existing staff is sufficient to meet the company's reasonable needs without requiring the 
Beneficiary to perform primarily non-managerial or non-executive duties. 
The regional manager's duties listed above refer to work at both store locations, but the Petitioner 
also stated that the regional manager works "mainly in ' specifically 31 hours per week, 
Friday through Tuesday, and "[ s ]ometimes ... also works on Wed[ nesday] or Thursday to travel to 
WI store to supervise." (The Petitioner's assertion that "we plan to open 7 days a week 
for MN store" shows that the store did not yet keep that schedule at the time of filing.) 
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Matter ofS-H-F- Inc 
The person identified as the store's full time sales representative works 30 hours per 
week, Thursday through Monday. The other employee works two (unspecified) days a 
week and substitutes when the full time representative is on vacation. Therefore, it appears that, 
most of the time, there is only one worker present at the location. Although the Petitioner 
indicates that the Beneficiary will only spend 5% of her time helping customers in its stores, the 
limited hours worked by the subordinates across two locations, and the lack of a second store 
manager, suggest that this may not be an accurate reflection of the amount of time she would spend 
assisting in the store operations. 
The Petitioner's projections for "Year 5" included more staff, including an administrative assistant 
and a marketing consultant, but the Petitioner did not claim to have those employees at the time of 
filing. The Petitioner must establish eligibility at the time of filing, as required by 8 C.F.R. 
§ 103 .2(b )(1 ). 3 We must therefore consider the state of the company at the time of filing, rather than 
the Petitioner's long-term plans. 
The Director also found that the Petitioner had not shown that the Beneficiary is a function manager. 
The term "function manager" applies generally when a beneficiary does not supervise or control the 
work of a subordinate staff but instead is primarily responsible for managing an "essential function" 
within the organization. See section 101(a)(44)(A)(ii) of the Act. The term "essential function'' is 
not defined by statute or regulation. If a petitioner claims that a beneficiary will manage an essential 
function, a petitioner must clearly describe the duties to be performed in managing the essential 
function, i.e., identify the function with specificity, articulate the essential nature of the function, and 
establish the proportion of a beneficiary's daily duties dedicated to managing the essential function. 
See 8 C.F.R. § 214.2(1)(3)(ii). In addition, a petitioner's description of a beneficiary's daily duties 
must demonstrate that the beneficiary will manage the function rather than. perform the duties related 
to the function. For the reasons discussed above in the "Duties" section, the Petitioner has not 
shown that the Beneficiary will primarily manage any essential function of the company rather than 
perform the duties of that function. The Petitioner has not specifically claimed that the Beneficiary 
is a function manager, instead asserting that some of her subordinates are professionals, as discussed 
above. 
The statutory definition of the term "executive capacity" focuses on a person's elevated position 
within a complex organizational hierarchy, including major components or functions of the 
organization, and that person's authority to direct the organization. Section 101(a)(44)(B) of the 
Act. Under the statute, a beneficiary must have the ability to "direct the management" and "establish 
the goals and policies" of that organization. Inherent to the definition, the organization must have a 
subordinate level of managerial employees for a beneficiary to direct and a beneficiary must 
primarily focus on the broad goals and policies of the organization rather than the day-to-day 
operations of the enterprise. An individual will not be deemed an executive under the statute simply 
because they have an executive title or because they "direct" the enterprise as an owner or sole 
3 A new office petition can rely on projections for up to one year in the future. See 8 C.F.R. § 214.2(1)(3)(v)(C). But this 
provision does not apply to a petition, such as this one, seeking to extend a previously approved new office petition. 
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Matter of S-H-F- Inc 
managerial employee. In this instance, the Beneficiary has only one subordinate whom the 
Petitioner identifies as a manager, but the regional manager's duties are those of a sales 
representative with some authority as a first-line supervisor. The Petitioner has not demonstrated 
sufficient organizational complexity to warrant a primarily executive position for the Beneficiary. 
Furthermore, the Petitioner initially referred to the Beneficiary as an executive in a list of exhibits, 
but has not repeated that claim on appeal. 
The Petitioner has indicated that the Beneficiary's managerial role will grow as the company 
expands, but the Petitioner has not established that it was able, at the time of filing, to employ the 
Beneficiary in a primarily managerial capacity in the United States under the extended petition. 
III. FINANCIAL STATUS 
A petitioner seeking to extend a new office petition must submit evidence of the company's financial 
status. See 8 C.F.R. § 214.2(l)(l4)(ii)(E). 
To establish business activity, the Petitioner submitted copies of several documents including: 
• Rent payment checks 
• Utility bills 
• Sales receipts 
• Invoices showing movement of products to and from the Petitioner's stores 
• Bank statements from four accounts held by the Petitioner 
In the denial notice, the Director stated that the Petitioner's bank statements show an average 
balance below $20,000, and that there is no evidence of further capital contributions from the foreign 
parent company. The Director concluded, therefore, that the Petitioner had not established its ability 
to conduct business and pay the Beneficiary's $50,000 annual salary. 
On appeal, the Petitioner states that it has established the company's viability and ability to employ 
the Beneficiary and other staff. We agree with the Petitioner, and will withdraw this ground for 
denial. 
The bank statements show low monthly balances, but they also reflect a significant volume of 
deposits and withdrawals, consistent with an active business. The bank balance of an active 
company may fluctuate significantly in the course of normal business as the company collects 
proceeds and pays expenses. There is no requirement that the Petitioner must, at all times, hold the 
Beneficiary's full annual salary in reserve. Even so, the Petitioner's four bank accounts held 
$63,809.88 as ofNovember 30, 2016, the end of the last statement cycle before the petition's filing 
date. Also, the Beneficiary received her full salary in the last quarter preceding the filing date. 
The Petitioner has submitted sufficient financial documentation to satisfy the requirement at 8 C.F.R. 
§ 214.2(1)(14)(ii)(E). But we will dismiss the appeal because the other ground for denial remains. 
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Matter of S-H-F- Inc 
IV. CONCLUSION 
The Petitioner did not establish that it will employ the Beneficiary in a managerial or executive 
capacity. 
ORDER: The appeal is dismissed. 
Cite as Matter ofS-H-F- Inc, ID# 713708 (AAO Oct. 30, 2017) 
II