dismissed
L-1A
dismissed L-1A Case: Retail And Food Service
Decision Summary
The appeal was dismissed because the petitioner failed to establish that its new office would support a managerial or executive position within one year. The Director found, and the AAO agreed, that the evidence regarding the proposed organizational structure and staffing was insufficient to substantiate that the Beneficiary would be relieved from performing non-qualifying duties.
Criteria Discussed
New Office Requirements Support Of Managerial/Executive Position Executive Capacity Staffing Plans Organizational Structure
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U.S. Citizenship and In1n1igration Services MATTER OF T-G- LLC Non-Precedent Decision of the Administrative Appeals Office DATE: MAR. 14, 2019 APPEAL OF CALIFORNIA SER VICE CENTER DECISION PETITION: FORM 1-129, PETITION FOR A NONIMMIGRANT WORKER The Petitioner, which sells cell phones and leases a food truck, seeks to temporarily employ the Beneficiary as President of its new office1 under the L-lA nonimmigrant classification for intracompany transferees. Immigration and Nationality Act (the Act) section 10l(a)(l5)(L), 8 U.S.C. § 110l(a)(l5)(L). The L-lA 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 the new office will support a managerial or executive position within one year after approval of the petition. On appeal, the Petitioner asserts that it provided sufficient information to establish that the Beneficiary's duties are primarily executive in nature. Upon de nova review, we will dismiss the appeal. I. LEGAL FRAMEWORK To establish eligibility for the L-lA nonimmigrant visa classification in a petition involving a new office, a qualifying organization must have employed the beneficiary in a managerial or executive capacity for one continuous year within three years preceding the beneficiary's application for admission into the United States. 8 C.F.R. § 214.2(1)(3)(v)(B). In addition, the beneficiary 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. Id. The petitioner must submit evidence to demonstrate that the new office will be able to support a managerial or executive position within one year. This evidence must establish that the petitioner 1 The term "new office" refers to an organization which has been doing business in the United States for less than one year. 8 C.F.R. § 214.2(l)(l)(ii)(F). The regulation at 8 C.F.R. § 214.2(1)(3)(v)(C) allows a "new office" operation no more than one year within the date of approval of the petition to support an executive or managerial position. . Matter of T-G- LLC secured sufficient physical premises to house its operation and disclose the proposed nature and scope of the entity, its organizational structure, its financial goals, and the size of the U.S. investment. See generally, 8 C.F.R. § 214.2(1)(3)(v). 11. NEW OFFICE When a new business is first established and commences operations, the regulations recognize that a designated manager or executive responsible for setting up operations will be engaged in a variety of low-level activities not normally performed by employees at the executive or managerial level and that often the full range of managerial responsibility cannot be performed in that first year. The "new office" regulations allow a newly established petitioner one year to develop to a point that it can support the employment of a beneficiary in a primarily managerial or executive position. Here, the Petitioner claims that the Beneficiary would be employed in an executive capacity within one year of approval. The term "executive capacity" is defined as 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 10l(a)(44)(B) of the Act. When examining the executive capacity of a given beneficiary, we will look to the petitioner's description of the job duties. See 8 C.F.R. § 214.2(1)(3)(ii). However, the position description alone is insufficient to establish that a beneficiary's duties would be primarily in a managerial or executive capacity, particularly in the case of a new office petition where much is dependent on factors such as a petitioner's business and hiring plans and evidence that the business will grow sufficiently to support a beneficiary in the proposed position. A Staffing and Business Plan A new office petition must include evidence of the proposed nature of the office, describing the scope of the entity, its organizational structure, and its financial goals. 8 C.F.R. § 214.2(1)(3)(v)(C)(J). This evidence should demonstrate a realistic expectation that the enterprise will succeed and rapidly expand as it moves away from the developmental stage to full operations, where there would be an actual need for a manager or executive who will primarily perform qualifying duties by the end of the one year period. See generally 8 C.F.R. § 214.2(1)(3)(v). The Petitioner filed the petition in April 2018. The Petitioner submitted two business plans - one for the cell phone business and one for the food truck business. The cell phone business plan states that the Petitioner plans to hire five workers in its first year of operations, and grow to 15 by 2022/2023. The food truck business plan states that the Petitioner plans to hire five workers to start the business, including three chefs, an assistant food truck manager, and a purchaser. The plan notes that manages the food truck and the Beneficiary will be one of the management team members. 2 . Matter of T-G- LLC The Petitioner's counsel stated in a support letter with the petition that the Petitioner currently employs the Beneficiary as President, and also employs a wireless industry manager, a food truck event manager, an accountant/bookkeeper, and two sales associates. The letter states that the Petitioner plans to hire additional sales associates, a food truck purchaser, and an online marketing specialist. With the petition, the Petitioner submitted job descriptions for the Petitioner's existing and proposed jobs, including a President (the Beneficiary); a cashier; a chef; a food truck event manager; an accountant/bookkeeper; an online marketing specialist; a purchaser; a wireless industry manager; and two sales associates. The Petitioner also submitted an organizational chart showing that the Beneficiary would oversee the wireless industry department (with a manager and five sales associates), the food truck department (with a manager, a purchaser, and two chefs), and other departments including an online marketing specialist and accountant/bookkeeper. In a request for evidence (RFE), the Director asked for more information about the Petitioner's first year staffing plans to show that the company will support a managerial or executive position. In response, the Petitioner submitted substantially expanded descriptions of the duties of the President; a cashier; a chef; a food truck event manager; an accountant/bookkeeper; an online marketing specialist; a purchaser; a wireless industry manager; and two sales associates. The Petitioner also submitted a new organizational chart showing that the Beneficiary would oversee the wireless industry department (with a manager and five sales associates), the food truck department (with a manager, a purchaser, a chef, and a cashier), 2 and other departments including an online marketing specialist and accountant/bookkeeper. The Petitioner stated that its foreign company, , "is the only source of income that [the Petitioner] is using - therefore, all transactions, rent payments, etc., are made only through the capital that is continually being invested by Bank statements confirm that has transferred some funds to the Petitioner; however, as noted below, is not required to make any capital contributions beyond its initial capital contribution of$100,000. In denying the petition, the Director indicated that the Petitioner had not submitted sufficient documentation about the proposed positions the Beneficiary will oversee. She stated that despite the Beneficiary having an executive job title, the evidence does not substantiate that the Beneficiary would be relieved from performing non-qualifying duties within one year of business operation. She stated that based on the evidence submitted regarding the Beneficiary's proposed position and the proposed organizational structure and staffing the new office, the Petitioner has not established that it will be able to support the Beneficiary in an executive or managerial position within one year. On the appeal filed in August 2018, the Petitioner asserts that it provided a detailed description of the job duties of the Beneficiary' s subordinate staff and an organizational chart. It states that it "hired a professional accounting firm to handle all financial affairs of the company." It further states that it has two managers that handle all managerial work, as "the food truck sector of the business 2 The new chart removes one chef and adds a cashier. It conflicts with the food truck business plan which states that the Petitioner plans to hire three chefs, an assistant food truck manager, and a purchaser for the food truck business. 3 . Matter of T-G- LLC has yet to conduct business, and the cellphone stores have, in addition to the separate wireless manager, a modest sales associate team to cover the daily tasks of the cellphone stores." It states that it is a start-up company with sufficient staff to support a primarily executive position, yet it provides no additional evidence on appeal to support its assertions. A petitioner's unsupported statements are of very limited weight and normally will be insufficient to carry its burden of proof The Petitioner must support its assertions with relevant, probative, and credible evidence. See Matter ofChawathe, 25 I&N Dec. 369, 376 (AAO 2010). Moreover, the business plans submitted raise concerns about the accuracy of the information being provided. With regard to the Petitioner's wireless stores, the business plan indicates that it operates two wireless stores in Texas - one on and one on The record contains a sublease for one store in Texas, valid from March 1, 2018, through June 30, 2019. The record does not contain a lease for a second store and the Petitioner has not indicated when space for the second store will be secured. The wireless business plan states that it projects to generate $135,000 in sales in year one, and increase revenue to "just under $350,000 by year five." However, a sales and use tax statement for the Petitioner shows that location "0000 l" had $0 in total sales, and location "00002" had $14, 115 in total sales for the period ending March 31, 2018. It is not clear that the Petitioner actually operates two stores, and the Petitioner has not provided a full picture of what its business operations will look like within one year of approval. The existence or nonexistence of a second store is clearly important to our evaluation of the Petitioner's growth in the first year. The wireless business plan also states that the management team includes the Beneficiary; 1wireless industry manager); and -~ (event manager) and that it currently employs two sales associates. However, it is not clear if the staff is to be employed full time or part-time, and the record does not contain payroll records for the Petitioner showing how much the current employees work or are paid. Additionally, as the Petitioner claims to be operating two stores (although this is not supported by the record), it is not clear if the Petitioner will have enough staff to cover its operations during business hours within one year after approval, such that the Beneficiary would be relieved from primarily performing non-qualifying operational duties. The business plan for the food truck likewise raises concerns about the veracity of the claims being made. The business plan references a lease for a food truck and a lease for a premises. The record contains a lease for a food truck, but does not contain a lease for a premises or establish what would be done at the premises. The pictures of the food truck show a dish cleaning area, a drink refrigerator, and a gas stovetop, and the Petitioner obtained permits for a mobile food unit. However, it is not clear where the chefs would be cooking the food (on the truck, on the premises, or both) and whether there is a kitchen to support the food truck business. Additionally, the staffing of the food truck and its proposed operation have been inconsistently described. On appeal, the Petitioner stated that the food truck is not yet operational, but the Petitioner has not provided clear timelines for the hiring of staff and purchasing of materials that would lead to the food truck conducting business. Although the Petitioner has a manager, there is no 4 Matter of T-G- LLC timeline for hiring a purchaser, chef(s), or cashier. Furthermore, given the nature of the food truck business, it is not clear that the staff described, a manager, purchaser, cashier, and 1-2 chefs could actually be supported by the food truck business. The Petitioner has not shown how the revenue from the business would be able to pay the salaries of these proposed positions or that this size of staff is reasonable for the type of business. As the business plan notes only $36,000 in salary expenses, it is unclear how the five workers projected to start the business would be paid from that sum, casting further doubt on the Petitioner's staffing claims. A petitioner cannot inflate the staffing to an unreasonable level to support a claimed executive positon. Artificial tiers of subordinate employees are not probative and will not establish that an organization would be sufficiently complex to support an executive position. The record also shows that the individual currently employed as the food truck manager is actually the managing partner of the Petitioner, casting doubt on the claim that he will actually serve as the food truck manager. If the managing partner is not employed as the food truck manager, but is instead serving at a higher level than the Beneficiary, this would undermine the Petitioner's claim that the Beneficiary will act in an executive capacity with subordinate managerial positions. The Petitioner has not resolved this discrepancy in the record with independent, objective evidence pointing to where the truth lies. Matter of Ho, 19 I&N Dec. 582, 591-92 (BIA 1988). Unresolved material inconsistencies may lead us to reevaluate the reliability and sufficiency of other evidence submitted in support of the petition. Id. We also note that the business plan for the food truck indicates that it expects the following "utilization percentages" and "average price points" over the next five years: Menu Items Utilization Percentages Average Price Points Breakfast 10% $5 Lunch 65% $7 Snacks 5% $7 Dinner 20% $17.67 The record contains a menu showing the following food categories: wraps/burritos, platters, tacos, and sides. The menu does not contain breakfast items and does not have different price points for lunch and dinner. The evidence in the record simply does not support the Petitioner's with respect to its business plan for the food truck. The food truck business plan states that it expects the following revenues over the next five years: Year 1 $85,000 Year 2 $102,000 Year 3 $142,800 Year4 $171,360 Year 5 $205,632 It projects that the costs of goods sold will remain steady at $10,000 per year; that the truck rent will remain steady at $24,000 per year for five years; that separate "lease" payments will remain steady 5 . Matter of T-G- LLC at $7,200 per year for five years;3 and that its marketing, salary, and "other expenses" costs will also remain steady at $1,500, $36,000, and $2,500 per year for five years, respectively. It is not clear how the Petitioner plans to increase its food truck revenues by over 58% in the next five years without increasing its expenses at all. Due to the Petitioner's inconsistent and unexplained statements, we cannot determine when the food truck will be operational or what stage of business it will reach within one year of approval, nor can we rely on the Petitioner's claims regarding the proposed staffing of the food truck. Doubt cast on any aspect of the petitioner's proof may lead to a reevaluation of the reliability and sufficiency of the remaining evidence offered in support of the visa petition. Matter of Ho, 19 I&N Dec. at 591. Further, the record lacks information on the other proposed positions that are not assigned to either the food truck or wireless businesses. The Petitioner claims that the Beneficiary will also oversee an accountant/bookkeeper and online marketing specialist. However, the Petitioner has not provided any information on how these positions will split their time between the two business or whether their salaries will be split between the wireless and food truck businesses and if so, how. Moreover, although the Petitioner initially described an accountant/bookkeeper to be supervised by the Beneficiary; on appeal, the Petitioner claims that it hired a professional accounting firm to handle all financial affairs of the company. This contradicts the Petitioner's earlier claim that it employs an accountant/bookkeeper, overseen by the Beneficiary, "who will be responsible for the finances and records regarding financial transactions for the company." The Petitioner has not resolved this discrepancy in the record with independent, objective evidence pointing to where the truth lies. Matter of Ho, 19 I&N Dec. at 591-92. It is important that the Petitioner present a full and accurate picture of its staffing. Without such information, we cannot determine that the Beneficiary would have sufficient subordinate staff to relieve him from performing non-qualifying operational duties. The record also contains inconsistent information regarding the funding of the new businesses. The projected balance sheet for the wireless stores shows $130,000 of contributed capital at start up and in years 1-3, and $132,000 in contributed capital in years 4-5. The food truck business plan states that it "is seeking total funding of $15,000 to launch its food truck" to be "used for funding capital expenditures, manpower costs, marketing expenses, and working capital." It states that the funds will specifically be used for "permits, rent and utilities, payroll, marketing, and inventory." However, the Operating Agreement for the Petitioner dated February 8, 2018, shows two members, and It states that initially contributed $100,000 in capital to the company, and contributed no capital. The Operating Agreement states that no member is required to make additional contributions to the company's capital. Thus, it is not clear where the Petitioner's projected source(s) of contributed capital will come from for the wireless stores, where the funding for the food truck will come from, or whether the contributed capital is sufficient to pay the Beneficiary, in addition to covering the other expenses and start-up costs. As noted, a new office petition must establish the size of the United States 3 The business plan states that it will finalize a "lease agreement (Truck)" and a "lease agreement (Location)" by December 2017. Matter of T-G- LLC investment and the financial ability of the foreign entity to remunerate the beneficiary and to commence doing business in the United States. 8 C.F.R. § 214.2(1)(3)(C)(v)(2). The Petitioner has provided conflicting information about its planned and current staffing and business activity. Given these discrepancies, and the lack of corroborating documentation, the Petitioner has not established that the new office will support an executive position within a year after approval of the petition. B. Duties When examining the executive capacity of a given beneficiary, in addition to the staffing and structure of the organization as discussed above, we will look to the petitioner's description of the job duties. See 8 C.F.R. § 214.2(1)(3)(ii). Here the Petitioner asserts that the Beneficiary will primarily perform executive duties within one year of approval. 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 10l(a)(44)(B) of the Act. Inherent to the definition, the 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 the owner or sole managerial employee. Based on the definition of executive capacity, the Petitioner must first 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 executive duties, as opposed to ordinary operational activities alongside the Petitioner's other employees. See Family Inc. v. USCIS, 469 F.3d 1313, 1316 (9th Cir. 2006); Champion World, 940 F.2d at 1533. In the initial filing, the Petitioner stated that the Beneficiary's duties as President would include planning and executing the Petitioner's direction and growth; managing and evaluating the Petitioner's profitable growth; communicating with managers about the functioning of the Petitioner; ensuring the reliability and safety of the food truck; organizing and developing the business objectives of the company; establishing a capable, efficient, and productive retail team; overseeing the drafting of the company's business plan and monitor its implementation on an ongoing basis; setting budgets and financial targets to promote growth; monitoring and implementing safe operational procedures for effective workflow; directing the management-namely the food truck manager and the wireless industry manager; setting and overseeing the implementation of the Petitioner's overall strategic vision and direction; establishing the Petitioner's goals and policies; and making decisions regarding the hiring and firing of employees. The Petitioner further states that the "president will have sole decision-making power." Matter of T-G- LLC In the RFE, the Director requested additional information to establish that the new office will support the Beneficiary primarily in a managerial or executive position within one year. The Director stated that the job description was generic and lacked adequate detail about what the Beneficiary will actually do on a daily basis. The Director also noted that the Petitioner had not submitted adequate documentation about the personnel whom the Beneficiary will oversee. In response to the RFE, the Petitioner submitted an expanded description of the duties of President. It included the duties submitted with the petition, and added the following: setting higher level operation policies and rules; setting company standards; reviewing sales reports and setting company goals; setting operations, overall strategy and future growth; overseeing the production of goods/services; reviewing the carrier portal/Caliduss report; ensuring all operations are running efficiently; opening and closing bank accounts; running and approving payroll and commission; setting daily, weekly and monthly goals; establishing sales procedures; reviewing and approving marketing plans and budgets; reviewing and approving business expenses; and reviewing daily bank deposits and checks. The Petitioner also gave a daily breakdown of how the Beneficiary's time will be allocated among these duties. In her decision, the Director determined that the Petitioner did not establish that the Beneficiary will be employed in an executive capacity. On appeal, the Petitioner asserts that it provided a detailed description of the Beneficiary's job duties. It states that the evidence establishes that the Beneficiary supervises and controls the work of subordinate professional employees and exercises authority to hire and fire employees under his supervision. Here the duties assigned to the Beneficiary do not appear to be primarily executive in nature. Many of the assigned duties do not provide a meaningful understanding of how the Beneficiary will actually spend his time. Duties such as "setting higher level operation policies and rules;" "executing the Petitioner's direction and growth;" "managing and evaluating the Petitioner's profitable growth;" "organizing and developing the business objectives of the company, setting and overseeing the implementation of the Petitioner's overall strategic vision and direction;" and "establishing the Petitioner's goals and policies" are overly broad. Reciting a beneficiary's vague job responsibilities or broadly-cast business objectives is not sufficient; the regulations require a detailed description of the beneficiary's daily job duties. The actual duties themselves will reveal the true nature of the employment. Fedin Bros. Co., Ltd v. Sava, 724 F. Supp. 1103, 1108 (E.D.N.Y. 1989), aff'd, 905 F.2d 41 (2d. Cir. 1990). The proposed duties also include a number of non-qualifying administrative and operational duties, such as "opening and closing bank accounts;" "running and approving payroll and commission;" "setting daily, weekly and monthly goals;" and "reviewing daily bank deposits and checks." Other duties assigned to the Beneficiary, such as "reviewing the carrier portal/Caliduss report," "reviewing and approving business expenses," and "overseeing the production of goods/services" are not readily apparent executive duties. The Petitioner has not demonstrated how those activities, in the context of wireless stores and a food truck business, represent primarily directing the management of the organization. . Matter of T-G- LLC In response to the Director's request for specific information on how the Beneficiary would spend his time, the Petitioner provided a daily schedule for the Beneficiary, with his day divided into blocks of time for "Commercial/Operation/Sales," "Finance," "Meetings and site visits,' "HR," and "Operation, Management." The daily breakdown further emphasizes the non-executive nature of the Beneficiary's proposed duties within one year of approval of the petition. Based on a proposed nine hour day, the Petitioner asserts that the Beneficiary will spend two hours a day on non-qualifying tasks including reviewing schedules, requesting maintenance, and checking inventory and merchandise levels. The Beneficiary will spend a further two and a half hours a day reviewing sales reports, reviewing food truck event schedules, checking promotions, and determining whether the "team is fully trained." In addition, the rest of the description of the Beneficiary's day does not document what proportion of the Beneficiary's duties would be executive functions and what proportion would be non-qualifying duties. Although the Beneficiary's proposed schedule is divided into blocks of time, those blocks of time include both potentially executive tasks and administrative or operational tasks, and the description does not quantify the time the Beneficiary spends on these different duties. This lack of information is important because several of the Beneficiary's daily tasks lumped together under "Finance," and "Meeting and site visits" do not fall directly under managerial or executive duties as defined in the statute. For this reason, we cannot determine whether the Beneficiary will primarily performing the duties of an executive. See IKEA US, Inc. v. US. Dept. of Justice, 48 F. Supp. 2d 22, 24 (D.D.C. 1999). The Petitioner has also not explained how the Beneficiary will split his time between the wireless stores and the food truck business. Given the very disparate nature of these two business ventures, it is vital that the Petitioner detail how the Beneficiary will perform the claimed the duties and divide his time between the two businesses. The absence of this information raises questions about the accuracy of the duties provided. As noted above, it is the actual duties that reveal the true nature of the proposed employment. Fedin Bros. Co., Ltd v. Sava, 724 F. Supp. at 1108. Finally, although the Petitioner claims that the Beneficiary will exercise broad decision making authority and "have sole decision-making power," the record does not support such a claim. With the petition, the Petitioner submitted the Petitioner's Operating Agreement. It states that the "Chief Executive Member shall have primary responsibility for managing the operations of the Company and for effectuating the decisions of the members." The Petitioner also submitted documentation showing that (the food truck event manager), and not the Beneficiary, is the managing member of the Petitioner. The Operating Agreement does not establish officers such as a President, Secretary, or Treasurer for the limited liability company. Thus, the Operating Agreement of the Petitioner contradicts the Petitioner's assertion that the Beneficiary will serve as President with sole decision-making power . Rather , the chief executive member , has sole responsibility for managing the operations of the business. The Petitioner has not resolved this discrepancy in the record with independent , objective evidence pointing to where the truth lies. Matter of Ho , 19 I&N Dec. at 591-92. Unresolved material inconsistencies may lead us to reevaluate the reliability and sufficiency of other evidence submitted in support of the petition. Id 9 Matter of T-G- LLC A petitioner has the burden to establish that it would realistically develop to the point where it would require the beneficiary to perform duties that are primarily managerial or executive in nature within one year. Accordingly, the totality of the evidence must be considered in analyzing whether the proposed duties are plausible considering a petitioner's anticipated staffing levels and stage of development within a one-year period. See 8 C.F.R. § 214.2(1)(3)(v)(C). Here, the Beneficiary's job duty breakdown indicates that a considerable portion of his time would be allocated to non-executive functions. Furthermore, the Petitioner's staffing and organizational structure is not sufficient to support a finding that the Beneficiary will be relieved from having to allocate his time primarily to performing non-executive job duties beyond the first year of operation. Thus, the Petitioner has not established that the new office will support an executive position within one year after approval of the petition. III. CONCLUSION 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. The Petitioner has not met that burden. ORDER: The appeal is dismissed. Cite as Matter of T-G-LLC, ID# 2253314 (AAO Mar. 14, 2019) 10
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