dismissed L-1A Case: Web Development

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PUBLICCOPY
U.S. Department of Homeland Security
20 Massachusetts Ave., N.W., Rm. A3000
Washington, DC 20529
u.s.Citizenship
and Immigration
Services
FILE: LIN 05 139 52786 Office: NEBRASKA SERVICE CENTER
t"
Date: APR 0I 2001
INRE: Petitioner:
Beneficiary:
PETITION: Petition for a Nonimmigrant Worker Pursuant to Section 101(a)(15)(L) of the Immigration and
Nationality Act, 8 U.S.c. § 1101(a)(l5)(L)
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.
.----~ ~Robe~Wielrumn, Chief
Administrative Appeals Office
www.uscis.gov
LIN 05 139 52786
Page 2
DISCUSSION: The Director, Nebraska Service Center, denied the petition for a nonimmigrant visa. The
matter is now before the Administrative Appeals Office (AAO) on appeal. The appeal will be dismissed.
The petitioner filed this nonimmigrant petition seeking to extend the employment of its vice president of
operations as an L-IA nonimmigrant intracompany transferee pursuant to section 101(a)(15)(L) of the
Immigration and Nationality Act (the Act), 8 U.S.C. § 1101(a)(l5)(L). The petitioner, a corporation
organized in the State of Oregon, claims to be the subsidiary of Remix, Ltd., located in Khabarousk, Russia.
The petitioner identifies itself as a website development company. The beneficiary was initially granted a
one-year period of stay to open a new office in the United States, and the petitioner now seeks to extend the
beneficiary's stay for an additional three years.
The director denied the petition concluding that the petitioner did not establish that the beneficiary will be
employed in the United States in a primarily managerial or executive capacity.
The petitioner filed an appeal in response to the denial. On appeal, counsel for the petitioner alleges that new
evidence not previously available would show that the director's decision was erroneous. In support of this
contention, counsel submits a brief and additional evidence.
To establish eligibility for the L-l nonimmigrant visa classification, the petitioner must meet the criteria
outlined in section 101(a)( 15)(L) of the Act. Specifically, a qualifying organization must have employed the
beneficiary in a qualifying managerial or executive capacity, or in a specialized knowledge capacity, for one
continuous year within three years preceding the beneficiary's application for admission into the United
States. 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, executive, or
specialized knowledge capacity.
Pursuant to 8 C.F.R. § 214.2(l)(3)(v), if the petition indicates that the beneficiary is coming to the United States as
a manager or executive to open or to be employed in a new office in the United States, the petitioner shall submit
evidence that:
(A) Sufficient physical premises to house the new office have been secured;
(B) The beneficiary has been employed for one continuous year in the three year
period preceding the filing of the petition in an executive or managerial capacity
and that the proposed employment involved executive or managerial authority
over the new operation; and
(C) The intended United States operation, within one year of the approval of the
petition, will support an executive or managerial position as defined in
paragraphs (1)(l)(ii)(B) or (C) of this section, supported by information
regarding:
LIN 05 139 52786
Page 3
(1) The proposed nature of the office describing the scope oftqe entity, its
organizational structure, and its financial goals;
(2) The size of the United States investment and the financial ability of the
foreign entity to remunerate the beneficiary and to commence doing
business in the United States; and
(3) The organizational structure of the foreign entity.
The regulation at 8 C.F.R. § 2l4.2(1)(14)(ii) provides that a visa petition, which involved the opening of a
new office, may be extended by filing a new Form 1-129, accompanied by the following:
(a) Evidence that the United States and foreign entities are still qualifying organizations
as defined in paragraph (1)(l)(ii)(G) of this section;
(b) Evidence that the United States entity has been doing business as defined in
paragraph (1)(1)(ii)(H) of this section for the previous year;
(c) A statement of the duties performed by the beneficiary for the previous year and the
duties the beneficiary will perform under the extended petition;
(d) A statement describing the staffing of the new operation, including the number of
employees and types of positions held accompanied by evidence of wages paid to
employees when the beneficiary will be employed in a managerial or executive
capacity; and
(e) Evidence of the financial status of the United States operation.
The issue in this matter is whether the beneficiary will be employed by the United States entity in a primarily
managerial or executive capacity.
Section lOl(a)(44)(A) of the Act, 8 U.S.c. § 1 101(a)(44)(A), defines the term "managerial capacity" as an
assignment within an organization in which the employee primarily:
(i) manages the organization, or a department, subdivision, function, or component of
the organization;
(ii) supervises and controls the work of other supervisory, professional, or managerial
employees, or manages an essential function within the organization, or a department
or subdivision of the organization;
(iii) if another employee or other employees are directly supervised, has the authority to
hire and fire or recommend those as well as other personnel actions (such as
LIN 05 139 52786
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promotion and leave authorization), or if no other employee is directly supervised,
functions at a senior level within the organizational hierarchy or with respect to the
function managed; and
(iv) exercises discretion over the day to day operations of the activity or function for
which the employee has authority. 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)(B) of the Act, 8 U.S.c. § 1101(a)(44)(B), defines the term "executive capacity" as an
assignment within an organization in which the employee primarily:
(i) directs the management of the organization or a major component or function of the
organization;
(ii) establishes the goals and policies of the organization, component, or function;
(iii) exercises wide latitude in discretionary decision making; and
(iv) receives only general supervision or direction from higher level executives, the board
of directors, or stockholders of the organization.
On the L Supplement to Form 1-129, the petitioner briefly described the beneficiary's duties in the U.S. as
follows:
Contact sales managers/executives of USA target companies to negotiate multimedia services
directed at webpage development; hire and supervise talent to deliver contracted services
No additional information was provided with regard to the beneficiary's duties. The record further indicated
that in addition to the beneficiary, the U.S. entity employed a president. No subordinate staff members were
identified.
On May 10, 2005, the director requested additional evidence pertaining to the nature of the beneficiary's
position in the U.S. business. The request asked the petitioner to submit a more detailed description of the
beneficiary's duties specifically addressing the ability of the beneficiary to function in a managerial role.
Evidence or an explanation regarding the ability of the beneficiary to hire, fire, and pay staff was requested.
In addition, the director requested quarterly tax returns as evidence of the petitioner's employees and current
staffing levels.
Counsel for the petitioner submitted a response dated July 29, 2005. Included in the response was a letter
from the foreign entity dated July 27,2005, which provided an updated overview of the beneficiary's duties.
Specifically, it stated:
LIN 05 139 52786
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Our executive employee [the beneficiary] holds the posItIon of Vice-President of [the
petitioner]. Her managerial duties in the current position include:
organization of the web and multimedia component deve1opment[;]
conducting negotiations with the top-managers of the client companies;
supervising and control of projects implementation;
hiring [and] firing of the personnel for [the petitioner] to perform duties in the web and
multimedia components of our business;
conducting negotiations and· securing strategic alliances with the companies in this
market segment[.]
During her first year in her current position [the beneficiary] has played [an] integral role in
creating our initial client network on both the East and West coasts of the States. [The
beneficiary] was successful in establishing and organizing our growing presence on the East
coast. After multiple trips she has been successful at making [the petitioner] truly national by
establishing our presence in Tampa, Florida. [The beneficiary] has also conducted numerous
strategic negotiations with potential partners in California and Washington. [The beneficiary]
has been successful in negotiations with corporate clients leading to the consummation of
numerous contracts of which approximately 25% have been successfully accomplished with
the balance currently under development.
The petitioner also included copies of the beneficiary's travel itineraries for the previous year in addition to a
client list. No additional discussion or evidence of the presence or hiring of other staff members was
provided.
On December 12, 2005, the director denied the petition. The director found that the evidence in the record
was insufficient to establish that the beneficiary would primarily be employed in a managerial or executive
capacity. The director concluded that the documentary evidence submitted did not establish that the
beneficiary would function at a senior level within the organization or that the beneficiary had sufficient
subordinate staff to relieve her from performing non-qualifying duties. Finally, the director concluded that
the petitioner had not yet reached the point where it could employ the beneficiary in a primarily managerial or
executive capacity.
On appeal, counsel for the petitioner provides extensive evidence pertaining to the petitioner's recent business
dealings, and claims that based upon the petitioner's expansion in recent months, it should be evident that the
beneficiary is employed as a manager in the United States. Counsel also included additional details not
previously submitted with regard to the beneficiary's duties. The petitioner, however, was put on notice of
this required evidence and given a reasonable opportunity to provide it for the record before the visa petition
was adjudicated. The petitioner provided only a brief clarification of the beneficiary's duties and now
submits an expanded overview on appeal. However, the AAO will not consider this evidence for any
purpose. See Matter ofSoriano, 19 I&N Dec. 764 (BIA 1988); Matter ofObaigbena, 19 I&N Dec. 533 (BIA
1988). The appeal will be adjudicated based on the record of proceeding before the director.
LIN 05 139 52786
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When examining the executive or managerial capacity of the beneficiary, the AAO will look first to the
petitioner's description of the job duties. See 8 C.F.R. § 214.2(l)(3)(ii). The definitions of executive and
managerial capacity have two parts. First, the petitioner must show that the beneficiary performs the high
level responsibilities that are specified in the definitions. Second, the petitioner must prove that the
beneficiary primarily performs these specified responsibilities and does not spend a majority of his or her
time on day-to-day functions. Champion World, Inc. v. INS, 940 F.2d 1533 (Table), 1991 WL 144470 (9th
Cir. July 30, 1991). In this matter, only a very brief statement regarding the beneficiary's role in the U.S.
entity was provided on the L Supplement to Form 1-129. In response to the director's request for additional
evidence which demonstrated that the beneficiary was a manager and held a high level of authority within the
petitioning entity, the petitioner provided another brief description, which was largely generalized and not
very specific.
This updated description of duties indicated that the beneficiary was largely involved in conducting
negotiations and securing strategic alliances. Additionally, the petitioner submitted evidence that the
beneficiary traveled extensively to meet with clients to personally conduct such negotiations. Finally, her
duties were said to include the organization of the web and multimedia component development. This
statement essentially acknowledges that the beneficiary is primarily responsible for acquiring clients and
setting up alliances and contracts, factors which are essential to the continued operation of the petitioner's
business. These duties, however, do not fall directly under traditional managerial duties as defined in the
statute.
In addition, the current organizational hierarchy raises questions with regard to the exact nature of the
beneficiary's routine workday. For example, the petition indicates that the beneficiary is supported only by
one other person, who has the title of president and co-owner of the petitioner. Although the beneficiary's
duties included the duty of "hiring and firing personnel," no staff members have been hired since the new
office petition was granted. As a result, therefore, it appears that the beneficiary is primarily responsible for
promoting the company and expanding its sales and marketing contacts, duties which, though critical to the
petitioner's success, are not traditionally managerial in nature. In addition, as the petitioner fails to document
what proportion of the beneficiary's duties would be managerial functions and what would be non­
managerial, the AAO cannot determine whether the beneficiary would be primarily performing the duties of a
function manager. See IKEA US, Inc. v. u.s. Dept. of Justice, 48 F. Supp. 2d 22, 24 (D.D.C. 1999). An
employee who primarily performs the tasks necessary to produce a product or to provide services is not
considered to be employed in a managerial or executive capacity. Matter ofChurch Scientology International,
19 I&N Dec. 593, 604 (Comm. 1988). This factor, coupled with the lack of subordinate staff members to
relieve her from these and other non-qualifying duties, suggests that the beneficiary is not employed in a
primarily managerial or executive capacity.
Pursuant to section 101(a)(44)(C) of the Act, 8 U.S.c. § 1101(a)(44)(C), if staffing levels are used as a factor
in determining whether an individual is acting in a managerial or executive capacity, Citizenship and
Immigration Services (CIS) must take into account the reasonable needs of the organization, in light of the
overall purpose and stage of development of the organization. In the present matter, however, the regulations
provide strict evidentiary requirements for the extension of a "new office" petition and require CIS to examine
the organizational structure and staffing levels of the petitioner. See 8 C.F.R. § 214.2(l)(14)(ii)(D).
LIN 05 139 52786
Page?
At the time of filing, the petitioner was a one-year-old website development company that claimed to have a
projected gross annual income of $455,000 for the year 2005. The petitioner's income tax return, however,
shows a gross annual income of only $22,125 for 2004. The finn employed the beneficiary as vice president,
plus a president. The AAO notes that both employees have executive titles. The petitioner did not submit
evidence that it employed any subordinate staff members who would perfonn the actual day-to-day, non­
managerial operations of the company. In fact, based on the petitioner's representations, it appears that the
beneficiary was primarily responsible for all sales and marketing functions for the company. Consequently, it
does not appear that the reasonable needs of the petitioning company might plausibly be met by the services
of the beneficiary as vice-president and one other person employed as the company's president. Regardless,
the reasonable needs of the petitioner serve only as a factor in evaluating the lack of staff in the context of
reviewing the claimed managerial or executive duties. The petitioner must still establish that the beneficiary
is to be employed in the United States in a primarily managerial or executive capacity, pursuant to sections
101(a)(44)(A) and (B) or the Act. As discussed above, the petitioner has not established this essential
element of eligibility.
The regulation at 8 C.F.R. § 214.2(l)(3)(v)(C) allows the "new office" operation one year within the date of
approval of the petition to support an executive or managerial position. There is no provision in CIS
regulations that allows for an extension of this one-year period. If the business does not have sufficient
staffmg after one year to relieve the beneficiary from primarily performing operational and administrative
tasks, the petitioner is ineligible by regulation for an extension. In the instant matter, it is clear that at the time
of filing, the beneficiary was responsible for all aspects of the business. As previously stated, an employee
who primarily performs the tasks necessary to produce a product or to provide services is not considered to be
employed in a managerial or executive capacity. Matter of Church Scientology International, 19 I&N Dec. at
604. Moreover, the petitioner must establish eligibility at the time of filing the nonimmigrant visa petition. A
visa petition may not be approved at a future date after the petitioner or beneficiary becomes eligible under a
new set of facts. Matter ofMichelin Tire Corp., 17 I&N Dec. 248 (Reg. Comm. 1978).
Based on the evidence presented, the petitioner has not reached the point that it can employ the beneficiary in
a predominantly managerial or executive position. For this reason, the petition may not be approved.
Beyond the decision of the director, the petitioner has not established that a qualifying relationship exists
between the U.S. entity and the claimed foreign employer pursuant to 8 C.F.R. 214.2(l)(I)(ii)(G). The
petition includes evidence in the form of a Shareholder's Agreement and its accompanying Exhibit A that the
U.S. petitioner is owned as follows:
Remix, Ltd.
Beneficiary
Serge Kuptsov
52%
24%
24%
Other documentation contained in the record, however, raises questions with regard to the validity of this
claim. First, none of the share certificates included in' the record are issued to Remix, Ltd., the claimed
foreign parent and majority owner of the petitioner. Instead, a certificate for 52 shares is issued to an
individual named ,who appears to be the president of the foreign entity. The issuance of 52
LIN 05 139 52786
Page 8
shares to this individual directly contradicts the claim in the shareholders agreement that Remix, Ltd., a legal
entity separate and apart from its shareholders, is the majority owner of the petitioner. Doubt cast on any
aspect of the petitioner's proof may, of course, lead to a reevaluation of the reliability and sufficiency of the
remaining evidence offered in support of the visa petition. Matter ofHo, 19 I&N Dec. 582, 591 (BIA 1988).
More importantly, however, the petitioner's income tax return for 2004 was filed using a Form 1120S, U.S.
Income Tax Return for an S Corporation. To qualify as a subchapter S corporation, a corporation's
shareholders must be individuals, estates, certain trusts, or certain tax-exempt organizations, and the
corporation may not have any foreign corporate shareholders. See Internal Revenue Code, § 1361(b)(l999).
A corporation is not eligible to elect S corporation status if a foreign corporation owns it in any part.
Accordingly, since the petitioner would not be eligible to elect S-corporation status with a foreign parent
corporation, it appears that the U.S. entity is owned by one or more individuals residing within the United
States rather than by a foreign entity.
A further review of the tax return indicates on Schedule K-l that contrary to the shareholder's agreement and
share certificates contained in the record, the petitioner is owned equally by the beneficiary and Serge
Kuptsov. Under section H of these forms, both the beneficiary and -,ndicate that they own 50%
of the petitioner. This conflicting information has not been resolved. It is incumbent upon the petitioner to
resolve any inconsistencies in the record by independent objective evidence. Any attempt to explain or
reconcile such inconsistencies will not suffice unless the petitioner submits competent objective evidence
pointing to where the truth lies. MatterofHo, 19 I&N Dec. at 591-92. If CIS fails to believe that a fact stated
in the petition is true, CIS may reject that fact. Section 204(b) of the Act, 8 U.S.c. § 1154(b); see also
Anetekhai v. INS., 876 F.2d 1218, 1220 (5th Cir.1989); Lu-Ann Bakery Shop, Inc. v. Nelson, 705 F. Supp. 7,
10 (D.D.C.1988); Systronics Corp. v. INS, 153 F. Supp. 2d 7, 15 (D.D.C. 2001). For this additional reason,
the petition may not be approved.
An application or petition that fails to comply with the technical requirements of the law may be denied by
the AAO even if the Service Center does not identify all of the grounds for denial in the initial decision. See
Spencer Enterprises, Inc. v. United States, 229 F. Supp. 2d 1025, 1043 (E.D. Cal. 2001), afJ'd. 345 F.3d 683
(9th Cir. 2003); see also Dor v. INS, 891 F.2d 997, 1002 n. 9 (2d Cir. 1989)(noting that the AAO reviews
appeals on a de novo basis).
In visa petition proceedings, the burden of proving eligibility for the benefit sought remains entirely with the
petitioner. Section 291 of the Act, 8 U.S.c. § 1361. Here, that burden has not been met. Accordingly, the
director's decision will be affIrmed and the petition will be denied.
ORDER: The appeal is dismissed.