Unreasonable Delays in EB-5: Fighting for New Norms

By Brad Banias, Partner, Wasden Banias LLC 

For years, the EB-5 litigation bar advised clients to wait to file “mandamus” suits until after the delays exceeded published processing times. These cases would invariably settle as they were (by definition) some of the longest pending petitions at the Immigrant Investor Program Office (IPO) at U.S. Citizenship & Immigration Services (USCIS). Motions to dismiss submitted by the U.S. government in response to federal complaints filed by frustrated investor plaintiffs were rare, and settlements were the rule. This was the norm. But this norm backfired because it allowed the IPO, not the plaintiffs, to define what was a “reasonable” amount of time to adjudicate a Form I-526. The results were predictable.

The IPO has started publishing ever-increasing processing times and, implicitly, extending “reasonable” delays for adjudication. The IPO now claims that it takes between three and six years to adjudicate a Form I-526. And over the first six months of Fiscal Year 2020, the IPO adjudicated only 1,359 Forms I-526. If the EB-5 litigation bar continues its past practice, “reasonable” processing times will continue to grow. Now is the time to use litigation to set new norms.

Practically, the EB-5 litigation bar must divorce processing times from what constitutes a reasonable amount of time to adjudicate an EB5 petition. Afterall, “[a]lthough [USCIS processing times] provide context, they don’t prove that the delays at issue are reasonable as a matter of law.” Processing times are not wholly irrelevant, but they are not dispositive. Other guideposts are more relevant to determine what is a reasonable processing time.

First, congressional intent is paramount. Twenty years ago, Congress expressed concern about the excessive backlogs in processing immigration benefit applications, which it defined, among other things, as including petitions to confer status under the INA. To address the problem of agency delay, Congress authorized the appropriation of funds to eliminate the backlog of petitions pending for more than 180 days. Consistent with that directive, Congress stated that “the processing of an immigration benefit application should be completed not later than 180 days after the initial filing of the application[.]” Again in 2003, when Congress created the Department of Homeland Security, it amended the prior backlog elimination statute by directing the agency to eliminate immigration application backlogs within one year.

 

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