October 24, 2014

DC Circuit Reverses Decision that Fogo de Chao Chef Lacks “Specialized Knowledge”

Holland & Knight Regulatory Litigation Blog
Jameson B. Rice

On October 21, 2014, the United States Court of Appeals for the District of Columbia Circuit held that it was reversible error for the U.S. Citizenship and Immigration Service ("USCIS"), an agency of the Department of Homeland Security, to categorically discount culturally acquired knowledge when determining whether an alien applying for a nonimmigrant visa has "specialized knowledge."

An L-1B visa (a type of nonimmigrant visa) may be issued to an alien employee of a multinational company, who meets certain conditions, to allow the employee to transfer with that company and enter the United States, if the employee works "in a capacity that . . . involves specialized knowledge." 8 U.S.C. § 1101(a)(15)(L). The relevant regulation defines "specialized knowledge" as "special knowledge possessed by an individual of the petitioning organization's product, service, research, equipment, techniques, management, or other interests and its application in international markets, or an advanced level of knowledge or expertise in the organization's processes and procedures." 8 C.F.R. § 214.2(l)(1)(ii)(D).

USCIS granted the Brazilian steakhouse chain Fogo de Chao over 200 L-1B visas between 1997 and 2006 for "'gaucho chefs' who learned the churrasco style of cooking and service firsthand" in the Rio Grande do Sul region of southern Brazil. These employees went on to work in the U.S. for Fogo de Chao as chefs and to train American employees. USCIS reversed course in 2010 when it denied a L-1B visa petition for a Fogo de Chao chef. USCIS affirmed this decision in an administrative appeal, claiming that the employee's "culinary skills, knowledge of his native regional culture, and 'authenticity' gained through his life experiences could not, as a matter of law, constitute 'special knowledge of the petitioner's product.'" The United States District Court for the District of DC affirmed USCIS's decision.

The DC Circuit reversed and remanded, finding that USCIS "erred in adopting a categorical prohibition on any and all culturally acquired knowledge supporting a 'specialized knowledge' determination." The circuit court seemed to substantively disagree with USCIS's rationale, stating that "nothing in the regulations or previous guidance explains why informational knowledge, experience, and skills that would otherwise be considered specialized lose that status just because they were originally acquired through one's upbringing, family traditions, and life experience outside the workplace." But the court left room for USCIS to deny the visa again on remand, so long as it considers culturally acquired knowledge, stating that USCIS:

nevertheless retains substantial discretion in considering this question anew on remand. The statutory definition provides little guidance on this specific issue, and it is for the agency in the first instance to formulate a rule that articulates whether and when cultural knowledge can be a relevant component of specialized knowledge. It likewise is for the agency to articulate, if deemed appropriate, a line between, on the one hand, actual skills and knowledge derived from an employee's traditions and upbringing, and, on the other hand, the simple status of being from a particular region. We hold only that, given the statutory text, the dictionary definitions embraced by the agency, and the prior Service guidance the agency says it was following in this case, we cannot sustain the Appeals Office's decision on the given rationale that cultural knowledge is categorically irrelevant to "specialized knowledge" without a more reasoned explanation from the agency.

Additionally, the DC Circuit held that USCIS failed to follow its own guidance when it did not consider the economic burden on Fogo de Chao if the visas were not granted, including the amount of in-house training required for American chefs. The circuit court directed USCIS to also consider this issue when reconsidering the role of cultural knowledge in a "specialized knowledge" analysis.

Fogo De Chao (Holdings) Inc. v. U.S. Dept. of Homeland Sec., No. 13-5301 (D.C. Cir. Oct. 21, 2014). 

Related Insights