Jonathan Wasden: Welcome to Immigration Uncovered, the docketwise video podcast where we dive deep into the dynamic world of immigration law with the latest developments in law and policy, cutting edge practice management strategies, and the transformative impact of legal technology. I'm James Pittman. And today, I'm joined by Jonathan Wasdin, and Jonathan is one of the plaintiff's attorneys in the case the recently filed case of Moody et al. Versus Mayorkas, which is a federal lawsuit that seeks to block USCIS from implementing the filing increases that are in fact, going into effect today. Jonathan, thank you for joining me today.

James Pittman: Thank you for having me. It's good to be with you.

Jonathan Wasden: Okay. And, Jonathan, you are the founder of Wasden Immigration Litigation. Let me ask you first. What prompted the decision to file the lawsuit against USCIS regarding the filing fee increases?

James Pittman: So, obviously, the clients are the ones that drive the drive the train on that. And to understand what motivated them, you really kinda gotta take a step back and look at some institutional biases within USCIS. Yep. I worked there for a while, so I have a bit of an insight. There's 2 visa categories that they really dislike, The h one b and the e b five.

James Pittman: Not bad. And so you see the brunt of all these fees attacking those 2 Visa categories.

Jonathan Wasden: Why do you think they dislike those categories?

James Pittman: Well, I think there is a couple of reasons. One is, I mean, there's always the fear of blatant racism or something like that, but I think it you have all these government employees. None of them have technical degrees. None of them have a, you know, background in IT. Most of them can't, you know, map themselves to their own printer. And they're adjudicating all these very high end h one b's and e b fives. And they're saying all these people make a lot of money, and I think that might be, you know, possibly one of the explanations is that they're a little bit miffed that they're not making the money that immigrants are making.

Jonathan Wasden: Wow. Okay. That's it. That's I've never heard it. I've never heard anyone put it quite so bluntly. That exact if there's if you think envy plays a role.

James Pittman: Yeah. Yeah. There's also just an amazing amount of arrogance in USCIS these days. And it's part of their transition from an adjudicating agency to trying to be a law enforcement agency, which is one of the things that we hit on in our lawsuit.

Jonathan Wasden: Alright. So alright. Let's but, let's continue. So they these two categories, h one b c b fives, were particularly hit.

James Pittman: Yeah. So the fees make it very difficult for people like my client, IT Serv. IT Serv is, you know, the largest trade group representing the small, medium sized IT companies, and they rely heavily on the H1B. The large companies, what they call product companies or end clients, rely heavily on the IT cert companies to fill short term needs and to fill gaps in projects so they don't have to hire somebody and fire somebody really quick for a short term project. So they hire the staffing companies. The profit margins aren't great on staffing companies. And so what we see happening is the substantial increase in fees is taking a hit. But for the staffing company, it's even more exacerbated because they typically are running on an industry standard 6 months contract for an employee. So that employee is gonna be moving sometimes every 6 months. And so every time they move that employee, they're having to refile and pay these fees again. So it's conceivable for them to be paying these fees, you know, 4 or 5 times over the 3 year visa. And that just gets really cost prohibitive, you know, when you're spending that much money on one employee. For AIA, they're the only group that I'm aware of that represents immigrant investors. And when you see the fees that USCIS is trying to soak the immigrant investors with, it's staggering. And it really is going to I think it's going to actually end up generating maybe less revenue because fewer people are gonna, you know, apply for it.

Jonathan Wasden: Taking it out of the sweet spot. And that's a that's an issue that's an issue that all investor visa programs around the world, all golden visa and things like that, have to think about is what is the sweet spot? If your goal if your goal is really to raise revenue and you set it too high, people aren't gonna be attracted to it.

James Pittman: Yeah. Definitely. I think the agency makes the mistake of thinking everybody who's filing EB 5 is independently wealthy. A lot of these people yeah. I have a lot of clients that are in this boat. Came here on an h one b script and saved for Right. A decade. And then they apply for an EB 5 because it's a faster route to a green card. So their entire life savings is wrapped up in that EB5. And those are the people that really are going to be hit. The less economically benefited or gifted folks are gonna be the ones that are pushed out of the market.

Jonathan Wasden: Now I know in the case of the EB fives, I was I was going through the the new fee schedule. I mean, it's basically has, it has increased exponentially. I mean, what is it by the factor of

James Pittman: So depending on the the form type we're talking about, it goes up several 100%. It's a lot.

Jonathan Wasden: Got the I here we go. The I 526. It's it's it's gone up to $11,160. Yeah. What was it previously?

James Pittman: It was in the I think it was 3,000 something. So it was, like, almost a 300% increase.

Jonathan Wasden: Right. So so very, very high. Let's talk about the the lawsuit. So let's talk about the what you're alleging in the complaint. So wait. First of all, where did you file think you filed in the Federal District of Colorado?

James Pittman: Yeah. So we I like the 10th Circuit because of its libertarian Gorsuch style philosophy. And so we figured in the 10th Circuit, we have a great chance of getting the right type of judge, and we can appeal it to the the 10th Circuit Court of Appeals who I think is probably gonna be one of the more favorable courts to our arguments that is out there. So we, have 3 different counts in the case. Okay. So the first count is whether or not the Reform and Integrity Act required USCIS to conduct a performance based fee study prior to raising fees on EB fives. And it seems pretty clear that that was congress's intent. Yeah. They put all kinds of, parameters for how this study was supposed to generate fees, and demanded that it be done by a certain deadline, which I believe is March 1st. They blew past that deadline without any concern and raised fees that were not based on performance metrics. And that's exactly what congress told them not to do. The, the second ground is challenging more fiscal law issues. So it's a little different. It's outside of the typical immigration and APA context. But what we're alleging is, a, that every fee that is fee category that has been created has been created by statute. There's never been a fee category created by regulation. And the way we see the law, fee categories have to be created by statute, not by the agency fiat. And so that's one of the issues in the asylum fee. The other fiscal law issue is the agency was told by Congress not to spend money on certain activities. One of which was investigation. What we see going on right now is the number of people working in USCIS's FDNS. That's their basically investigative police force. It has gone from, I want to say it was around 750 in 2018 to well over 2,000 now in climbing. And so they're diverting all this money away from adjudicators, putting it into these investigators, and meanwhile processing times are abysmal. So our read of the law is that Congress did not want them doing that because they delegated that authority exclusively to ICE. So, ICE should be doing the investigating. USCIS should be focused on adjudicating, and they're distracted from their main from their only goal, really.

Jonathan Wasden: Could you elaborate on the claim that the final rule was promulgated without appropriate notice and comment?

James Pittman: So in the preamble to the the proposed rule, they had a contact info for if you wanted to view the data that the the rule was based on that the fees were based on. And so myself and several other groups, nationally prominent groups, we contacted that number. The the number rang, rang, rang, rang. Nobody ever picked up. And this was over the course of a month. And so there was another phone number that was listed in there, so we called that and it was just some random government employee that had no idea what we were talking about. And so we ended up, you know, having to threaten to get an injunction to get access to this evidence. So we show up at the, we schedule an appointment with the agency rather. We're scheduling the appointment. I say okay, I'm bringing my expert with me.

James Pittman: We're going to take a look at all this data. And they said, oh no, no. You can't see the data. You can't see the data that we're basing the rule on. What you can see is we'll give you a description of how the program works. How a computer IT system works, which is not terribly helpful at all when you're trying to figure out if the agency's math is correct. And so because they didn't allow access to the evidence the rule is based on, the argument is is that they failed to comply with the APA's requirements.

Jonathan Wasden: Now what specific aspects are being challenged as unlawful or arbitrary?

James Pittman: In an APA case, everything is gonna fit into arbitrary and capricious. And in the way that the Supreme Court basically distills that down is, did you consider things that you were supposed to consider, or did you consider things you weren't supposed to consider in formulating a rule? And so everything kind of rolls into that arbitrary and capricious once you find congressional intent in agency action that doesn't comply with congressional intent. So, yeah, all of the the claims in this the case basically come down to being arbitrary and capricious because Congress at different points has told them to do things. They're not doing it.

Jonathan Wasden: Now from a legal standpoint, how does the Administrative Procedures Act, the APA, come into play in this case?

James Pittman: So the APA is the the handbook that the government has to follow when they're making rules, when they're making decisions. It has some pretty firm requirements. There's a notice requirement. They have to give you notice of proposed actions. There's the opportunity to review evidence before an action it takes, and then there's the written decision requirement.

James Pittman: And if the agency doesn't comply with all these things, they don't get that give adequate notice, then it's a violation of the APA. And so for the access to evidence issue, that's definitely what we're really leaning hard on is the language in the APA that says that they're required to give people access prior to, yeah, making a final rule.

Jonathan Wasden: Now there's a proposed asylum program, fee. What is it? What is it? What do they, say that it's supposed to do? Who's gonna be paying it? Looks like it's falling mostly on the petitioners and employment based cases.

James Pittman: Yeah. Exclusively. It's hitting the goose that laid the golden egg, basically. So the the companies that file, you know, the most visas are getting hit with the highest fees. So they created the the new fee category, and it charges $600 per petition for companies that are larger than 25 and 300 for smaller companies. So, you know, earlier we were talking about how the IT serve companies are filing a lot of petitions in this 3 year span. The percentage increase is just astronomical that they're now having to face per petition, and over the course of that 3 year span, at a asylum fee just really jacks up the cost on the businesses.

Jonathan Wasden: Mhmm. Understood. Understood. Yeah. It's a well, it's a thorny issue. I mean, in in lieu of that, I mean, if you had your druthers on it as as you've given it, thought, I mean, would there have been some sort of an alternative arrangement for trying to defray the cost of the asylum system? Obviously, you don't wanna be charging asylum applicants the fee. It's been applying for asylum has been free for, you know, as long as there's been an I 589. I I mean, maybe a more broad based smaller but more broad based increase across across, you know, all the categories would have been better. I I don't know.

Jonathan Wasden: Have you given any thought?

James Pittman: So I I think the easiest fix to this problem is for them to follow the structure of the statute, which is they adjudicate, they don't investigate. There's 2,000 people that are getting salaries from the agency and being housed by the agency for doing investigation, which they're not supposed to do. And so if USCIS devoted that money to adjudication, the asylum problem would be gone.

Jonathan Wasden: Understood. Alright. Well, let's, talk about so so the immigrant investor fees are skyrocketing. And what are what are the implications? I mean, we've talked about the fact that it's not all, you know, billionaires and so forth who are in that program. You know, what are the implications of the fees going up this high? It becomes less attractive. We've said that. Any anything else?

James Pittman: So one of the hard things about EB 5, and this is why Congress had the RIA language in it for a performance based fee study, is that their record keeping and their data collection is abysmal within the EB5 category. And they don't have any clue of what's going on.

Jonathan Wasden: How do you know that, Sean?

James Pittman: Oh, because it says it in the statute. Yeah. That was one of the things in the in the legislative history where they were frustrated with USCIS and that they have to create these performance based metrics, which requires them to collect the data that they have been oblivious to.

Jonathan Wasden: Not all not all on the reform integrity option.

James Pittman: Yeah. The implications are they don't really know how this is going to impact their overall revenue because they don't really have good numbers. From what I see anecdotally, a really high percentage of EB5 applicants are people that are not massively wealthy. Right? They're the people I was referring to earlier that Scrimpton Saved got together their $500,000 and filed. Those are the people that are going to be priced out of the EB5 market and I think that will bring the numbers down quite a bit and also the agency's revenue. So it's conceivable that we could be in a situation where the demand drops for these visas so much, h one b's, e b two's, and and, e b five, that we're just gonna have to go through another round of fee rules because the revenue is not matching expectations.

Jonathan Wasden: So let's talk about the the statutory requirements that were in the Reform Integrity Act, the RIA, that was passed in 2022. Which of those requirements are you alleging have not been met by USCIS?

James Pittman: The fee study. I mean, that's the easiest thing to point to. Because they were required to come up with a fee study, which set fees based on performance metrics.

Jonathan Wasden: Where in your view, that impacts the legality of the whole final.

James Pittman: Yeah. So they put a firm deadline of March 1st of 2023 on that, and they blew past it. And so, yeah, they do the rule without going through the the fee study process. And Congress was pretty clear in the RIA that they shouldn't be raising fees without connecting those fees to performance based metrics.

Jonathan Wasden: Mhmm. Understood. Understood. And, let's talk about the role of the American Immigrant Investor Alliance in supporting the legal challenge. So they're they're one of the plaintiffs. Mhmm. And, you know, did they how did it arise? They came to you with the idea for the suit or or what?

James Pittman: So I've got a long standing relationship with IT, sir. My co counsel, Matt Galati, has a long standing relationship with AIA. And so we were Matt and I and Jesse, we were just kind of comparing notes on how we wanted to challenge this issue. And we decided it made more sense to have a bigger tent and bring these two groups together so that we could fight for both of their causes.

Jonathan Wasden: Got it. Well, there's obviously a lot. When did you start getting ready or make the decision to to file the suit?

James Pittman: Later than we would have liked. So, yeah, there's there's always a huge buildup where people takes them a while to make the decision to file suit. And, yeah, getting the clients through, you know, the that pre suit process sometimes takes longer than you'd like. So we got it going probably later than we would have liked. Ideally, we would have got it going so that we could file a preliminary injunction motion and not ask for a TRO like we had to do, and we'd have time to brief that before the rule goes into effect and get a decision from the judge.

Jonathan Wasden: Let's talk about that for a second. So you you did file for a TRO, and as of today, that has not been granted. You're still waiting on the decision?

James Pittman: No. Friday, Friday evening, the judge ruled. And so when the government opposed the motion Yeah. They only focused on irreparable harm. And they said the harm wasn't irreparable because people who pay unlawful fees can go to the Federal Court of Claims and ask for a refund of those fees, And therefore, sought an irreparable harm. I think it's kind of auspicious because they have to pay an attorney to get those fees back and it's gotta be irreparable eventually. So that was the only argument that they really made was the reparable. They didn't touch the merits, and so the judge didn't rule on the merits of the case. She didn't opine on, you know, what the likelihood of success on the merits was and Oli ruled on irreparable harm. So, yeah, going forward, we're going to decelerate judgment, and we'll be briefing the merits. And the irreparable harm piece will be, you know, out the window because it that's not really relevant to summary judgment.

Jonathan Wasden: Now if you now in order to have requested a preliminary injunction versus a TRO, you would have had to file earlier?

James Pittman: Yeah. So if you do a preliminary injunction, you usually file ideally 3 weeks before the rule goes into effect. The government has you know, you negotiate a briefing schedule, but usually they'll get 2 weeks to reply and then we would get a week to make a reply brief to that. Then the judge makes a decision from there. So it gives the parties and it gives the court more time, which is always better for getting a decision that is what you want. But, unfortunately, we're we're stuck with the TRO where we had to trial before the Monday before the rule goes into effect.

Jonathan Wasden: Do you think that you would have had a great a greater likelihood of suggest success with the preliminary injunction?

James Pittman: So I think we would have kept our 1st judge. So the case was assigned to exactly the type of judge that we were looking for in the 10th circuit. Okay. And I he's a senior judge, and I think the compressed timeline just didn't work, you know, for his schedule. And so it got reassigned to a new, Biden appointee. I I think our arguments would have been probably better received by, you know, an old school Republican, an h w Bush Republican that sees the value of employment based immigration. So, yeah, that was probably the the worst part of the timing is that we lost that judge.

Jonathan Wasden: Okay. So the entire case has been reassigned?

James Pittman: Yeah.

Jonathan Wasden: Alright. Let me ask you a question, if you don't mind. So aside from the plaintiffs, the Immigrant Investor Alliance, and IT, sir, are are there any other organizations, or campaigns, you know, helping to defray the cost of the suit?

James Pittman: No. AIIAIA has a, a GoFundMe site that they're running for it. But, yeah, there's really nobody else that's shipping and fees. In fact, the companies that are hit the hardest by this, the the very large consulting companies, yeah, they aren't, you know, spending a dime on on that litigation, and I don't think they ever have. So there's really nobody contributing financially.

James Pittman: There's a lot of people that are armchair quarterbacking. There's a lot of people that are chirping on the sidelines, yeah, about what should be done or what shouldn't be done. But nobody that's actually paying the bills is is engaged in that. And so

Jonathan Wasden: How do you anticipate that the outcome of this case either way would impact, USCIS and immigration policy moving forward? Like, suppose you win, you know, what would what do you think lasting impact would that have? And then on the other hand, if you were to lose, aside from the fact that the fees are you know, the fee increase remains, do you see any other impact?

James Pittman: So it really depends on yeah. If if we're successful, it would depend on which one of the counts the judge rules with us on or, you know, multiple. If we were right on the fiscal eye issue, then we would see USTIS become a much trimmer organization, and they would lose the fat of FDNS Mhmm. And devote that money towards adjudication, which would speed things up and would really help everybody. If we went on the fee study rule, the agency will have to be a little bit more compatible because or accountable rather, because they're actually going to have to meet some performance based requirements. And right now, they're a pin they're taking the proposed rule and the final rule is that, yeah, COVID said we had to do this, but we don't have to do it. We we can keep raising fees indefinitely without ever completing this fee study, And there's no problem with that, which is a pretty bold statement for a federal government agency to say and basically tell congress to go pound sand.

Jonathan Wasden: Got it. I mean, when you go to trial on this, are you expecting to utilize experts, and what type of experts would be useful or indicate?

James Pittman: Yeah. So we are looking at experts. We're getting somebody that has some statistical ability to look at government budgets and analysis. So that's the effort that we tried to take with us to view the evidence back, when the rule was still pending. Yeah. And ideally, we'll force access to the evidence and be able to take a look at that, and then break down and see whether or not USCIS's cost projections make sense, and whether or not they add up.

Jonathan Wasden: When would you anticipate that this would go to trial? Any any thoughts on the timeline?

James Pittman: So I think, yeah, very optimistically, we would get the administrative record within a month, month and a half. We would be filing briefs a month and a half later. And then, you know, CORE would probably give a decision 4 or 5 months after that. If we get in bogged down into access to evidence issues, we have to start briefing whether or not the government has to produce the evidence Mhmm. Then it'll probably drag out a little longer.

Jonathan Wasden: Okay. Understood. And I I mean, how is how has the soup been received, you know, in the public square? I mean, you know, in terms of the immigration bar, the the immigration law community, and the media, I mean, have you, you know, had a request to do other interviews? And what level of awareness are you finding that there is regarding your suit?

James Pittman: So there's pretty good awareness, actually, which is k. I guess not terribly surprising because it's an issue that impacts everybody right now.

Jonathan Wasden: Right.

James Pittman: The you you know the immigration bar is kinda bifurcated. And you have the employment based, and you have the humanitarian side. And they have different clients, and they have different motives. And so the the employment based folks are all pretty much in favor of the suit and challenging these fees that are going into effect. The humanitarian side, not so much. They the reasoning for it, I don't really get, which is they think that if this current fee rule is rejected by the court, that the Trump era fee rule that was enjoined in the Northern District of California will then automatically spring into effect. I don't see how in the world that would be legally permissible or even something that the agency would consider because the fundamental problem with that case in the Northern District of California was that the agency created a rule without having a appointed person signing off of a rule.

Jonathan Wasden: Right. Can you just give us a little more background of what was that increase, when did that occur, and what happened?

James Pittman: Oh, yes. I think that was, 2021. So just 2 or 3 years ago. So it was a case filed in the Northern District of California challenging a fee increase from USCIS. Chad Wolf, who was the acting secretary of Homeland Security, had exceeded the amount of time he could be acting, and he was never appointed by Congress or confirmed by Congress. Right. And so the agency was being run for a period of time by somebody that actually didn't have any statutory authority to run it. And the court said you can't do that. You know? When you create a regulation, it has to be approved by somebody with the legal authority to to promulgate that regulation, and they didn't have that. And so that's illegal infirmity that's not going away. They can't, you know, hop in a time machine and fix that one. And I I just don't see how that rule that was enjoined on those grounds gets, automatically triggered into existence.

Jonathan Wasden: Apart from that case, are there any other precedents for challenging fee increases from USCIS? Is this something that's, you know, been successful in the past?

James Pittman: There's there's been surprisingly few fee increases because, you know, the few regulations in general from USCIS. The regulatory process is incredibly stifling. Yeah. The amount of bureaucracy and waste of time that goes into a new regulation is is hard to believe if you're not if you've not seen it from the inside. So there haven't been a lot of fee increases. I think 2016 was the most recent one before the 2020. So, yeah, in recent decade, the, the government's batting 500 up on their fee rules, and we'll see how they do it, this and that.

Jonathan Wasden: K. Adi, how are you feeling, you know, in overall about the prospects for the case? I mean, up still optimistic even after Friday's decision on TRO?

James Pittman: I really don't see how on the merits they get away from the RIA's performance based fee requirements. That seems very clear, the statute, that they had to do that before jacking up fees. I think that's the most likely issue to win on. Then the question becomes whether or not the corp will sever the EB 5 fees out from the rest

Jonathan Wasden: of the rule. Or just that one.

James Pittman: Which I don't think they can do. Because when you read the rule, what they're basically doing is redistribution of wealth from employment, paying for asylum. Right? And so the employment people are subsidizing the asylum adjudications. The people that are getting soaked the hardest is zb5. So if you take out those fee increases, those massive fee increases, there's gonna be a massive hole in the budget, and the agency will be strapped and won't have the cash to do its job. So I I don't see how they can sever the rule that way.

Jonathan Wasden: And how far are you willing to take this? I mean, so it certainly sounds like it's something which could be, you know, ending up in the 10th circuit.

James Pittman: I think if we don't win at the trial core level, the district core level, I really do like the 10th circuit for yeah. They're they're very strong libertarian, you know, government accountability, type mentality. It's a a very Gorsuch circuit.

Jonathan Wasden: Noteworthy. 10th circuit cases that come to mind on other government action that gives you that optimism? I mean, that you wanted

James Pittman: to share. So there's quite a few, actually, and that's that's a big part of why I I grew up in the 10th Circuit. And, yeah, there's just this very strong sense that the federal government is abusing its power all the time, and they're they have too much control over things, and they need to back off. And the 10th Circuit cases, especially on environmental law, they really do come and bring the hammer down on the government more frequently than anybody else, Mhmm. And, you know, find the government's abusing its authority in creating some of these rules.

Jonathan Wasden: Alright. Well, Jonathan, by representing the plaintiffs, you are serving as their legal representative. I mean, our in our audience, there may be people listening who would be affected by this, fee increase. I mean, there obviously are. What message would you like to convey to individuals and organizations who may be listening to our podcast and who would be affected by the proposed fee increases about your efforts to challenge them.

James Pittman: So I would say what everybody in the immigration space needs to to realize is they don't wanna be the frog in the boiling pot of water. Yep. You know, the the old story about the frog gets into the the pot of water. It's lukewarm. It you crank the heat up until it's boiling. The frog never leaves because it just doesn't notice the incremental change.

Jonathan Wasden: Right.

James Pittman: That's what's happening. And so everybody's eventually going to get the pinch. So people should be fighting for their rights and engaging long before it gets to the the boiling point.

Jonathan Wasden: Yeah. Reminds me of, you know, inflation and so forth and and, the overall client inflationary climate, similar to that, you you know, these, little increases. And before you know it, it turns into a large increase. But, Jonathan, you mentioned the GoFundMe page. Are there any other ways you wanna give us more information about the GoFundMe page or any other ways that concerned individuals can contribute to supporting your efforts in halting the implementation of the fingers?

James Pittman: They could reach out directly to Mac Galati or Jesse Bless or myself if if they wanted to contribute or for the GoFundMe page. I can get you the link after the show so you can post the link if you'd like.

Jonathan Wasden: Yes. We'll post the link along with the video. Alright. Well, so, Jonathan, we wanna thank you, very much for joining us to talk about the suit. It's, really, you know, an admirable effort. I I wish you success. And, again, thanks for joining us on today's episode of Immigration Uncovered, and good luck.

James Pittman: Thank you. It's good to be with you.

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