USCIS’ Unlawful Denial of H-1B Petitions Spurs Class Action Lawsuit

USCIS’ Unlawful Denial of H-1B Petitions Spurs Class Action Lawsuit

MadKudu Inc., et al. v. USCIS, et al., Case 5:20-cv-02653 (N.D. Cal. filed April 16, 2020)


This nationwide class action lawsuit challenges U.S. Citizenship and Immigration Services’ (USCIS) pattern and practice of arbitrarily denying H-1B nonimmigrant employment-based petitions for market research analyst positions filed by United States businesses.  

The complaint alleges that USCIS unlawfully denies H-1B petitions for market research analysts by misinterpreting the term “specific specialty” in the statute and the word “normally” in the first regulatory test.  In applying the first regulatory test, USCIS also misinterprets the Occupational Outlook Handbook—a publication of the U.S. Department of Labor’s Bureau of Labor Statistics that profiles hundreds of occupations in the United States job market—on which USCIS relies.

The lawsuit was filed at the federal district court in the Northern District of California by the American Immigration Council, the American Immigration Lawyers Association, and the law firms Joseph & Hall, P.C., Kuck Baxter Immigration LLC, and Van Der Hout, LLP. On May 4, 2020, the original plaintiffs filed a motion to certify the class. One week later, USCIS approved the original plaintiffs’ H-1B petitions. On June 29, defendants filed a motion to dismiss, claiming the plaintiffs no longer had legal capacity to sue because the H-1B approvals gave them the individual relief they requested, which plaintiffs opposed. On July 20, the two original plaintiffs and two new plaintiffs filed an amended complaint and an amended motion to certify the class.

On August 4, defendants filed a new motion to sever and to dismiss, which plaintiffs opposed. Defendants claimed that each plaintiff had to challenge its H-1B petition denial separately. Defendants again argued that the two original plaintiffs should be dismissed because their H-1B petitions had been approved. Defendants also asked the court to dismiss the two new plaintiffs because they did not have a connection to the Northern District of California.

On September 14, the Court denied defendants’ motion. First, the Court found that since the four plaintiffs claim a pattern and practice of arbitrary and unlawful denial of H-1B petitions for market research analysts, their cases are sufficiently related to be part of a single lawsuit. Second, the court concluded that USCIS could not avoid the lawsuit by approving Plaintiffs’ H-1B petitions when it did and that the two original plaintiffs’ claims were not resolved by the approvals. The Court recognized that plaintiffs sought a declaration from the Court that defendants’ practices were unlawful on behalf of a class, separate and apart from each company’s interest in having their H-1B petitions approved. Finally, the Court concluded that the two new plaintiffs could be part of the lawsuit because only one plaintiff—in this case, an original plaintiff—had to be within the Court’s jurisdiction when suing the government or its officers or employees.

On November 17, the Court granted in part plaintiffs’ class certification motion. The Court adopted plaintiffs’ definition of the class, with one exception. As plaintiffs proposed, the class opens with U.S. employers who filed market research analyst H-1B petitions on January 1, 2019. But the court decided to limit the class to U.S. employers who filed their petitions on or before December 6, 2020. The Court imposed this limit because of a Department of Homeland Security (DHS) interim final rule (IFR) scheduled to take effect on December 7 that would have applied to H-1B petitions filed on or after that dateAmong other changes, the IFR would have removed the word “normally” from the first regulatory test. But the IFR was vacated for failing to comply with APA notice and comment requirements in Chamber of Commerce v. U.S. Dep't of Homeland Sec., No. 20-cv-07331-JSW (N.D. Cal. Dec. 1, 2020). The Council submitted an amicus brief in support of the plaintiffs in the Chamber lawsuit. 

On February 2, 2021 (after the government’s time to appeal expired), plaintiffs filed a motion to amend the certified class definition. This motion asks the court to approve the class definition plaintiffs originally proposed, since the DHS rule never took effect. On March 15, 2021, plaintiffs filed their motion for summary judgment. As relief for the class, plaintiffs seek a court order:

  • Declaring that USCIS unlawfully engaged in a pattern and practice of denying H-1B market research analyst petitions under the first regulatory test by misinterpreting the OOH and misapplying “specific specialty” in the law and “normally” in the regulation.
  • Stopping USCIS from denying class members’ H-1B petitions on the ground that the OOH entry for market research analyst does not meet the first regulatory test. 

Briefing on the motions has been extended temporarily as the parties have entered settlement negotiations. 

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