Lawsuit Challenges Postponement of International Entrepreneur Rule

October 9, 2017

By Immigration Group

This article was prepared with the assistance of ABIL, the Alliance of Business Immigration Lawyers, of which Laura Danielson is an active member.

Professionals working together in an officeThe American Immigration Council (AIC) has filed a lawsuit, National Venture Capital Association, et al., v. Duke, challenging the postponement of the International Entrepreneur Rule (IER). The rule, which was supposed to take effect July 17, 2017, would have permitted foreign entrepreneurs to travel to or stay in the United States to grow new businesses. Less than a week before the IER was scheduled to take effect, the Department of Homeland Security (DHS) announced that its implementation would be significantly delayed and suggested that it ultimately intends to rescind the IER.

In announcing the lawsuit, AIC said, "Immigrant entrepreneurs, who bring their talents, ideas and initiative with them to the United States often face significant barriers to obtaining permission to travel and work in the United States. The IER was promulgated to address these problems and was informed by extensive input from affected entrepreneurs, the business community and the American people."

Plaintiffs are prospective entrepreneur applicants under the IER or companies founded by potential applicants.

AIC, in cooperation with the Washington, D.C., office of Mayer Brown LLP, filed the lawsuit against the Department of Homeland Security. Plaintiffs include the National Venture Capital Association (NVCA), which is the largest organization of venture capitalists in the United States; foreign entrepreneurs; and startup companies. The complaint alleges that the government failed to comply with the Administrative Procedure Act's notice-and-comment requirement. Plaintiffs seek to compel the defendants to implement the IER and to begin accepting and adjudicating parole applications from international entrepreneurs. NVCA noted that its 2013 study "determined that a full one-third of U.S. venture-backed companies that went public between 2006 and 2012 had at least one immigrant founder." NVCA also cited a 2016 finding by a National Foundation for American Policy study that "immigrants have started more than half (44 of 87) of America’s startup companies valued at $1 billion or more."

The AIC's announcement of the lawsuit is located here. NVCA's statement about the lawsuit is found here. The complaint can be read here