Derya Kara v. United States

• Court: Court of Appeals for the Eleventh Circuit
• Decided: August 2, 2021
• Docket: 21-10182
• Status: Unpublished

Opinion

USCA11 Case: 21-10182 Date Filed: 08/02/2021 Page: 1 of 9

[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT ________________________

No. 21-10182 Non-Argument Calendar ________________________

D.C. Docket No. 1:20-cv-20611-RNS

DERYA KARA,

Plaintiff-Appellant,

versus

UNITED STATES OF AMERICA,

Defendant-Appellee.

________________________

Appeal from the United States District Court for the Southern District of Florida ________________________

(August 2, 2021)

Before WILLIAM PRYOR, Chief Judge, LAGOA and BRASHER, Circuit Judges.

PER CURIAM: USCA11 Case: 21-10182 Date Filed: 08/02/2021 Page: 2 of 9

Derya Kara appeals the summary judgment in favor of the United States

Citizenship and Immigration Services and against her complaint to compel the

agency to grant her a visa to enter the United States as an alien investor, 8 U.S.C.

§ 1153(b)(5). The agency denied Kara’s petition for a visa on the ground that she

failed to submit “evidence that [she had] invested . . . capital obtained through

lawful means.” See 8 C.F.R. § 204.6(j). The district court ruled that it could not

“set aside [an] agency action” that was not “arbitrary or capricious.” See 5 U.S.C.

§ 706(2)(A). We affirm.

An alien may obtain a visa to enter the United States by investing capital

from a lawful source into a for-profit enterprise that results in the creation of full-

time jobs for at least ten citizens or legal permanent residents. 8 U.S.C.

§ 1153(b)(5)(A). An alien can become eligible for an employment-creation visa by

submitting “a petition . . . accompanied by evidence that [she] has invested, or is

actively in the process of investing, capital obtained through lawful means . . . .” 8

C.F.R. § 204.6(j). The capital must consist of cash, assets, “cash equivalents, and

indebtedness secured by assets owned by the alien investor,” and cannot be

“acquired, directly or indirectly, by unlawful means (such as criminal activities)

. . . .” Id. § 206.4(e). “To show that the . . . capital [is] obtained through lawful

means, the petition must be accompanied” with evidence of the origins of the

investment funds. Id. § 206.4(j)(3). Relevant sources include “business registration

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records,” “[c]orporate . . . and personal tax returns . . . or any other tax returns of

any kind filed within five years . . . with any taxing jurisdiction,” “[e]vidence

identifying any other source(s) of capital,” and “[c]ertified copies of any judgments

or evidence of all pending governmental civil or criminal actions . . . [and]

governmental administrative proceedings . . . against the petitioner from any court

in or outside the United States within the past fifteen years.” Id.

On March 9, 2015, Kara, a native and citizen of Turkey, petitioned for

classification as an alien investor. When Kara filed her petition, an alien could

receive a visa if she invested no less than $500,000 in a targeted commercial area

that benefitted at least 10 citizens of, aliens lawfully admitted to, or immigrants

allowed to be employed in the United States. 8 U.S.C. § 1153(b)(5)(A),

(b)(5)(B)(ii), (b)(5)(C)(ii). Kara invested $620,000 in a company named Lexor

Miami, Inc., which she created to operate a small shopping mall in Miami, Florida.

Kara attached to her petition bank records showing that, on September 5,

2013, she wrote a check to Lexor for $620,000, which originated from a balance of

$140,000 in her account combined with $480,000 that her other company,

Optimystik Eyewear, Inc., deposited into Kara’s account on September 4, 2013.

Kara submitted reports about the operations and development of Lexor, bank

statements for Optimystik, and the first pages of its corporate returns for tax years

2011 to 2013. The 2013 transfer to Kara was not recorded on the Optimystik return

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for tax year 2013. Kara provided no explanation for the transfer, such as it

constituted a loan, dividend, or distribution, nor did she submit a personal tax

return.

The agency sent Kara a notice of intent to deny her petition. The notice

stated that funds “associated with Optimystik Eyewear, Inc. were seized,” that

Kara “accepted a settlement payment while forfeiting the remaining funds to the

United States,” and that, “in light of these events the lawfulness of [her] investment

funds is called into question.” The agency requested additional evidence to

establish the lawful source of Kara’s investment funds.

Kara responded that her investment funds were lawful profits of Optimystik.

She stated that, in 2014, she received notice that $40,513.74 had been seized on

suspicion of a “black peso violation,” that amount equated to 0.003% of company

revenue, and that the transaction was flagged because two Colombian wholesale

customers deposited cash payments into the company bank account. Kara

explained that she settled the matter after calculating the cost of a lawsuit, and she

submitted an affidavit disclaiming any wrongdoing. The settlement agreement,

which Kara executed in July 2014 and attached to her response, stated that

$16,205.50 “shall be administratively forfeited to United States pursuant to 18

U.S.C. §§ 981 and 983 and 18 U.S.C. § 1956” in exchange for the return of

$24,308.24 and that the stipulation was not an admission of liability. Kara

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submitted an article titled The Black Peso Money Laundering System, which

described how drug traffickers used legitimate business purchases to launder drug

money. Kara also submitted a letter written by the accountants for Optimystik, in

which they stated there had been no money laundering, black peso transactions, or

other financial impropriety by the company or its management and that it had

$11,646,118.29 in sales between January 2010 and December 2013. In addition,

Kara submitted copies of the sales report for Optimystik from 2010 to 2013 and of

the summary page of tax returns it had filed with the State of Florida between

January 2010 and January 2014.

The agency denied Kara’s petition for a visa on the ground that her

investment in Lexor was “acquired, directly or indirectly, by unlawful means . . .

[and could] not be considered capital.” See 8 C.F.R. § 204.6(e). The agency

considered all of Kara’s evidence, including her assertion that Optimystik had been

a victim of black peso operations and her evidence that the $40,513.74 seized was

a small fraction of its revenues. The agency found that the money Kara invested in

Lexor did “not appear to be lawful” because the funds seized from Optimystik

were related to narcotics proceeds and were commingled with other company

funds.

Kara complained that the decision to deny her petition was arbitrary and

capricious. She argued that she produced evidence that the funds invested in Lexor

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derived from the more than $12 million Optimystik made in retail and wholesale

sales and that the burden then shifted to the agency to prove the funds were not

obtained lawfully. Kara moved for summary judgment.

The agency also moved for summary judgment. The agency argued that

Kara failed to prove that her investment funds were not tainted. And the agency

highlighted that Kara submitted no personal tax returns, which were required by

the regulations to establish eligibility for a visa. See id. § 206.4(j)(3)(ii).

The district court denied Kara’s motion and granted summary judgment in

favor of the agency. The district court ruled that Kara failed to establish that “[t]he

‘complete path’ of her investment funds was . . . wholly devoid of illicit narcotics

trafficking proceeds.” The district court also ruled that the agency did not abuse its

discretion by denying Kara’s visa application because she “fail[ed] to make an

adequate record” that “individually or collectively trace[d] her investment funds to

a lawful source.”

We review de novo a summary judgment. Mahon v. U.S. Dep’t of Agric.,

485 F.3d 1247, 1252 (11th Cir. 2007). “[E]ven in the context of summary

judgment, [the decision of a federal administrative agency] is entitled to great

deference.” Id. at 1253 (quoting Ala.–Tombigbee Rivers Coal. v. Kempthorne, 477

F.3d 1250, 1254 (11th Cir. 2007)). Under the Administrative Procedure Act, a

district court may set aside a decision of a federal agency only if it is “arbitrary,

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capricious, an abuse of discretion, unconstitutional, in excess of statutory authority,

without observance of procedure as required by law, or unsupported by substantial

evidence.” Id. Substantial evidence is “such relevant evidence as a reasonable mind

might accept as adequate to support a conclusion.” Stone & Webster Constr., Inc.

v. U.S. Dep’t of Labor, 684 F.3d 1127, 1133 (11th Cir. 2012) (quoting Richardson

v. Perales, 402 U.S. 389, 401 (1971)).

The district court did not err by granting summary judgment in favor of the

agency. Kara failed to create a material dispute that she was entitled to a visa as an

alien investor by investing funds in Lexor that were “obtained through lawful

means.” See 8 C.F.R. § 204.6(j). Kara omitted from her petition that, months after

Optimystik supplied $480,000 of the $620,000 investment funds, the government

seized $40,513.74 of its proceeds on the suspicion that that cash payment by

customers in Colombia was a “black peso violation.” See id. § 206.4(j)(3)(iv)

(requiring disclosure of governmental actions). None of the bank records,

corporate records, or first pages and summaries of corporate tax returns that Kara

submitted to the agency established that the investment funds Optimystik supplied

came from a different account or had been isolated from the proceeds later seized

by the government. Kara also submitted no evidence that the proceeds, which had

been commingled with the investment funds, were untainted. Kara agreed to

“administratively forfeit[] [forty percent of the funds seized] . . . pursuant to 18

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U.S.C. § 1956,” which prohibits money laundering. Optimystik admitted no

liability in the agreement, but it did not exonerate the company. Although Kara and

Optimystik accountants disclaimed any knowledge of money laundering, their

ignorance was unsurprising when the article Kara submitted to the agency about

black peso transactions explained that narcotics traffickers used legitimate business

transactions to disguise money laundering.

No material factual dispute existed about whether the agency acted

arbitrarily or capriciously by denying Kara’s petition. For “[a] decision [to be]

arbitrary and capricious . . ., the agency [must] rel[y] on factors which Congress

has not intended it to consider, entirely fail[] to consider an important aspect of the

problem, or offer[] an explanation for its decision that runs counter to the evidence

before the agency.” High Point, LLLP v. Nat’l Park Serv., 850 F.3d 1185, 1193–94

(11th Cir. 2017) (internal quotation marks omitted and alteration adopted). Kara

had “[t]o show that . . . [she had] invested . . . capital obtained through lawful

means” to qualify for a visa as an alien investor. 8 C.F.R. § 206.4(j)(3). After

discovering that Optimystik supplied a majority of the funds that Kara invested in

Lexor, the agency gave Kara an opportunity to submit evidence that the funds from

Optimystik were lawfully sourced. But Kara failed to do so. Because the

administrative record evidenced that the funds Kara obtained from Optimystik

were “acquired, directly or indirectly, by unlawful means (such as criminal

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activities) [and could] not be considered capital,” see id. § 206.4(e), and she had

not “invested . . . capital” in Lexor, 8 U.S.C. § 1153(e)(5)(A)(i), the agency had to

deny her petition for a visa.

We AFFIRM the summary judgment in favor of the agency.