Srinivasa Rao Potnuru, et al. v. United States Department of Homeland Security

CourtDistrict Court, D. Arizona
DecidedJanuary 5, 2026
Docket2:23-cv-02423
StatusUnknown

This text of Srinivasa Rao Potnuru, et al. v. United States Department of Homeland Security (Srinivasa Rao Potnuru, et al. v. United States Department of Homeland Security) is published on Counsel Stack Legal Research, covering District Court, D. Arizona primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Srinivasa Rao Potnuru, et al. v. United States Department of Homeland Security, (D. Ariz. 2026).

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 Srinivasa Rao Potnuru, et al., No. CV-23-02423-PHX-DLR

10 Plaintiffs, ORDER

11 v.

12 United States Department of Homeland Security, 13 Defendant. 14 15 16 This case arises from the United States Customs and Immigration Services’ 17 (“USCIS”) administration of the H-1B visa program, of which Plaintiffs were all 18 beneficiaries. USCIS is an agency within the Department of Homeland Security (“DHS”), 19 the Defendant here. Plaintiffs allege that DHS violated the Administrative Procedure Act 20 (“APA”) in enforcing certain rules as part of the program. Before the Court are the parties’ 21 cross-motions for summary judgment. (Docs. 39, 43.) The motions are fully briefed. (Doc. 22 46.) The Court heard oral argument on December 19, 2025. (Doc. 53.) For the following 23 reasons, Plaintiffs’ motion is granted in part and denied in part, and DHS’s motion is 24 granted in part and denied in part. 25 I. Background 26 A. The H-1B Visa Process 27 Admission to H-1B status is based “upon petition of the importing employer.” 8 28 U.S.C. § 1184(c)(1). The process is divided into two parts. At step one, the petitioner- 1 employer must register to file a petition on behalf of a foreign national1 on the USCIS 2 website, and the registration must be made in “accordance with 8 CFR 103.2(a)(1), 3 paragraph (h)(8)(iii) of this section and the form instructions.” 8 C.F.R. § 4 214.2(h)(8)(iii)(A)(1). As part of the registration, a petitioner-employer must complete an 5 attestation, under penalty of perjury, that the petitioner-employer “has not worked with, or 6 agreed to work with, another registrant, petitioner, agent, or other individual or entity to 7 submit a registration to unfairly increase chances of selection for the beneficiary.” H-1B 8 Electronic Registration Process, U.S. Citizenship & Immigr. Servs., 9 https://www.uscis.gov/working-in-the-united-states/temporary-workers/h-1b-specialty- 10 occupations/h-1b-electronic-registration-process (Oct. 22, 2025). After the close of the 11 registration period, USCIS performs a computer-generated lottery selection. §§ 12 214.2(h)(8)(iii)(A)(5)(ii); 214.2(h)(8)(iii)(A)(6)(ii). USCIS then notifies those employers 13 whose registrations were selected. § 214.2(h)(8)(iii)(C). At step two, those employers must 14 then file a petition in accordance with § 214.2(h)(4)(iii)(B). 15 An employer may not file more than one H-1B petition on behalf of the same foreign 16 national. § 214.2(h)(2)(i)(G). Doing so would “result in the denial or revocation of all such 17 petitions.” Id. That rule does not preclude related employers from filing petitions on behalf 18 of the same foreign national. 73 Fed. Reg. 15392(III)(B). “USCIS recognizes that an 19 employer and one or more related entities (such as a parent, subsidiary or affiliate) may 20 extend the same [foreign national] two or more job offers for distinct positions and 21 therefore have a legitimate business need to file two or more separate H-1B petitions on 22 behalf of the same [foreign national].” Id. But if USCIS believes that the related employers 23 may not have a legitimate business need to file more than one H-1B petition for the same 24 foreign national, USCIS may issue a request for additional evidence, notice of intent to 25 deny (“NOID”), or notice of intent to revoke (“NOIR”) each petition. § 214.2(h)(2)(i)(G). 26 If in response, any of the related entities fail to demonstrate a legitimate business need, all 27 petitions filed on that foreign national’s behalf by the related entities will be denied or

28 1 This order uses the term “foreign national” as equivalent to the statutory term “alien” used in the INA. 1 revoked. Id. 2 USCIS notifies the petitioner-employer—not the foreign national —of the approval, 3 denial, intent to deny, intent to revoke, or revocation of an H-1B petition. §§ 214.2(h)(9)(i), 4 (h)(10)(ii), (h)(11). USCIS may issue a NOID or a NOIR to a petitioner-employer if it finds 5 the application contains fraud or misrepresents a material fact. § 214.2(h)(11)(iii)(B). Then 6 “[i]f a[] [foreign national] who was issued a visa or otherwise provided nonimmigrant 7 status . . . is found to have been issued such visa or otherwise provided such status by fraud 8 or willfully misrepresenting a material fact” and that visa or nonimmigrant status is 9 revoked, then one H-1B cap number is restored. § 1184(g)(3). 10 B. Factual Background 11 Plaintiffs are all nationals originally from India. (Doc. 14 ¶¶ 1–9.) Some currently 12 reside in the United States; others still live in India. (Id.) Various employers registered and 13 then filed petitions on behalf of each of the Plaintiffs. (Id. ¶¶ 131, 147, 160, 177, 192, 207, 14 221, 235, 248.) USCIS approved all petitions submitted by Plaintiffs’ employers and all 15 Plaintiffs received H-1B status and cap numbers. (Id. ¶¶ 132, 148, 161, 178, 193, 208, 222, 16 236, 249.) Plaintiffs were authorized to begin employment in October 2022. (Id.) Other 17 employers later submitted transfer petitions on behalf of Plaintiffs Srinivasa Rao Potnuru, 18 Dheeraj Mangu Venkata, Harikrishna Padarti, Krishna Sai Golakoti, Prajwal 19 Kandigemoole Lakshminarayan, and Raghupathy Kommidi. (Id. ¶¶ 134, 163–64, 180, 195, 20 210, 224.) 21 USCIS later determined that all employers who filed petitions on behalf of Plaintiffs 22 had engaged in fraud and made false statements of material fact in the H-1B petitions by 23 colluding with other companies to increase Plaintiffs’ odds of selection during the 24 registration step. (Id. ¶¶ 138–39, 152–53, 168–69, 184–85, 198–99, 212–13, 227–28, 239– 25 40, 254.) USCIS therefore sent each petitioner-employer a NOIR, stating its intent to 26 revoke the H-1B petitions. (Id. ¶¶ 137, 150, 167, 182, 196, 211, 225, 238, 253.) USCIS 27 then revoked the H-1B petitions (Id. ¶¶ 141, 155, 171, 187, 201, 215, 230, 242, 255) and 28 Plaintiffs’ H-1B status and cap numbers (Id. ¶¶ 144, 158, 174, 190, 204, 218, 233, 245, 1 259). 2 Plaintiffs filed the present suit and alleged three counts, all for violations of the 3 APA. (Doc. 14 at 35, 37, 39.) DHS moved to dismiss, (Doc. 28) which the Court granted 4 in part as to Count I (Doc. 31 at 10). The remaining counts allege that DHS’s construction 5 of § 1184(g)(3) contradicts the plain language of the statute and that DHS’s revocation of 6 Plaintiffs’ cap numbers was procedurally deficient. (Doc. 14 at 37, 39.) Both parties now 7 move for summary judgment. 8 II. Legal Standard 9 Generally, a court may grant summary judgment where “there is no genuine dispute 10 as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. 11 Civ. P. 56(a). However, when a court is asked to review an administrative agency’s action, 12 “there are no disputed facts that the district court must resolve.” Occidental Eng’g Co. v. 13 INS, 753 F.2d 766, 769 (9th Cir. 1985). In such cases, the agency, not the court, is the fact 14 finder and the court’s role is merely to “determine whether or not as a matter of law the 15 evidence in the administrative record permitted the agency to make the decision it did.” Id. 16 Thus “summary judgment is an appropriate mechanism for deciding the legal question of 17 whether the agency could reasonably have found the facts as it did.” Id. at 770.

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