Linea Area Nacional De Chile S.A., D/B/A Lan-Chile Airlines v. Doris Meissner, Commissioner of Immigration and Naturalization Service, United States Department of Justice

Citations: 65 F.3d 1034; 1995 U.S. App. LEXIS 25721Docket: 1540

Court: Court of Appeals for the Second Circuit; September 11, 1995; Federal Appellate Court

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Doris Meissner, Commissioner of the Immigration and Naturalization Service (INS), appeals a district court ruling favoring Linea Area Nacional de Chile, S.A. (Lan-Chile), which granted summary judgment in a dispute regarding INS's policy on the detention costs of certain passengers. Lan-Chile challenged the policy requiring common carriers to cover expenses incurred when passengers, admitted under a contract allowing transit without visas, request asylum. The airline argued that amendments to the Immigration and Nationality Act (INA) in 1986 intended to shift the burden of detaining these passengers from carriers to INS, which they claimed violated the Administrative Procedure Act (APA).

The Court of Appeals affirmed the district court's judgment, agreeing that Congress intended for INS to bear the costs associated with detaining transit passengers who seek asylum. The ruling also upheld the limited waiver of sovereign immunity under the APA that allows for reimbursement of the expenses Lan-Chile incurred while detaining its former passengers. The facts show that between September 1990 and December 1992, multiple passengers on Lan-Chile flights arriving at JFK Airport requested political asylum, leading to significant financial burdens for the airline as it provided security, lodging, food, and medical assistance for the detainees over prolonged periods.

INS rejected the airline's claim for reimbursement of approximately $620,000 in costs related to the detention of transit without visa (TWOV) passengers. On June 15, 1993, Lan-Chile filed a complaint in the U.S. District Court for the Eastern District of New York, seeking a declaration that INS's policy of holding common carriers liable for TWOV detentions exceeded its statutory authority and violated the Administrative Procedure Act (APA), was arbitrary and capricious under the APA, and an order for reimbursement of costs incurred. The court granted summary judgment to Lan-Chile on September 14, 1994, leading to INS's appeal.

Prior to 1986, under 8 U.S.C. Sec. 1223 of the Immigration and Nationalization Act, common carriers were responsible for the expenses of temporarily detained aliens. This statute required carriers to cover costs associated with the examination and inspection of aliens upon their arrival. INS enforced this statute, mandating that carriers, including Lan-Chile, pay for the detention and deportation of aliens deemed ineligible for transit. This included entering agreements that obligated carriers to reimburse the U.S. for immigration officer salaries and expenses during the detention of these passengers.

INS regulations further specified the conditions of the TWOV program, placing the burden of continuous custody of the alien on the transportation line and requiring that the alien have confirmed onward reservations. The privilege of TWOV was contingent on various stipulations, including non-refundability of tickets and limitations on applying for extensions of stay or adjustments of status while in the U.S.

A regulation regarding the liability of carriers for the detention expenses of Transit Without Visa (TWOV) aliens has been in place since 1973, as reflected in 8 C.F.R. Sec. 214.2(c)(1). The Immigration and Nationality Act (INA) underwent significant amendments in 1986, notably repealing section 233, which had previously allowed the Commissioner to hold carriers responsible for TWOV alien detention costs. Responsibility for aliens detained for health reasons shifted from carriers to the Immigration and Naturalization Service (INS). The 1986 amendments also adjusted section 286, instituting a User Fee of $5 (later increased to $6 in 1993) per passenger to fund immigration inspection costs, with funds deposited into a segregated User Fee Account.

Congress authorized reimbursements from this account for expenses incurred by the Attorney General for immigration-related services, including detention of 'excludable' aliens—defined as those who misrepresent facts to procure entry into the U.S. Although the amendments modified certain statutory provisions, they preserved the Commissioner's authority to form Transit Agreements with common carriers.

Post-amendment, INS acknowledged the shift of responsibility for detaining excludable aliens from carriers to itself, as indicated in regulatory changes made in 1989. INS is responsible for detaining aliens arriving without proper documentation or with false documents, but it does not assume custody or costs for those presented as TWOVs. Despite the 1986 amendments, carriers, including Lan-Chile, are still liable for the detention costs of TWOVs who seek asylum.

The excerpt addresses legal challenges to the Immigration and Naturalization Service's (INS) policy regarding the handling of transit without visa (TWOV) passengers who seek political asylum. Various cases, such as Dia Navigation Co. v. Pomeroy and Argenbright Sec. v. Ceskoslovenske Aeroline, support the notion that stowaways are considered "excluded" aliens, allowing INS to require carriers to bear the costs of their detention. In June 1993, Lan-Chile sued the INS in the Eastern District of New York, seeking reimbursement for costs associated with three groups of detainees. The district court ruled that TWOVs seeking asylum became excludable aliens under 8 U.S.C. § 1182(a)(6)(C)(i) due to willful misrepresentation. 

The court concluded that while the legislative history did not explicitly mention TWOVs seeking asylum, Congress intended to shift the financial responsibility of detaining such aliens from common carriers to the INS. It found INS's policy unreasonable and inconsistent with the User Fee Act, which aimed to relieve carriers of this burden. The court identified three main inequities in imposing responsibility on carriers: the inability to screen asylum seekers before boarding, a lack of guidelines for detention duration, and the inconsistency with statutory provisions that allow TWOVs to transit through the U.S. Ultimately, the court determined that INS exceeded its authority and acted arbitrarily, allowing Lan-Chile to seek reimbursement for the expenses incurred in detaining these aliens, as supported by the precedent in Bowen v. Massachusetts.

The key legal question revolves around whether the 1986 amendments to the Immigration and Nationalization Act shifted the responsibility for the costs associated with TWOV passengers seeking asylum from common carriers to the INS. The court affirmed that Lan-Chile is entitled to reimbursement, while the review of the summary judgment was conducted de novo, as there were no disputed factual issues.

The statutory interpretation indicates that judicial review of an agency’s construction of its governing statute is typically deferential, as established by Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc. However, when the statutory language is clear, both agencies and courts must adhere to Congress's intent, deferring only in cases of ambiguity. The judiciary holds the ultimate authority in statutory construction and must reject administrative interpretations that contradict clear legislative intent.

In this context, Congress's intent regarding the detention of excludable aliens is explicit. Prior to 1986, the Immigration and Naturalization Service (INS) had authority under section 233 of the Immigration and Nationality Act (INA) to require common carriers to detain excludable aliens. This section was repealed in 1986, while section 1356 was enacted, shifting the responsibility for detaining passengers initially classified as "transit without visa" (TWOV) from carriers to the INS, thereby placing the financial burden on the INS.

TWOVs who seek asylum are classified as excludable aliens due to willful misrepresentation of their intentions. Congress defined an excludable alien as one who fraudulently seeks to procure entry into the U.S. This is supported by judicial precedent, which holds that TWOVs who repudiate their onward tickets engage in willful misrepresentation, thus gaining entry unlawfully. Furthermore, INS regulations stipulate that TWOV privileges are contingent on the intention not to apply for an extension or adjustment of status, which is negated when an individual seeks asylum. Consequently, those TWOV passengers who abandon their intent to depart are considered excludable aliens under the statute, no longer qualifying for TWOV status per INS regulation.

Congress intended for the INS to be financially responsible for the detention and deportation of excludable aliens, as outlined in Section 286, which mandates the use of User Fee account funds for these purposes. INS has acknowledged that it cannot compel carriers to take custody of excludable aliens. Section 206 of Pub. L. 99-591 assigns custody responsibility for excludable aliens to the INS, with no exceptions identified by Congress. The court emphasized that creating exceptions to clear statutory language is a legislative, not judicial, matter. INS's argument that 8 U.S.C. Sec. 1228(c) allows it to contract with airlines for the detention of aliens, specifically TWOVs (transit without visa), is not convincing. While Sec. 1228(c) enables the Attorney General to enter into contracts with carriers for transit purposes, it does not grant authority to transfer the detention obligation imposed by Sec. 1356 to the airlines. The historical reliance of INS on repealed Sec. 1223 and Sec. 1228(c) for requiring carriers to detain TWOVs is rejected, as the cited provisions do not confer the specific power to compel detention of asylum seekers among TWOVs. The record shows that INS primarily referenced Sec. 1223 to support its actions.

In 1985, then-INS Commissioner Nelson testified that when an inadmissible alien arrives via a carrier under contract with the Attorney General, placing the alien in the carrier's custody generally meets the detention requirements of the law. The INS's interim rule on detaining inadmissible aliens cites this statutory authority. Legislative history reflects concerns from the Senate Appropriations Committee regarding the policy requiring airlines to take custody and financial responsibility for undocumented aliens, raising questions about the legality and fairness of such a requirement. The House Appropriations Committee echoed these concerns, advocating for the INS to assume full custodial and financial responsibility when airlines attempt to detect inadmissibility in good faith before boarding. This suggests Congress intended to shift responsibility for excludable aliens, including those in Transit Without Visa (TWOV) status, to the airlines. Historical context indicates that when the airline and INS agreement was formed, the implications of extended detention for asylum requests were not anticipated. The TWOV program's regulations, revised in 1994, specified that transit should not exceed eight hours, highlighting that neither airlines nor the INS could foresee the potential for prolonged detention resulting from asylum claims.

The airlines accepted the INS's interpretation of the Immigration and Nationality Act (INA), but Congress later clarified that the INS bears the responsibility for detaining excludable aliens. The 1986 amendments to the INA eliminated ambiguity regarding the treatment of transit without visa (TWOV) applicants seeking asylum, declaring INS's policy excluding TWOVs from detention as unfounded and inconsistent with the INA's mandate. 

The excerpt references case law, including Dia Navigation Co. v. Pomeroy, where the Third Circuit upheld INS's authority to hold carriers liable for stowaways, highlighting that Congress did not explicitly transfer this burden. Unlike stowaways, who are treated differently under the INA, TWOVs do not have such a distinction, meaning no agency interpretation is necessary, and the court is not bound by INS's policy.

On sovereign immunity, the Administrative Procedure Act allows suits against the U.S. for relief other than money damages. The Commissioner argued that Lan-Chile's claims are for monetary damages, which the district court cannot grant. However, the court disagreed, citing Bowen v. Massachusetts, which established that a judicial remedy that results in payment from the U.S. is not necessarily categorized as money damages. The focus is on whether the remedy compensates for a loss or fulfills an entitlement.

Lan-Chile seeks funds it believes are statutorily owed to it, not compensation for losses incurred due to the withholding of those funds. The cases of Maryland Dep't of Human Resources and Katz v. Cisneros illustrate that claims for statutorily entitled funds differ from claims for damages. Unlike those cases, where statutes explicitly mandated payments from government agencies, no statute explicitly requires the Immigration and Naturalization Service (INS) to reimburse carriers for expenses related to detaining former transit without visa (TWOV) individuals. However, the analysis suggests that Congress intended for the INS to cover these costs as part of a broader policy shift regarding the detention of excludable aliens.

Section 1356 of the Immigration User Fee Account outlines that a tariff is collected from passengers, and it mandates that the Secretary of the Treasury refund amounts spent by the Attorney General on detention and deportation services for excludable aliens. While there is no direct mandate for the Attorney General to reimburse carriers, congressional intent implies that the Attorney General (and by delegation, the INS) would incur these expenses.

In contrast, the Third Circuit's decision in Pomeroy found no clear congressional intent regarding financial responsibility for the detention of stowaways pending asylum, concluding that the carriers had no statutory entitlement to reimbursement. The court reasoned that any wrong suffered by the carrier was due to the INS's procedural failures rather than a denial of funds they were entitled to under the Immigration and Nationality Act (INA).

Lan-Chile is entitled to reimbursement from INS for the detention expenses incurred for its TWOV passengers who became excludable aliens after renouncing their intent to depart. The Immigration and Nationality Act (INA) mandates that the Commissioner cover these expenses for excludable aliens, thus establishing Lan-Chile's statutory entitlement to reimbursement, which is not obstructed by sovereign immunity. This conclusion aligns with a precedent set by the Third Circuit in Zellous v. Broadhead Associates, where tenants successfully claimed damages against HUD for failing to adjust utility allowances, despite the absence of direct payment mandates in the applicable statutes. The court emphasizes that the mechanism of payment does not negate the entitlement established by statute, and it affirms that Congress intended for INS to bear the financial responsibility for detaining excludable aliens, including former TWOVs. Consequently, the judgment of the district court is affirmed.