On June 9, 2014, in Scialabba v. Cuellar De Osorio, the US Supreme Court reversed the US Court of Appeals for the Ninth Circuit, holding that the Board of Immigration Appeals (BIA) reasonably interpreted Section 203(h)(3) of the Immigration and Nationality Act (INA) (8 U.S.C. § 1153(h)(3)). This section, added by the Child Status Protection Act (CPSA), allows the petitions of aged-out derivative beneficiaries to retain their original priority dates instead of receiving current priority dates, and only applies to aged-out derivative beneficiaries who have qualifying relationships with their original sponsors whose petitions seamlessly convert from one family preference category to another. The aged-out derivative beneficiaries' petitions that require substituting original sponsors with new sponsors do not qualify for the statute's priority date retention provision because they do not automatically convert to a new and valid family preference category. (No. 12–930, (June 9, 2014).)

The respondents in two separate suits were the principal beneficiaries of an F3 petition and an F4 petition filed by a US citizen parent and sibling, respectively. The respondents' children were under 21 on the date of filing and qualified as derivative beneficiaries of their petitions, but by the time the respondents' visas became available, their children were older than 21. After becoming lawful permanent residents (LPRs), the respondents filed F2B petitions for their children. The US Citizenship and Immigration Services (USCIS) gave the new F2B petitions current priority dates. The respondents, relying on the priority date retention provision of Section 203(h)(3) of the INA, filed suit against the Government arguing that their children's F2B petitions should retain the priority dates of their original F3 and F4 petitions instead of receiving current priority dates.

Section 203(h)(3) states in relevant part:

(8 U.S.C. § 1153(h)(3).)

The district courts granted summary judgment to the Government, deferring to the BIA's interpretation in Matter of Wang, which held that:

However, the BIA held that the aged-out derivative beneficiary in Wang could not retain her priority date under Section 203(h)(3) because:

(25 I. & N. Dec. 28 (2009).)

After consolidating the cases on appeal, the panel of the Ninth Circuit affirmed the district courts' grant of summary judgment, finding that:

The Ninth Circuit then granted a rehearing en banc and reversed the decision, holding that the language unambiguously and broadly grants automatic conversion and priority date retention to all aged-out derivative beneficiaries.

The US Supreme Court granted certiorari to resolve a circuit split on the meaning of Section 203(h)(3).

The Supreme Court plurality (Justice Kagan, with Justices Kennedy and Ginsburg joining) reversed the Ninth Circuit's decision, holding that:

Chief Justice Roberts concurred and Justice Scalia joined, holding that the statute is not ambiguous and the BIA correctly interpreted it.

Justice Alito dissented, noting that the aged-out derivative beneficiaries who need to substitute sponsors should be allowed to retain their priority dates because, by the time their new petitions are filed, the petitions would seamlessly convert to F2B petitions because the parents would be LPRs and their children would have qualifying relationship with them.

Justice Sotomayer dissented, with Justice Breyer joining and Justice Thomas joining except as to footnote 3, finding that the only condition for qualifying for priority date retention is that they are 21 or older for purposes of derivative beneficiary status, and therefore automatic conversion and priority date retention should apply to all aged-out derivative beneficiaries.

Although this decision does not directly impact business immigration, the Supreme Court provides clarity on how the "automatic conversion" language applies in the context of immigration statutes. This decision may also affect employees seeking LPR status for their families.