A version of this article first appeared in the Side Bar journal for the Litigation…
Most civil lawsuits end in settlement long before they go to trial. Lawsuits to enforce the I-864 are no different. In our experience, roughly half of I-864 enforcement cases settle before a lawsuit is ever filed, or very shortly after the lawsuit is filed. In the remainder of cases there is at least some “motions practice,” which in these cases usually involves asking the judge to narrow the issues in the lawsuit.
For those I-864 enforcement cases that do settle, here is how things usually work.
How do you calculate damages for the I-864?
Calculating damages – the money that can be recovered by a plaintiff – under the I-864 is easy, at least in principle. A sponsor is required to provide support equal to 125% of the Federal Poverty Guidelines for a person’s household size. For a household of one that’s roughly $1,300 per month, though the figure goes up a bit each year. The support obligation starts when a person gets their green card, though for settlement purposes we normally calculate damages from when the person stopped living with their sponsor. The obligation continues until one of these five legal events occur.
Because the I-864 looks at a person’s “income,” damages are reduced by any income the immigrant has been earning. So the formula for calculating damages for a one-person household is simply: ($1,300 x months the person was entitled to support) minus (all income earned during that period.
For example, if someone was entitled to 12 months of sponsorship ($15,600) and earned $5,000 working odd jobs, she would be entitled to support in the amount of $10,600.
What money can be recovered in an I-864 settlement?
There are basically two components to I-864 settlement.
First, there are support arrearages. This represents damages that are due up to the time that a person settles her claim. In the example above, the person has $10,600 in support arrears. At the end of the day, this is simply a matter of arithmetic, as explained above. All you need to know is the person’s household size, and how much income they have earned. Subtract the income from 125% FPG for the household size and that’s your figure for support arrearages.
The second component of and I-864 settlement is for future support. The I-864 support obligation continues into the future until the person becomes a U.S. citizen, earns 40 quarters of work, or leaves the U.S. and gives up her green card. But in most cases, what we’re really focused on is the person’s employment prospects. Why? Since income reduces a sponsor’s obligation, once an immigrant is earning $1,300 or more per month, that negates the sponsor’s support obligation. So for settlement purposes, we are looking at when our client is likely to be stabling employed. Sometimes that’s relatively easy if we have a student for example finishing a degree program. Other times is’’t much tougher if we have someone with limited English and no clear job prospects.
Dealing with future support is the trickiest part of I-864 settlement. That’s because we have no magic way of knowing when our client will be back in the workforce. Because of that unknown, there are two ways we approach settlement.
In some cases, the sponsor agrees to a piecemeal settlement. Taking this approach, the sponsor pays all support arrears, then agrees to continue making monthly support payments until our client is employed. That can be an attractive option for the sponsor, since they won’t risk over-paying for support (that is, they pay only for months they know that a person is unemployed). The two downsides are: (1) there is no end to the sponsor’s obligation, and he could end up paying support for the rest of our client’s life; and (2) there is an administrative cost, since lawyers have to be involved each month to provide the requested documentation of unemployment and to take care of payments.
In other cases, we reach a global settlement of all claims. On that approach, the sponsor agrees to pay a specific dollar amount that covers both support arrears and all future support. This is often attractive to both parties since they can set a specific valuation for the case and be conclusively done. This is how most, though not all, of our cases, are settled.
How does the settlement payment work?
Sometimes settlement payment is completed in one lump sum. Normally we see this only in cases with a total settlement cost of $50,000 or less. Depending on the financial status of the sponsor, he can agree to simply cut one check, then walk away and be done.
For sponsors that have limited financial ability, and for higher costs cases, payment is structured over a period of time. For these settlements, the sponsor pays one initial sum, usually 30% of the total settlement, and then makes monthly payments over a period of time. These agreements often include a requirement that the sponsor pay interest.
The settlement also includes attorney fees.
Both the I-864 contract itself and the Immigration and Nationality Act authorize an attorney fee award for sponsored immigrants. (The sponsor is not entitled to a fee award if he wins). Every case we settle includes an attorney fee allocation so that our hourly fees are paid by the sponsor.