Reported / Citable
Background
Under the Immigration and Nationality Act (INA), the Department of State is required to administer an annual Diversity Visa (DV) Program awarding up to 55,000 visas to individuals from countries with low immigration rates to the United States.
For fiscal year 2027 (DV-2027), the Department failed to open the lottery registration period without explanation, effectively canceling the program.
In August 2026, Red Eagle Law, L.C., a San Diego immigration law firm representing DV selectees, sued the Secretary of State, alleging the suspension was arbitrary and capricious, unlawfully withheld agency action under the APA, and was ultra vires.
Red Eagle did not join any prospective DV applicants as plaintiffs.
On October 14, 2026, the district court entered a preliminary injunction ordering the Department to announce the registration period by October 29, 2026, open registration by November 1, 2026, and notify selectees by December 3, 2026.
The government appealed and moved for an emergency stay pending appeal.
The Court’s Holding
The Ninth Circuit granted the government’s emergency motion for a stay pending appeal.
The per curiam panel held that the government made a strong showing of likely success on the merits because Red Eagle Law is not “arguably within the zone of interests” protected by the DV Program statute (8 U.S.C. § 1153(c)).
The statute’s purpose is to encourage immigration from underrepresented countries, not to generate revenue for law firms.
The court distinguished East Bay Sanctuary Covenant v.
Trump, where nonprofits providing legal services to asylum seekers fell within the zone of interests because the asylum statute expressly contemplated pro bono legal services; the DV statute contains no such provisions.
The court also rejected reliance on CSL Plasma Inc. v.
CBP, where plasma companies benefited from a statute intended to benefit businesses.
Judge Smith concurred, arguing Red Eagle also lacks Article III standing because its alleged economic injury from lost prospective clients is speculative, not concrete or particularized, and relies on the independent choices of third parties (aliens registering, winning the lottery, and hiring the firm).
Judge Smith warned that recognizing such standing would allow lawyers to “roam the country in search of governmental wrongdoing.”
Key Takeaways
- The Ninth Circuit granted a stay of a preliminary injunction that had ordered the State Department to restart the DV-2027 lottery registration period.
- Red Eagle Law, an immigration firm, lacks prudential standing (zone of interests) because its economic interest in representing DV selectees is only marginally related to the DV Program’s statutory purpose of diversifying immigration.
- The DV statute, unlike the asylum statute in East Bay, contains no provisions facilitating legal representation, so law firms are not within the zone of interests.
- Concurring Judge Smith held Red Eagle also lacks Article III standing: its alleged lost revenue from hypothetical future clients is too speculative and depends on the independent decisions of third parties (aliens entering the lottery, winning, and choosing the firm).
- The court did not endorse the Department’s failure to open the lottery but ruled the plaintiff cannot maintain the suit; the appeal of the preliminary injunction will proceed on a regular briefing schedule.
Why It Matters
This decision halts a district court order that would have forced the State Department to implement the DV-2027 program on an expedited timeline.
It establishes that immigration law firms cannot invoke the APA’s zone-of-interests test to challenge the cancellation of the Diversity Visa Program based solely on lost revenue, because the statute is designed to benefit prospective immigrants, not legal service providers.
The concurrence’s Article III standing analysis further raises a significant barrier for service providers seeking to challenge immigration program suspensions, requiring a concrete, non-speculative injury traceable to the defendant’s action without relying on attenuated chains of third-party decisions.
The ruling leaves open the possibility that a proper plaintiff—such as a qualified alien selectee—could challenge the program’s suspension, but affirms that the government’s appeal will proceed on the merits.