INS Terminated Contract Early, Suit Says

A class-action lawsuit alleged that federal immigration officials improperly terminated a three-year contract that allowed thousands of small businesses to fingerprint hopeful U.S. citizens and legal residents with green cards.

The lawsuit, filed Wednesday in U.S. District Court in Los Angeles against the U.S. Immigration and Naturalization Service, seeks a temporary restraining order that would allow the companies to resume fingerprinting services.

The suit was filed on behalf of 3,800 small businesses nationwide, including more than 100 in Orange County.

Although the suit does not specify damages, the Newport Beach lawyer representing the businesses estimated they stand to lose at least $32 million per year in revenue.

Attorney George Trejo said the INS canceled a three-year fingerprinting contract less than six months after the agreement took effect. The federal agency should have scheduled a hearing so that the businesses could contest the new procedures, he said.

Mary Ann Nugent, who has owned Mail Biz Plus in Laguna Hills for 13 years, said her revenue dropped by $600 to $1,000 per month after she was notified that her business could no longer provide fingerprinting services, which usually cost about $20 per person. Her business also lost revenues from document copies, passport photos and notary services often requested by customers being fingerprinted, she said.

“It’s been an economic disaster for all of us,” Nugent said.

An INS spokesman said he could not comment on the lawsuit, but added that he was unaware of a three-year provision in the fingerprinting contract.

As a result of record citizenship applications now numbering more than 1.6 million, Congress ordered the INS to restructure the fingerprinting process to reduce fraud and inefficiency. Last month, the agency began a program to standardize the process in an effort to cut down the time it takes to become a citizen, INS spokesman Andrew Lluberes said.

The lawsuit contends that the fingerprinting contract was taken away from several thousand smaller firms and handed to one, Dyncorp, of Virginia.

Lluberes said Dyncorp is helping set up new facilities where fingerprints will now be taken, but that the company is not involved in taking prints.

The spokesman said the INS plans to oversee fingerprinting activities, but the lawsuit contends that Dyncorp employees will be taking fingerprints instead.