A federal court in Boston has delivered a significant blow to the Trump administration's immigration agenda, vacating the controversial $100,000 fee imposed on new H-1B visa petitions in a ruling that could reshape the ongoing battle over executive power and legal immigration policy.
The Ruling
In a 42-page decision, U.S. District Judge Leo Sorokin vacated the policy nationwide, concluding that the federal government overstepped its authority by imposing the fee without approval from Congress.
The policy violated the federal Administrative Procedure Act and the Constitution, Judge Sorokin declared in the ruling.
At the heart of the decision was a critical legal distinction:
the judge found that the payment is a tax that Congress had not delegated to the executive branch, agreeing with the plaintiff states that "the substance and application of the $100,000 payment reveal that it is a tax."
Judge Sorokin also concluded that the policy violated the Administrative Procedure Act because it exceeded the president's statutory authority and was implemented in an "arbitrary and capricious" manner.
In a notable passage, Sorokin wrote that "the President has no authority to levy a tax unless such a power is delegated by Congress through statute," as reported by MS NOW.
Legal Reasoning and Supreme Court Precedent
Judge Sorokin's analysis drew heavily on recent Supreme Court rulings.
The judge cited the Supreme Court's opinion in February striking down Trump's "reciprocal" tariffs, in which the high court ruled that tariffs assessed by the Department of Homeland Security "amount to taxes for the purposes of the Constitution's Taxing Clause."
The judge also relied on the Supreme Court's 2012 blockbuster decision upholding Obamacare's individual mandate. The justices famously ruled 5-4 in that case that it was a lawful exercise of Congress's taxing authority, rejecting a challenge that it was an unlawful penalty.
Applying the same framework in reverse, Sorokin concluded that the H-1B fee functioned as a tax—and one that only Congress could authorize.
The administration's attempts to characterize the fee as a "regulatory payment" were dismissed by the court.
The Trump administration had claimed "that the $100,000 payment requirement is 'a regulatory payment,' which is 'not the same as a tax.'" Sorokin called this "mere ipse dixit," citing the Latin legal phrase meaning an argument is unsupported, noting the administration offered "no definition for what constitutes 'a regulatory payment'" and advanced "no reasoned argument explaining how this term encompasses something different than a tax or a penalty."
As part of the ruling, Sorokin invalidated agency memoranda, guidance documents, website instructions, FAQs, and fee schedules that established and enforced the $100,000 H-1B visa fee.
Background: The $100,000 Fee
Last September, Trump signed a proclamation adding a $100,000 fee for new H-1B visa applications. The fees are generally paid for by the sponsoring employer, and administration officials cast it as an initiative to encourage companies to hire Americans instead.
The fee represented a staggering increase from prior costs.
Employers generally paid between $960 and $7,595 in fees prior to Trump's proclamation, court filings said.
The dramatic increase had an immediate chilling effect:
before Trump's new fee went into place, the costs for that kind of visa were around $2,000 to $5,000. Due to the high increase, just 85 payments for H-1B visas had been made since the costs were increased, a dramatic decrease from the tens of thousands of applications that are usually filed each year.
Several companies, including Walmart, said that they would pause their participation in the H-1B program as a result of Trump's proclamation.
The Coalition Challenge
Sorokin was assigned the case brought by 20 states, which struck down the visa policy, concluding that the executive branch exceeded its authority and violated the Administrative Procedure Act.
The case, California et al. v. Trump, was led by California Attorney General Rob Bonta and Massachusetts Attorney General Andrea Joy Campbell.
The coalition included the attorneys general of Arizona, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maryland, Michigan, Minnesota, Nevada, North Carolina, New Jersey, New York, Oregon, Rhode Island, Vermont, Washington, and Wisconsin.
In the Boston case, the states argued that the policy impedes their ability to hire primary and secondary school educators and to staff public colleges and universities, will stymie academic research, and will lead to a decline in medical workers.
California Attorney General Bonta celebrated the ruling, stating that the fee "was an attack on America's ability to attract and retain the high-skilled talent that strengthens our economy," as reported by The Hill.
New York Attorney General Letitia James also praised the decision, saying, "Today a court put an end to this administration's illegal attempt to destroy this critical program and the many jobs it makes possible."
The Administration's Response
The Trump administration said it would appeal the ruling.
White House spokesperson Taylor Rogers stated, "President Trump has clear legal authority to restrict entry of any class of aliens he determines is not in America's best interests, and that is exactly what he did. The H-1B program has been abused for decades, and President Trump finally took action to fix it."
Trump himself responded: "These federal judges are really giving us a hard time. It is really crazy what's going on with the court system. They are giving us a very, very hard time. And they shouldn't be doing that. They are hurting our country very badly."
Conflicting Rulings and What Comes Next
This ruling sets up a significant legal conflict.
Sorokin's decision contrasts with a December 23 ruling by a federal judge in Washington, D.C.—Beryl Howell, also an Obama appointee—who thought the visa fee was justified by "a straightforward reading of congressional statutes giving the President broad authority to regulate entry into the United States."
The U.S. Chamber of Commerce also sued, in federal court in Washington, D.C., and has appealed a denial of a summary judgment against the fee hike, which had left the higher fee in effect.
Still another lawsuit was filed in federal court in San Francisco by religious groups and labor organizations, setting up the possibility of divided rulings in three appellate court circuits.
The Trump administration presumably will ask the U.S. Court of Appeals for the 1st Circuit to review Sorokin's decision.
Given the circuit split, many legal experts believe this issue may ultimately reach the Supreme Court.
Practical Implications for Employers and Workers
The ruling carries immediate practical significance.
While the ruling is in effect, employers have the option to submit H-1B petitions without including the $100,000 fee, effectively restoring the H-1B program to its pre-Proclamation cost structure. If the ruling stands, employers who already paid the fee may be able to seek refunds.
While the fee did not apply to foreign nationals already in the U.S. on student visas or existing H-1B holders, some foreign nationals found their employment offers withdrawn or faced hiring freezes during the initial uncertainty around the policy.
For the time being, this decision provides significant relief to the technology companies, healthcare systems, universities, and public school districts that depend on the H-1B program to address persistent talent shortages. However, given the pending appeal and conflicting federal court rulings, employers and immigration attorneys should continue to monitor the situation closely, as the legal landscape could shift again quickly.
---
ClinchLaw will continue to monitor this developing case and provide updates as the appellate process unfolds. If you are an employer or H-1B visa applicant affected by this ruling, consult with a qualified immigration attorney to understand how this decision may impact your specific situation.