Federal Court Strikes Down H-1B Fee
What Employers Need To Know Today
Federal court strikes down H-1B fee today, June 8, 2026, restoring the previous fee structure for employers sponsoring high-skilled foreign workers.
U.S. District Judge Leo Sorokin vacated the fee in a 42-page ruling in State of California et al v. Mullin, finding that the payment constituted an unauthorized tax rather than a permissible regulatory fee — and that only Congress holds the power to levy taxes under the Constitution.
Background: The Fee That Reshaped H-1B Demand
President Trump signed the Presidential Proclamation on September 19, 2025, effective September 21, 2025. The proclamation introduced a $100,000 supplemental charge per H-1B petition — a 10- to 20-fold increase over the previous cost range of $5,000 to $10,000 per sponsorship.
The fee applied to new petitions filed by beneficiaries outside the United States who did not hold a valid H-1B visa at the time of filing. It did not apply to:
- Change-of-status filings for individuals already in the U.S. (such as F-1 OPT workers)
- Extensions and amendments for current H-1B holders
- Cases where DHS granted a national interest waiver
Even with those exemptions, the impact was stark. By February 15, 2026, DHS reported that only 85 fee payments had been processed — out of more than 200,000 applicants who had sought visas during that period.
What the Court Found
Judge Sorokin’s ruling rested on three core findings:
- Unauthorized taxation. The $100,000 charge functioned as a revenue-raising mechanism, which falls under Congress’s exclusive constitutional authority — not the executive branch.
- Statutory limits of the INA. Sections 212(f) and 215(a) of the Immigration and Nationality Act grant the President broad authority to restrict entry, but do not authorize imposing unlimited financial barriers or raising revenue.
- Precedent. The ruling cited the 2026 Supreme Court decision Learning Resources v. Trump, which previously restricted the administration’s use of aggressive financial strategies under executive authority.
The administration is expected to appeal; however, no filing has been announced as of this writing.
Practical Impact for Employers
Effective today, the $100,000 fee requirement is vacated. The previous H-1B fee structure — averaging $5,000 to $10,000 per petition, depending on company size and filing type — has been restored.
Employers who paused new H-1B sponsorships due to cost should reassess their hiring timelines. Companies in technology, healthcare, higher education, and engineering — the sectors most affected by the fee — now face a materially different cost landscape for international talent.
The Department of Labor’s “Project Firewall” initiative, launched alongside the original proclamation to increase audits and oversight of H-1B-dependent employers, remains in effect and is not affected by today’s ruling.
What To Watch
The administration is likely to appeal. The First Circuit will be the next venue, and the outcome there — or a potential Supreme Court review — could reinstate the fee or produce further restrictions. The timeline for an appeal ruling is uncertain.
Employers should not assume the fee is permanently resolved. Immigration counsel can help assess the timing of the petition given the risk of appeal.
Next Steps
If your company has pending H-1B petitions, a backlog of sponsorships paused during the fee period, or questions about how today’s ruling affects your workforce planning, contact Gunn-Menefee Immigration Lawyers to review your options.