NEED TO KNOW

• Federal judge in Boston voided Trump’s $100K H-1B fee as an unauthorized tax
• A D.C. judge upheld the same fee in December — the rulings now directly conflict
• A fast-tracked appeal and two more lawsuits leave the fee’s fate unsettled

BOSTON, MA (TDR) — A federal judge struck down President Trump’s $100,000 fee on new H-1B visa applications on Monday, ruling the charge is a tax Congress never authorized the executive to impose.

The big picture: Two federal courts have looked at the same proclamation and reached opposite conclusions. The fight is no longer about whether the fee survives — it’s about which ruling an appeals court lets stand.

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• Judge Leo Sorokin sided with 20 Democratic-led states, finding the substance of the payment makes it a tax regardless of its label
• He leaned on the 2012 Supreme Court ruling upholding the Affordable Care Act mandate as a tax, turning a conservative-era precedent against the administration

Why it matters: The H-1B program is the main pipeline for high-skilled foreign hiring, and the fee reshapes who can afford it.

• Employers typically paid $2,000 to $5,000 per petition before the proclamation; the new charge is up to 50 times that
• The chilling effect is measurable: only 85 payments had been collected by mid-February
• Indian nationals and U.S. tech firms absorb the bulk, with some companies shifting staff toward green cards

Driving the news: Trump issued the fee by proclamation in September 2025, framing it as a fix for the “large-scale replacement of American workers.”

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• The administration argued the payment was a lawful penalty under the president’s power to restrict entry of foreign nationals
• Its main argument was that the court had no authority to review the fee. It lost.

What they’re saying: The same proclamation drew opposite readings from two Obama-appointed judges.

• Leo Sorokin, U.S. District Judge (Massachusetts) — “The payment is not a penalty, just as the IRS fee in Sebelius was not”
• Beryl Howell, U.S. District Judge (D.C.) — Congress granted broad statutory authority the president used to address “a problem he perceives to be a matter of economic and national security”
• Daryl Joseffer, U.S. Chamber of Commerce EVP — the fee makes H-1B visas cost prohibitive for the businesses Congress meant the program to serve

Yes, but: Both tribes are claiming a clean win neither ruling delivers. The states celebrating today won on a taxing-power theory, not on protecting workers, and the same logic that voids the fee concedes Trump could likely restrict the program another way.

• Howell found Trump adequately documented firms that laid off Americans while petitioning for H-1B workers
• The “protect American jobs” framing collides with its own coalition: the Chamber of Commerce, a reliable GOP ally, leads the fight against the fee
• Neither ruling answers whether the program helps or replaces U.S. workers. Both dodge the merits for procedure

Between the lines: This was never going to settle at the district level. With trial courts split on identical facts, the fast-tracked D.C. Circuit appeal becomes the real decision point — and the appeal’s signatories include conservative legal icon Paul Clement, the coalition fracture made literal. A clean split is the kind of disagreement the Supreme Court exists to resolve.

What’s next:

• The administration said it will appeal Sorokin’s ruling, opening a second circuit-level fight
• A third challenge from a nurse-recruitment coalition is pending in California, widening the field
• Employers remain in limbo on pending petitions until an appeals court, or the Supreme Court, speaks

If a president can price a visa out of reach but can’t tax it, where exactly is the line between restricting entry and raising revenue — and who gets to draw it?

Sources

This report was compiled using reporting from The Hill, CNBC, Al Jazeera, Roll Call, Fortune, The Daily Record, Lawfare, CUPA-HR, and the court ruling via CourtListener

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