Why was Trump’s H-1B fee struck down?
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- Judge Leo T. Sorokin struck down Trump's $100,000 H-1B fee in a 42-page June 8 ruling with nationwide effect, holding it was an unlawful tax requiring Congressional delegation under Article I, Section 8 of the Constitution.
- California and 19 other States challenged the policy, arguing the $100,000 charge would worsen teacher shortages, disrupt research, and deepen healthcare staffing gaps in their public systems.
- Trump's Proclamation 10973, signed September 19, 2025, raised H-1B filing costs from roughly $960–$7,595 to $100,000 and relied on INA Sections 212(f) and 215(a) — provisions the court found did not delegate taxing authority.
- Indian nationals, who account for roughly 70% of H-1B approvals (Chinese nationals at about 12%), faced the steepest barrier from the fee, which the source says functioned as a 'prohibitive barrier' for software engineers, doctors, and researchers already stuck in green-card backlogs.
- Sorokin, an Obama appointee, applied Bailey v. Drexel Furniture Co. (1922) and NFIB v. Sebelius (2012) to classify the charge as a tax rather than a penalty, reasoning that H-1B hiring is plainly lawful and the payment punished no unlawful conduct.
- The court also found multiple violations of the Administrative Procedure Act, vacating the policy in its entirety on that second, independent ground.
Why it matters: For U.S. employers and the Indian tech workers who dominate H-1B pipelines, the ruling reopens access to specialty-occupation hiring that Trump's proclamation had priced out at $100,000. With roughly 70% of H-1B approvals going to Indian nationals, the decision preserves a workforce channel that 20 states argued was threatened by teacher shortages and healthcare gaps.
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