California Helped Strike Down the $100,000 H-1B Fee. Now, the Fight Moves to Appeals

Sorokin sided with 20 states in a lawsuit, led by California, which alleged that the executive branch exceeded its authority and violated the Administrative Procedure Act, which governs how federal agencies develop and issue regulations.

“This tax was an attack on America’s ability to attract and retain the high-skilled talent that strengthens our economy and helps us meet critical workforce needs,” California Attorney General Rob Bonta said in a statement, adding that California “remains open for business, open to talent.”

In making their case, the states argued the higher visa costs, which previously ranged from $960 to $7,595, would lead to severe staffing shortages in public school systems, state universities, and public healthcare facilities that rely on foreign workers.

The Trump administration argued the visa restrictions were within the executive branch’s authority.

“The H-1B program has been abused for decades, and President Trump finally took action to fix it. A federal judge in Washington already upheld a nearly identical order, and the Administration is confident this order will be reversed on appeal,” White House Spokeswoman Taylor Rogers wrote KQED.

President Donald Trump’s Proclamation 10973 sought to discourage companies from hiring skilled foreign workers over American workers.

“It’s really shooting us in the foot,” immigration attorney Emily Neumann said on KQED shortly afterward.

Deep-pocketed technology companies are the biggest users, with more than 70% of approvals going to workers from India, but the H-1B visa also helps to fill vacancies for doctors and teachers. Trump’s proposal meant big changes to the longstanding H-1B visa application system, and the many tech companies, big and small, that came to rely on it over the last three decades.

Until the Trump administration clarified that current visa holders weren’t affected, the proposal prompted much of corporate America to push out emergency advisories to all employees on H-1B visas, asking them not to leave the U.S. if they were here, or come back immediately within 24 hours if they were abroad.

In October, the U.S. Chamber of Commerce also sued the administration in federal court over the fee hike, and it has appealed a denial of a summary judgment in December. That ruling left the higher fee in effect, at least until September 2026, when it is scheduled to expire.

Another lawsuit was filed in federal court in San Francisco in October by nurses, schools, religious groups and labor organizations, setting up the possibility of divided rulings in three appellate court circuits.

“This has a tremendous effect for employers and for people’s lives, and so I think it’s something that the Supreme Court’s gonna take up, and perhaps even relatively soon,” Erwin Chemerinsky, dean of the law school at the University of California, Berkeley, told KQED.

Chemerinsky said that, in Learning Resources, Inc. v. Trump earlier this year, the Supreme Court ruled 6-3 against the administration in a way that bodes well for Silicon Valley and other industries keen to restore the H1-B.

“The states have a good shot of winning their case, and I say that based on the tariffs decision from Feb. 20,” Chemerinsky said.

The issue has stoked infighting among the Trump administration’s top advisers, and not for the first time, as the President targeted the H1-B and similar visas during his first term in the White House.

But Trump’s tech advisers, including White House AI and crypto czar David Sacks, former Andreessen Horowitz partner Sriram Krishnan, who resigned from the White House two days ago, and Elon Musk, himself a former H-1B holder, came down lopsidedly for the program. This put them at odds with the nativist wing of the administration, which has helped drive Trump’s crackdown on immigration.