Lawsuit Over H-1B Visa Fees

Bill Ong Hing

17 Dec 2025 — 3 min read

Guest blogger: Yana Gagloeva, law student, University of San Francisco

A coalition of 20 U.S. states, including California, are suing the federal government over a newly imposed $100,000 fee on H-1B visas.[1] This action is more than just another lawsuit against the Trump Administration; it’s a flashpoint in an increasingly polarized debate over America’s economic future, sovereignty, and place in a competitive global talent market.

At the heart of this lawsuit is a dramatic change: back in September, the White House, through President Trump, began requiring employers to pay a six-figure surcharge when petitioning for new H-1B visas.[2] This order would raise the cost of a H-1B visa from a few thousand dollars to $100,000.

The states’ complaint rests on two claims.[3] First, they argue that the executive branch lacks constitutional authority to impose such a roadblock; only Congress can set fees that generate revenue or fundamentally reshape an immigration visa program.[4] Second, they contend the administration botched the rulemaking process, abandoning the transparent “notice and comment” procedures required under the Administrative Procedure Act, and failed to consider the practical harms of the policy.[5]

This lawsuit, led by California Attorney General Rob Bonta and joined by attorneys general from states including New York, Washington, and Arizona, frames the new fee not just as unlawful but as economically harmful.[6] They warn it will deepen already acute worker shortages in sectors like healthcare and education, where institutions rely on foreign-born specialists because domestic candidate pipelines fall short.[7] Schools in rural Arizona, public universities in Washington, and hospitals nationwide could find essential hires financially out of reach.[8]

In practical terms, the $100,000 surcharge could force employers to rethink hiring foreign talent altogether. For smaller firms, nonprofits, and public entities, especially those that operate on small budgets, absorbing this burden may be impossible.[9] In fact, this is already happening in numerous districts and universities where they have begun freezing recruitment or withdrawing offers amid uncertainty over costs and legal exposure.[10]

The Trump Administration and commentators, frame the issue differently. They argue that America should prioritize domestic workers, that the H-1B program has been corrupted by employers who use foreign labor to suppress wages, and that a hefty fee will discourage taking advantage of the system.[11] Additionally, the Trump Administration argues that because of companies alleged exploitation of H-1B visa program, college graduates from U.S. schools are having a difficult time finds jobs, because companies choose to hire employees from outside the country.[12]

An ideological battle sits between these competing narratives from both sides of the political aisle. On one side, defenders of the current H-1B system see global talent as a competitive advantage, essential not just for Silicon Valley but for public institutions, rural schools, and regional health systems that cannot hire enough specialists domestically. On the other, advocates for a tighter regime argue that protecting U.S. workers should be the primary goal of U.S. policy and that current visa rules enable loopholes that somehow harm U.S. citizens.

Moreover, this lawsuit is not happening in a vacuum. Other plaintiffs like the U.S. Chamber of Commerce and unions, have filed separate challenges, arguing on similar procedural and constitutional grounds.[13] That type of opposition suggests the fee may have unintended consequences that extend beyond partisan battles.

If the courts rule in favor of the states, it would, at least temporarily, put a stop to executive overreach and reaffirm that immigration and economic policy changes require legislative authority. On the other hand, if the government prevails, it could signal a new era in which presidents wield increasingly expansive power over immigration policy, with potentially unpredictable impacts on economy.

In the end, the lawsuit isn’t just about fees. It’s about who gets to decide the rules that govern an economy. Do we welcome the world’s best minds and build a flexible, reachable system? Or do we retreat into protectionist instincts, putting up barriers that may do more harm on the economy than good?

This legal challenge is a moment for all of us, politicians and citizens, to ask: Should America’s immigration policy be a blunt weapon or a precision tool? The answer will shape the country’s economic trajectory, for better or for worse.

[1] https://oag.ca.gov/system/files/attachments/press-docs/H1B%20Complaint.pdf

[2] https://www.whitehouse.gov/presidential-actions/2025/09/restriction-on-entry-of-certain-nonimmigrant-workers/

[3] The Complaint, supra note 1.

[4] Id.

[5] Id.

[6] https://www.indiatoday.in/world/us-news/story/california-leads-19-state-lawsuit-to-block-trumps-100000-h-1b-visa-fee-glbs-2835302-2025-12-13

[7] https://www.azag.gov/press-release/attorney-general-mayes-sues-over-unlawful-new-100k-fee-h-b-visas-protecting-rural?utm_source=chatgpt.com

[8] Id.

[9] https://www.pollakimmigration.com/blog/trump-on-h1b-the-100k-fee-and-other-updates-on-the-program

[10] https://www.visaverge.com/h1b/arizona-ag-mayes-challenges-new-h-1b-visa-fee-in-federal-suit/?utm_source=chatgpt.com

[11] https://economictimes.indiatimes.com/nri/latest-updates/abuse-h1b-and-face-consequences-us-labor-secretary-says-american-jobs-must-go-to-americans-first/articleshow/125943419.cms?from=mdr

[12] https://www.whitehouse.gov/presidential-actions/2025/09/restriction-on-entry-of-certain-nonimmigrant-workers/