President Donald Trump’s newly announced $100,000 fee on H-1B visa applications has drawn swift legal challenges from a coalition of labor unions, businesses, universities, and religious organizations. The lawsuit, filed in federal court in San Francisco, contends that the hefty new fee violates U.S. constitutional and administrative law, marking the first major court test of Trump’s latest immigration policy.
A Controversial Presidential Proclamation
On September 19, 2025, President Trump issued a proclamation requiring U.S. employers sponsoring new H-1B visa applicants to pay an additional one-time fee of $100,000 per petition. The rule applies to filings submitted between September 21, 2025, and September 21, 2026, and is part of what the administration describes as a broader effort to “prioritize American workers” and reduce abuse of the visa system.
Under the proclamation, employers seeking to hire foreign professionals in specialty occupations — such as engineers, healthcare workers, professors, and software developers — must either pay the new fee or apply for a limited “national interest waiver.” These waivers would be granted at the discretion of the Secretary of Homeland Security, based on whether a petition serves significant U.S. economic or security interests.
Previously, companies paid between $2,000 and $5,000 in standard filing and fraud prevention fees per H-1B application. The new $100,000 fee represents an increase of roughly 2,000%, a change that critics say could make the visa program inaccessible for smaller employers, nonprofits, and academic institutions.
The Lawsuit: Who’s Suing and Why
The plaintiffs — including the United Auto Workers (UAW), the American Association of University Professors (AAUP), and several religious and healthcare groups — argue that President Trump overstepped his legal authority by unilaterally imposing a massive fee on a program established by Congress.
The complaint, filed in the U.S. District Court for the Northern District of California, asserts that the president’s proclamation effectively functions as a new tax — something that only Congress can authorize under the U.S. Constitution.
The coalition also claims the rule violates the Administrative Procedure Act (APA), which requires public notice and an opportunity for comment before implementing significant policy changes. Plaintiffs describe the move as “an unlawful end-run around Congress” that will “cripple employers, universities, and hospitals that depend on skilled workers to serve the public interest.”
Additionally, the lawsuit challenges the discretionary waiver process, arguing it allows the government to grant exemptions arbitrarily and favors politically aligned entities.
The Administration’s Defense
The White House has defended the fee as a legitimate tool to curb exploitation of the H-1B system and protect American workers. Administration officials argue that some employers have abused the visa program by filing large numbers of speculative applications to secure more slots in the annual H-1B lottery.
According to a White House spokesperson, “The $100,000 fee will discourage bad actors from gaming the system while ensuring that U.S. employers make serious, good-faith efforts to hire American workers first.”
The administration also insists that the president possesses broad discretion over immigration policy under existing statutes — particularly the Immigration and Nationality Act (INA) — which grants the executive branch authority to regulate entry of noncitizens in the national interest.
However, legal scholars point out that while the president can suspend or restrict immigration temporarily, imposing new financial barriers on statutorily authorized visa programs may go beyond what the law allows.
Industry and International Reaction
The new fee has triggered alarm across industries that rely heavily on high-skilled foreign talent — particularly technology firms, research institutions, hospitals, and universities.
Companies in Silicon Valley warn that the fee could stifle innovation and make it harder to recruit top global talent, especially in areas such as artificial intelligence, cybersecurity, and biomedical research. Many smaller startups and nonprofit organizations say they cannot afford to pay $100,000 per employee.
In academia, universities fear the policy will hinder their ability to hire international faculty and researchers, which could undermine America’s position as a global leader in higher education and science.
Globally, the decision has sparked diplomatic backlash. The Indian government, whose citizens make up a large portion of H-1B visa recipients, condemned the policy as “unjustified and discriminatory.” Indian officials expressed concern that the fee could effectively price out many skilled workers and strain bilateral trade and education ties with the United States.
Legal Stakes and Possible Outcomes
This lawsuit marks one of the most consequential legal challenges to Trump’s immigration agenda since his earlier efforts to restrict asylum and expand travel bans.
If the San Francisco court grants a preliminary injunction, the fee could be temporarily suspended while the case proceeds. A ruling on the merits could set a far-reaching precedent defining the limits of presidential power over visa and immigration policy.
Legal experts expect the case to eventually reach the Ninth Circuit Court of Appeals, and possibly the U.S. Supreme Court, given its constitutional implications. The key question will be whether the president can impose new financial conditions on an existing statutory program without congressional approval.
Broader Implications
The outcome of this case could reshape how future administrations manage skilled-worker immigration. A ruling in favor of the plaintiffs would reinforce Congress’s exclusive power to set visa fees and conditions. Conversely, a ruling favoring the administration would give future presidents unprecedented authority to modify visa programs unilaterally through executive action.
For U.S. employers, the stakes are high. Many industries already face a shortage of qualified domestic workers in specialized fields, from data science to medicine. For international professionals, the case could determine whether pursuing careers in the United States remains financially feasible.
As the court prepares to hear arguments, the lawsuit underscores a central tension in modern immigration policy — balancing national labor priorities with global talent competition in a technology-driven economy.
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