Federal Court Strikes Down $100,000 H-1B Payment Requirement

On June 8, the United States District Court for the District of Massachusetts issued a decision in State of California et al. v. Mullin et al., Civil No. 25-13829-LTS, granting summary judgment in favor of 20 plaintiff states and vacating in its entirety the federal policy implementing a $100,000 supplemental fee payment requirement for H-1B visa petitions. The $100,000 supplemental fee payment was mandated by a presidential proclamation issued on Sept. 19, 2025, and applicable for certain H-1B petitions filed after Sept. 21, 2025, on behalf of workers outside the United States in addition to the existing statutory and regulatory fees.

The decision, issued by Judge Leo T. Sorokin, declared the policy unlawful on both constitutional and Administrative Procedure Act grounds.  

The Tax Issue at the Heart of the Decision 

The central legal question in this case was whether the $100,000 payment requirement imposed by Proclamation 10973 constitutes an unconstitutional tax levied without proper congressional authorization. The court concluded that it does.

In addition to the constitutional claim, the court granted summary judgment on all three Administrative Procedures Act (APA) claims: the policy was issued without required notice-and-comment rulemaking (Count I); it exceeded the agencies' statutory authority (Count II); and it was arbitrary and capricious because the agencies failed to consider reliance interests, reasonable alternatives, or the impact on sectors like education and healthcare (Count III).

The Litigation Landscape: An Adverse Decision and a Pending Case

This decision does not exist in a vacuum. The court acknowledged that another federal court, the U.S. District Court for the District of Columbia, in Chamber of Commerce of the U.S. v. U.S. Department of Homeland Security, reached the opposite conclusion on the merits. In that case, the district court granted final judgment in favor of the federal government and against the plaintiffs on all claims, including constitutional and APA challenges to the same proclamation. That adverse decision is currently on appeal, as the government invoked the judgment in its preclusion arguments in the Massachusetts case.

Additionally, a third case, Global Nurse Force v. Trump, No. 4:25-cv-08454-HSG, is currently pending in the Northern District of California and has not yet reached a final judgment on the merits. The court noted that this pending case has no preclusive effect on the current litigation.

What This Means for Employers

• The Immediate Effect: Vacatur of the Policy

The court vacated the policy materials implementing the $100,000 payment requirement in their entirety. Critically, the court held that vacatur under the APA is not limited to the parties before the court; it operates on the unlawful agency action itself, not merely as party-specific relief. This means the vacatur has universal effect; the $100,000 payment requirement is no longer in force for any employer filing H-1B petitions, not just the plaintiff states and their institutions.

• Could the Government Appeal?

The government vigorously contested every aspect of this case, advancing multiple theories of presidential authority, and a circuit split is already developing given the adverse ruling in the D.C. case. The government has filed a notice of appeal as of June 11. As a result, the litigation will continue, and the ultimate validity and implementation of the fee remain subject to further judicial review. The constitutional significance of the case makes eventual Supreme Court review a possibility.

• Could the Government Obtain a Stay Pending Appeal?

Given the Supreme Court's recent posture on executive authority in immigration matters, and given that another district court ruled in the government's favor on the same Proclamation, there is a meaningful risk that the government could obtain a stay, either from the district court or from the First Circuit.

• Practical Implications for Employers

For now, the $100,000 payment requirement is vacated and unenforceable. Employers, including cap-exempt institutions such as universities, nonprofit research organizations, and governmental research entities should be able to file H-1B petitions without the supplemental $100,000 payment. This is particularly significant for employers in education, healthcare, and research, sectors whose reliance interests the court found the government entirely failed to consider.

However, clients should be prepared for potential disruption if the government obtains a stay pending appeal. The existence of a circuit split, with the D.C. district court ruling in the government's favor and now the Massachusetts court ruling against it, increases the likelihood that this issue will ultimately be resolved by the Supreme Court. Clients should plan for a period of continued litigation and the changes to the immigration landscape that may follow.