A coalition of U.S. states led by California has moved to legally challenge President Donald Trump’s decision to impose a $100,000 fee on new H-1B visas, calling the move unlawful and economically damaging.
California Attorney General Rob Bonta said that California and 18 other states are filing a lawsuit in federal court in Massachusetts seeking to block the policy, which was announced in September 2025. The lawsuit marks the third major legal challenge to the fee since its introduction.
Under the existing system employers typically pay between $2,000 and $5,000 in government fees to sponsor an H-1B worker. The new rule represents a dramatic increase, requiring employers to pay $100,000 per worker before a new H-1B visa holder can enter the United States.
State officials argue that the president lacks the legal authority to impose such a fee. Federal immigration law permits the government to collect only fees necessary to cover the administrative costs of processing visas, not to generate revenue. The lawsuit also contends that the U.S. Constitution grants Congress not the president the power to impose taxes or revenue raising fees.
The H-1B visa program allows U.S. employers to hire foreign professionals in specialty occupations such as Technology, Engineering, Healthcare and Education. The program is heavily used by companies in Silicon Valley and other technology hubs as well as hospitals and universities facing skilled worker shortages.
Bonta said the fee would place severe financial strain on institutions providing essential services including public hospitals and schools, potentially worsening existing labor shortages and forcing cuts in services.
States joining California in the lawsuit include New York, Massachusetts, Illinois, New Jersey and Washington, among others.
The Trump administration has defended the policy, stating that the fee is a lawful use of presidential authority aimed at discouraging misuse of the H-1B program and protecting American workers. Critics of the program argue that some employers use H-1B visas to replace U.S. workers with lower-paid foreign labor.
However, major business groups, technology firms and healthcare organizations maintain that the H-1B program is critical to filling positions where qualified American workers are unavailable.
The U.S. Chamber of Commerce, along with a coalition of unions, employers and religious organizations, has already filed separate lawsuits challenging the policy. A federal judge in Washington, D.C. is expected to hold a hearing in one of those cases next week.
Under the administration’s order new H-1B visa holders are barred from entering the United States unless the fee is paid by their employer. The rule does not apply to existing H-1B workers or to applications filed before September 21, 2025.
Legal experts say the outcome of the lawsuits could have far reaching consequences for U.S. immigration policy and for thousands of skilled foreign workers seeking employment in the country.
