California and 19 other US states filed a lawsuit on Friday seeking to block President Donald Trump’s USD100,000 fee on new H-1B visas for highly skilled foreign workers, according to a report by Reuters.
California Attorney General Rob Bonta is leading the 20-state coalition lawsuit, calling the policy unlawful and warning it could disrupt sectors that rely on skilled foreign workers.
The lawsuit, filed Friday in federal court, argues that the Department of Homeland Security (DHS) imposed the fee outside the bounds of congressional authority and bypassed required notice-and-comment procedures. Bonta’s office said the fee, more than 10 times the typical H-1B cost, would place significant strain on schools, universities, and hospitals that depend on H-1B employees.
The H-1B program allows employers to hire highly skilled foreign workers, including engineers, researchers, doctors, and teachers. While many government and nonprofit employers are exempt from the program’s annual cap, they are not exempt from the new fee, which critics say will make it harder to recruit essential personnel amid nationwide shortages.
Trump signed the executive order on September 19, introducing the USD 100,000 charge for new H-1B petitions. DHS retains discretion over which applications are subject to the fee, prompting states to argue it could be applied selectively.
Joining California in the lawsuit are Arizona, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maryland, Massachusetts, Michigan, Minnesota, Nevada, North Carolina, New Jersey, New York, Oregon, Rhode Island, Vermont, Washington, and Wisconsin.
In 2024, Indian nationals accounted for a staggering 71% of all H-1B visa beneficiaries, with China a distant second at 11.7%.
The legal challenge adds to mounting opposition from corporate and nonprofit sectors. The US Chamber of Commerce, along with unions, nonprofits, and a healthcare staffing firm, have filed separate lawsuits, calling the fee “draconian,” “extortionate,” and a violation of Congress’s constitutional taxing authority.
The White House defended the policy. Spokesperson Taylor Rogers said, “President Trump promised to put American workers first, and his commonsense action on H-1B visas does just that by discouraging companies from spamming the system and driving down American wages, while providing certainty to employers who need to bring the best talent from overseas.”
The fee has raised concern in Silicon Valley, where companies such as Amazon, Microsoft, Meta, and Apple rely heavily on H-1B hires. Industry leaders warned it could push jobs overseas. The legal dispute comes as the administration expands digital vetting for H-1B applicants, with the State Department requiring applicants to make social media profiles publicly available beginning December 15.
Earlier the US Chamber of Commerce had filed a lawsuit against the Trump administration over the annual fee on H-1B visa applications, arguing that the fee is unlawful and would severely impact American businesses.