What's new

The decision came in State of California et al. v. Noem — reported in law-firm coverage as State of California et al. v. Mullin — No. 1:25-cv-13829, a challenge filed on December 12, 2025 by twenty states. The court vacated the $100,000 payment requirement in its entirety, along with the agency actions that implemented it.

Proclamation 10973, signed by President Donald Trump on September 19, 2025 and effective two days later, imposed the supplemental payment on employers submitting petitions for new H-1B visas. The court found that the materials carrying the policy into effect — Customs and Border Protection memoranda, State Department frequently-asked-questions documents, and USCIS website guidance — were legislative rules under the Administrative Procedure Act (APA) that the agencies issued without the required notice-and-comment rulemaking.

The vacatur applies universally. Because the court set aside the agency actions themselves, the ruling's effect is not limited to employers in the twenty plaintiff states.

Why it matters

The central holding reframes the payment's legal character. The court concluded the $100,000 requirement operates as a tax rather than an immigration restriction, placing it within the taxing power of Congress rather than the president's authority over the entry of foreign nationals.

The ruling also addresses populations beyond the technology industry most associated with the H-1B program. Marquita L. Capers, an associate at Ogletree Deakins, noted in the firm's June 9 analysis that the court found the agencies had not adequately considered the policy's impact on employers and institutions outside the technology sector, including healthcare providers, universities, and schools.

The practical effect is immediate for employers. Fragomen's June 8 analysis states that, unless and until a further court order is issued, USCIS should not require the $100,000 fee for the approval of any H-1B petition. The fee had applied to new petitions since September 21, 2025, layering a six-figure cost onto the primary US employment-visa route for Indian and other foreign professionals. The ruling lands amid a wider rulemaking cycle around H-1B program costs — a separate Department of Labor prevailing-wage proposal closed its public-comment period on May 26, 2026.

Where it stands

Correction (October 22, 2026): an earlier version of this article described the June 12 order as a stay of the vacatur granted for the length of the appeal. The June 12 order was a temporary administrative stay, entered while the government sought a stay pending appeal from the First Circuit.

On June 12, 2026, the court paused its own June 8 order. After the government filed a notice of appeal to the U.S. Court of Appeals for the First Circuit on June 11, Judge Sorokin entered a temporary administrative stay while the government sought a stay pending appeal from the First Circuit. The administrative stay reinstated the $100,000 payment requirement for affected new H-1B petitions in the interim.

On July 24, 2026, a First Circuit panel of Chief Judge Barron and Judges Gelpí and Rikelman denied the government's motion to stay the June 8 order pending appeal, in the case now captioned State of California v. Mullin, No. 26-1699. The ruling ended the administrative stay. USCIS states that DHS will comply with the court's order while it considers next steps.

On September 18, 2026, President Trump signed Proclamation 11069, published in the Federal Register on September 23, which extends the Proclamation 10973 entry restriction and its $100,000 payment condition for a further 12 months, to September 21, 2027.

The Massachusetts proceedings also sit opposite an earlier outcome in another federal court. According to Fragomen, a December 2025 decision of the District of Columbia district court upheld the $100,000 fee in a separate challenge, leaving federal district courts divided on the payment's lawfulness until the appellate courts take up the question.

As of October 22, 2026, the June 8 vacatur is in effect, DHS has stated it is complying with that order, and the government's appeal is pending before the First Circuit.