Federal Court Blocks Implementation of $100,000 H-1B Fee in Another Significant Ruling

On September 30, 2026, the U.S. District Court for the Northern District of California issued another significant ruling concerning the Trump Administration’s $100,000 H-1B payment requirement. The court vacated the federal agency policies implementing the fee and prohibited the agencies from enforcing those policies unless and until they complete the required federal rulemaking process.

Background

On September 19, 2025, President Trump issued Presidential Proclamation 10973, imposing a $100,000 payment requirement in connection with certain H-1B petitions. The Proclamation was recently extended for an additional 12 months.

The policy has faced multiple legal challenges. In June 2026, the U.S. District Court for the District of Massachusetts vacated the agency policies implementing the fee, and in July 2026, the First Circuit declined to stay that ruling while the government’s appeal proceeds. As a result, the $100,000 payment requirement was already not in effect when the Northern District of California issued its September 30 decision.

The Court’s Decision

In its September 30, 2026 order, the Northern District of California found that the plaintiffs are likely to succeed on their claims that the agencies violated the APA. The court concluded that the agencies failed to engage in reasoned decision-making, including by failing to consider alternatives and the reliance interests of those affected by the policy.

The court also found that the agency policies were legislative rules subject to the APA’s notice-and-comment rulemaking requirements. The agencies had not completed that process or the regulatory flexibility analysis required to assess the impact on small businesses.

Accordingly, the court vacated the policy and prohibited USCIS from enforcing or implementing it until the required notice-and-comment rulemaking and regulatory flexibility analyses have been completed. The court also denied the government’s request to stay the ruling pending appeal.

Practical Impact for Employers:

The agency policies implementing the $100,000 H-1B payment requirement remain vacated, and employers are not currently required to submit the $100,000 payment under those policies.

• The Northern District of California’s decision does not finally resolve whether the President had statutory authority to issue the underlying Proclamation.
• Litigation concerning the $100,000 H-1B payment requirement remains ongoing, and employers should continue monitoring developments as the cases proceed through the courts.