U.S. companies face uncertainty after judge blocks $100,000 H-1B fee

Dallas-based software consulting firm owner Kishore Khandavalli, who employs nearly half of his 380 staff on H-1B visas, said the proposed fee increase threatened his operations. He noted a persistent skills gap in the U.S. labor market, especially for emerging technologies, and said there is insufficient domestic talent to fill his openings.

In September 2025, the administration announced a hike in the H-1B filing fee from roughly $215 to $100,000. On June 8, U.S. District Judge Leo Sorokin ruled the charge unlawful, describing it as a tax lacking statutory authority. The 42-page decision invalidated the fee pending appeal.

"The substance and application of the $100,000 payment reveal that it is a tax, regardless of what the payment is called," Judge Sorokin wrote.

Khandavalli said he has not hired new foreign workers since the fee was announced and estimated the rule would have cost his company about $1 million annually. He warned that additional restrictions could force him to offshore work, potentially disrupting a pipeline that has supported both skilled immigrants and American firms for decades.

A doctoral student from India, Ravi Bushan, who had planned to study in the U.S. and later obtain an H-1B, said the shifting immigration climate is prompting him to consider alternatives outside the United States.

"With the changes in the visa formalities, and the shifts in the way immigration is now seen in the U.S., now I'm looking at diversifying my options, looking at other places," Bushan said.

The administration has indicated it will appeal the decision, leaving companies like Khandavalli's uncertain about future visa costs and the broader impact on innovation and talent retention.