Federal Judge Nukes Trump’s $100K H-1B Visa Fee by Ruling It’s an Unlawful Tax

(AP Photo/Jacquelyn Martin)

A federal judge has struck down President Donald Trump’s executive order imposing a $100,000 payment on employers submitting petitions for new H-1B visas, finding it to be an unlawful tax and an usurpation of Congress’ powers to set tax and immigration policy.

The H-1B visa is a non-immigrant visa that allows a foreign worker to be hired to work in the U.S. in a “specialty occupation” (generally meaning one requiring “highly specialized knowledge” and a bachelor’s degree or higher) for an initial three-year period. This can be extended to a maximum of six years, or longer if the worker meets green card requirements. There is a cap on the number of H-1B visas granted for several different categories, along with a list of exemptions for certain employers, like higher education institutions and non-profit research organizations.

Last September, Trump signed an executive order that claimed the “systematic abuse” H-1B visa has allowed the program to be “deliberately exploited to replace, rather than supplement, American workers with lower-paid, lower-skilled labor.”

“It is therefore necessary to impose higher costs on companies seeking to use the H-1B program in order to address the abuse of that program while still permitting companies to hire the best of the best temporary foreign workers,” Trump’s order continued before imposing “a $100,000 payment” on each H-1B visa petition, subject to some specific exceptions, like employing foreign workers who the Secretary of Homeland Security determines are “in the national interest and does not pose a threat to the security or welfare of the United States.”

In December, twenty states filed a complaint challenging the $100,000 payment as unlawful under the U.S. Constitution and the federal Administrative Procedure Act, and for being “arbitrary and capricious.”

The 42- page ruling by Judge Leo Sorokin of the U.S. District Court for the District of Massachusetts, an Obama appointee, relied on two Supreme Court precedents to strike down Trump’s executive order: the Obamacare ruling finding that it was a “tax,” and a more recent ruling that struck down Trump’s tariffs for exercising taxing policy that belonged to Congress absent a clear and express grant of authority to the executive branch.

Sorokin’s ruling held that Trump’s executive order “imposes a tax on H-1B petitions without the requisite delegation by Congress” and “is declared unlawful and is VACATED in its entirety,” completely striking it down.

In the written opinion, the judge repeatedly rejected arguments made by the Trump administration attorneys as unproven, illogical, or without supporting citations.

When the Defendants tried to claim the $100,000 payment was a “regulatory payment” and “not the same as a tax,” Sorokin dismissed that as “mere ipse dixit,” noting that the Trump administration attorneys “offer no definition for what constitutes ‘a regulatory payment,’ cite no cases or statutes employing the term, and advance no reasoned argument explaining how this term
encompasses something different than a tax or a penalty,” finding that the Defendants “have waived this theory” by failing to make “some effort at developed argumentation.”

Arguments that Congress had delegated its taxing authority to the president were similarly rejected as insufficient, because all the Trump administration attorneys could point to was “broad” and “ambiguous language” that was “not sufficient for establishing the delegation of the taxing power” so as to overcome the separation of powers issue.

Sorokin was especially blunt in his response to the Defendants’ “miscellaneous arguments” that the president’s “immigration and commerce powers” granted him the power to impose the $100,000 payment, finding that support for these claims was “nowhere to be found in the authorities they cite,” which “concerned a completely different separation-of-powers issue than the situation at hand.”

The Trump administration is likely to appeal. White House spokesperson Taylor Rogers issued a statement, “The H-1B program has been abused for decades, and President Trump finally took action to fix it. A federal judge in Washington already upheld a nearly identical order, and the Administration is confident this order will be reversed on appeal.”

The “nearly identical order” Rogers is referencing is a district court ruling that was issued before the Supreme Court struck down Trump’s tariffs, an opinion that Sorokin relied upon in his decision — and which would be controlling precedent over a lower court ruling.

New: The Mediaite One-Sheet "Newsletter of Newsletters"
Your daily summary and analysis of what the many, many media newsletters are saying and reporting. Subscribe now!