H-1B $100K Fee Reinstated Pending Appeal: What the First Circuit Case Means

In fourteen days, the $100,000 H-1B fee went from federal law to vacated to reinstated. On June 8, a federal judge in Boston called it an unauthorized tax and struck it down. That ruling and the three legal grounds behind it are analyzed in detail in our predecessor article. On June 12, the same judge paused his own ruling pending appeal. Now the First Circuit has the case.

For practitioners managing H-1B consular processing files, this sequence creates three categories of clients: those who filed during the four-day no-fee window, those who now face the reinstated fee, and those who made structural decisions (switching workers to O-1, canceling sponsorship plans, restructuring hiring pipelines) based on one court's reading of the law. All three groups need different answers today.

The June 8 Ruling and Why It Happened

The full analysis of the June 8 decision is in our prior article on the vacatur, but a brief summary is necessary to understand what the First Circuit is actually reviewing.

Judge Leo T. Sorokin (D. Massachusetts) vacated the fee on three independent grounds. First, the $100,000 payment is a tax. The Constitution vests the taxing power in Congress, not the executive. The INA does not delegate that power, and labeling a revenue measure a "fee" does not convert it into one. Second, the rule bypassed APA notice-and-comment. The administration issued the fee through a proclamation with no prior notice and no opportunity for public comment. Third, the rule was arbitrary and capricious: the administration gave a two-sentence acknowledgment of employer disruption before imposing a 20x increase in petition costs, which is not enough to satisfy the APA's reasoned-decision-making requirement.

Three grounds. Each one independently sufficient to vacate the rule. That structure matters enormously for the appellate stay analysis, as explained below.

The fee had been on the books since September 21, 2025. It applied to every new H-1B petition filed by employers sponsoring workers who needed to enter from abroad via consular processing. Extensions and intra-company transfers for workers already inside the United States were never subject to it.

What a Self-Stay Means

A court staying its own order is not a reversal. It is not the court reconsidering whether its ruling was correct. It is a procedural mechanism that gives the appellate court time to look at the question without the losing party suffering immediate irreversible consequences in the interim.

Four factors govern whether a district court grants a self-stay. The moving party must show: (1) a likelihood of success on the merits of the appeal; (2) irreparable harm absent a stay; (3) substantial injury to other parties if the stay is granted; and (4) the public interest. Courts weigh these together, not separately.

Here, the government's argument for a stay rested primarily on the harm prong. The fee was generating revenue. Vacating it immediately created regulatory uncertainty for an ongoing government function. The irreparable harm the government raised is the loss of collected revenue during the appeals window, plus the administrative disruption of implementing the vacatur and then potentially re-implementing the fee if the First Circuit reverses.

That the court granted the self-stay does not tell us how strong the government's appellate case is. District courts often stay their own orders when the appeal involves a significant legal question, regardless of the district court's confidence in its own ruling. What the self-stay does tell us: the First Circuit will have a fully briefed record and a live controversy with real stakes on both sides.

The administrative stay issued June 12. The government's deadline to formally request a stay from the First Circuit was June 18. Multiple law firms confirmed the fee was collectible again as of that date.

The First Circuit Timeline

Emergency stay decisions at the First Circuit typically take two to six weeks after the stay request is filed. The First Circuit will consider the same four-factor test the district court applied. Given that three independent grounds support the vacatur, the government must make credible arguments that it is likely to succeed on appeal as to at least one of them.

Scenario 1: First Circuit denies the stay

The administrative stay lifts. The fee is vacated again immediately, and a second filing window opens for consular processing petitions. Employers who held back new hires or deferred hiring decisions get another chance to file without the $100,000 payment. This scenario mirrors the June 8-12 window but could last longer: until the First Circuit issues a merits decision or the Supreme Court intervenes.

Scenario 2: First Circuit grants the stay

The fee remains in effect through the full merits review. That timeline is 6 to 18 months at the First Circuit level, with a near-certain Supreme Court petition to follow given the circuit split. Employers face two to three years of continued $100,000 fee exposure on consular processing petitions if the government prevails at each appellate stage.

Scenario 3: First Circuit issues a partial stay or a narrow ruling

Courts occasionally thread the needle: staying the vacatur as to certain petitioner classes or imposing conditions. This is less likely given the structural framing of the district court's ruling, but practitioners should not rule it out. A partial stay could, for example, reinstate the fee for large-cap employers while exempting smaller sponsors who showed greater reliance-interest harm at the district court level.

The First Circuit's decision on the stay request will arrive before the end of July 2026 under normal emergency motion timelines. Watch for it.

The Circuit Split and Where It Points

Two federal courts have now reached opposite conclusions on the same fee. On December 23, 2025, Judge Beryl Howell (D.D.C.) upheld the fee in Chamber of Commerce of the USA v. Department of Homeland Security, No. 1:25-cv-03675. On June 8, 2026, Judge Sorokin in Boston struck it down.

These are not two courts interpreting different facts. They are reading the same proclamation, the same statute, and the same constitutional structure. The D.C. court found the executive had sufficient authority under the INA's entry-restriction powers. The Boston court found the payment constituted a tax that Congress alone can impose and that the INA's entry powers do not reach.

A circuit split of this kind does not resolve itself. The D.C. Circuit and the First Circuit will eventually issue opinions that either widen or collapse the gap. If both circuits issue conflicting precedents, the Supreme Court is the only institution that can resolve the conflict with binding nationwide effect. Supreme Court cert petitions in fast-moving immigration enforcement cases can move quickly. Petitions have been granted in as few as eight months after a circuit decision in high-profile regulatory disputes.

One practical consequence: the First Circuit's ruling will be closely read by the D.C. Circuit, which has the parallel appeal in front of it. The two appellate courts will be writing into a void where the Supreme Court has not yet spoken. Neither circuit wants to be the one whose reasoning looks less defensible in the eventual high-court opinion.

The Dorcas v. USCIS ruling, which vacated the benefit freeze for 39 travel-ban country nationals, is also now before the First Circuit on appeal. The same court is thus simultaneously reviewing two major immigration-enforcement rollbacks. Whether the judges approach the two cases similarly is an open question, but the shared appellate venue means practitioners tracking both cases can watch the First Circuit's calendar for both.

The June 8-12 Filing Window

Four days separated the vacatur from the self-stay. Petitions filed between June 8 and June 12, 2026, were filed during the period when no fee was legally required. USCIS had no valid authority to collect the $100,000 during that window.

For attorneys who filed during that period, the documentation question is not hypothetical. If USCIS seeks to impose a retroactive fee obligation on those petitions after the stay was reinstated, the argument will turn on the filing date.

Preserve everything that establishes the filing date:

• USCIS receipt notice with date
• USCIS online account filing timestamp
• Courier or mail tracking confirmation (for paper filings)
• Internal docketing system record
• The client communication confirming the filing instruction was given and executed during the vacatur window

USCIS has not issued guidance on retroactive fee collection for the June 8-12 window. That silence is not a green light. It is an open question. The strongest protection for your client is contemporaneous documentation that the petition was filed when no fee was required, and that the attorney had a good-faith legal basis for that position given the operative court order at the time of filing.

Any attempt by USCIS to deny these petitions on fee grounds after the fact would likely face its own legal challenge. The filing was lawful the day it was made. A stay that reinstates the rule prospectively does not retroactively create a fee obligation that did not exist when the petition was submitted.

Employer Decision Framework

The fee volatility now demands that employers and their counsel think in scenarios rather than planning around any single outcome. Here is a practical decision framework organized by employer situation.

Employer A: New hire pending, offer letter out, worker is abroad

The fee is in effect today. If you file today, you pay $100,000. If the First Circuit denies the stay in the next four to six weeks, you may wish you waited. If it grants the stay, you will have paid what you were legally required to pay. The decision turns on how time-sensitive the hire is. A worker who must start in 30 days cannot wait. A hire with a September start date can.

Employer B: Paused all consular processing sponsorship after September 2025

The self-stay changes nothing structurally for you yet. The fee is back. If the First Circuit denies the stay and the fee drops again, that creates a second window to revisit paused hires. Watch the First Circuit docket actively. The fee volatility is real and will not resolve in the next 90 days.

Employer C: Switched workers from H-1B to O-1 to avoid the fee

The O-1 switch was a rational response to what looked like a permanent $100,000 fee. With the fee now in appellate flux, a switch made solely to avoid the payment deserves reassessment. O-1B requires independent evidence of extraordinary ability that is distinct from anything the employer controls. It costs more in legal fees to prepare. It is harder to maintain. If the First Circuit vacates the fee again, you will have paid the O-1 preparation cost to avoid a fee that is no longer required. Reassess this with the client's profile in front of you, not as a general policy. Some clients genuinely qualify for O-1 and are better off on that classification. Others were shoehorned into it purely for cost avoidance. Those two categories need different advice now. See also our EB-1A petition guide for clients on a longer-term path to a green card who need to think about status maintenance as a multiyear strategy.

Employer D: Worker on F-1 OPT, cap-subject H-1B petition pending or planned

Cap-subject petitions filed via change of status within the United States are not subject to the $100,000 fee if they do not request consular notification. If your client will activate H-1B status by staying in the country through the October 1 cap date, you are not in this fee dispute. The USCIS AOS memo on H-1B and L-1 holders contains important context on related policy changes affecting employment visa holders that may intersect with your planning here.

Employer E: Worker from a travel-ban country

This client sits at the intersection of two separate legal disputes. The $100,000 fee applies to consular processing; the Dorcas v. USCIS ruling affects adjustment of status benefit processing. If your client is adjusting status from inside the United States, the H-1B fee is irrelevant. If your client needs to process at a consulate, both the fee and the travel ban's entry restrictions apply simultaneously. These are separate legal questions with separate litigation trajectories. Do not conflate them in your client advice.

What to Tell Clients Right Now

Clients will ask whether to file now or wait. Here is language you can use in client communications:

For clients with pending new hires from abroad who are deciding whether to file today:

"As of June 12, 2026, the $100,000 H-1B consular processing fee is in effect under a court-issued administrative stay. A federal district court struck down the fee on June 8, but stayed its own ruling four days later while the government appeals to the First Circuit. The appeal is Case No. 26-1699. The First Circuit is expected to rule on the stay request within the next four to six weeks. If it denies the stay, the fee drops again and petitions pending at that moment may proceed without it. If it grants the stay, the fee remains in place through the full appeal, which could take 12 to 18 months. We can file today and pay the fee, or we can hold the petition for up to six weeks and watch the First Circuit's ruling. That decision depends on how critical your start date is for this hire."

For clients who filed between June 8 and June 12:

"Your petition was filed while the fee was legally vacated. No fee was required on the date we filed. We have preserved all documentation of the filing date. If USCIS raises a fee issue, we will contest it on the basis that the filing was made under a valid federal court order vacating the fee. No USCIS guidance has been issued on retroactive fee collection for petitions in this window."

For clients who switched to O-1 to avoid the fee:

"The H-1B fee is currently reinstated and the appellate outcome is uncertain. The O-1 election you made was legally sound when it was made. Whether to maintain it or return to H-1B sponsorship if the fee drops again is a case-by-case question. We should review whether the O-1 evidence package remains strong on its own terms, independent of the fee question."

Action Checklist

The list below is not comprehensive legal advice for any single case. It reflects the steps that apply to most H-1B consular processing matters given the current status of the fee litigation.

For petitions you need to file now:

• Confirm the $100,000 fee is included. The administrative stay is in effect. Do not file without it.
• Set a calendar alert for First Circuit stay ruling, expected by late July 2026.
• Document the fee payment in the client file with the USCIS receipt and payment confirmation.

For petitions filed June 8-12:

• Preserve the USCIS receipt notice, filing timestamp, internal docket entry, and all client communications from that week.
• Prepare a short file memo stating: petition filed on [date], during the period when the district court's vacatur in Case No. [docket] was in effect, no fee was required under the operative court order, filing made in good faith reliance on that order.
• Monitor USCIS for any request for evidence or notice of deficiency citing the fee.

For employers who paused sponsorship:

• Identify which paused hires are still viable and on what timeline.
• Build a contingency plan for a second no-fee window: which hires go first if the First Circuit denies the stay.
• Do not restart hiring pipelines on the assumption the fee will drop. Prepare for it to happen, but do not restructure around an assumption.

For workers currently on O-1 status who made the switch post-September 2025:

• Review the O-1 evidence file on its own merits.
• Identify the O-1 petition expiration date and whether H-1B sponsorship is still available from the employer.
• If the fee is vacated again by the First Circuit and the client's EB-1A track is well advanced, the O-1 may remain the better long-term choice regardless of fee status. See our EB-1A petition guide for the full path analysis.

For ongoing client communications:

• Update any standard H-1B consular processing engagement letters that cited the fee amount to include a volatility disclosure.
• Do not guarantee a filing cost to new employer clients. Quote the fee as "currently $100,000 under administrative stay, subject to change on First Circuit ruling expected by late July 2026."

The First Circuit ruling is the next inflection point. Everything else in this case flows from what that court says about the stay in the next few weeks: the merits, the Supreme Court timeline, the resolution of the circuit split. The fee has now been on, off, and back on within a nine-month span. That instability alone is a cost for employers trying to plan workforce strategy. Watch No. 26-1699.