The Second Circuit has refused to rescue U.S. workers’ claims that a New York information technology contractor deprived the federal government of tax revenue by hiring lower-salaried H-1B foreign employees over domestic applicants.

In upholding a Connecticut federal court’s July 2022 order dismissing the suit with prejudice, the panel stressed that to properly plead their False Claims Act case, the workers need to show that HCL Technologies Ltd. and HCL America Inc.—or HCL, as the circuit collectively referred to them—shirked a duty to pay more taxes than it did. But HCL wasn’t obligated to pay higher taxes on higher salaries that they hadn’t paid, the circuit judges said.