States Join Lawsuit to Halt Trump’s New Tariffs

A coalition of twenty‑four states—most led by Democrats plans to file a lawsuit against the Trump administration. They argue that President Donald J. Trump’s latest 10% global tariff is illegal because it was imposed right after a Supreme Court decision that invalidated many of his earlier tariffs. The court ruled that the president lacked the authority he claimed under the International Emergency Economic Powers Act.

Key Points

• States Involved: New York, California, Oregon, and 21 others.
• Legal Basis: The states contend the new tariffs were issued under the Trade Act of 1974, a law intended for short‑term monetary crises, not to correct the country’s regular trade deficits.
• Trade Act Constraints: Tariffs are allowed only when the U.S. faces a balance‑of‑payments problem—a situation that has not occurred in recent decades.
• Timing of Tariffs: Trump announced the tariffs on February 20, just days after the Supreme Court ruling. Treasury Secretary Scott Bessent later suggested rates could rise to 15%.
• Court of Filing: The lawsuit will be filed in the U.S. Court of International Trade, located in New York City.
• Relief Sought: A court order to stop the new tariffs and require refunds for any payments already collected under Section 122 of the Trade Act.

Broader Context

• The Supreme Court’s decision forced Trump to rely on a different section of the Trade Act, which has never been used for this purpose before.
• The court is already handling around 2,000 lawsuits from businesses seeking refunds for over $130 billion in tariffs paid before the Supreme Court’s decision.
• Customs officials have been ordered to start processing those refunds.

Significance

This legal challenge marks the first time a group of states has taken on the president’s tariff policy in court. The outcome could shape how future trade measures are justified and implemented.