US states sue to stop Trump’s latest global tariffs

Lawsuit is to stop the 10 percent tariffs that Trump immediately imposed after US Supreme Court struck down previously imposed tariffs.

A group of 24 states in the United States have sued US President Donald Trump’s administration in the first legal challenge to his newly imposed 10 percent global tariffs, alleging that the president cannot sidestep a recent US Supreme Court ruling that invalidated most of his previous tariffs on imported goods by citing new legal authority.

The Democratic-led states, including New York, California and Oregon, in the lawsuit on Thursday argue the new tariffs, which Trump announced immediately after the high court ruling on February 20, are also illegal.

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Trump has said the tariffs are essential to reduce America’s longstanding trade deficits. He imposed duties under Section 122 of the Trade Act of 1974 after the Supreme Court struck down tariffs he imposed last year under an emergency powers law.

Section 122, which has never been invoked, allows the president to impose tariffs of up to 15 percent. They are limited to five months, unless extended by Congress, and are meant to address short-term monetary emergencies, not routine trade deficits, according to the states’ lawsuit filed in the New York-based US Court of International Trade.

The balance-of-payments deficit measures in the Trade Act are primarily intended to address “archaic” monetary risks that existed when foreign governments could trade dollars for gold held by the US, according to the states. Trump, however, has misapplied that standard in an attempt to instead address US “trade deficits”, which occur when a nation imports more than it exports, according to the states.

Oregon Attorney General Dan Rayfield said during a news conference that Trump’s latest tariffs are an attempted “end run” around working with Congress, as the US Constitution requires.

“Make no mistake about it, President Trump’s signature economic policy is historically unpopular and is costing Americans, our business, and us as states hundreds of billions of dollars,” Rayfield said. “It cannot continue just because a few of Trump’s lawyers have found a way to twist words and craft a legal argument.”

“The focus right now should be on paying people back, not doubling down on illegal tariffs,” he said.

The suit comes a day after a judge ruled that companies that paid tariffs under Trump’s old framework should get refunds.

Central pillar

White House spokesperson Kush Desai said in a statement that the administration will vigorously defend the president’s action in court.

“The president is using his authority granted by Congress to address fundamental international payments problems and to deal with our country’s large and serious balance-of-payments deficits,” Desai said.

Trump’s February 20 executive order imposed a 10 percent tariff on imports, but US Treasury Secretary Scott Bessent said on Wednesday that those rates would likely rise to 15 percent later this week.

Trump has made tariffs a central pillar of his foreign policy in his second term, claiming sweeping authority to issue tariffs without input from Congress. But the Supreme Court on February 20 handed Trump a stinging defeat when it struck down a huge swath of tariffs he had imposed under the International Emergency Economic Powers Act (IEEPA), ruling that the law did not give him the power he claimed.

Trump responded by criticising the justices who ruled against him and announcing new duties under Section 122. Trump has also imposed other tariffs on imports like autos, steel and aluminium, under more traditional legal authority. Those tariffs are safer from legal challenges.

Meanwhile, the court is grappling with about 2,000 lawsuits from businesses seeking refunds for more than $130bn in IEEPA tariff payments made by importers before the Supreme Court’s February ruling. On Wednesday, the court ordered US Customs to begin processing tariff refunds.