A coalition of 24 states filed a federal lawsuit Thursday challenging President Donald Trump’s recently implemented 10% tariffs on imported goods, marking the first court challenge to the administration’s latest trade policy moves.
The legal action comes after the Supreme Court delivered a major blow to Trump’s trade agenda on February 20, invalidating most of his earlier tariff program. In response, Trump immediately announced new import duties using different legal justification.
According to a spokesperson from Oregon’s Attorney General office, the participating states – predominantly led by Democratic leadership and including New York, California, and Oregon – contend that these replacement tariffs violate federal law just like their predecessors.
The lawsuit, being filed in New York’s U.S. Court of International Trade, challenges Trump’s use of the Trade Act of 1974 to justify the tariffs. The states maintain this law was designed for addressing urgent monetary crises, not the standard trade imbalances that occur when wealthy countries like America purchase more goods internationally than they sell abroad.
Treasury Secretary Scott Bessent indicated Wednesday that the current 10% rate established in Trump’s February 20 executive order will likely increase to 15% in the coming days.
Tariffs have become a cornerstone of Trump’s international strategy during his second presidency, with the administration asserting broad executive power to implement trade duties without congressional approval. However, the Supreme Court’s February ruling significantly undermined this approach by rejecting Trump’s use of the International Emergency Economic Powers Act for tariff authority.
Following that judicial setback, Trump publicly criticized the opposing justices and pivoted to Section 122 of the Trade Act of 1974 – another law that had never previously been utilized for U.S. tariff implementation. The administration has also maintained other import duties on products including automobiles, steel, and aluminum using more established legal frameworks that face fewer court challenges.
The plaintiff states contend that the Trade Act specifically permits tariffs only for addressing “balance of payments” shortfalls – a economic condition not seen since Richard Nixon’s presidency when America was transitioning away from the gold standard.
These balance-of-payments provisions were primarily created to handle monetary emergencies such as dramatic dollar devaluation in international currency markets, the states argue. They claim Trump has incorrectly applied this standard to target ordinary “trade deficits” that naturally occur when nations import more than they export.
The legal filing seeks a court injunction halting the new tariffs and requiring refunds for any payments already collected under Section 122 authority.
Separately, the court system is managing approximately 2,000 business lawsuits seeking reimbursement for over $130 billion in tariff payments made under the now-invalidated IEEPA program before the Supreme Court’s February decision. On Wednesday, the court directed U.S. customs officials to begin processing these refund requests.
