Half of the 50 states of the United States filed a lawsuit this Monday against President Donald Trump and his Administration over the recent global tariffs, which range from 10% to 12.5% on imports from most of their trading partners. The states argue that these rates are "just as illegal" as those that the Supreme Court has already declared unconstitutional.
In the lawsuit, driven by Oregon, Arizona, and California and supported by another 22 states governed by Democrats, it is stated that "The tariffs imposed by the United States Trade Representative (USTR) are so broad that they contradict their own stated objectives and mock the law used to justify them."
This new round of levies, approved at the end of July just hours before another temporary global tariff of 10% expired, is based on Section 301 of the Trade Act of 1974, which allows for such measures against unfair trade practices considered a restriction on U.S. trade. The White House justifies its decision based on a months-long internal investigation into alleged forced labor practices in other countries.
The states emphasize in the filing that "The plaintiff states oppose forced labor in all its forms and support the protection of workers worldwide. But the Administration cannot use forced labor as a pretext to continue its illegal tariff plan." The complaint has been filed with the United States International Trade Court, based in Manhattan.
The plaintiffs argue that the USTR, Jamieson Greer, has ignored the procedures and requirements set by law, and therefore they seek the annulment of the tariffs and the reimbursement of the deposits paid by the states in respect of these rates.
The initiative opens a new chapter in the ongoing struggle between coalitions of states and small businesses, on one side, and the Trump Administration, on the other, regarding the third round of tariffs imposed by the president.
Trump tries to rebuild a tariff framework dismantled in February, when the Supreme Court declared his global tariffs illegal, approved under the International Emergency Economic Powers Act (IEEPA). Since then, customs authorities have had to process a flood of refund requests from thousands of companies that paid around 166 billion dollars (144.230 billion euros) in levies.
After that judicial setback, the White House re-established global tariffs of 10% based on Article 122 of the Trade Act. A trade court also declared them illegal, although it allowed them to remain in effect while the appeal was resolved, until their expiration last month.
The latest round of tariffs has already triggered other lawsuits. In one of the first, filed by two small companies —the spice importer Burlap and Barrel Inc and the watch retailer Collective Horology LLC—, the lawyers argue that the new rates do not respond to the "country-specific investigation" that Congress contemplated when approving Section 301.
The companies, which are presenting the procedure as a possible class action to include all registered importers who have paid the new tariffs, claim that the trade representative did not detail "how the specific practices of each economy constitute a burden or restrict U.S. trade, instead of relying on generalized claims about the effects of forced labor and inputs from forced labor in global supply chains."