25 states sue Trump administration over latest global tariffs

Twenty-five states sue Trump tariffs in a new challenge to import duties that reach goods from 60 U.S. trading partners. For investors and consumers, the case puts another major tariff program before the courts, though the lawsuit does not itself change the duties or guarantee a result.

A coalition of 25 Democratic-led states filed the case Monday in the U.S. Court of International Trade, according to CNBC and Reuters. The complaint targets tariffs of 10% or 12.5% on most goods imported from the affected economies. The states say those economies account for 99.4% of U.S. imports.

A tariff is a tax charged on imported goods. In this case, the legal dispute is over whether the administration had authority to impose the broad duties under the provision it chose.

Why are 25 states suing Trump over tariffs?

The states contend that the administration exceeded its authority by invoking Section 301 of the Trade Act of 1974. They argue that Section 301 is being used to restore sweeping tariffs that the Supreme Court and the Court of International Trade had previously rejected, CNBC reported.

Reuters likewise reported that the states say the latest tariffs go beyond the president’s legal authority to tax imports. The filing is an allegation, not a court finding, and no response from the administration to this Aug. 3 lawsuit was included in the available reporting.

The complaint also alleges that the administration rushed its investigations of the 60 economies, skipped required country-by-country consultations and did not justify imposing nearly uniform rates on countries with different policies involving forced-labor imports, according to CNBC.

The states asked the trade court to block and invalidate the tariffs and to order refunds of duties paid by the states.

How is this case different from the March tariff lawsuit?

This is a separate challenge from a March 5 lawsuit brought by 24 states. That earlier case contested a 10% global tariff that was expected to rise to 15%, and it focused on Section 122 of the Trade Act of 1974, Reuters reported.

The Aug. 3 lawsuit involves 25 states, tariffs of 10% or 12.5% covering goods from 60 trading partners, and a Section 301 legal theory. Keeping the two cases separate matters because each challenges a different tariff program and statutory authority.

CNBC reported that small businesses had already filed another challenge to the newer duties on similar grounds. The Court of International Trade will decide whether the states’ challenge can proceed and whether the tariffs can remain in place.

This story draws on original reporting from CNBC.