25 States Sue Trump Over Section 301 Duties

Twenty-five states are suing the Trump administration over its efforts to rebuild the crumbling foundation of its trade strategy through new and divisive tariffs.

On Monday, a coalition of mostly Democratic-led states including Oregon, Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Massachusetts, Maryland, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Rhode Island, Kentucky, Pennsylvania, Vermont, Virginia, Washington and Wisconsin filed suit in the Court of International Trade (CIT) against President Donald Trump, United States Trade Representative Ambassador Jamieson Greer and U.S. Customs and Border Protection Commissioner Rodney S. Scott for using Section 301 of the Trade Act of 1974 to penalize 60 countries over allegations of forced labor when previous attempts to tariff them were either deemed unlawful or expired.

“For more than a year and a half, the President has unilaterally imposed tariffs without legal authority to do so,” the state attorneys general, as well as two governors, wrote in the complaint.

Calling the administration’s Section 301 tariff action—which imposes 10-12.5 percent duties on dozens of trading partners—”capricious, and contrary to law,” the plaintiff states said the administration “cannot use forced labor as a pretext to continue its illegal tariff scheme.”

While they “oppose forced labor in all its forms and support protections for workers around the globe,” the plaintiffs added, “[t]he tariffs the USTR imposed are so broad that they defy the USTR’s own stated aims and make a mockery of the statute used to justify them.”

The duties took effect on July 24, the same day that another set of 10 percent duties levied under Section 122 of the same 1974 trade statute expired.

That’s no coincidence, the writers noted, as the administration has made little effort to hide its ambitions to continue imposing punishing tariffs on America’s trade partners under any justification. Nor are the president’s opponents—from politicians to importers, like the small businesses that sued the administration last month—taking the tariffs lying down.

The plaintiffs in Monday’s case made a well-worn point: all of Trump’s tariffs have faced allegations of unfairness in court, and in the most important cases, the plaintiffs have been vindicated. Trump’s “reciprocal” duties, levied under the International Emergency Economic Powers Act (IEEPA), were struck down by the Supreme Court in February, prompting the administration to embark on the painful process of refunding about $166 billion in collected duties.

Meanwhile, the Section 122 duties were deemed unlawful by the New York-based CIT in May. The Trump administration was granted a stay on that decision, and was allowed to continue to collect the tariffs pending the completion of the administration’s appeal.

The states asserted Monday that the Section 301 duties, like the tariffs that preceded them, are in violation of the statute as they go “beyond the bounds” of the powers given by Congress to the executive.

California Attorney General Rob Bonta, who sued the president last year on behalf of the Golden State over his IEEPA duties, said in a statement Monday following the release of the new lawsuit that Trump “is so intent on raising the cost of living for Americans that he is willing to break law after law after law to do so.”

“This is President Trump’s third attempt to illegally impose tariffs that would make life more expensive for American families and small businesses, and this is the third time we’re taking the Administration to court over this misuse of power,” he added. “Tariffs are taxes, and the American people cannot and should not shoulder the extra costs that come from the President’s failed and illegal economic policy—no matter how much the President wants them to.”

The states are asking the CIT to deem the duties unlawful and to stay their effective date pending judicial review, and to award refunds to the plaintiff states for tariffs already paid.

“Donald Trump has lost in court after court trying to unilaterally impose tariffs, yet for more than a year he has recklessly pressed ahead—and Arizonans have paid the price,” said Arizona Attorney General Kris Mayes.

“Tariffs have resulted in higher grocery prices, bigger bills for small businesses trying to stay afloat, and chaos in nearly every sector of our economy,” she added.