Blue states sue Trump administration over tariffs

Democratic attorneys general are pushing a lawsuit against the Trump administration in their newest shot at President Trump’s global tariffs.

This comes on the heels of a landmark Supreme Court decision that struck down his Liberation Day duties implemented last year, arguing that he improperly used the International Emergency Economic Powers Act to impose them.

In response, the president immediately announced a new wave of tariffs, based on Section 122 of the Trade Act of 1974, currently set at 10%, with expectations to raise it to 15%.

Thursday’s lawsuit, filed at the Court of International Trade, will seek to deem Mr. Trump’s latest tariffs illegal and order refunds to states.

A New York federal judge ruled Wednesday that companies are due billions of dollars in refunds for paying tariffs.

The federal government collected an estimated $130 billion through mid-December from the tariffs.

The attorneys general’s lawsuit is led by New York’s Letitia James, Arizona’s Kris Mayes, California’s Rob Bonta and Oregon’s Dan Rayfield.

Their lawsuit argues that Mr. Trump is overstepping his power by implementing Section 122, which has never been invoked, asserting that the tariffs violate the Constitution’s separation-of-powers principle that gave Congress the power to impose duties.

“Trump is trying to use an obscure law to push through tariffs that his coequal branch of Congress, not the president alone, is supposed to authorize,” Mr. Bonta said at a Thursday press conference. “Simply put, the law does not allow this, and we won’t stand by while it’s broken.”

They also argue that Section 122 was intended to address specific economic conditions that occur only when a country is on a fixed exchange rate, like when the U.S. was using the gold standard, rather than to counter a trade deficit.

“These are not the same thing at all,” Ms. Mayes said. “The president either doesn’t know the difference, or he doesn’t care. Either way, he is breaking the law — again.

A coalition of 12 states sued the Trump administration last year to halt his original tariffs, later combining with suits from small businesses, challenging the same policy, which led to the recent Supreme Court case.

“Almost two weeks ago, the President learned what all of us already knew, that his attempt to pass tariffs were unlawful and unconstitutional, and instead of focusing his efforts on returning the hundreds of billions of dollars to Americans, he instructed his attorneys to find more lawyerly ways to pass his failed economic agenda item under his instruction,” Mr. Rayfield said.

Ms. James said Mr. Trump’s latest tariff is nothing more than an effort to sidestep the Supreme Court.

Given that it took nearly a year for the Supreme Court to issue a definitive ruling, and Section 122 has a 150-day cap, a ruling may not come before the president’s tariff hits the time limit. 

When asked if any state is considering a program to help business owners who paid tariffs navigate the refund process, Mr. Rayfield said states should not be burdened with footing the bill.

He said it’s the responsibility of the Trump administration to figure out how to put money back in Americans’ pockets. 

“If they can figure out how to take tariff money, they can figure out how to get it back to us,” he said.

With affordability a highlight of this campaign season, Mr. Bonta said these are costs that Americans are bearing “when they are screaming for more affordability, not less, for prices to be lowered, not raised.”

He said many Republican attorneys general are “secretly rooting for us because when we deliver a victory and get tariffs struck down, their residents benefit, their businesses benefit.”