A coalition of 25 states has sued the Trump administration in an effort to block new tariffs imposed on goods from 60 major trading partners, arguing that the White House is attempting to preserve a global trade regime that courts previously rejected under different laws.
The lawsuit was filed Monday in the U.S. Court of International Trade. It asks the court to declare the tariffs unlawful, stop federal officials from collecting them and order refunds for duties already paid by the states.
The plaintiffs include New York, California, Michigan, North Carolina, Oregon, Washington and Wisconsin, along with the governors of Kentucky and Pennsylvania. The complaint names President Donald Trump, the United States, U.S. Trade Representative Jamieson Greer and Customs and Border Protection officials as defendants. No judge has yet ruled on the states’ allegations.
The challenged tariffs were announced in late July following investigations conducted under Section 301 of the Trade Act of 1974.
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The administration imposed rates of 10% or 12.5% on imports from 60 economies, including Canada, China, Japan, the United Kingdom, Australia, India and the European Union. The covered trading partners collectively account for approximately 99.4% of U.S. imports, although exemptions apply to selected goods and products already subject to other trade restrictions.
Trump administration officials say the tariffs are intended to pressure foreign governments to prohibit and more effectively police imports made with forced labor.
Countries that have adopted some form of forced-labor import restriction, or committed to doing so through trade agreements, generally received the lower 10% rate. Other economies were assigned a 12.5% tariff, while several partners received rates adjusted to account for their existing most-favored-nation duties.
USTR says its process included two rounds of public hearings, more than 2,100 comments and consultations with more than 45 governments. The agency argues that Section 301 permits action against unreasonable or discriminatory foreign practices that burden American commerce.
The states do not dispute the seriousness of forced labor. Their lawsuit instead argues that the tariffs are too broad and insufficiently connected to the stated goal.
According to the complaint, USTR divided 60 different economies into only a few tariff categories without adequately linking each rate to the prevalence of forced-labor products or the effectiveness of each country’s enforcement system.
The states also argue that the administration failed to establish clear benchmarks explaining what a trading partner would need to do to have the tariffs removed. They claim that the 10% minimum placed even on countries taking steps against forced labor suggests that the policy’s real purpose is maintaining broad tariffs rather than changing specific foreign conduct.
The legal challenge relies partly on the Administrative Procedure Act. The states accuse USTR of exceeding its statutory authority and acting arbitrarily by imposing nearly uniform tariffs on countries with significantly different laws, economies and supply chains.
They also allege that officials did not adequately address testimony warning that the tariffs could raise costs for American importers, disrupt access to essential manufacturing inputs and weaken cooperation with governments attempting to improve labor enforcement. Those claims remain arguments made by the plaintiffs and have not been accepted by the court.
The administration has rejected accusations that forced labor is merely a pretext. White House officials maintain that countries allowing goods associated with forced labor into their markets place American workers and responsible businesses at a disadvantage.
Section 301 has previously been used against targeted trade practices, most notably during Trump’s first-term confrontation with China. The central question in this case is whether the law also permits tariffs applied across nearly the entire global trading system following simultaneous investigations of dozens of economies.
The lawsuit follows earlier court defeats involving two other tariff authorities. The Supreme Court ruled in February that the International Emergency Economic Powers Act did not authorize the administration’s earlier worldwide import taxes. A separate trade court later ruled against temporary tariffs imposed under Section 122, although litigation over that decision has continued.
The new case could therefore determine whether those rulings created meaningful limits on presidential tariff authority or simply required the administration to find a different statute.
For states and ordinary consumers, the immediate concern is cost. State governments purchase vehicles, equipment, medical supplies, construction materials and other products containing imported components. The complaint says vendors are passing tariff costs to public agencies, making budgeting and purchasing more expensive.
Private companies face a similar choice. Importers can absorb the additional expense, attempt to negotiate lower prices with suppliers or pass part of the cost to customers. The effect will differ by product, particularly when businesses cannot find a comparable American-made substitute.
It is not yet clear how quickly the trade court will consider the states’ request to suspend the tariffs. The court could temporarily block collection while the case proceeds, allow the policy to remain in effect or ultimately uphold some tariffs while rejecting others.
Why It Matters
The tariffs apply to trading partners responsible for nearly all goods imported into the United States. The outcome could affect prices for businesses, consumers and state governments while influencing how much authority future presidents have to reshape trade policy without new congressional legislation.
The case also tests whether forced-labor enforcement can legally support broad tariffs on nearly every product from dozens of countries, including goods with no identified connection to abusive labor practices.
What Comes Next
The Trump administration is expected to defend the tariffs and may argue that USTR followed the required investigation, consultation and public-comment procedures.
The states are likely to seek rapid court action because duties are already being collected. Businesses have also filed separate legal challenges, increasing the possibility that the court will coordinate or closely compare the cases.
Any ruling by the Court of International Trade could be appealed, potentially returning the wider dispute over presidential tariff power to the Supreme Court.
