U.S. states challenge Trump forced-labour tariffs in new legal fight

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U.S. states challenge Trump tariffs

Highlights

Multiple U.S. states launched lawsuits challenging the Biden administration's new Section 301 tariffs of 10% to 12.5% on over 60 trading partners.
Legal challenges argue the White House is using Section 301 as a pretext to maintain Trump's trade agenda after courts struck down previous emergency powers tariffs.
Litigation by Learning Resources and Liberty Justice Center seeks to vacate the global Section 301 tariffs, claiming they impose billions in new taxes on American businesses and consumers.

Legal challenge targets Section 301 tariff strategy

As reported by Financial Times, the states allege the administration conducted a "sham" investigation of trading partners and used it as a pretext to preserve a tariff programme that courts have already scrutinised. The lawsuit argues the White House is attempting to keep Trump's broader trade agenda in place by shifting to a different statutory basis after the Supreme Court struck down most earlier tariffs imposed under emergency economic powers.

Late last month, the U.S. announced fresh tariffs of 10% to 12.5% on more than 60 trading partners following an investigation into whether countries were enforcing rules on forced labour. The new duties rely on Section 301 of the Trade Act of 1974, a law generally viewed as more legally durable than some of the other authorities previously used by the administration.

California attorney-general Rob Bonta says the measures mark Trump's third attempt to impose unlawful tariffs that would raise costs for American families and small businesses. In a statement, he says tariffs are taxes and that consumers should not bear the cost of what he describes as a failed and illegal economic policy.

Broader trade and business impact comes into focus

A separate challenge is also being pursued by Learning Resources, whose lawyers argue the administration is making an unprecedented and indiscriminate use of Section 301 to impose billions of dollars in taxes on Americans, including family-owned businesses and their customers. Their filing calls on the court to declare the global Section 301 tariffs unlawful and vacate them.

Lawyers for the Liberty Justice Center file another case the same day, arguing the government cannot preserve a pre-determined global tariff policy simply by moving from one statute to another. The wave of litigation raises the prospect of another prolonged court battle over a central pillar of Trump's economic policy and his effort to reshape global trade.

The White House defends the duties as a lawful response to unreasonable foreign practices that burden U.S. commerce. Spokesperson Kush Desai says countries that fail to prohibit and effectively enforce bans on goods made with forced labour harm American workers, and he adds that Section 301 tariffs have remained a legally durable tool since Trump's first term.

In our earlier coverage of the multi-state lawsuit challenging the Trump administration’s Section 301 tariffs on imports from 60 trading partners, we outlined how 25 Democratic-led states argue the White House exceeded its authority and bypassed required country-specific investigations. We also noted that an adverse ruling could weaken the administration’s ability to preserve a broad tariff regime and raise legal uncertainty for import-dependent businesses.

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