* Lawsuit is the first to challenge Trump's
recently-imposed global tariffs
* Trump had imposed new tariffs after Supreme Court
invalidated most of his prior tariffs
* States that joined the lawsuit include California, New
York, Oregon
(Updates paragraphs 1-2 to reflect lawsuit has now been filed,
adds comment from Oregon Attorney General and White House in
paragraphs 3-6 and context in paragraph 11)
By Dietrich Knauth
March 5 (Reuters) - A group of 24 U.S. states sued
President Donald Trump's administration on Thursday in the first
legal challenge to his newly imposed 10% global tariffs,
alleging that the president cannot sidestep a recent U.S.
Supreme Court ruling that invalidated most of his previous
tariffs on imported goods by citing new legal authority.
The Democratic-led states, including New York, California
and Oregon, argue the new tariffs, which Trump announced
immediately after the high court ruling on February 20, are also
illegal. The tariffs were imposed for 150 days under the Trade
Act of 1974, which is meant to address short-term monetary
emergencies, not routine trade deficits that arise when a
wealthy nation like the United States imports more than it
exports, according to the states' lawsuit filed in the New
York-based U.S. Court of International Trade.
Oregon Attorney General Dan Rayfield said during a press
conference that Trump's latest tariffs are an attempted "end
run" around working with Congress, as the U.S. Constitution
requires.
"Make no mistake about it, President Trump's signature
economic policy is historically unpopular and is costing
Americans, our business, and us as states hundreds of billions
of dollars," Rayfield said. "It cannot continue just because a
few of Trump's lawyers have found a way to twist words and craft
a legal argument."
White House spokesperson Kush Desai said in a statement that
the administration will vigorously defend the president's action
in court.
"The President is using his authority granted by Congress to
address fundamental international payments problems and to deal
with our country's large and serious balance-of-payments
deficits," Desai said.
Trump's February 20 executive order imposed a 10% tariff on
imports, but U.S. Treasury Secretary Scott Bessent said
Wednesday that those rates would likely rise to 15% later this
week.
CENTRAL PILLAR
Trump has made tariffs a central pillar of his foreign
policy in his second term, claiming sweeping authority to issue
tariffs without input from Congress. But the Supreme Court on
February 20 handed Trump a stinging defeat when it struck down a
huge swath of tariffs he had imposed under the International
Emergency Economic Powers Act, ruling that the law did not give
him the power he claimed.
Trump responded by criticizing the justices who ruled
against him and announcing new duties under Section 122 of the
Trade Act of 1974, a law that - like IEEPA - had never before
been used to impose tariffs in the U.S. Trump has also imposed
other tariffs, on imports like autos, steel and aluminum, under
more traditional legal authority. Those tariffs are safer from
legal challenges.
Section 122 authority allows the president to impose duties
of up to 15% for up to 150 days on any and all countries to
address "large and serious" balance of payments issues. It does
not require investigations or impose other procedural limits.
After 150 days, Congress would need to approve their extension.
The balance-of-payments deficit measures in the Trade Act
are primarily meant to address "archaic" monetary risks that
existed when foreign governments could trade in their dollars
for gold held by the U.S., according to the states. Trump,
however, has misapplied that standard in an attempt to instead
address U.S. "trade deficits," which occur when a nation imports
more than it exports, according to the states.
The states that filed the lawsuit include 22 states with
Democratic attorneys general and two, Pennsylvania and Kentucky,
with Democratic governors and Republican attorneys general. They
are asking the court to issue an order that would block the new
tariffs and order any tariff payments already made under Section
122 authority to be refunded.
Meanwhile, the court is grappling with about 2,000 lawsuits
from businesses seeking refunds for more than $130 billion in
IEEPA tariff payments made by importers before the Supreme
Court's February ruling. On Wednesday, the court ordered U.S.
Customs to begin processing tariff refunds.