In a significant escalation of the ongoing trade friction, 24 states have officially filed a lawsuit against the Trump administration’s recently imposed Section 122 tariffs. The complaint, filed March 5 at the Court of International Trade (CIT), represents a massive pushback from state governments seeking to shield their economies and “instrumentalities” from these new costs.
The Core of the Suit: Injunctions and Refunds
The plaintiffs are not just looking for a pause; they are seeking a permanent injunction to stop the government from implementing the Section 122 proclamation entirely. Beyond stopping future collections, the suit demands that the government refund any Section 122 tariffs already collected from the states and their respective agencies.
A Question of Pretext
The legal strategy centers on the validity of the administration’s justification. Under the statute, Section 122 tariffs are intended to address a “balance of payments” crisis. However, the 24 states argue that:
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No Crisis Exists: The complaint alleges that the economic conditions required to trigger Section 122 simply aren’t present.
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Executive Overreach: The states claim the crisis is a “pretext” allowing the President to bypass traditional legislative hurdles and impose tariffs via “executive order, memoranda, and social media posts.”
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Arbitrary Exemptions: The suit points to the 80 pages of product and country-specific exemptions, arguing that these carve-outs are not justified by the language of the statute and reflect “whims” rather than a standardized economic policy.
Why This Matters for Trade
If the CIT finds that the “balance of payments” justification was misused, it could significantly limit the executive branch’s power to use obscure trade statutes for broad economic shifts. For businesses and state agencies currently paying these duties, the possibility of a court-ordered refund offers a potential—though far from certain—financial reprieve.
