Trade Court Rules Trump 10% Tariffs Illegal
SkimNews Take
The ruling highlights the judiciary's role in delineating executive authority over trade, even as the immediate collection of tariffs demonstrates the executive's capacity to maintain policy during appeals.
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- Court of International Trade ruled 2-1 on Thursday that Trump's 10% universal tariffs are illegal, though duties continue collecting for most importers while the administration appeals.
- Trump turned to Section 122 of the Trade Act of 1974 — a never-before-used provision allowing up to 15% tariffs for 150 days to address 'large and serious' balance-of-payments deficits — the same day the Supreme Court struck down his prior tariffs in February, imposing a 10% surcharge set to expire July 24.
- The court warned that if the president can select which sub-accounts to examine, 'the President would always be able to identify a balance-of-payments deficit' — an 'expansive reading' of the statute that gives Trump 'unlimited tariff power that belongs to Congress.'
- Unlike the nationwide injunction that followed the Supreme Court ruling, this permanent injunction is narrower, applying only to the plaintiffs — a spice company and a toy retailer represented by the Liberty Justice Center, the same group that argued the prior successful challenge.
- The court dismissed the claims of 23 of 24 state attorneys general who joined the suit, ruling their tariff-related harms were too indirect to establish standing.
- Wiley Rein's Tim Brightbill told Axios 'plan C' is already in motion via ongoing Section 301 investigations, and since the tariffs are set to expire in July regardless, 'the administration may not need to win in court to keep high tariffs in place.'
- White House spokesperson Kush Desai said the administration 'is reviewing legal options and maintains confidence in ultimately prevailing.'
Why it matters: Trump has now lost two consecutive rounds in court on his signature trade policy — the Supreme Court in February and the trade court Thursday — yet the 10% duties keep collecting during appeals, and the administration has replacement tariff investigations already underway ahead of the July 24 expiration date. The practical effect for the roughly 200 million non-plaintiff importers is zero change for now, but the court's reasoning narrows the legal pathway for executive tariff authority.
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