A coalition of 25 Democratic-led US states has sued the Trump administration to block tariffs on India and 59 other trading partners, arguing the import duties are unlawful and an attempt to bypass earlier court rulings against the president’s trade policy
President Donald Trump’s new tariff regime has landed back in court after 25 Democratic-led US states filed a lawsuit seeking to overturn duties imposed on India and 59 other trading partners, calling the measures an illegal attempt to bypass previous court rulings.
The lawsuit, filed in the US Court of International Trade in New York, asks the court to declare the tariffs unlawful, block their enforcement and order the Trump administration to refund duties already collected. The states argue that the latest levies are effectively a fresh version of sweeping import taxes that US courts, including the Supreme Court, have already ruled the president cannot impose unilaterally.
The legal challenge is the latest in a series of courtroom battles over Trump’s trade policy, underscoring the administration’s determination to preserve its tariff strategy by relying on different provisions of US trade law.
Tariffs cover India, EU and other major trading partners
The tariffs, which took effect in July, impose duties of 10 per cent and 12.5 per cent on imports from 60 trading partners, including India, China, Canada, Japan, Taiwan, Norway and the European Union.
The Trump administration has justified the tariffs under Section 301 of the Trade Act of 1974, arguing that the affected countries have failed to do enough to stop goods produced using forced labour from entering global supply chains. Washington says such imports disadvantage American workers and businesses.
More from BusinessIndia was initially set to face a 12.5 per cent tariff but was moved to the lower 10 per cent category after New Delhi tightened its trade rules to prohibit imports produced wholly or partly using forced labour. The policy change came as India and the United States continued negotiations on an interim bilateral trade agreement.
According to the states’ complaint, the tariffs on 59 countries and the European Union cover 99.4 per cent of US imports, making them among the broadest trade measures adopted by the Trump administration.
States accuse Trump of defying courts
The coalition argues that the administration is using the forced labour investigation as a legal pretext to restore tariffs that courts have already found unlawful.
“After losing at the Supreme Court, the administration is once again trying to illegally raise taxes on families and businesses with a new round of tariffs,” New York Attorney General Letitia James said in a statement.
“No matter how the administration tries to justify it, the law and our Constitution are clear that the president does not have the power to impose sweeping tariffs on whatever countries he wants,” she added.
The lawsuit has been joined by New York, California, Arizona, Colorado, Connecticut, Delaware, Hawaii, Illinois, Massachusetts, Maryland, Maine, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, Oregon, Rhode Island, Virginia, Vermont, Washington and Wisconsin, along with the governors of Kentucky and Pennsylvania.
Oregon Attorney General Dan Rayfield said the administration was once again creating uncertainty for businesses.
“Despite losing every step of the way, Trump is trying yet again to inflict more chaos on working families and homegrown Oregon businesses,” he said.
White House defends tariff strategy
The White House rejected the allegations, insisting that the tariffs are both lawful and necessary to address unfair trade practices.
“The United States is using its lawful authority to obtain the elimination of unreasonable acts, policies, and practices that burden US commerce,” White House spokesman Kush Desai said.
“A foreign country’s failure to impose and effectively enforce a prohibition on the importation of goods produced with forced labor is unreasonable and burdens US commerce, including American workers, and must be addressed. Section 301 tariffs have proven to be a legally durable tool since the President’s first term, and they remain so now,” he added.
The administration argues that Section 301 has long been used by successive US presidents to respond to unfair foreign trade practices and remains a valid legal basis for the latest measures.
Plaintiffs challenge use of Section 301
The states, however, argue that the Trump administration has stretched Section 301 far beyond its intended purpose.
While previous administrations used the law to target specific countries or industries following detailed investigations, the plaintiffs say Trump has deployed it to impose sweeping tariffs affecting almost all US imports.
New York Governor Kathy Hochul said the administration’s reliance on forced labour concerns does not satisfy the legal requirements under Section 301.
“The administration is using ‘forced labor’ as an excuse to continue its policy of indiscriminately enacting damaging tariffs on a wide range of countries that lead to higher prices for our constituents,” Hochul said.
She added that the tariffs amount to “nothing more than a tax on hardworking families”, increasing the cost of groceries, household essentials, building materials and other everyday goods.
Fresh legal uncertainty for global trade
The lawsuit follows a separate challenge filed by the Liberty Justice Center on behalf of two US small businesses, which also argues that Trump exceeded his executive authority by imposing the latest tariffs.
The dispute comes months after the US Supreme Court ruled that the International Emergency Economic Powers Act (IEEPA) did not authorise the president to impose broad global tariffs. The administration subsequently introduced temporary tariffs before unveiling the latest measures under Section 301.
The outcome of the case could shape the future of Trump’s trade policy and determine whether the administration can continue using alternative legal authorities to maintain tariffs on major trading partners.
For India, the legal battle adds another layer of uncertainty as New Delhi works to conclude an interim trade agreement with Washington. While India’s tariff rate was reduced to 10 per cent after changes to its forced labour import rules, exporters will be closely watching whether the courts allow the new duties to remain in force.
With inputs from agencies.
