A coalition of 24 states filed suit in the U.S. Court of International Trade on March 5, 2026 to block President Trump's 10 percent global tariff imposed under Section 122 of the Trade Act of 1974 — a statute never previously invoked by any president. The lawsuit followed the Supreme Court's February 20 ruling that tariffs imposed under the International Emergency Economic Powers Act are unconstitutional, which struck down Trump's earlier tariff regime. Trump responded the same day by invoking Section 122, imposing a 10 percent tariff on nearly all imports — covering an estimated .2 trillion, or 34 percent, of annual U.S. imports. The Tax Foundation and the Budget Lab at Yale estimated the tariff amounts to an average cost increase of approximately ,500 per U.S. household. CNN Business and SCOTUSblog both confirmed the legal timeline and constitutional questions.
The states argue that Section 122 — a Cold War-era provision designed to address monetary crises under fixed exchange-rate systems — was never intended to authorize broad global tariffs in response to a trade deficit. Their central argument is that the U.S. does not have a "balance-of-payments deficit" in the legal sense the statute requires, because trade deficits and balance-of-payments deficits are different economic measures, and that the statute's conditions for invocation are therefore not met. The Liberty Justice Center filed a parallel lawsuit on behalf of private businesses making the same constitutional argument. PBS NewsHour confirmed both suits and summarized the states' arguments.
The tariff is subject to a statutory 150-day expiration, meaning it would automatically expire in approximately mid-July 2026 unless extended — a constraint that differentiates it from the IEEPA tariffs, which had no built-in expiration. Economists at the Budget Lab at Yale estimated that if the tariff expires as scheduled, its ultimate price impact will be between 0.3 and 0.4 percent — a to loss per household. Trump has signaled intent to raise the rate to 15 percent, though the rate remains at 10 percent. Multiple Section 301 investigations targeting forced-labor practices by 60 trading partners, including China, are also underway through the USTR, providing a potential additional tariff mechanism that may not face the same legal vulnerabilities as Section 122.
NPR covered the economic uncertainty from the consumer perspective, reporting that businesses are struggling to price goods when a tariff regime could be eliminated by a court at any moment. Fox Business and the Washington Examiner framed the lawsuits as liberal state governments using the courts to undermine the executive's authority to protect American manufacturing and address trade imbalances that have persisted for decades — regardless of which legal theory the administration uses.
Left-Leaning Emphasis
- NPR and CNN framed the Section 122 tariff as the administration's desperate search for a legal hook after the Supreme Court eliminated IEEPA tariffs, treating it as an unstable and likely unconstitutional workaround that will create sustained uncertainty for consumers and businesses.
- Left-leaning coverage emphasized the ,500-per-household cost estimate, framing the tariffs as a regressive tax on American consumers rather than a burden on foreign exporters.
Right-Leaning Emphasis
- Fox Business and right-leaning trade coverage framed the state lawsuits as politically motivated obstruction by Democratic state AGs seeking to limit executive power on trade — where presidents of both parties have historically exercised broad authority.
- Right-leaning analysts argued Section 122's 150-day limit actually demonstrates the administration's legal restraint, contrasting it with the IEEPA regime and giving Congress and courts time to respond.
Sources
- PBS NewsHour Mar 25
- CNN Business Mar 1
- SCOTUSblog Mar 25
- Tax Foundation Mar 25
- NPR Feb 20