Twenty-four U.S. states have filed a major lawsuit. They challenge President Trump’s new global tariffs. The legal action targets tariffs imposed after a Supreme Court defeat. Oregon leads the coalition of states. Oregon Attorney General Dan Rayfield is a key figure. He stated the focus should be on refunds. “The focus right now should be on paying people back, not doubling down on illegal tariffs,” Rayfield said.
The lawsuit argues the tariffs violate federal law. It claims they undermine the constitutional separation of powers. The states also cite a breach of the Administrative Procedure Act. Trump invoked Section 122 of the Trade Act of 1974. He did this after the Supreme Court rejected his IEEPA tariffs.
The Legal Challenge
This new tariff policy follows a Supreme Court ruling. The court struck down tariffs under the International Emergency Economic Powers Act (IEEPA). This happened on February 20, 2026. Trump then quickly turned to Section 122. This law has never been used before. It allows tariffs of up to 15% for 150 days.
The states argue Section 122 is for specific financial crises. It addresses “fundamental international payments problems.” However, they contend a trade deficit does not meet these conditions. A trade deficit is different from a balance-of-payments deficit. The Justice Department itself argued this point previously. Critics say the law is obsolete now.
Furthermore, states claim the president lacks this broad tariff power. Congress holds the authority to levy taxes. This new action bypasses that authority. The states believe this is an unlawful attempt to sidestep the Supreme Court’s prior decision.
Economic Fallout for Americans
These tariffs carry significant economic costs. A Federal Reserve Bank of New York analysis found a stark reality. Nearly 90 percent of tariff costs in 2025 fell on U.S. consumers and businesses. Prices for basic goods like groceries and clothing have soared.
Experts estimate tariffs could cost an average Oregon family over $1,200 annually. Small businesses heavily rely on imports. Unpredictable trade policy directly hurts their costs and stability. Many firms are passing tariff-related cost increases to customers. Some companies shrink product sizes instead of raising prices. This economic uncertainty weighs on consumers.
The White House Response
The White House vows a strong defense. Spokesperson Kush Desai stated the President uses congressional authority. This addresses “fundamental international payments problems” and “large and serious balance-of-payments deficits”. The administration believes it acts within its legal bounds.
What Happens Next
The lawsuit seeks to block these new tariffs. It also demands refunds for any tariffs already paid under Section 122. The Court of International Trade will hear the case. Legal analysts offer mixed views on the outcome. Some suggest Trump may receive more judicial deference this time.
Meanwhile, companies that paid prior IEEPA tariffs are entitled to refunds. This legal battle highlights ongoing tension over presidential trade powers. It impacts countless consumers and businesses. Many struggle to afford necessities, making it difficult to enjoy everyday life. This news underscores the complex economic and legal landscape. We will continue to explore this story as it unfolds. The outcome will shape future trade policy and affect Americans nationwide.
