Trump’s latest tariff plan faces a lawsuit, and the path may be as rough as the last one. Courts killed his earlier “liberation day” duties after ruling that the White House used a law that did not let the president tax imports from most countries. Trump has returned with another broad tariff program, but the new case says the administration is keeping the policy alive under another law. The duties started on Friday and cover products from more than 80 countries. Those partners account for 99.4% of U.S. trade. The White House says the tariffs target governments that have not done enough to block goods tied to forced labor. Trump is relying on Section 301 of the Trade Act of 1974, which lets Washington answer unfair practices with tariffs. Trade lawyers say Trump is stretching Section 301 far beyond its usual limits Section 301 has been used by several presidents, including Trump during his first term, when the United States imposed duties on China. Peter Harrell, a visiting scholar at Georgetown University Law Center’s Institute of International Economic Law, said this use is broader than usual. He told CNBC, owned by Comcast (NASDAQ: CMCSA), that Trump is “using the statute in a fundamentally different way.” Harrell said Congress did not create Section 301 so a president could rewrite the U.S. tariff list or leave wide duties in place without an end date. He said courts could “for sure” cancel the policy. Trump is also using Section 301 for trade fights. On Friday, he said the United States would immediately investigate the European Union after regulators issued penalties against American technology companies. The administration has also placed a 25% tariff on Brazilian imports and threatened a 50% rate on Canadian products. Two small companies filed the first case hours after the duties began. Their complaint went to the U.S. Court of International Trade. They say the forced labor claim is legal cover for rebuilding the worldwide tariff system that judges rejected five months earlier. The timing is central. The Section 301 duties began as another tariff group expired. Trump announced those charges under Section 122 of the 1974 law hours after the Supreme Court rejected his global policy on February 20. Section 122 allowed temporary import charges, so those duties had a fixed end date. The International Emergency Economic Powers Act, or IEEPA, does not permit Trump to impose tariffs on nearly all trading partners by himself, the Supreme Court ruled. The White House cannot circumvent that decision by selecting a different legislation while maintaining essentially the same structure, according to the current complaint. The filing says Section 301 does not give the president power to tax almost all imports at rates chosen to copy the failed IEEPA system. It argues that duties must be tied to specific foreign conduct and designed to stop it. Two businesses ask the court to block Trump’s replacement tariff system The administration denies that it is bringing back the earlier program. A senior official told reporters Thursday that forced labor has concerned Trump “for many years.” The official said the Friday start date was chosen “really to avoid complexity.” The two companies’ case was brought by the Liberty Justice Center. The challengers who won the previous IEEPA lawsuit were represented by the same NGO. It states that the White House cannot maintain a tariff strategy that was predetermined by changing legal provisions. Sara Albrecht, the group’s chairman and chief executive, said forced labor is “morally indefensible,” but a serious goal does not allow the government to ignore legal limits. Sara said one tariff package expired and another began immediately under a different law. “Changing the statute doesn’t change the law,” she said. Patrick Childress, a Holland & Knight partner and former U.S. trade official, said the Section 301 duties could last much longer than the expired Section 122 charges. “These tariffs will be with us for the long haul,” Patrick said. Countries may not get relief even if they adopt every rule Washington requests. Patrick said each government must prove that it is enforcing those rules to satisfy U.S. officials before Trump’s tariffs are removed. He said there is no short-term route for a country to escape the new rates.
