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California and 24 other states are asking a federal court to stop President Trump’s latest round of tariffs, arguing the administration is breaking the law by using an obscure, never-before-invoked statute to tax American consumers. The motion for summary judgment, filed in the U.S. Court of International Trade, represents the most significant legal challenge yet to the president’s trade agenda.
The lawsuit centers on Section 122 of the Trade Act of 1974, a provision that allows emergency tariffs only when the United States faces “fundamental international payments problems” and “large and serious balance-of-payments deficits.” California Attorney General Rob Bonta, who is co-leading the case with Oregon, Arizona, and New York, says the administration’s justification doesn’t pass the laugh test. “The president’s rationale for these unlawful tariffs has gone from unreasonable to ridiculous,” Bonta said during a virtual press conference. He’s not wrong to be skeptical—legal scholars note that a trade deficit and a balance-of-payments deficit are two entirely different economic concepts, and conflating them suggests either profound ignorance or deliberate obfuscation.
This isn’t the administration’s first attempt to find legal cover for its tariff regime. Last month, the Supreme Court struck down Trump’s use of the International Emergency Economic Powers Act to impose tariffs, ruling that Congress never granted the president such sweeping authority over international trade. Within days of that defeat, the White House pivoted to Section 122, slapping 10% tariffs on most imported goods worldwide. The speed of that pivot raises an obvious question: if the president genuinely believes these tariffs are necessary for national security, why does the legal justification keep changing?
The economic stakes are substantial. According to court filings, the 24 plaintiff states stand to pay at least $748 million annually in additional costs due to the tariffs. A Yale Budget Lab study estimates the average American household is already paying roughly $1,000 more per year because of the administration’s trade taxes. California’s agricultural sector and wine industry have been particularly hard hit, with exports declining as trading partners retaliate with tariffs of their own.
The White House isn’t backing down. Spokesperson Kush Desai insisted the administration would “vigorously defend the President’s action in court,” claiming the tariffs address legitimate balance-of-payments concerns. But that defense faces significant hurdles. Section 122 also requires tariffs to be applied evenly across products, yet the administration has granted numerous exemptions for goods from Canada and other countries—undermining its own legal argument.
Oral arguments are scheduled for April 10, 2026, in New York City. The court’s ruling could have far-reaching implications not just for this administration, but for the balance of power between the executive branch and Congress on trade policy. For decades, lawmakers have delegated vast authority to the president on international commerce, often with little oversight. This case may force a reckoning about whether that delegation has gone too far.
What’s clear is that working families are caught in the crossfire of this legal and political battle. Whether you support the president’s trade agenda or not, the Constitution matters. If the administration wants to reshape the American economy through tariffs, it should either make its case to Congress or find a legal foundation that can withstand judicial scrutiny. Using obscure statutes in ways their drafters never intended isn’t governance—it’s improvisation, and the American people deserve better than policy made up on the fly.
The states are also seeking refunds of tariffs already collected under Section 122, potentially putting billions in federal revenue at risk. For an administration that has made fiscal responsibility a cornerstone of its messaging, the prospect of writing massive refund checks to importers and consumers can’t be welcome news. But when you play fast and loose with the law, consequences follow.
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