U.S. court blocks Trump's 10% global tariff

Tariffs are back in court again — and Trump lost again. On May 7, a split panel at the U.S. Court of International Trade said his 10% global tariff was not allowed under the law he used to impose it. But the catch is important: this was not a clean nationwide shutdown. The ruling blocks the tariff only for Washington state and two companies that sued, so most importers are still paying for now. (usnews.com) ### What exactly did the court block? The court took aim at Trump’s February 2026 “backup” tariff — a flat 10% duty applied broadly across imports from around the world. This was the administration’s Plan B after the Supreme Court, on February 28, knocked out Trump’s earlier, broader tariff program. The new version leaned on Section 122 of the Trade Act of 1974 instead of the emergency powers law that failed the first time. (politico.com) ### Why did the judges say no? Basically, the majority said Section 122 does not give a president open-ended power to slap a worldwide tariff on nearly everything just because he wants a broad trade reset. That law is narrower. It allows temporary import surcharges — up to 15% for no more than 150 days — when the U.S. faces serious balance-of-payments problems. The court said Trump’s use of it here did not fit. (politico.com) ### Why wasn’t this a nationwide block? Because standing mattered more than the headline. The panel said the plaintiffs who clearly showed direct injury were Washington state, spice importer Burlap & Barrel, and toy company Basic Fun! The broader coalition of 24 mostly Democratic-led states did not get the un(politico.com) (usnews.com) ### So are companies still paying the tariff? For most of them, yes. That’s the weird part. Even with the court calling the tariff unlawful, the decision leaves the duty in place for nearly everyone except those three successful plaintiffs while appeals play out. That means customs collections do not suddenly stop across the board. It also means more lawsuits are likely, because other importers now have a road map. (usnews.com) ### Why does Section 122 matter so much? Because this was the administration’s fallback tool. Trump first tried to build a giant tariff wall using emergency authority under IEEPA. The Supreme Court rejected that in February. Section 122 was supposed to be the workaround — older, narrower, and never really used this way before. Now that workaround has also run into a court saying the statute does not stretch that far. (politico.com) ### What happens next? An appeal is the obvious next step. That would go first to the U.S. Court of Appeals for the Federal Circuit, and from there it could end up back at the Supreme Court. Meanwhile, the administration is not signaling retreat. Trump has already said his team will keep trying, and reporting says officials are looking at Section 301 investigations as another route to broad tariffs later this year. (politico.com) ### Why does this matter beyond one tariff? Because it keeps narrowing the legal space for a president to impose across-the-board tariffs without Congress. Trump can still pursue targeted trade actions. But courts are now saying, twice, that a universal tariff needs a much tighter legal fit than the White Hou(politico.com)ally have. (usnews.com) ### Bottom line This was a real loss for Trump’s tariff strategy, but not an immediate full stop. The court said the 10% global tariff was unlawful. Yet for most businesses, the bill keeps coming until a broader order — or a higher court — says otherwise. (usnews.com)