Court challenges tariffs
A federal court heard a new challenge to President Trump’s temporary 10% global tariffs brought by a coalition led by Oregon, arguing the administration lacks proper legal authority. Judges pressed whether the administration’s reliance on Section 122 of the Trade Act of 1974 was ever intended for a chronic trade‑deficit justification rather than an acute monetary emergency, a line of questioning that could limit the White House’s tariff powers. Investors responded nervously: pharmaceutical stocks fell after the administration signalled imported medicines could be next in line for tariffs. (opb.org) (chicagotribune.com) (indiatoday.in) (jainam.in)
A federal trade court spent Friday probing whether President Donald Trump had legal authority to slap a temporary 10% tariff on nearly all imports. (opb.org) The case was argued on April 10 before the United States Court of International Trade in New York, where a coalition led by Oregon and joined by 23 other states asked judges to block the tariff. (opb.org) Trump imposed the tariff on February 20 under Section 122 of the Trade Act of 1974, a law that lets a president levy an import surcharge of up to 15% for 150 days to address “fundamental international payments problems.” (whitehouse.gov) That law was written for balance-of-payments trouble, meaning strains in how money moves between the United States and the rest of the world, including a “large and serious” deficit or a sharp dollar slide. Judges pressed government lawyers on Friday over whether a chronic trade gap fits that narrower language. (law.cornell.edu) The hearing came after the Supreme Court, on February 20, struck down Trump’s earlier tariffs under the International Emergency Economic Powers Act, saying that statute did not authorize tariffs. The administration turned to Section 122 the same day. (cov.com) The states argue Congress, not the White House, sets tariff policy, and that Section 122 cannot be used as a standing workaround after the administration lost the earlier case. (politico.com) Government lawyers told the court the president made the findings Section 122 requires and that the statute gives him room to act when the United States faces a large and serious balance-of-payments deficit. (federalregister.gov) The tariff is temporary on paper: Section 122 caps it at 150 days unless Congress extends it, and trade lawyers say the current surcharge is set to expire on July 24, 2026, absent new legislation. (law.cornell.edu, swlaw.com) Markets were already reacting to the administration’s next trade move. Drugmakers’ shares fell after Trump announced new pharmaceutical tariffs on April 2, including duties of up to 100% on some imported patented medicines, with carveouts for some companies. (cnbc.com) The judges did not rule from the bench on Friday. Their eventual decision could determine how far a president can go in using old trade statutes to impose broad tariffs without a new vote in Congress. (chicagotribune.com)
