Court of International Trade rules Trump's tariffs illegal
U.S. trade court ruled that President Trump's latest round of global 10% tariffs are invalid, marking another legal defeat for his tariff agenda.
Objective Facts
A U.S. trade court on Thursday ruled that President Trump's latest round of global 10% tariffs are invalid, with a panel of judges in the U.S. Court of International Trade siding with 24 states and a small group of businesses who filed a lawsuit in March challenging the legality of the Trump administration's tax on most imports. Those new tariffs were put in place in February, days after the Supreme Court struck down Mr. Trump's previous round of sweeping "Liberation Day" tariffs, most of which were issued in April 2025 under the International Emergency Economic Powers Act. The court said Mr. Trump didn't have the right to impose tariffs under Section 122 because that law requires there to be a deficit in the U.S.'s balance of payments, an economic term that refers to the total amount of money flowing in and out of the country, but the White House proclamation rolling out the tariffs instead focused primarily on two separate, narrower economic concepts: the U.S.'s trade deficit and its current account deficit. The panel ruled that the Trump administration must stop charging tariffs for the state of Washington and the two businesses that sued and must issue refunds plus interest for all tariffs paid by those three plaintiffs. On May 12, 2026, the U.S. Court of Appeals for the Federal Circuit entered an administrative stay, suspending the implementation of the CIT's order while the appeal proceeds.
Left-Leaning Perspective
Progressive outlets and Democratic critics framed the Court of International Trade ruling as a constitutional and economic victory. The Independent Institute wrote that "The ruling brings America one step closer to being free from President Trump's executive overreach and harmful economic policies", while Rep. John Larson (D-CT) stated "The Supreme Court already rebuked the president's costly tariffs, but Donald Trump sees our Constitution as a mere suggestion to follow, and not the law of the land". Larson further argued that "The average household has already had nearly $2,000 stolen from them by this administration, and they should not have to pay a penny more". Left-leaning analysis emphasized both constitutional violations and economic harm. Lori Wallach, Rethink Trade's director, said "Trump's promises to prioritize speedily cutting the trade deficit and create more American manufacturing jobs are getting undermined by his chaotic and often mistargeted use of tariffs". Dan Anthony, Executive Director of We Pay the Tariffs—a business coalition opposing tariffs—said "There has been little relief from the onslaught of tariff costs for small businesses". Left-leaning coverage emphasizes the pattern of legal losses (this being the second major court ruling against Trump's tariffs) and the harm to families and small businesses, while downplaying or omitting discussion of whether tariffs could serve legitimate trade policy goals or the administration's argument about balance-of-payments deficits.
Right-Leaning Perspective
Right-leaning officials and Trump administration representatives disputed the court's legal interpretation and vowed to continue pursuing tariffs through alternative authorities. U.S. Trade Representative Jamieson Greer told Fox Business Network that judges "are apparently just hell-bent on importing from China" and argued "They essentially said that Congress passed a law that can't be used, which we all know in the legal community, that's not how law should be interpreted". Greer stated "we're confident that on appeal we'll be successful". The Trump administration's defense centered on the legal principle that statutes should be interpreted as usable. The Trump Administration argued that the President has discretion to determine when large and serious balance-of-payments deficits exist based on reasonable economic methodologies currently in use. Trump told reporters "We always do it a different way", signaling the administration's intent to pursue tariffs under Section 301 or other legal authorities. Right-leaning coverage minimized the immediate practical impact of the ruling by noting that the Section 122 tariffs are set to expire in July anyway—and the administration has signaled that replacement tariffs will likely be enacted before then, suggesting the legal setback may prove temporary for Trump's broader tariff agenda.
Deep Dive
The Court of International Trade's May 7, 2026 ruling represents the second major judicial rejection of Trump's tariff strategy in four months, following the Supreme Court's February 2026 decision striking down the administration's broader IEEPA-based tariffs. The Trump administration imposed the Section 122 tariffs in February, days after the Supreme Court struck down its even broader double-digit tariffs. The Trump Administration issued Proclamation 11012 on the same day that the United States Supreme Court invalidated the President's IEEPA tariffs, invoking Section 122 (for the first time since the provision entered into force) to impose a temporary 10 percent ad valorem surcharge on nearly all imports. The narrow scope of the court's injunction—applying only to three plaintiffs rather than nationwide—creates a peculiar legal and practical situation. The central dispute hinges on statutory interpretation of Section 122, which was enacted in 1975 during the post-Bretton Woods monetary crisis. Section 122 authorizes the President to impose duties of up to 15 percent ad valorem for up to 150 days "to deal with large and serious United States balance-of-payments deficits." The statute was passed in 1975 in response to strains on the post-World War II global financial system based on fixed exchange rates. Section 122 is a relic of the 1970s, created after President Richard Nixon took the United States off the gold standard, when the United States was indeed experiencing a crisis and literally running out of gold, with "a balance of payments crisis that could be felt palpably". The administration's core argument—that trade deficits satisfy Section 122's requirements—fails because the statute contemplates a more specific and now-obsolete monetary crisis. The administration has a "plan C" already in place: Section 301 investigations that are underway, though the tariffs are set to expire in July anyway—and the administration has signaled that replacement tariffs will likely be enacted before then. The practical outcome may matter less than the legal precedent: courts have now consistently rejected Trump's rationales across multiple statutory authorities, signaling that broad congressional delegation of tariff power does not permit the president to redefine the triggering conditions for using those authorities. What remains unresolved is whether Section 301 investigations—expected to produce new tariffs in July—will withstand their own inevitable legal challenges.