US Small Businesses Return to Court Within Hours of Trump’s Latest Tariffs Taking Effect

By Kekeletso Nkele, small.news Assistant

(small.news) — Two groups of small businesses filed separate lawsuits in the U.S. Court of International Trade on July 25, challenging a new wave of tariffs announced by the Trump administration that impose double-digit levies on goods from 60 trading partners, reports NBC News.

The suits were filed less than 24 hours after the tariffs took effect—marking the latest in a series of legal challenges to the administration’s trade policy.

The Legal Basis Being Challenged

The new tariffs are implemented under Section 301 of the Trade Act of 1974, with the Trump administration citing countries’ failure to prevent imports produced by forced labor as the legal justification. The tariffs cover approximately 99% of U.S. imports.

Critics argue the stated rationale is less about addressing forced labor and more about reconstituting a broad global tariff regime similar to the one the Supreme Court struck down in February, after which temporary 10% worldwide tariffs that had also faced legal challenge expired. The administration has not publicly responded to those characterizations.

Who Filed and What They Argue

Educational toy company Learning Resources—which was among the plaintiffs in the tariff lawsuit that succeeded at the Supreme Court—filed one of the new suits along with several other small businesses. The second lawsuit was brought by Burlap and Barrel, a New York-based spice importer, and Collective Horology, a watch retailer based in Ventura, California, represented by the Liberty Justice Center, a libertarian advocacy organization.

Both lawsuits argue that the government failed to establish its case against each specific economy adequately and did not sufficiently explain how the tariffs would eliminate the forced labor practices cited as justification, as required under Section 301.

Sara Albrecht, chairman and CEO of the Liberty Justice Center, said the administration had allowed one global tariff to expire and immediately replaced it under a different statute, and argued that changing the legal vehicle does not change the underlying legal requirement. The White House did not respond to a request for comment on either lawsuit.

Why This Round May Be Harder to Challenge

Legal experts caution that the current lawsuits face a steeper climb than the litigation that succeeded last year. Trump used Section 301 to impose large tariffs on China during his first term, and those levies survived court challenges.

Patrick Childress, a partner at Holland & Knight and a former U.S. trade official, said the new tariffs are likely to prove durable. He noted that even if countries enact the precise policies the U.S. demands, they will still need to demonstrate enforcement to Washington’s satisfaction before tariffs are removed, suggesting no short-term path for country-wide relief from the new Section 301 tariffs will be available.

The Broader Legal and Policy Context

The lawsuits arrive at a moment of significant legal turbulence around U.S. trade policy. The Supreme Court’s February ruling against the administration’s previous tariffs—imposed under the International Emergency Economic Powers Act—was a significant setback for the White House’s trade agenda. The new Section 301 approach represents a pivot to a different legal authority, one with a longer track record of surviving judicial scrutiny.

Whether the courts will view the current tariffs as a legitimate use of that authority, or as a procedurally deficient attempt to replicate a regime that was already struck down, is the central question the new litigation raises. That question is unlikely to be resolved quickly.