Trump Tariff Lawsuit
Small Businesses Challenge Trump Tariffs in Court, Arguing Arbitrary Global Enforcement
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Key Points
1
Tariffs took effect at 12:01 a.m. EDT on July 24, 2026, after the expiration of a 150-day temporary surcharge under Section 122; new Section 301 duties apply at 10% or 12.5% on goods from 80 countries, covering about 99.4% of U.S. imports, with exemptions for some foods and fuels and excluding automobiles and certain metals.
2
The lawsuit Burlap & Barrel, Inc. v. Greer et al was filed in the U.S. Court of International Trade on July 24, 2026, on behalf of Burlap & Barrel and Collective Horology, seeking to halt enforcement of the new tariffs and to obtain refunds with interest for duties already collected.
3
The filing argues that the Trump administration moved a global tariff program from one statute to another without proper congressional boundaries and that Section 301 requires country-specific findings and remedial actions; the USTR reportedly opened 60 investigations into forced-labor concerns after a March 12, 2026 IEEPA ruling, followed by a three-day public hearing and more than 1,600 comments before the tariffs were imposed.
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The challenge is part of a broader wave of IEEPA/Section 301-related litigation surrounding President Trump’s tariff policy; reporting notes that the Supreme Court previously ruled IEEPA does not authorize presidential tariffs, prompting the government to proceed with targeted forced-labor investigations before applying global duties.
Two small U.S. businesses sued the Trump administration on July 24, 2026 — less than one day after new tariffs took effect — asking a federal court to stop the duties and refund what was already collected. NBC News reported the lawsuit was filed by the Liberty Justice Center on behalf of spice importer Burlap & Barrel and watchmaker Collective Horology in the U.S. Court of International Trade in New York.
The new tariffs hit goods from roughly 60 to 80 countries at rates of 10% or 12.5%, starting at 12:01 a.m. EDT on July 24. They cover about 99.4% of all U.S. imports, according to Virginia Business.
New Tariffs Replace Expired Emergency Duties
The old tariffs were set under Section 122 of the Trade Act — an emergency power with a 150-day time limit. When that window closed, the Trump administration shifted to Section 301, a different trade law. The new duties went live immediately, with no gap in coverage. NBC News noted that some foods, fuels, automobiles, and certain metals are excluded.
The administration says the tariffs target forced-labor practices abroad. Before imposing them, the U.S. Trade Representative opened 60 country-specific investigations starting March 12, 2026. A three-day public hearing followed, along with more than 1,600 public comments, according to Virginia Business.
Lawsuit Argues Trump Overstepped Congressional Limits
The businesses argue that Section 301 does not allow a sweeping global tariff program. The law requires country-specific findings and targeted fixes, they say — not blanket duties on 80 nations at once. Virginia Business reported the plaintiffs claim the administration simply moved its tariff program from one law to another without proper boundaries set by Congress.
The case is called Burlap & Barrel, Inc. v. Greer et al. The Liberty Justice Center previously challenged Trump tariffs under a different law — the International Emergency Economic Powers Act, known as IEEPA. Investing.com noted that the Supreme Court ruled IEEPA does not authorize presidential tariffs, which is why the government shifted to Section 301.
Small Businesses Bear the Real Cost of Tariff Fight
Burlap & Barrel imports spices. Collective Horology sells watches. Both buy goods from countries now hit by the new duties. Every percentage point added to import costs squeezes margins that big companies can absorb more easily. NBC News reported the businesses want refunds with interest for duties already paid.
AOL News noted the suit was filed less than one day after the tariffs took effect — a sign the Liberty Justice Center had the case ready to go the moment the duties kicked in. The group has become one of the most active legal challengers to Trump's broader tariff agenda.
Broader Wave of Tariff Lawsuits Still Moving Through Courts
This case is part of a larger legal battle over how much power the president has to set tariffs without Congress. Multiple lawsuits have challenged both IEEPA and Section 301 authority. The Supreme Court's earlier IEEPA ruling forced the administration to find new legal ground, according to Investing.com.
The U.S. Court of International Trade will now decide whether the new Section 301 tariffs can stand. If the court sides with the small businesses, it could freeze duties covering nearly all U.S. imports — a major blow to the administration's trade strategy, Virginia Business reported.
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