Trade Cases
CIT Receives Thousands of Lawsuits Over Section 301 Tariffs
Written by Sandy Williams
September 27, 2020
The Trump administration has received more than 3,300 lawsuits from manufacturers alleging that the most recent rounds of tariffs against China under Section 301 of the Trade Act of 1974 were unlawful and arbitrary.
The first two rounds of tariffs covered $50 billion worth of Chinese goods. The third was implemented on $200 billion of imports and the fourth on $120 billion. The products in question include everything from household goods and clothing to machinery and auto parts. Plaintiffs allege that the United States Trade Representative exceeded its authority in imposing the third and fourth rounds and are seeking refunds for tariffs already paid.
A number of major automakers have filed lawsuits with the Court of International Trade including Tesla, Volvo, Ford and Mercedes Benz. Tesla called the tariffs “arbitrary, capricious, and an abuse of discretion.”
Mercedes Benz accused the administration of prosecuting “an unprecedented, unbounded, and unlimited trade war. Mercedes added that U.S. law “did not confer authority on defendants to litigate a vast trade war for however long, and by whatever means, they choose.”
The National Law Review states, “Section 301 of the Trade Act of 1974 authorizes the USTR to impose duties to combat certain ‘unreasonable’ or ‘discriminatory’ trade acts by a foreign government.” Tariffs are paid by the U.S. importers of those goods.
The National Review added, “The plaintiffs argue that the Section 301 law was not intended as a tool to engage in an ‘open-ended trade war,’as opposed to an initial response to China’s intellectual property violations.”
Although the lawsuits are consider a long shot at best, the sheer number of complaints are expected to garner serious attention from the CIT. Besides the automakers, major companies include HMTX Industries, Coca-Cola, Home Depot and Target.
“I would hope the court realizes that law firms and companies don’t sue the government on a whim. That while the payout could be significant, they would not do this without having looked at it carefully and done the due diligence to make sure the case is legitimate,” a lawyer told Inside U.S. Trade. “You don’t pull the trigger on suing the government lightly. I think the number of cases and the well-regarded law firms — that should have some impact on any judge’s views of the validity of the claims. I don’t think they can ignore that.”
Sandy Williams
Read more from Sandy WilliamsLatest in Trade Cases
US and Canada expect positive outcomes from tariff negotiations
Canadian Prime Minister Mark Carney and US President Donald Trump told reporters at the White House on Tuesday that they’ll be formulating a trade deal that works for both nations.
Leibowitz: When the shutdown should end
There is no doubt that the current government shutdown reflects the vast divisions between the extremes of American politics, society, and even geography. Almost all Americans agree that government is necessary, but voters disagree...
Price: The U.S. Steel shutdown that wasn’t and a call to stop ‘valuation cheating’
How can the U.S. government block U.S. Steel’s Granite City rolling mill closure without harming other American steelmakers? Reducing imports should be the first step. Foreign producers continue to aggressively target the U.S. market, especially now as they find themselves displaced by Chinese exports.
US steel industry applauds ITC final determination in coated trade case
Domestic mills praised the US International Trade Commission’s (ITC's) final determination that imports of corrosion-resistant (CORE) steel from 10 countries pose a threat to them.
ITC’s final ruling: Dumped, subsidized CORE imports are harming domestic market
The US International Trade Commission (ITC) finds that corrosion resistant steel (CORE) imports from 10 countries have caused material damage to domestic product producers, according to the ITC’s statement.