State leaders and a Florida retailer argue in federal court that using the 1977 IEEPA to levy broad import duties oversteps presidential authority, disrupts California’s $675 billion trade network, and forces costly price hikes on small businesses
California’s top officials opened a new front in the tariff wars on April 16 by suing President Donald Trump in the U.S. District Court for the Northern District of California, alleging that his sweeping use of the International Emergency Economic Powers Act (IEEPA) to levy import duties exceeds statutory and constitutional limits and deals a costly blow to the state’s $675 billion trading economy.
Governor Gavin Newsom and Attorney General Rob Bonta contend the emergency powers law written in 1977 to let presidents freeze assets or impose narrowly‑tailored sanctions “was not intended to authorize the unilateral imposition of tariffs,” yet the White House has invoked it to slap duties as high as 145 percent on China and 25 percent on Canada and Mexico.
Filed just hours after the new tariff schedule took effect, the complaint argues that the duties bypass Congress, violate the Constitution’s Commerce Clause, and threaten to cripple California ports that handle 40 percent of U.S. imports while raising consumer prices statewide.
State lawyers also cite the Supreme Court’s major‑questions doctrine, saying an action of such economic magnitude requires an explicit congressional mandate.
Midway through the 43‑page filing, Newsom’s team quotes the statute directly: IEEPA measures must be “necessary” to address an “unusual and extraordinary threat.”
Attorneys insist that targeting long‑standing trade partners fails that test.
The lawsuit further warns that retaliatory tariffs already announced by China and the EU could wipe out thousands of agricultural and logistics jobs.
California growers are especially vulnerable because more than 40 percent of their inputs arrive from the three countries now subject to the highest duties.
A separate action arrived the same day from the New Civil Liberties Alliance, which filed in Florida on behalf of Simplified, a stationery and home‑organization company whose owner says 20 percent duties on Chinese goods have driven up landed costs and forced price hikes.
The complaint echoes California’s, charging that the tariffs were imposed “without the necessary legal findings, procedures, or statutory authority” and that altering the U.S. tariff schedule by executive order violates both IEEPA and the Constitution’s non‑delegation doctrine.
Simplified does not dispute the existence of a national emergency tied to fentanyl shipments from China, but it argues that blanket tariffs are not “necessary” the very word Congress put in the statute as a tool to curb opioid trafficking.
Instead, the company says it now pays nearly 30 percent more for basic supplies such as paperboard and wire binding, costs that “leave small businesses no choice but to pass the burden to American consumers.”
Critics across party lines have grown louder since the White House announced what it calls “Liberation Day” tariffs: a baseline 10 percent duty on all imports plus higher tiers for 60 countries deemed unfair traders.
Economists warn the broader package could shave a full percentage point off U.S. GDP if fully implemented, while trade attorneys say the legal challenges have a solid chance because no prior president has tried to use IEEPA for across‑the‑board tariffs.
The stakes are immediate.
California alone exported $23.6 billion in agricultural goods last year and relies on friction‑free supply chains for everything from packaging materials to offshore cold‑storage space.
Industry groups fear protracted litigation will inject fresh uncertainty into planting decisions and capital spending just as growers contend with drought, labor shortages, and rising interest rates.
The administration insists it is acting within the law.
A White House spokesperson said the president “remains committed to addressing this national emergency with every tool at our disposal,” adding that the tariffs are designed to “rebalance trade and safeguard American jobs.”
Legal scholars, however, point to IEEPA’s decades‑long history as a sanctions statute and doubt that courts will condone its use as a blanket tax mechanism.
Should either lawsuit secure an injunction, tariffs could be suspended within weeks; absent that, attorneys predict a fast‑tracked appeal that may land before the Supreme Court during its next term.
Even if the courts ultimately rein in the executive branch, tariff opponents believe the disputes have already underscored the need for clearer statutory guardrails.
Bipartisan bills circulating on Capitol Hill would require congressional approval for any IEEPA‑based tariff lasting more than 90 days.
For now, businesses from California farm co‑ops to Florida stationery suppliers will watch the dockets and their balance sheets while the judiciary weighs how far a president can go when declaring a trade emergency.
