Trump’s Escalation of China Trade War Draws Wave of Lawsuits

The Trump administration’s expansion of tariffs on Chinese goods has drawn a flurry of challenges from domestic importers at the U.S. Court of International Trade.

They filed over 300 cases Thursday and Friday, more than all the cases filed in the trade court all year.

Complaints for some of the cases weren’t available by midday Friday. But those that were challenge President Trump’s decision to expand “Section 301" duties on goods from China under the Trade Act of 1974.

The Office of the U.S. Trade Representative conducted an investigation into China’s intellectual property policies and practices under Section 301. It found that certain “acts, policies, and practices of the Chinese government related to technology transfer, intellectual property, and innovation are unreasonable or discriminatory and burden or restrict U.S. commerce.”

The U.S. initially imposed duties on $50 billion worth of Chinese goods in response. After China retaliated with duties on U.S. goods, the administration in 2018 greatly expanded the Section 301 duties to cover Chinese goods worth hundreds of billions of dollars.

The importers’ new challenges to duties come right before the trade court’s two-year statute of limitations, which runs out Sept. 21.

Some of the hundreds of plaintiffs include Concepts In Time LLC, an importer of home decorative accessories; Diamond Sports, an importer of sports bags; and Safco Products Co., an importer of office furniture.

Common arguments include that the administration waited too long to expand the tariffs and didn’t adequately seek public input.

The importers also argue the decision was improperly motivated by factors other than China’s IP and technology practices.

For example, Tweets from President Trump indicate the U.S.-China trade imbalance and China’s currency policy were factors, they say.

The companies seek an injunction against the tariff expansion and a refund of the duties they’ve already paid. Their cases will likely be consolidated.

The importers have an uphill battle for legal relief, however, given the level of deference courts generally extend to the government in international trade matters, Stefan H. Reisinger, a trade attorney at Norton Rose Fulbright US LLP, told Bloomberg Law.

The government is also likely to vigorously contest the lawsuits, and will appeal any adverse rulings by the trade court, meaning a final resolution of the cases could take years, Reisinger added.