The Court of International Trade published their opinion and order today regarding the Trump Administrations use of Section 122 of the Trade Act of 1974.  In a 2-1 majority, the CIT found the underlying basis of a “balance-of-payment imbalance” was not properly used by the administration as it was designed in the 1974 legislation, therefore rendering the use of Section 122 unlawful.

The argument was brought to the CIT by a group of 24 US States, led by Oregon along with a case filed by importers Burlap and Barrel, Inc. and Basic Fun, Inc. in March.

As a result, the CIT issued an order that Section 122 tariffs are no longer to be collected with respects to the State of Washington acting as an importer, and both private importers Burlap and Barrel and Basic Fun. Summary judgment was denied for the other 23 States for lack of standing.

This outcome does not prevent Section 122 tariffs from being collected for all other importers.

It is expected that the Trump administration will issue swift appeal, asking for a stay on the issued injunction pending an appeal.