Overview
- The three-judge panel, which heard arguments Friday, pressed the Justice Department on whether a trade gap counts as a legally valid “balance of payments” problem under the 1974 statute.
- Section 122 lets a president impose up to 15 percent duties for 150 days to address a large and serious payments deficit, and Trump used it to set a 10 percent near-global tariff on February 24 after the Supreme Court rejected his IEEPA tariffs four days earlier.
- Twenty-four mostly Democratic-led states and several small businesses sued, saying the law targeted short-term currency crises tied to the old gold-linked dollar rather than today’s routine trade deficits.
- Government lawyer Brett Shumate argued the trade deficit feeds a broader payments shortfall that fits the law, while an opposing attorney urged the court to apply the major questions doctrine given the sweeping economic impact.
- The judges set no ruling date, and the duties lapse in July unless extended by Congress, as the White House describes the 150-day measure as a bridge to other authorities for longer-term tariffs.