On September 11, 2020, a lawsuit was filed challenging the legality of the Section 301 tariffs on China. It specifically challenges List 3 and List 4. Over 3,000 additional plantiffs have filed copy cat cases.
On March 12, 2021, the government filed its outline of ANTICIPATED DEFENSES
1. USTR was acting at the direction of the President in promulgating List 3 and List 4, and the President is not subject to the Administrative Procedures Act (APA).
2. Review of the President’s discretionary decisions, and USTR’s implementation of those decisions, present a non-justiciable, political question.
3. Even if the challenged actions could be considered actions of USTR, substantial deference is afforded, and the Court should not interpose because there was no clear misconstruction of a governing statute, significant procedural violation, or action outside delegated authority.
4. USTR (acting at the direction of the President) possessed the authority under Section 307 of the Trade Act to promulgate List 3 and List 4, because the burden or restriction on United States commerce of China’s acts, policies, and practices that were the subject of the Section 301 action continued to increase, including following the one-year investigation period, and because the previous actions taken in response to the Section 301 investigation proved to no longer be appropriate, as the actions were not effective in eliminating the unfair trade practices that were the subject of that investigation. In addition, Section 307 does not limit modifications to merely delaying, tapering, or terminating an action.
5. Alternatively, if the challenged actions constitute agency action, they are exempt from the APA’s informal rulemaking requirements, because they qualify for the foreign affairs function exception.
6. Even if the APA’s informal rulemaking requirements apply, USTR’s actions in promulgating List 3 and List 4 complied with all statutory requirements, and they were not arbitrary and capricious, contrary to law, or in excess of statutory authority.
More information is available at https://news.bloomberglaw.com/international-trade/biden-white-house-defends-trump-china-tariffs-in-legal-showdown.