The United States in June imposed double-digit tariffs on 59 countries and the European Union, charging that they had not done enough to crack down on imports produced by forced labour.
The new tariffs took effect just as the clock ran out on temporary tariffs President Donald Trump had turned to after the Supreme Court defeat.
"After losing at the Supreme Court, the administration is once again trying to illegally raise taxes on families and businesses with a new round of tariffs," said New York Attorney-General Letitia James.
Joining New York in the lawsuit announced on Monday are Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Kentucky, Massachusetts, Maryland, Maine, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania, Rhode Island, Virginia, Vermont, Washington and Wisconsin.
Trump, who argues high tariffs will revive American manufacturing, in 2025 overturned decades of US policy that favoured lower tariffs and ever-freer trade.
Invoking the 1977 International Emergency Economic Powers Act, or IEEPA, he imposed double-digit tariffs on imports from almost every country, saying America's longstanding trade deficit amounted to a national emergency.
But the Supreme Court ruled that IEEPA did not authorise tariffs. The decision forced the administration to send refunds to importers who had paid the tariffs.
Eager to make up the lost revenue, Trump turned to temporary 10 per cent worldwide tariffs. But they expired at midnight on July 24.
Now he is tapping more durable tariffs under Section 301 of the Trade Act of 1974, which permits the president to impose import taxes and other sanctions against countries found to engage in unfair trade practices. Trump used Section 301 to impose big tariffs on China in his first term, and they survived court challenges.
The administration invoked Section 301 to impose the forced-labour tariffs, which range from 10 per cent to 12.5 per cent and hit countries that provide 99 per cent of American imports.
The states' lawsuit follows two other lawsuits filed in The Court of International Trade in July by small businesses that also challenged the 301 tariffs.
Both of those lawsuits argue the government didn't adequately establish its case against each specific economy or spell how the tariffs will eliminate the specified practice they are being levied for, as required by Section 301.
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