California Governor Gavin Newsom has taken a bold step by filing a lawsuit against President Donald Trump over his recent tariffs. This legal action aims to challenge Trump’s use of emergency powers to impose tariffs on imports from Mexico, China, and Canada. Newsom argues that these tariffs are harming consumers and businesses in California, which is known for having the fifth-largest economy in the world.
In a complaint submitted to a federal court in San Francisco, Newsom highlighted the negative effects the tariffs have had on the economy. He stated that the new tariff regime has caused chaos in financial markets, leading to significant losses in market value and chilling investment. The governor warned that these actions threaten to push the country into a recession.
Newsom, a Democrat who may run for president in 2028, along with California Attorney General Rob Bonta, is seeking a court order to block the tariffs immediately. At a press conference, Newsom expressed concern that California stands to lose more than any other state from these measures, warning of severe consequences for the state’s budget and economy.
A spokesperson for the White House responded by criticizing Newsom’s focus on the tariffs instead of addressing issues like crime and homelessness in California. The president’s use of the International Emergency Economic Powers Act (IEEPA) to impose tariffs is unprecedented and has created uncertainty in the markets, prompting fears of a recession and strained international relations.
The IEEPA, which was enacted in 1977, allows the president to regulate financial transactions during a national emergency. Historically, it has been used for sanctions rather than tariffs. Trump is the first president to leverage this act for tariffs, claiming it is a response to the threats posed by undocumented immigration and illegal drugs.
California’s lawsuit aligns with other legal challenges against Trump’s tariffs. Previous cases have argued that the IEEPA does not grant the president the authority to impose tariffs without congressional approval. Bonta emphasized that Congress has not authorized these tariffs, and the inconsistent nature of their implementation creates confusion and instability.
Justice Department lawyers have suggested that these tariff disputes should be handled by the Court of International Trade in New York, which specializes in trade-related cases. They are seeking to transfer ongoing cases from district courts to this trade court.
California has previously challenged several of Trump’s executive actions, including efforts to end birthright citizenship and freeze federal grants. Newsom has positioned himself as a national figure on various issues, and with his second term ending in 2026, speculation about a presidential run is growing.
California plays a vital role in the U.S. economy, contributing about 14% of the nation’s GDP. The state has a population of 40 million and would rank as one of the largest economies globally if it were independent. The agricultural sector is crucial, with California exporting $24 billion in goods in 2022, including significant contributions from almonds, dairy, and wine.
Newsom mentioned that the tariffs have already forced him to revise the upcoming state budget, anticipating a downturn in economic growth and increased unemployment. He has also indicated plans to seek exemptions directly from global trading partners, although the feasibility of such actions remains uncertain.
The case is officially titled State of California v. Trump, and it is being heard in the U.S. District Court for the Northern District of California.