California's Tariff Lawsuit Dismissed by US District Court: What’s Next?

On April 16, 2025, the Governor of California and the California Attorney General filed a lawsuit in Federal Court against US President Donald Trump, claiming that he overstepped his authority when he unilaterally enacted tariffs.

On June 3, 2025, US District Judge Jacqueline Corley in San Francisco dismissed the lawsuit without addressing the merits of the case. However, the judgment provides for an option to appeal against the decision.

Reason for Dismissal

The primary reason for dismissal was that the US District Judge Corley determined that the State of California should have filed a lawsuit before the Court of International Trade (CIT) instead. Since the central issue in the dispute is executive orders imposing tariffs, and not whether tariffs are constitutional, as stated by Judge Corley, CIT has the exclusive jurisdiction to rule in tariff disputes in the US.

However, the State of California did not want its case to be transferred to the CIT, and instead requested dismissal. By doing so, California maintained the right to appeal before the US Circuit Court of Appeals. California's Attorney General Rob Bonta argues that since the International Emergency Economic Powers Act does not authorize tariffs at all, the dispute can be settled before any Federal Court.

On the contrary, the White House claims that the question of tariffs can only be settled before the CIT, which has exclusive jurisdiction over the matter. Therefore, throughout the procedure before the US District Court, the government requested that the case be transferred to the CIT.

In the end, although Judge Corley emphasized that the case should have been initiated before the CIT, she decided to dismiss the lawsuit rather than transfer it to the CIT, as the Government failed to clearly explain or justify why transferring the case would be fair or in line with justice. 

Conclusion

Considering all the statements from the decision, as well as the statements of both parties after its publication, it is fair to say that neither side is willing to relinquish their claims. Therefore, it is expected that the State of California will appeal to the Court of Appeals against this decision, and the Government will continue to insist that the case be transferred to the Court of International Trade.

In addition to this lawsuit, the US Government is also facing another lawsuit before the US Court of International Trade (CIT), brought by two separate cases: V.O.S. v. United States, involving impacted small businesses, and a coalition of US state governments in Oregon v. United States.

Source: US District Court - Northern District of California, Reuters, VATabout - California Sues to Stop US Tariffs Imposed by Trump, Citing Economic Harm, VATabout - Federal Court Blocks Trump's Tariffs; Court of Appeals Pauses Ruling