Horolonomics

Early last week I started listening to the latest episode of Openwork, a podcast by the good people at Collective Horology.

Collective was founded by two former Facebookers as a retailer of high-end independent watch brands from different parts of the world (there's more to Collective's history and you can read about it here). I've visited Collective's booth at a couple Windup events and I enjoy the podcast. It is business-oriented, primarily, which I find very informative.

At the beginning of the podcast, Collective shared a statement mentioning that the retailer joined a lawsuit filed in opposition to the most recent round of tariffs by the Trump administration. I found this very interesting so I went ahead and downloaded the lawsuit. I also watched a Collective co-founder's interview during a CNN segment covering the lawsuit. Here's what I learned.

The Collective lawsuit is filed against the US Trade Representative, the President of the United States and the Commissioner of US Customs and Border Patrol. Collective and their co-plaintiff are represented by a libertarian law firm in Washington DC. It is fairly undebatable that the Trump Administration tariffs represent a significant interference in the operation of international markets, something libertarians generally do not appreciate. Nor, for that matter, do importers.

For those keeping score at home, the round 1 "liberation day" tariffs, supposedly grounded in the International Emergency Economic Powers Act, were ruled unconstitutional by the US Supreme Court on February 20, 2026. At present, importers who paid the now-nullified tariffs can apply for refunds and roughly $90 billion of the illegal tariff revenue has been returned. Not to be deterred, the Trump administration pivoted and implemented new tariffs under Section 122, a completely different law. Those, too, were nullified (this time by the US Court of Internationl Trade), a decision which is under appeal.

The do-si-do dance of laws used as a basis for tariffing imports has now ensnared a third law: Section 301. My informal, non-legal, description of this law is that it requires the government to conduct a study of policies in other countries which harm American commercial interests through trade. Once this study is conducted, a new tariff rule may be circulated to the public thereby allowing time for public comment. Subsequent to that period, the proposed tariff rule may be implemented.

The lawsuit reveals that, in the near future, Collective expects to pay $8,280 in customs duties while importing watches worth $69,000 under the new duty regime.

In addition, Collective is waiting for the return of over $160,000 which the government illegal collected under the now-unconstitutional "liberation day" tariffs (see the CNN interview).

There are three main allegations that Collective and their co-plaintiff make in their lawsuit: 1) that the tariffs exceed the legal authority which the government has invoked to justify the duties 2) that the tariffs are "arbitrary, capricious and contrary to law" and 3) even if the tariffs are allowed under the relevant law, the law itself is unconstitutional (ie violates the nondelegation doctrine).

The first and third of these claims are largely questions of law and I'm just going to step over all of that because I am not qualified to go into it. But I think the second claim is worth discussing here because I think there is evidence which supports this claim.

The lawsuit observes that there is a striking uniformity to the most recent round of tariffs. Those duties are justified as a response to supposedly inadequate prevention of forced labor in the countries facing the new duties. As the lawsuit points out, it is hard to believe that the 60 economies facing these new tariffs are uniformly bad at preventing forced labor. For example, India faces a 10% tariff which is equal to the UK tariff rate. But India's rate of forced labor is more than quadruple the rate of the UK according to data published by Walk Free.

That same data speaks to other questionable aspects to the "forced labor" basis for the tariffs. In its lawsuit, Collective lists the countries it imports watches from.

They are Switzerland, the UK, France, Austria, Denmark and the Netherlands. Using the same Walk Free data, the average incidence of forced labor per thousand for these countries is 1.233. In comparison, the incidence of forced labor in the United States is 3.33, more than double the rate of countries Collective does business with (you may wonder why the US has such a comparatively high rate, I believe part of the reason lies in the fact that forced labor is, constitutionally, still an acceptable form of punishment under the 13th Amendment, check out this documentary to learn more).

It isn't hard to argue that, based upon this evidence, Collective's import activities reduce the prevelance of products produced through forced labor rather than increase it. From that perspective, it seems a bit odd that the watch retailer would be told it has to pay an extra tax because of concerns over forced labor.

In any event, given the rate at which the US government's tariffs have failed to pass judicial review, my guess is that Collective and their co-plaintiff enjoy decent odds that they will succeed. If they are successful, it is possible that many industries and US consumers will enjoy relief from the most recent round of duties.

The case in question is Burlap and Barrel, Inc; Collective Horology LLC v Jamieson Greer, Donald J. Trump and Rodney S. Scott filed in the US Court of International Trade, Case No. 26-03345. Also note that I reached out to Collective for comment on this post but I have not as yet received a response.

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