On May 28, 2025, the Court of International Trade (CIT) ruled that President Trump’s tariffs, imposed under the International Emergency Economic Powers Act (IEEPA), exceeded the President’s authority under that law, siding with small import-reliant businesses and twelve states that challenged the policy. The next day, the Administration appealed and the Federal Circuit court granted a temporary stay, allowing the tariffs to remain in effect while the appeal is considered.

This case brief lays out some of the basics you need to understand this case and what’s to follow. 

Timeline of Trump tariffs and executive orders:

The administration cites national emergencies related to drug trafficking, human trafficking, and persistent trade deficits as the basis for tariffs imposed under the IEEPA. The government’s stated goal is to “bring our trading partners to the table.” 

January 20, 2025:

  • Proclamation 10886: Declared a national emergency at the southern border, citing threats from cartels, traffickers, and smugglers.
  • Executive Order 14157: Designated cartels and transnational criminal organizations as foreign terrorist organizations, enabling the use of emergency economic powers.

February 1, 2025: Executive Orders 14193 (Canada), 14194 (Mexico), and 14195 (China) imposed trafficking-justified tariffs of 25% on most goods from Mexico and Canada, and 10% on goods from China. 

  • These “trafficking tariffs” were justified as a response to the influx of illicit drugs and illegal immigration from these countries. The administration cites the flow of synthetic opioids like fentanyl and human trafficking as national security threats, arguing that the tariffs will pressure the governments to crack down on these activities.

February 3, 2025: Executive Orders 14197 and 14198 temporarily paused the tariffs on Mexico and Canada for 30 days.

March 3, 2025: Executive Order 14228 raised the tariff on Chinese goods from 10% to 20% citing China’s insufficient actions to address the synthetic opioid crisis.

April 2, 2025: “Liberation Day” tariffs announced. Executive Order 14257 imposed a universal 10% tariff on nearly all imports, with additional surcharges ranging from 11% to 50% on goods from 57 nations.

  • The Order offers this justification: “[L]ack of reciprocity in our bilateral trade relationships, disparate tariff rates and non-tariff barriers, and U.S. trading partners’ economic policies that suppress domestic wages and consumption, as indicated by large and persistent annual U.S. goods trade deficits, constitute an unusual and extraordinary threat to the national security and economy of the United States.”

April 8–9, 2025: Executive Orders 14259 and 14266 increased the surcharge targeting China first to 84% and then to 125%.

May 12, 2025: Executive Order 14298 temporarily reduced the surcharge on Chinese goods back to 10%.

Parties Involved:

  • Plaintiffs: V.O.S. Selections, Inc. and four other small import-reliant businesses affected by the tariffs. Also, 12 states: Oregon, Arizona, Colorado, Connecticut, Delaware, Illinois, Maine, Minnesota, Nevada, New Mexico, New York, and Vermont.
  • Defendants: United States Government, including agencies such as Customs & Border Protection and the Department of Commerce, responsible for implementing and enforcing the tariffs.

Courts:

  • Court of International Trade (CIT): A federal trial-level court with nationwide exclusive jurisdiction over cases involving international trade and customs laws. It operates under Article III of the Constitution, granting its judges lifetime appointments. 
    • The judges who ruled on the tariff case: Judge Timothy M. Reif, appointed by Donald Trump in 2019; Judge Jane A. Restani, appointed by Ronald Reagan in 1983; Judge Gary S. Katzmann, appointed by Barack Obama in 2016. 
  • Court of Appeals for the Federal Circuit: A specialized federal appellate court with nationwide jurisdiction over specific subject areas (including international trade) rather than geographic regions. Designated to hear appeals from CIT. 

The legal question on the merits: Does the President have authority under the Emergency Economic Powers Act (IEEPA) to unilaterally impose broad tariffs on imports by declaring national emergencies related to trafficking and trade deficits?

The laws at play in the tariff case:

  • The Constitution (Article I, Section 8):
    Gives Congress—not the President—the power to set tariffs and regulate trade with other countries.
  • IEEPA (International Emergency Economic Powers Act, 1977):
    Allows the President to take action during a national emergency tied to foreign threats, but only if there’s a direct link to an “unusual and extraordinary threat” from outside the U.S.
  • Trade Act of 1974, Section 122:
    Permits temporary tariffs to address trade imbalances, but with clear limits. The court said the administration sidestepped this law by using IEEPA to impose broader tariffs.

Trade Expansion Act of 1962, Section 232:
Lets the President impose tariffs if imports are found to harm national security. Trump used this law for steel and aluminum tariffs, but those were not part of this ruling.

What did the Court of International Trade decide?

  • The IEEPA does not provide the President with unrestricted tariff-setting powers: “Because of the Constitution’s express allocation of the tariff power to Congress… we do not read IEEPA to delegate an unbounded tariff authority to the President.”
  • The cited threats (trafficking, trade deficits) do not meet the legal requirement: “IEEPA’s limited authorities may be exercised only to ‘deal with an unusual and extraordinary threat’… and may not be exercised for any other purpose.”
  • Quoting a prior appellate opinion, the court warned: “The declaration of a national emergency is not a talisman enabling the President to rewrite the tariff schedules.”
  • The court also found violations of the nondelegation and the major questions doctrines:  
    • “[A]n unlimited delegation of tariff authority would constitute an improper abdication of legislative power… any interpretation of IEEPA that delegates unlimited tariff authority is unconstitutional.”
    • “Under the major questions doctrine, when Congress delegates powers of ‘vast economic and political significance,’ it must ‘speak clearly.’”
  • The court vacated the tariffs and permanently enjoined their enforcement. 

What’s Next?

  • The Federal Circuit will soon decide whether Trump’s tariffs remain in effect while the appeal moves forward. Plaintiffs submit their briefs by June 5, the government responds by June 9, and a ruling on that question could come shortly after.

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