US Court of International Trade Strikes Down Trump Administration Tariffs
In a landmark decision on May 28, the U.S. Court of International Trade (CIT) ruled that President Donald Trump exceeded his authority by imposing broad tariffs under the International Emergency Economic Powers Act (IEEPA). The court's unanimous decision declared that IEEPA does not grant the president the power to unilaterally impose tariffs without congressional approval, reaffirming the constitutional principle that Congress holds exclusive authority over trade regulation.
The Catalyst: Trump Liberation Day Tariffs
On April 2, now dubbed "Liberation Day," President Trump announced a series of sweeping tariffs aimed at correcting what he described as decades of unfair trade practices. These included a baseline 10% tariff on all imports, with additional "reciprocal" tariffs ranging from 11% to 50% on specific countries like China, Mexico, and Canada. The administration justified these measures under IEEPA, citing national emergencies related to trade deficits and the influx of illegal drugs. For more information on the Liberation Day tariffs, see Constitution Partners analysis.
The CIT Decision
In its 63-page opinion, a three-judge panel of the CIT unanimously held that the Trump administration had exceeded its statutory and constitutional authority by using IEEPA to impose a broad and ongoing schedule of tariffs.
"The worldwide and retaliatory tariff orders exceed any authority granted to the President by IEEPA to regulate importation by means of tariffs,” the court wrote, rejecting the administration’s claim that a trade imbalance or drug trafficking constituted a national emergency justifying such action."
The CIT's ruling stemmed from two consolidated lawsuits: one filed by a coalition of 12 states led by Oregon Attorney General Dan Rayfield, and another by the Liberty Justice Center representing five small businesses adversely affected by the tariffs. The court found that IEEPA does not authorize the president to impose tariffs in the manner executed by the Trump administration.
There were three significant holdings laid out by the court:
IEEPA: IEEPA does not give Trump the power he claims tp impose tariffs of any amount, upon any nation, for any duration. The court determined that the IEEPA statute cannot be read and interpreted to mean that the president has unchecked authority over tariff policy. It holds that if Congress had intended to give the president full authority over tariffs, then the statute would violate the Constitution's separation of powers, since Congress cannot give away its full authority over tariffs to the president.
Addressing Nation's Trade Deficit: Part of the justification for the broad tariffs was the need to address the United States trade deficit. The court explains that in order to address this specific issue, the administration would need to use a separate federal law, Section 122 of the Trade Act of 1974. In short, Section 122 allows the president to impose a 15% or lower tariff rate that would remain in effect for 150 days. So although the administration has not singled as to whether or not they will use Section 122, any tariffs imposed would only be in effect for five months.
"Unusual and Extraordinary Threat": The IEEPA statute states that it may be used to counter an "unusual and extraordinary" threat to the nation. On Liberation Day, President Trump said that the tariffs would be used to stop the flow of illegal drugs into the country, particularly from Canada and Mexico. The court argued that the tariffs do not do anything to explicitly counter the flow of drugs into the United States. They stated, “However sound this might be as a diplomatic strategy, it does not comfortably meet the statutory definition of ‘dealing with’ the cited emergency,” the court argues, adding that “it is hard to conceive of any IEEPA power that could not be justified on the same ground of ‘pressure.’”
Click here to read the full opinion.
Aftermath & Reactions
Following the CIT's decision, the Trump administration swiftly appealed. On May 29, the U.S. Court of Appeals for the Federal Circuit granted a temporary stay, allowing the tariffs to remain in effect pending further review. The appeals court has set deadlines for both parties to submit briefs, with the plaintiffs' responses due by June 5 and the government's reply by June 9.
The court's ruling has significant implications for U.S. trade policy and the economy. Analysts estimate that the invalidated tariffs could have generated nearly $200 billion annually. The uncertainty surrounding the tariffs has already impacted global trade negotiations, with countries like the European Union reconsidering their approach to trade talks with the U.S
Politically, the decision has sparked debates over the extent of executive power. While the White House criticized the ruling as judicial overreach, legal experts argue that it reinforces the constitutional balance between the legislative and executive branches. The administration's reliance on IEEPA for trade measures has been viewed by some as an overextension of presidential authority.
Congress has been attempting to legislate on the IEEPA tariffs since April. In response to concerns over executive overreach, bipartisan efforts in Congress have led to the introduction of the Trade Review Act of 2025. This proposed legislation aims to reassert congressional authority over trade policy decisions by requiring the president to notify Congress of any new tariffs, provide economic justifications, and obtain congressional approval for those tariffs to remain in effect beyond 60 days.While there was quite a bit of momentum on these measures early on, reconciliation has slowed any progress. The injunction will likely bring trade legislation back to the forefront. The CIT's decision marks a pivotal moment in the ongoing debate over the scope of presidential authority in trade matters.