Competing Rulings on Trump Tariffs Cause Chaos
An appeals court has ruled that President Donald Trump's tariffs can move forward.
On Thursday, the U.S. Court of Appeals for the Federal Circuit put a hold on a decision from the U.S. Court of International Trade, which issued an injunction Wednesday against Trump's tariffs on China, Mexico, and Canada, among other trading partners.
The legal back-and-forth over the president's tariffs has left both sides scrambling and created uncertainty for policymakers and the business community alike.
Yet another ruling on Thursday by District Judge Rudolph Contreras further muddied the waters.
Contreras, an appointee of former President Barack Obama, ruled Thursday that the 1977 International Emergency Economic Powers Act (IEEPA)—which the Trump administration cited to justify imposing tariffs—'does not authorize the President to impose the tariffs set forth in the above-listed orders.'
This decision stops the administration from collecting tariffs from two Illinois toy importers, Learning Resources and hand2mind, which filed a lawsuit against the administration in April.
'That crushing burden is felt most immediately and acutely by this country's small and mid-size businesses, including Plaintiffs,' the lawsuit said.
Contreras gave the administration two weeks to appeal his decision.
On what Trump called 'Liberation Day' on April 2, the president imposed 10 percent tariffs on almost every United States trading partner as well as increased levies on countries such as China, on which he imposed a 30 percent tariff. Canada and Mexico were also slapped with 25 percent tariffs.
On Wednesday, a three-judge panel from the U.S. Court of International Trade, which included a 2018 Trump appointee, ruled that the IEEPA did not grant the president 'unbounded authority' to impose tariffs—a function that the Constitution relegates to Congress.
The panel added that Trump's tariffs 'exceed any authority granted' to the president by the IEEPA, declaring that most of his tariffs were issued illegally.
'The President's assertion of tariff-making authority in the instant case, unbounded as it is by any limitation in duration or scope, exceeds any tariff authority delegated to the President under IEEPA,' the judges wrote. 'The Worldwide and Retaliatory tariffs are thus ultra vires and contrary to law.'
However, the U.S Court of Appeals for the Federal Circuit put the ruling from the U.S. Court of International Trade on hold, saying the injunction would be 'temporarily stayed until further notice while this court considers the motions papers.' The injunction does not apply to Contreras' ruling today.
The Trump administration promptly filed a notice of appeal to challenge the court's decision.
The Department of Justice has requested to temporarily halt the court order, saying Thursday that it needed 'to avoid immediate irreparable harm to United States foreign policy and national security.'
'It is not for unelected judges to decide how to properly address a national emergency,' White House Spokesman Kush Desai said, noting that the Trump administration is committed to using 'every lever of executive power to address this crisis.'
Conspiracy theorist and stalwart Trump supporter Laura Loomer called the decision a 'JUDICIAL COUP' on X—a phrase also used by White House Deputy Chief of Staff Stephen Miller, who said, 'The judicial coup is out of control,' on Wednesday.
Despite the court ruling, the president could still find a way to impose his global tariffs, according to economists at Goldman Sachs.
'This ruling represents a setback for the administration's tariff plans and increases uncertainty but might not change the final outcome for most major U.S. trading partners,' they wrote in a research note, reported CNBC.
'For now, we expect the Trump administration will find other ways to impose tariffs,' they added.
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