US appeals court keeps Trump tariffs in place while it considers a legal fight of 'exceptional importance'
A federal appeals court ruled Tuesday night that President Trump's 'Liberation Day' tariffs could stay in force while it considers whether the president has the ultimate legal authority to impose the duties.
The US Court of Appeals for the Federal Circuit in Washington, D.C. granted the administration's request to let the tariffs stand pending a review of a decision made by a lower court to invalidate the levies.
"The court concludes a stay is warranted under the circumstances," the judges wrote in the order.
The court set an expedited schedule for the dispute and ordered the administration and its challengers to be prepared for oral arguments on July 31.
The court noted the decision on the stay was made by the court's full panel of judges, aside from those recused or disqualified from considering the issue.
And because the dispute over the president's authority to invoke the tariffs raised issues of "exceptional importance," its full panel of judges would also decide the merits of the case.
The president is seeking a definitive legal victory from the appeals court after a three-judge panel at the US Court of International Trade (CIT) said in May that he lacked authority to impose his "Liberation Day" duties under the International Economic Emergency Powers Act (IEEPA).
The group of importers and Democratic-led states that prevailed in the trade court argued that the administration's basis for the tariffs — a national emergency caused by illegal immigration and flows of illegal drugs from overseas — was unauthorized because it did not directly address the stated emergency.
That decision was temporarily put on hold by the federal appeals court, and the administration argued in a court document Monday that reimposing the CIT's injunction that invalidated the tariffs would risk "irreparable economic and national security harms."
"The injunction unilaterally diminishes America's bargaining position during sensitive trade negotiations, encouraging other countries to hold our nation hostage," the administration said.
The CIT's decision, it said, usurped political choices, putting the judiciary in a central role in managing foreign negotiations, the national economy, and national security.
In addition, the administration said, it would likely prevail over the lower court's ruling on appeal because the lower court misapplied the text of the IEEPA. That court's interpretation of the law would "unnaturally cabin" the president's tariff authority, the administration said.
The CIT ruled that the president lacked power under IEEPA to impose the duties, saying "any interpretation" of IEEPA "that delegates unlimited tariff authority is unconstitutional."
Legal experts expect this case to eventually be taken up by the Supreme Court.
That could mean the Trump administration will have to grapple with the hurdle of the 'major questions doctrine,' which limits the authority of federal agencies to take action on issues of "vast economic and political significance" except where Congress has explicitly authorized the action.
Trump's legal team is looking to former President Nixon as proof that his global tariffs should be allowed to eventually stand in court.
Roughly five decades ago, 10% duties unilaterally imposed by the 37th president as part of a set of economic measures dubbed the "Nixon shock" were challenged in court in much the same way as Trump's 2025 tariffs have been.
And Nixon's duties also suffered an initial defeat.
What has emboldened the Trump administration is that the Nixon-era Justice Department eventually won its case on appeal, an outcome the Trump administration has cited in court documents, predicting that its legal saga would likely turn out the same way.
It has told the US Court of Appeals for the Federal Circuit that "the Federal Circuit's predecessor concluded that the very same language that today exists" in a law used by Trump to justify his tariffs "gave President Nixon the power to impose an import duty surcharge."
Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on X @alexiskweed.
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