The Supreme Court may very well decide the tariff case before Xmas. We’ll see. Trump’s tariff actions are now being contested by an increasing number of countries and also larger companies. Trump has backed down in many of his confrontations.  Companies have already sued in the Court of International Trade to get refund of the billions of collected tariffs — in case the Supreme Court orders such refunds. Large companies are now pursuing such refunds, not just smaller ones. (Costco has just filed an action in the Court of International Trade.) Trump’s tariff policy has been totally chaotic and non-productive, on so many levels. We’ll know soon …………….

“But big businesses will end up paying the most in tariffs because of the immense volume of goods they import. They have so far been in wait-and-see mode, viewing that as a better strategy than stirring up a feud with the temperamental president …. Big business is now acting on what small businesses felt instantly: Tariffs are taxes on Americans. The largest companies had enough money to absorb some of those costs for a while, but time is running out, and they don’t want to pass them on to their customers.” “Costco’s Lawsuit and Tariff Refunds.” Washington Post (12.3.25).

“From the buy-in-bulk retailer Costco to the canned-tuna company Bumble Bee Foods, some businesses are racing to get in line for tariff refunds, anticipating that the Supreme Court will soon rule against President Trump and force him to return billions of dollars collected on imports…. A ruling against the president could also force the Trump administration to pay back a substantial portion of the roughly $200 billion it has collected in duties since the start of the year. While the Supreme Court offered little indication as to whether it would order such refunds, some businesses have started the legal legwork to obtain them anyway, aiming to beat the rush and recover their full tariff costs.” “Tariff Refunds and Companies Now Suing.” New York Times (12.4.25).

“How did the dispute over the tariffs start? Beginning in February, Trump issued a series of executive orders imposing tariffs. The tariffs can be divided into two categories. The first type, known as the “trafficking” tariffs, targeted products of Canada, Mexico, and China, because Trump says those countries have failed to do enough to stop the flow of fentanyl into the United States. The second category, known as the “worldwide” or “reciprocal” tariffs, imposed a baseline tariff of 10% on virtually all countries, and higher tariffs – anywhere from 11% to 50% – on dozens of them. In imposing the worldwide tariffs, Trump cited large trade deficits as an “unusual and extraordinary threat to the national security and economy of the United States.” One case was filed in the U.S. District Court for the District of Columbia by Learning Resources and hand2mind, two small, family-owned companies that make educational toys, with much of their manufacturing taking place in Asia. Another case challenging the tariffs was brought in the U.S. Court of International Trade by several small businesses, including V.O.S. Selections, a New York wine importer, and Terry Precision Cycling, which sells women’s cycling apparel. What are the laws at the center of the dispute over the tariffs? Article I of the Constitution gives Congress the power to “lay and collect Taxes, Duties, Imposts and Excises,” and it requires that “Bills for raising Revenue shall originate in the House of Representatives.” In issuing the executive orders that imposed the tariffs, Trump relied primarily on a 1977 law, the International Emergency Economic Powers Act. Section 1701 of IEEPA provides that the president can use the law “to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States,” if he declares a national emergency “with respect to such threat.” Section 1702 of the act provides that, when there is a national emergency, the president may “regulate … importation or exportation” of “property in which any foreign country or a national thereof has any interest.” Has the Supreme Court addressed this question? The Supreme Court has not weighed in on the president’s power to impose tariffs under IEEPA. United States v. Yoshida International, a 1975 decision by the U.S. Court of Customs and Patent Appeals, is perhaps most relevant to the current tariff debate because of the similarities between IEEPA and the text of the law at the center of that case, the Trading with the Enemy Act of 1917. That case began as a challenge to then-President Richard Nixon’s imposition of a 10% temporary tariff on imports in response to a large trade deficit, which in 1971 was a relatively unusual development in U.S. history. In 1974, the U.S. Customs Court – the predecessor to the Court of International Trade – ruled that Nixon did not have the power under the Trading with the Enemy Act, which allowed the president in the case of an emergency to “regulate … the importation … of … any property in which any foreign country or a national thereof has any interest.”   In response to the ruling by the Customs Court, a provision of the Trade Act of 1974 specifically gave the president the power to impose tariffs to “deal with large and serious United States balance-of-payment deficits,” but – at the same time – the law limited tariffs to a maximum of 15% and a duration of five months. The Court of Customs and Patent Appeals reversed the decision of the Customs Court, concluding that Nixon had the authority to impose the tariffs after all. The 10% tariff, the court explained, was a “limited” one imposed “as ‘a temporary measure’ calculated to help meet a particular national emergency, which is quite different from ‘imposing whatever tariff rates he deems desirable.’” What are the challengers’ arguments? The challengers contend that – unlike other laws that directly deal with tariffs – IEEPA doesn’t mention tariffs or duties at all, and that no president before Trump has ever relied on IEEPA to impose tariffs. And the government has not provided an example of any other law, they add, in which Congress used the phrase “regulate” or “regulate … importation” to give the executive branch the power to tax. Interpreting IEEPA to give the president the power to impose unilateral worldwide tariffs would create a variety of constitutional problems, the challengers before the Federal Circuit also contend.  First, they write, it would run afoul of a doctrine known as the major questions doctrine, they say, which requires Congress to be explicit when it wants to give the president the power to make decisions with vast economic and political significance. Allowing the president to rely on IEEPA to impose the tariffs would also violate the nondelegation doctrine – the principle that Congress cannot delegate its power to make laws to other branches of government. How did the lower courts rule on these cases? In the cases brought by V.O.S. Selections and the other small businesses as well as the states, the CIT on May 28 ruled for the small businesses and the states, and it set aside the tariffs. The CIT reasoned that IEEPA’s delegation of power to “regulate … importation” does not give the president unlimited tariff power. The limits that the Trade Act sets on the president’s ability to react to trade deficits, the court continued, indicates that Congress did not intend for the president to rely on broader emergency powers in IEEPA to respond to trade deficits. The “trafficking” tariffs are also invalid, the CIT continued, because they do not “deal with an unusual and extraordinary threat,” as federal law requires. Instead, the CIT concluded, Trump’s executive order tries to create leverage to deal with the fentanyl crisis. The U.S. Court of Appeals for the Federal Circuit, which hears appeals from the Court of International Trade, put the CIT’s ruling on hold while the government appealed. By a vote of 7-4, a majority of the Federal Circuit agreed that “IEEPA’s grant of presidential authority to ‘regulate’ imports does not authorize the tariffs” that Trump had imposed. In the case in federal court in the District of Columbia, U.S. District Judge Rudolph Contreras ruled for Learning Resources and hand2mind, agreeing with them that “the power to regulate is not the power to tax.” Contreras’ order was a narrow one, barring the government only from enforcing the tariffs against Learning Resources and hand2mind, and he put that decision on hold while the government appealed. “ “Trump’s Tariffs – Summary of Case.”  Scotus Blog (10.30.25).

“This momentous case must either undermine or buttress the Constitution’s architecture: the separation of powers. Six amicus briefs explain why …. The conservative Goldwater Institute and the liberal Brennan Center separately argue that the statute the president says gives him unreviewable power to impose taxes (which tariffs are)  … does no such thing …. A brief from a broad spectrum of economists argues: Even if the IEEPA permits imposing tariffs (it has never been so used), tariffs would not “deal with” (IEEPA language) trade deficits. Besides, over the past 50 years, in any given year, most countries have run trade deficits …. A brief from the New York University School of Law’s Institute for Policy Integrity stresses the “major questions” doctrine, which protects Congress from having its words twisted to unintended purposes. It holds that Congress does not cryptically delegate enormous powers. Presidents claiming such delegated powers must cite specific congressional language ….  A brief by three Cato Institute researchers refutes the extralegal doomsaying the administration uses, perhaps to compensate for the weakness of its legal arguments …. The administration says tariffs imposed under the IEEPA are indispensable for negotiating agreements with trading partners. But since the IEEPA’s 1977 enactment, 14 regional and bilateral agreements have been reached, without any IEEPA tariffs.” “S. Ct. Tariff Case – Separation of Powers.” Washington Post (11.1.25).