Lawsuit Could End Trump Tariffs And Stock Market Rout
A new lawsuit aims to end the Trump administration’s sweeping tariffs by arguing the president’s use of emergency powers is unlawful. When Donald Trump signed an order to impose sweeping tariffs on countries worldwide, he did not use traditional trade law. Instead, Trump claimed authority under the International Emergency Economic Powers Act. However, no president has ever used that law to impose tariffs. If the new lawsuit or other legal actions succeed, the massive tariffs the Trump administration imposed on imports worldwide could largely disappear and provide relief for consumers, companies and investors…
Lawsuit Argues Trump Tariffs Are Unconstitutional
On April 3, 2025, the New Civil Liberties Alliance filed a complaint for injunctive and declaratory relief challenging the Trump administration’s use of the International Emergency Economic Powers Act. The lawsuit is on behalf of Simplified, a Pensacola-based company that imports goods from China and expects to pay higher tariffs because of the president’s executive order.
“Presidents can impose tariffs only when Congress grants permission, which it has done in carefully drawn trade statutes,” according to the complaint. The statutes limit the conditions and scope of the tariffs. “President Trump is attempting to bypass these constraints by invoking the IEEPA. But in the IEEPA’s almost 50-year history, no previous president has used it to impose tariffs. Which is not surprising, since the statute does not even mention tariffs, nor does it say anything else suggesting it authorizes presidents to tax American citizens.”
The complaint provides four primary reasons why the president’s recent tariff actions using the International Emergency Economic Powers Act are unlawful.
First, “[The] IEEPA does not authorize a president to impose tariffs. Basic tools of statutory construction dictate this conclusion.” The complaint argues, “Because the Executive Orders present a question of ‘vast economic and political significance,’ the major questions doctrine requires the President to show that the IEEPA ‘clearly’ authorizes him to impose tariffs. The President cannot make that showing.”
Second, “the China Executive Orders are ultra vires because the President has not—and cannot—meet the IEEPA requirement that he show the tariffs are ‘necessary’ to address the stated ‘emergency’ of illegal opioids.”
Third, “if IEEPA permits the China Executive Orders, then this statute violates the nondelegation doctrine because it lacks an intelligible principle that constrains a president’s authority. In that case, the IEEPA is unconstitutional because it delegates Congress’s prerogative to tax and to regulate commerce with foreign nations.”
Fourth, “the resulting modifications made to the HTSUS [Harmonized Tariff Schedule of the United States] violate the Administrative Procedure Act because they are contrary to law.”
… Donald B. Cameron, Jr., senior counsel in the international trade practice at Morris, Manning & Martin, believes the lawsuit has merit. “It is saying that the administration concocted a reason to invoke the provision, and if this is lawful, then the Executive, not Congress, controls tariffs since the reason is transparently made up.” He said the New Civil Liberties Alliance makes a good statutory argument as to why the statute does not, on its face, permit tariffs as a remedy. “It will be interesting to see what the court will do, but this is a good complaint.”
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April 6, 2025
Originally Published in Forbes