A federal trade court has blocked President Trump from imposing broad tariffs on imports under IEEPA following a lawsuit led by Oregon. The decision blocks Trump from sweeping tariffs on imports under an emergency-powers law. The ruling from a three-judge panel at the New York-based Court of International Trade came after several lawsuits arguing Trump has exceeded his authority, left U.S. trade policy dependent on his whims and unleashed economic chaos.
“The Worldwide and Retaliatory Tariff Orders exceed any authority granted to the President by to regulate importation by means of tariffs," the court wrote, referring to the 1977 International Emergency Economic Powers Act. the Trump administration has already filed a notice of appeal to challenge the decision. The case now heads to the U.S. Court of Appeals for the Federal Circuit.
At least seven lawsuits are challenging the levies, the centerpiece of Trump’s trade policy. Tariffs must typically be approved by Congress, but Trump says he has the power to act because the country’s trade deficits amount to a national emergency. He imposed tariffs on most of the countries in the world at one point, sending markets reeling.
The plaintiffs argued that the emergency powers law does not authorize the use of tariffs, and even if it did, the trade deficit does not meet the law’s requirement that an emergency be triggered only by an "unusual and extraordinary threat." The U.S. has run a trade deficit with the rest of the world for 49 consecutive years. Trump imposed tariffs on most of the countries in the world in an effort to reverse America’s massive and longstanding trade deficits.
In the past, he has also plastered levies on imports from Canada, China and Mexico to combat the illegal flow of immigrants and the synthetic opioids across the U.S. border. His administration argues that courts approved then-President Richard Nixon’s emergency use of tariffs in 1971, and that only Congress, and not the courts, can determine the "political" question of whether the president’s rationale for declaring an emergency complies with the law. Trump’s Liberation Day tariffs shook global financial markets and led many economists to downgrade the outlook for U.S. economic growth.
So far, though, the tariffs appear to have had little impact on the world’s largest economy. The lawsuit was initially filed by a of small businesses, including a wine importer, V.O.S. Selections, whose owner has said the tariffs are having a major impact and his company may not survive.
A dozen states also filed suit, led by Oregon. Attorney General Rayfield expressed satisfaction with the court's decision, stating, "Today’s court order is a victory not just for Oregon, but for working families, small businesses, and everyday Americans. President Trump’s sweeping tariffs were unlawful, reckless, and economically devastating," he said in a statement to KATU News.
They triggered retaliatory measures, inflated prices on essential goods, and placed an unfair burden on American families, small businesses, and manufacturers. Rayfield emphasized the constitutional implications of the ruling, adding, "We brought this case because the Constitution doesn’t give any president unchecked authority to upend the economy. This ruling reaffirms that our laws matter, and that trade decisions can’t be made on the president’s whim."
PAST COVERAGE: The lawsuit, led by Rayfield and Arizona Attorney General Kris Mayes, was joined by attorneys general from Colorado, Connecticut, Delaware, Illinois, Maine, Minnesota, Nevada, New Mexico, New York, and Vermont. AG Rayfield filed the multi-state lawsuit on April 23. "These tariffs are doing real damage to Oregonians and our small businesses," Rayfield said in April.
"Families cannot be expected to pay more at the store at a time when they’re already struggling to afford the basics. The President can’t just slap on tariffs that hurt working people without following the law. I don’t know many families who can afford an extra $3800 a month."
Some studies showed that 95% of the tariff costs are borne by Americans, with projections from the and the suggesting that the tariffs will lead to inflation. The submitted by the states as part of the lawsuit noted that businesses "expected elevated input cost growth resulting from tariffs" and that "Most businesses expected to pass through additional costs to customers." However, AP reported the U.S. economy, as of early May, was , and inflation has cooled considerably from its peak in 2022.
Consumers are spending at a healthy pace, though some of that may reflect buying things like cars ahead of tariffs. Businesses are still adding workers at a steady pace, and unemployment is low. After President Trump announced 50% tariffs on the European Union, which were then delayed to early July, European companies began investment plans in China as its economy slowed, and competition drove down prices, according to an annual survey released Wednesday.
The day he announced the lawsuit, AG Rayfield held a press conference with several guests. "When a president pushes an unlawful policy that drives up prices at the grocery store and spikes utility bills, we don’t have the luxury of standing by – especially when so many Oregonians live on fixed incomes," said Rayfield at the press conference in April. "These tariffs hit every corner of our lives – from the checkout line to the doctor’s office – and we have a responsibility to push back."
"Yet over the last three months, the President has imposed, modified, escalated, and suspended tariffs by executive order, memoranda, social media post, and agency decree. These edicts reflect a national trade policy that now hinges on the President’s whims rather than the sound exercise of his lawful authority," The court documents said. By claiming the authority to impose immense and ever-changing tariffs on whatever goods entering the United States he chooses, for whatever reason he finds convenient to declare an emergency, the President has upended the constitutional order and brought chaos to the American economy.
The Associated Press contributed to this story.
