In a landmark decision, the United States Court of International Trade (“CIT”) has ruled against the President’s imposition of tariffs under the International Emergency Economic Powers Act (“IEEPA”). The decision (involving two consolidated cases, V.O.S. Selections, Inc. et al. v. United States of America et al. and The State of Oregon et al. v. United States Department of Homeland Security et al.), is the first court decision on the Administration’s trade policy and the first judicial reversal of the tariffs imposed to date under the Trump administration.
The CIT’s decision focuses on the limits of presidential authority under the IEEPA and constitutional principles in the delegation of powers. The court examined whether the IEEPA authorized the President to impose the challenged tariffs and concluded it did not. The CIT interpreted the phrase “regulate . . . importation” to not permit the imposition of tariffs without clear limitations.
The CIT also invoked the nondelegation doctrine, which requires Congress to lay down an intelligible principle guiding the exercise of delegated powers, as well as the major questions doctrine, which demands clear congressional authorization for decisions of vast economic and political significance. The court found that an unlimited delegation of tariff authority would be unconstitutional under these doctrines.
The court rejected the US Government’s argument that the political question doctrine precluded judicial review of the President’s threat assessment under IEEPA. The CIT held that the question of whether the President’s actions met the statutory requirements of the IEEPA was justiciable.
The CIT’s decision is limited to the tariffs imposed by the current Administration under the IEEPA. These tariffs fall into three categories of executive orders:
- IEEPA Fentanyl Tariffs on Products of China imposed in February 2025 (which were increased to 20% in March 2025, and includes the revocation of the de minimis exemption);
- IEEPA Fentanyl/Border Tariffs on Products of Mexico and Canada of 25% for products of Mexico and Canada, except for (1) energy resources and potash, which are subject to 10% tariffs, and (2) USMCA-originating articles, which are exempt from the IEEPA tariffs; and
- IEEPA Reciprocal Tariffs of 10% on products from all countries except for Canada and Mexico (for which certain country-specific rates were paused until July 9 for all countries except for China, whose country-specific rate was recently paused until August 12).
The CIT has ordered the US Government to effectuate the permanent injunction against the IEEPA tariff orders within 10 calendar days of the CIT’s decision (i.e., by June 7, 2025). The US Government promptly appealed the CIT’s decision to the Court of Appeals of the Federal Circuit on the same day.
Update: On, May 29, the CAFC granted a short-term administrative stay of the CIT’s ruling that overturned the administration’s use of IEEPA to impose tariffs on US trading partners, ensuring the duties will remain in place through at least June 9. “The request for an immediate administrative stay is granted to the extent that the judgments and the permanent injunctions entered by the Court of International Trade in these cases are temporarily stayed until further notice while this court considers the motions papers” , states the order issued mid-afternoon on May 29, a day after the CIT ruling and injunction and just hours after the Department of Justice (DOJ) filed an emergency motion to stay the CIT decision.
On the same day, in a related case in a different court, the District Court for the District of Columbia struck down all tariff actions taken under the IEEPA. However, the DC court went farther than the CIT, holding that IEEPA categorically does NOT empower the President to impose tariffs.
The judge denied the government’s motion to transfer the suit to the CIT, declaring the reciprocal tariffs and tariffs on China, Canada and Mexico to be “unlawful,” though he did NOT vacate the executive orders imposing those tariffs in their entirety, like the CIT did in its ruling yesterday.
The judge also preliminarily enjoined the collection of the tariffs, but only as they relate to the plaintiffs in the case, two small importers. He stayed the injunction for 14 days to give the government a chance to appeal to the Court of Appeals for the DC Circuit. The DC court’s decision sets up a split on whether the CIT has exclusive jurisdiction to hear IEEPA tariff cases and on whether IEEPA provides tariff-setting authority at all.
So, for now, the tariffs stay in place until at least June 9 per the CAFC stay of the CIT injunction.
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