A legal showdown is unfolding over President Donald Trump’s “Liberation Day” tariffs, which he imposed to rebalance trade with other countries. The tariffs faced a major setback when a trade court tried to block them, only for an appeals court to step in and temporarily reinstate them.
The Trade Court’s Ruling
On May 28, the U.S. Court of International Trade ruled that Trump’s sweeping tariffs went beyond what the law allowed. The court found that the president’s use of the International Emergency Economic Powers Act (IEEPA) to justify the tariffs wasn’t valid. According to the court, Congress — not the president — has the final say on tariffs, and using the trade deficit as a “national emergency” wasn’t enough to let Trump do as he pleased.
The court’s decision blocked most of the tariffs, including a 10 percent baseline tariff on nearly all imports and other measures that targeted China, Canada, and Mexico over fentanyl trafficking. It ordered the administration to formally remove them within 10 days.
This decision was celebrated by critics who called Trump’s trade moves an abuse of presidential power. A group of 12 states that had sued Trump said the tariffs were driven by his “whims rather than the sound exercise of lawful authority.”
Trump’s Response
Trump immediately pushed back, calling the judges’ actions an attack on the United States. “Where do these initial three Judges come from?” Trump wrote on social media. “How is it possible for them to have potentially done such damage to the United States of America? Is it purely a hatred of ‘TRUMP?’”
He argued that his tariffs had already brought in trillions of dollars to America and that without them, the country would be at a disadvantage.
Appeals Court Steps In
The day after the trade court’s ruling, the U.S. Court of Appeals for the Federal Circuit stepped in to pause the lower court’s decision while it reviews the legal challenges. This meant Trump’s tariffs stayed in place for the time being.
The appeals court’s temporary stay doesn’t decide if the tariffs are ultimately legal. It just keeps them alive as the judges consider the matter. Former World Trade Organization official Alan Wolff said this move doesn’t change much for now. “It doesn’t change the circumstances in court all that much,” Wolff said. “I’m sure the White House would like this to get straightened out as soon as possible.”
Trump’s Options Moving Forward
Even if the court eventually blocks the tariffs, Trump has other legal tools. Trade experts pointed out that he could use parts of the Trade Act of 1974 — specifically Sections 122 and 301 — to bring back targeted tariffs. Section 122 allows a president to impose tariffs up to 15 percent for 150 days on countries with large trade surpluses. Section 301 lets the president respond to unfair trade practices.
Trump has already used Section 232 of the Trade Expansion Act of 1962 to justify tariffs on steel, aluminum, and automobiles, calling these imports a national security threat. Former trade adviser Peter Navarro suggested the administration might even look at reviving the Smoot-Hawley Tariff Act of 1930.
Supporters and Critics Weigh In
Supporters of Trump’s tariffs say they are vital for leveling the playing field. White House press secretary Karoline Leavitt warned that judges threatening the tariffs “jeopardize America’s standing in international trade.” National Economic Council Director Kevin Hassett added that despite “hiccups,” the tariffs are essential for pushing countries to negotiate better deals.
Critics, however, see this as an overreach. Canadian Prime Minister Mark Carney called the U.S. tariffs “unlawful as well as unjustified” and said they had harmed trade relationships. Economists like Bill Adams from Comerica Bank said the uncertainty around the tariffs is slowing down business investment and hiring in the U.S.
What Comes Next?
The legal battle could go on for over a year and may even reach the Supreme Court. If the courts decide against Trump’s tariffs, the administration might try to revive them under different laws. That would take time and might be more legally defensible, according to experts like Peter Harrell, who served as an economic adviser under President Biden.
For now, the tariffs remain in place as the appeals court considers the case. While Trump’s team is weighing backup plans, businesses are bracing for more uncertainty as they wait to see how the courts ultimately decide.
