The Prospects and Implications of Legal Challenges to President Trump’s IEEPA Tariffs

Since his second term in the White House began in January 2025, President Donald Trump has imposed a sweeping array of tariffs on nearly all U S trading partners While he has invoked familiar legal authorities such as Section 232 of the Trade Expansion Act of 1962, Trump has turned to the International Emergency Economic Powers Act (IEEPA) to justify his more extreme actions Historically, IEEPA—which authorizes the president to act after he has declared a national emergency with respect to an unusual and extraordinary threat to U S security—has been used to impose a range of economic sanctions, but prior to 2025 it had never been used to impose tariffs Trump has imposed four major sets of tariffs under IEEPA In February 2025, he targeted Canada, Mexico and China after declaring an emergency over fentanyl smuggling from those countries Next, he designated April 2, 2025, as Liberation Day and imposed a 10 per cent duty on imports from all countries, along with additional “reciprocal” tariffs on specific countries, to address trade imbalances In July, Trump imposed a 40 per cent tariff on Brazilian imports because he said Brazil’s prosecution of its former president, Jair Bolsonaro, posed a threat to U S security In August, he slapped India with a 25 per cent tariff on most imports in retaliation for India’s continued purchases of Russian oil during the war in Ukraine Legal scrutiny quickly followed the imposition of these tariffs, with more than a dozen lawsuits filed to date

The most significant of these is V O S Selections v Trump, which combines cases brought by small businesses and 12 U S states A three-judge panel of the Court of International Trade unanimously ruled the fentanyl and Liberation Day tariffs unlawful under IEEPA and issued an injunction to halt their collection The Federal Circuit Court of Appeals upheld this ruling, citing, among other reasons, IEEPA’s lack of clear authorization for tariffs as required by the major questions doctrine However, the case returned to the lower court to reconsider the scope of the injunction In November, the Supreme Court is slated to hear a consolidation of two cases: the U S government’s appeal in V O S Selections and a case called Learning Resources vs Trump In the latter case, a trial court decided that IEEPA does not authorize tariffs at all, with the Supreme Court agreeing to hear the case before the court of appeals ruled The outcome of this hearing may offer limited prospective relief from tariffs, though, as the Trump administration has signaled it will simply resort to alternative legal authorities, including older trade laws, to maintain or reimpose tariffs

Firms and governments should prepare for continued trade volatility, maintain detailed tariff records, review contracts for refund eligibility and monitor developments closely Even if the Supreme Court rules against the tariff regime, it is unlikely to end Trump’s aggressive policy of unilateral trade action