Federal Court Hears Lawsuit from 12 States to Stop Trump’s Tariffs

Is it just politics? Grandstanding? Or could a lawsuit heard yesterday by the Court of International Trade actually interrupt the Trump Administration’s tariffs?

An even dozen states – Arizona, Colorado, Connecticut, Delaware, Illinois, Maine, Minnesota, Nevada, New Mexico, New York, Oregon, and Vermont (that’s right, alphabetical order; someone tell my 1st grade teacher I can English good) – asked the court to halt President Trump’s tariffs. If you’re surprised not to see California on this list, let me assure you that the only reason it isn’t is likely that it has its own, separate lawsuit to fight the president’s tariffs.

Thus, you could say a baker’s dozen of states is suing to halt the Trump Administration’s tariffs. But are these legal challenges half-baked, or do they stand a chance of interrupting President Trump’s tariff strategy?

That the federal court hearing the case is based in New York, in and of itself, seems like a win for the states bringing the lawsuit. As a federal court, the Court of International Trade should be divorced of the politics of its blue state location. However, everyone knows that’s not how the courts always work in practice.

It sometimes feels like the governments in the states of New York and California are in a competition to out-Democrat each other (especially when it comes to Trump-adversary). By my estimation, California is winning because New York’s criminal prosecution of Trump seemed to backfire. Maybe by the number of people and businesses that have and are leaving what is one of the most beautiful states with probably the best weather in the whole union, you might say California is losing too.

But let’s focused in on yesterday’s hearing. I was listening to the audio recording of the hearing last night, trying really hard to stay awake and alert. I made it about half way. Luckily, the Epoch Times, which published the audio live as it was happening, also published an article by Katabella Roberts that gave succinct summaries of the states’ argument against the tariffs and the Department of Justice lawyer’s defense for President Trump’s tariff use. I’m no legal expert anyway, so here are excerpts from Roberts’s article….

States’ Argument Against Trump’s Tariff Usage

Here’s how Roberts summarized the states’ argument against President Trump’s tariffs:

The suit argues Trump’s tariff policies “reflect a national trade policy that now hinges on the President’s whims rather than the sound exercise of his lawful authority.”

Trump has claimed the IEEPA allows him to “set tariffs of any amount, on any country, for any length of time, and no court can review it,” Brian Marshall, an attorney for the state of Oregon, told the court.

Marshall said Trump’s assertion was incorrect, noting the law is meant to address “unusual and extraordinary” threats to the United States and requires presidential actions to be closely tied to a specific situation the executive branch seeks to resolve.

The attorney added that a president may not use tariffs or other actions “only for leverage” under the IEEPA.

Defense’s Argument for Defending Trump’s Power to Use These Tariff

Here’s how Reboerts summarized the defense:

Brett Shumate, a lawyer for the Department of Justice, countered that leverage is a valid reason to impose tariffs under IEEPA. He said the act empowers the president to negotiate trade deals and other foreign policy goals.

“The purpose of these tariffs is to create pressure,” Shumate said. “The tariffs are right now giving the president the leverage that he needs.”

Shumate further argued that only Congress, not U.S. states or the courts, has the authority to review a president’s actions taken in response to an IEEPA emergency.

Though the IEEPA does not specifically use the word “tariff,” it is included under its authority to “investigate, regulate, or prohibit” transactions, he said.

Did the Judges Dislike Defense Arguing Limitation on the Court’s Power?

As I went back to listening to the recording of the hearing today, I couldn’t help but notice a great deal of time spent between the judges and Shumate arguing over whether the courts had power to review President Trump’s actual usage of the tariffs.

Shumate argued the court only had the power to rule whether IEEPA gave the president power to use tariffs, providing precedent that it did. He argued the court had neither the power to judge procedural matters nor the appropriateness of the strategy the president executed with those tariffs. Much time was spent arguing over the power the court had in relation to the power granted the president by Congress.

Shumate said to the court, “… Congress thought carefully about the standard that it wanted the president to follow. It set up a scheme whereby there’s consultation, there’s reporting, and there’s review by Congress. There’s no role in that process for the courts to play. I know it’s always a difficult message for an advocate to send to a court, but there is–“

“And you say it with such a smile,” one of the judges interrupted.

That moment felt very encapsulating of the adversary nature of the dialogue between the judges and the lawyer. The interruption sounded pointed and it seemed to throw Shumate off his line of thought a little bit as he stammered some as he responded. To me, this period of the hearing felt much more adversary than most question and answer periods of court cases I’ve previously listened to, though most of those were Supreme Court cases between lawyers and the Justices, with varying levels of adversary tone.

Within minutes of that interruption, Judge Jane A. Restani interrupted Shumate, after he’d said in this case we have a clear delegation of authority to the president, with, “You’re having a lot of argument about something that’s clear.”

As Her Honor laughed at her own sarcastic jab, Shumate responded, “Do you think you could have a judgment for us today? Yes, it’s clear.”

“I think it’s not clear to everybody,” she stated, “or we wouldn’t be here.”

Shumate tried to respond, but another judge interrupted and steered the conversation toward a problem he seemed to see with President Trump’s tariff usage in relation to IEEPA being for rare and brief emergencies and the limited time period a president’s response should be to them.

It added up to enough that it wouldn’t be surprising if these judges ruled in favor of the states against President Trump and his tariffs. The states might even have some confidence in winning given Judge Restani’s remarks, including the above and, “I’m just wondering why we have all these statutes if the president can do this. I mean, we’ve got a lot of statutes out there: 122, 232, 301, 201, not to mention all the anti-dumping and countervailing duties. Why are we bothering with all this, with all that?”

It was like she was searching for an argument against the defense. To me, Congress using statutes to put tariffs in place is no argument against tariff powers it has also delegated to the president, so this seemed to stray from what the court should be deciding.

However, things strayed even further when one of the other judges then asked about why President Trump imposed the same tariffs on Canada as he did Mexico over the fentanyl crisis when 99% of seized fentanyl has happened at the southern border compared to 1% at the northern border. Though he gave a good answer as to Trump’s reasoning, Shumate made it clear that this shouldn’t affect the judge’s analysis. The judges should only be considering the argument if there is tariff authority, “not whether a 10% or 25% tariff is appropriate.”

It is logical that if the president has the tariff authority the defense argues he has, he would have the authority to decide what those tariffs are, not the court. The states seem to want the judges’ ruling to consider more than just President’s authority, and the judges’ questions like the one I just brought up seem to indicate a desire for a wider authority than the defense claims they have in this case.

The Verdict

His tariffs are a key factor in President Trump’s trade negotiations with countries around the world. There’s no way to look at this case and divorce it of the politics of trying to undermine the administration’s trade talks. The verdict has serious implications.

Right now, we wait to see what the court decides. A decision is expected within the next two or three weeks. Potentially, it could come in a matter of days. If the court rules against President Trump on his tariffs, don’t expect this to be over. The appeals process would happen right away. Those appeals would initially go through the U.S. Court of Appeals for the Federal Circuit in Washington, D.C. and could then rise to the Supreme Court.