Legal Rulings Block Import Tariffs

Two judicial rulings against most of President Donald Trump’s tariffs face appeals and challenges that may take the issue before the U.S. Supreme Court.

The U.S. Court of Appeals for the Federal Circuit ruled Thursday the tariffs will remain in place to give judges more time to sort through argument.

A panel of federal judges on the U.S. Court of International Trade ruled Wednesday that the administration’s interpretation of the International Emergency Economic Powers Act did not grant the president “unbounded authority” to impose tariffs.

On Thursday, the U.S. District Court for the District of Columbia ruled separately that the tariffs are unlawful. That case was brought by two small businesses.

The rulings create another round of uncertainty affecting contractors and manufacturers as they adjust price increases and deal with supply-chain issues. Still, this legal battle may not take long to resolve, said Alex Ayers, vice president of government affairs for Heating, Air-conditioning and Refrigeration Distributors International (HARDI).

“We’re definitely going to see some uncertainty, but it seems likely to be shorter than expected. The U.S. Court for International Trade has set a 10-day deadline for lifting the tariffs, which allows ample time for an appeals court to conduct emergency hearings,” he said. “However, the Trump administration has already informed the appeals court that if they don’t act today, they will escalate the issue to the Supreme Court on Friday. That is a quick turnaround for requesting intervention, and I’m not sure the Supreme Court will take it lightly.

He also pointed to messages from the Council of Economic Advisers who indicate there is another route to maintaining the tariffs. The emergency economic powers act also allows an administration to investigate trade practices of specific countries, which could be done within the 90-day delay on many tariffs adopted by Trump.

A Goldman Sachs analyst told The New York Times the administration could replace the 10% tariffs with a tariff up to 15% for 150 days through another trade rule.

“We expect the Trump administration will find other ways to impose tariffs,” the analyst wrote in an analysis reported by the Times.