By: Brian Walczyk, Compliance Manager, TradeInsights, LCB, CCS

On Friday, August 29, the U.S. Court of Appeals for the Federal Circuit (CAFC) concluded that the President’s use of IEEPA to impose tariffs, to rectify the trade deficit and combat the flow of fentanyl into the country, exceeded the authority granted within.

CAFC sent the case back to the Court of International Trade (CIT) so it could reconsider its injunction as the Supreme Court had recently ruled on limits of nationwide injunctions (Trump v. CASA).

Shortly after the CAFC statements an order was issued stating the court would withhold issuance of it’s mandate until October 14 to allow time for the government to appeal the ruling to the Supreme Court.

Of note, seven of the eleven judges that heard the case ruled against the IEEPA tariffs. Four of the judges also stated they did not believe IEEPA permitted the President to impose tariffs of any kind. The four judges that did not rule in favor of the plaintiffs did dissent, stating at length that the President’s use of the apparent tariff authority in IEEPA to be a valid use of the statute.

Key Points:

1. Jurisdiction – CAFC confirmed CIT jurisdiction to hear the case.
2. Statutory Text – CAFC gave opinion on IEEPA’s “regulate … importation” is not authoritative for imposing tariffs.
3. Major Questions Doctrine – CAFC states the use of IEEPA “runs afoul of the major questions doctrine,” which gives power to the executive to regulate issues on massive political / economic significance upon explicit delegation from congress.
4. Congressional Ratification of Yoshida v. U.S. – CAFC cut down the parallel drawn to Yoshida v. U.S. by way that in Yoshida there was a clear limited nature “in time, scope, and amount.”
5. Injunctive Relief – Since the CASA decision changed the injunctive relief landscape CAFC is following the Supreme Court’s lead, sending the case back to CIT for further clarification on the scope of relief.

We will continue to monitor this situation and issue updates as needed. Please contact your V. Alexander account team, or you may also contact our Trade Compliance team at tradeinsights@valexander.com with any questions, and you can always follow us on our website www.valexander.com for updates on this and other topics