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Update: Overnight (Thursday in the US) the Court of Appeals for the Federal Circuit temporarily reversed the Court of International Trade's decision, issuing an "immediate administrative stay" on the ruling while the Trump administration carries out its appeal. White House press secretary Karoline Leavitt described the trade court's decision as "judicial overreach" which she claims "must be stopped".
The US Court of International Trade has today (Wednesday in the US) blocked a swathe of global tariffs imposed since February, concluding the country's president Donald Trump overstepped his authority under the International Emergency Economic Powers Act (IEEPA).
Trump has depended on the act to claim various emergencies, from the threats of cartels to trade deficits, as the legal justification for tariff announcements that began with Mexico and Canada in February and were expanded worldwide in April on so-called "Liberation Day".
This includes a 10 per cent tariff on exports from Australia, with which the US in fact has a trade surplus.
"The court does not pass upon the wisdom or likely effectiveness of the President’s use of tariffs as leverage," said judges Gary Katzman, Timothy Reif and Jane Restani.
"That use is impermissible not because it is unwise or ineffective, but because [federal law] does not allow it."
Two of the three judges - Reif and Restani - were appointed by Republicans, and Reif was appointed by Trump himself in 2018.
"The Worldwide and Retaliatory Tariff Orders exceed any authority granted to the President by IEEPA to regulate importation by means of tariffs," the opinion states.
"The Trafficking Tariffs fail because they do not deal with the threats set forth in those orders."
Various media outlets have reported the Trump administration filed an appeal to the decision within minutes.
The case was brought by the non-partisan Liberty Justice Center on behalf of five owner-operated businesses that claim to have been severely harmed by the tariffs - VOS Selections, FishUSA, Genova Pipe, MicroKits LLC and Terry Precision Cycling.
The Liberty Justice Center filed the lawsuit challenging the US president's tariffs on 14 April along with co-counsel Ilya Somin, law professor, Scalia Law School, George Mason University. The ruling also covered a case filed by 12 US states, led by Oregon and also including Arizona, Colorado, Illinois and New York.
"From the very beginning, I have contended that the virtually limitless nature of the authority claimed by Trump is a key reason why courts must strike down the tariffs," Somin wrote on the website Reason: Free Mind and Markets following the unanimous ruling.
"All of Trump's tariffs adopted under the International Emergency Economic Powers Act of 1977 (IEEPA) are invalidated as beyond the scope of executive power, and their implementation blocked by a permanent injunction."
In its ruling, the court also concluded that if the challenged tariff orders are unlawful as to the plaintiffs, they are "unlawful as to all".
"Obviously, this probably won't be the end of the tariff litigation. The government is sure to appeal to the US Court of Appeals for the Federal Circuit, and potentially the Supreme Court. Still, today's ruling is an important step in the process, and a strong signal that the case against the tariffs has merit," Somin added.
The Liberty Justice Center's lawsuit argued that the administration’s justification - a trade deficit in goods - is neither an emergency nor an unusual or extraordinary threat.
"Trade deficits have existed for decades, and do not constitute a national emergency or threat to security," the center states.
"Moreover, the administration imposed tariffs even on countries with which the US does not have a trade deficit, further undermining the administration’s justification.
"And as the complaint explains, IEEPA does not authorize the president to impose across-the-board tariffs it does not even authorise tariffs at all; and even if the IEEPA did extend such power to the president, that would be an unconstitutional delegation of congress’s power to impose tariffs."
New York attorney general Letitia James noted the worldwide tariffs imposed, which violated the law, caused "severe economic damage throughout the country".
"The law is clear: no president has the power to single-handedly raise taxes whenever they like. These tariffs are a massive tax hike on working families and American businesses that would have led to more inflation, economic damage to businesses of all sizes, and job losses across the country if allowed to continue," James said.
"This decision is a major victory for our efforts to uphold the law and protect New Yorkers from illegal policies that threaten American jobs and economy."
Colorado attorney general Phil Weiser said the lawsuit was brought because "this was yet another example of the administration acting as though it's above the law".
"And this lawless action harmed the state and Coloradans by creating economic chaos and driving up prices at a time when so many are stretching to meet budgets," Weiser said.
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