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Economy

Federal court keeps Trump tariffs in place — for now

People walk past the U.S. Court of International Trade, Watson Courthouse, in lower Manhattan on Thursday. In a ruling that surprised many, the trade court ruled Wednesday in an opinion by a three-judge panel that a 1977 law called the International Emergency Economic Powers Act does not grant Trump "unbounded" authority to impose the worldwide and retaliatory tariffs he has issued by executive order. Then, on Thursday, the U.S. Court of Appeals for the Federal District granted the Trump administration's request to temporarily put on hold the trade court's judgment.
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People walk past the U.S. Court of International Trade, Watson Courthouse, in lower Manhattan on Thursday. In a ruling that surprised many, the trade court ruled Wednesday in an opinion by a three-judge panel that a 1977 law called the International Emergency Economic Powers Act does not grant Trump "unbounded" authority to impose the worldwide and retaliatory tariffs he has issued by executive order. Then, on Thursday, the U.S. Court of Appeals for the Federal District granted the Trump administration's request to temporarily put on hold the trade court's judgment.

Updated May 29, 2025 at 18:05 PM ET

The U.S. Court of Appeals for the Federal District on Thursday granted the Trump administration's request to temporarily put on hold the New York-based Court of International Trade judgment that struck down President Trump's tariffs a day earlier.

The court stayed the order while the legal proceedings play out.

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The plaintiffs — a group of U.S. states and small businesses — were asked to respond to the Trump administration's motions for a stay by June 5. A U.S. government response may be filed by June 9, the court said.

The order capped a frenzy of news related to the president's tariff policy. On Wednesday evening, the Court of International Trade ruled that the tariffs Trump imposed on April 2 on most countries are illegal. And earlier Thursday, a second federal court — the U.S. District Court for the District of Columbia — blocked Trump's authority to unilaterally impose tariffs, ruling in favor of two Illinois toy importers, but the judge in the case, Rudolph Contreras, paused his ruling for 14 days while the government appeals. Both those courts ruled that the tariffs exceeded the president's power under the International Economic Emergency Powers Act, which the Trump administration cited in imposing those tariffs.

White House spokeswoman Karoline Leavitt said Thursday: "We expect to fight this battle all the way to the Supreme Court."

President Trump speaks during an event to announce new tariffs in the Rose Garden at the White House on April 2 in Washington, D.C.
Mark Schiefelbein
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AP
President Trump speaks during an event to announce new tariffs in the Rose Garden at the White House on April 2 in Washington, D.C.

Federal trade court blocks Trump's emergency tariffs, saying he overstepped authority

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Wednesday's order — and what is almost certain to be a prolonged legal battle — struck at the heart of the sweeping tariffs, which unsettled consumers and sent stock markets plummeting.

Trump had moved to temporarily scale down those tariffs back to 10%. The ruling also struck down separate tariffs Trump imposed on China, Canada and Mexico, which the administration justified as a reaction to fentanyl trafficking.

In their Wednesday ruling, the court's three-judge panel wrote that Trump's worldwide tariffs had exceeded his power under IEEPA.

"Because of the Constitution's express allocation of the tariff power to Congress … we do not read IEEPA to delegate an unbounded tariff authority to the President," the court wrote.

The White House responded by rejecting the court's authority.

"It is not for unelected judges to decide how to properly address a national emergency," White House spokesman Kush Desai said in a statement. "President Trump pledged to put America First, and the Administration is committed to using every lever of executive power to address this crisis and restore American Greatness."

IEEPA, the law at the heart of the case, had never been used to impose tariffs until Trump did so. As the name suggests, the law gives a president broad economic powers during a national emergency.

The judgment came in a case brought against the administration by 12 states and five businesses.

While the court found Trump had exceeded his authority by imposing broad worldwide tariffs, the three-judge panel made a different argument in ruling against the fentanyl tariffs.

In that case, the court found that the president's argument — that the tariffs will create leverage to get other countries to crack down on drug trade — invalidates the tariffs. Under IEEPA, the judges wrote, a tariff must directly "deal with" the emergency a president cites when imposing the tariff. The fentanyl tariffs do not directly address the drug trade, the judges wrote, but instead merely attempt to create economic pressure within other countries.

The three judges were appointed by three separate presidents: Barack Obama, Ronald Reagan and Trump himself.

Copyright 2025 NPR

Corrected: May 29, 2025 at 2:48 PM PDT
An earlier version of this story incorrectly referred to the U.S. Court of Appeals for the Federal Circuit as the U.S. Court of Appeals for the Federal District.