By way of executive order, the Trump Administration has imposed tariffs on its global trading partners under the International Emergency Economic Powers Act (IEEPA), which gives the President powers to deal with national emergencies stemming from “any unusual and extraordinary threat” that comes in whole or in large part from outside the United States. The tariffs have taken two forms: targeted tariffs against China, Mexico and Canada relating to the importation of illegal narcotics (fentanyl) into the United States, though little evidence supports any such importation from Canada; and so-called reciprocal tariffs against all other nations pertaining to trade imbalances, which have been implemented as of Aug. 7, 2025, except as otherwise negotiated through bilateral trade deals with individual nations.
In V.O.S. Selections v. United States, the Court of International Trade (CIT) combined challenges by various shipping importers and twelve states that these tariffs are unconstitutional and violative of U.S. law arguing that such tariffs require congressional approval. On May 28, 2025, the CIT ruled that IEEPA’s statutory authority for the President to “regulate ... importation” does not extend to imposing unlimited tariffs under the Supreme Court’s major-questions doctrine, which limits federal agencies from broadly construing their powers from vague or implied grants of authority, or the Trade Act, which limits tariffs imposed to respond to balance of payment problems to 15% and a maximum duration of 150 days. These tariffs also require an extensive investigation by the U.S. Trade Representative (USTR) before implementation, which has not occurred. The CIT also ruled that Congress cannot delegate such unlimited power under the constitution, which assigns Congress the exclusive powers to “lay and collect taxes, duties, imposts and excises,” and to “regulate commerce with foreign nations.” Quoting Supreme Court precedent addressing the nondelegation doctrine, the CIT noted that delegations of such authority, of course, are permitted “as long as Congress ‘lay[s] down by legislative act an intelligible principle to which the person or body authorized to [exercise that authority] is directed to conform,’” which means when Congress “meaningfully constrains” the President’s authority.
One authorized congressional mechanism to address tariff rates is the U.S. Harmonized Tariff Schedule (HTSUS) administered by the U.S International Trade Commission, which has the power to investigate tariff relations between the United States and foreign nations. Congress has also delegated certain trade authority to the President, but each delegation has made clear that Congress retains legislative power over the imposition of duties and foreign commerce. CIT discussed various delegations over the years under the Trade Expansion Act of 1962, the Trade Act of 1974, and amendments to the Trading with the Enemy Act (TWEA) during the Nixon years, which resulted in IEEPA, and the National Emergencies Act of 1976, which placed restrictions on declaring emergencies and requires the President to transmit to Congress a notification of a national emergency declaration. In this case, the President has declared several national emergencies since January 2025 and imposed tariffs to address each.
In addressing the trafficking tariffs, the CIT held that IEEPA’s authority to “regulate ... importation” cannot be read broadly to allow the imposition of unbounded tariffs and under IEEPA such tariffs must “deal with the unusual and extraordinary threat with respect to which the national emergency has been declared” and not for any other purpose. Because the trafficking tariffs do not meet IEEPA’s conditions, the CIT held they exceed the statute’s scope.
About the retaliatory tariffs, the government argued that “regulate ... importation” derives from TWEA, which the courts found allowed tariffs in reliance upon that language. The CIT found any interpretation of IEEPA that delegates unlimited tariff authority is unconstitutional whether considered under the nondelegation doctrine, the major-questions doctrine or separation of powers principles. Specifically, CIT held that the words “regulation ... importation” do not confer unlimited tariff authority, and that the Congressional grant of authority under IEEPA is narrower than under TWEA. Congress passed IEEPA during the Vietnam War era when it looked to constrain the presidential exercise of broad economic powers without congressional review. IEEPA served to limit TWEA not continue its grant of authority. Further, the Trade Act of 1974 limits the quantum and duration of any tariffs imposed to address balance of payment deficits, which fall under the non-emergency authorities of Section 122 of the Act. Section 122 serves to “meaningfully constrain” the President’s authority under the nondelegation doctrine to which the CIT held the Trump Administration must conform.
Among other arguments, the government relied upon the political-question doctrine to argue that the tariff controversy is nonjusticiable. That doctrine applies “where there is ‘a textually demonstrable constitutional commitment of the issue to a coordinate political department; or a lack of judicially discoverable and manageable standards for resolving it.’” The CIT found that the trafficking tariff executive orders presented a justiciable question of statutory construction and do not deal with an “unusual and extraordinary threat” as required by IEEPA.
On June 10, the U.S. Federal Circuit Court of Appeals stayed enforcement of the CIT’s ruling and held oral argument on July 31. During oral argument before the court en banc, the government argued per United States v. Yoshida International, that the president has the power to impose tariffs. In Yoshida, the Court of Customs and Patent Appeals held that President Nixon had the authority to impose a 10% import duty surcharge under TWEA’s authority to “regulate ... importation.” The government argued before the Federal Circuit that Congress is presumed to have ratified Yoshida in its adoption of IEEPA two years later. The government’s counsel admitted that “we take all of Yoshida.” Amici counsel argued that “if you want to live by the sword of Yoshida, you’re going to die by the sword of Yoshida,” and then pointed out that the Yoshida court was not approving in advance any surcharge of a different nature or sanctioning the exercise of unlimited power, which would strike a blow to the Constitution. While approving the 10% import duty surcharge, Yoshida made clear that each presidential proclamation must be evaluated on its own facts and circumstances. In that case, the measure issued under TWEA was temporary, did not supplant the entire tariff scheme of Congress, and did not apply to all imports, but only those imports already subject to tariffs. Yet, despite such limitations, the Yoshida court recognized that there was a broad grant of authority under TWEA, and said: “[t]hough such a broad grant may be considered unwise, or even dangerous, should it come into the hands of an unscrupulous, rampant President, willing to declare an emergency when none exists, the wisdom of a congressional delegation is not for us to decide.” A number of the Court’s judges expressed concerns about the government’s position: it is the first time in 50 years IEEPA has been used for tariffs; it would dislocate the entire trade relief framework enacted by Congress in numerous statutes; and it would permit unbounded authority to set tariff percentages. Another judge noted that under Yoshida, the declaration of an emergency is not a talisman that allows the president to rewrite the tariff schedules, which would sound the death knell of the constitution.
The government argued that for the court to overturn the President’s actions, it must find that he violated IEEPA, which he did not. Further, the court’s authority is limited to examining whether IEEPA authorizes tariffs (it does, according to the government, based upon Yoshida’s interpretation of the words “regulate ... importation” under TWEA) and whether the limits imposed by IEEPA have been met (that is, the existence of a national emergency, which presents an unusual and extraordinary threat that emanates from outside the United States). The essential threat appears to be the collapse of U.S. manufacturing capability that affects national security brought on by persistent trade deficits, which the administration contends has spiked over the past four years, and which at least one of the judges found alarming.
The matter is now ripe for decision by the Federal Circuit, which could affirm the CIT’s decision, or set aside the grant of summary judgment and remand for further fact finding. If affirmed, the case will no doubt proceed to the Supreme Court. Reading the tea leaves is always problematic, but it certainly seems that enough of the Federal Circuit’s judges (eight of the twelve were appointed by democratic presidents) have doubts about the administration’s unfettered application of IEEPA to tariffs to uphold the CIT’s decision, which sets up the Roberts’ Court to address a variety of constitutional issues, including confronting the application of its major-questions doctrine (the government contends it only applies to domestic policy), to the cornerstone economic policy of this administration. Quite a showdown is looming.
“'V.O.S. Selections v. United States' and the Sword of Yoshida,” by Keith Letourneau was published in Texas Lawyer on August 18, 2025.
Reprinted with permission from the August 18, 2025, edition of the Texas Lawyer © 2025 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited.