Executive Emergency Powers and the U.S. Tariff State: Review in the U.S. Court of International Trade and the Federal Circuit

On August 29, 2025, in a 7-4 ruling the U.S. Court of Appeals for the Federal Circuit affirmed a May 2025 decision by the U.S. Court of International Trade (CIT) in V.O.S. Selections, Inc. v. United States, which had held in favor of the plaintiffs’ Motion for Summary Judgement, and had determined that U.S. President Donald Trump’s use of emergency powers under the International Emergency Economic Powers Act (IEEPA), 50 U.S.C. §1701 et seq., to impose sweeping tariffs, was unlawful. Oral arguments in front of the Federal Circuit Court were held on July 31, 2025. While affirming the CIT’s decision, the Federal Circuit did however pause its ruling from taking effect until October 14, 2025, allowing tariffs to remain in place while the Trump administration seeks relief from the U.S. Supreme Court to reverse the decision. On September 02, 2025, President Trump told reporters at the White House that he would seek an “expedited ruling” from the U.S. Supreme Court to overturn this decision. On September 09, 2025, the Supreme Court agreed to hear the case on a fast track, with oral arguments scheduled for the first week of November. Given the doctrinal importance of the case, especially its implications for emergency powers, non-delegation, and the Major Questions Doctrine, it represents a “major test of one of the… boldest assertions of executive power” for this administration.

On May 28, 2025, a three-judge panel of the U.S. Court of International Trade (CIT) issued a unanimous decision in V.O.S. Selections, Inc. v. United States, in favor of the plaintiffs. Specifically, the court found that IEEPA did not grant the President a general authority to impose tariffs and that the threats cited did not rise to the “unusual and extraordinary” standard required to trigger emergency powers under the statute. Crucially, the panel also determined that the President’s actions infringed upon Congress’s Article I authority over tariffs and trade, constituting an unconstitutional usurpation of legislative power. 

Following the CIT’s decision in May, the Trump administration filed an immediate appeal to the U.S. Court of Appeals for the Federal Circuit, which granted a temporary administrative stay on May 29, 2025, on the CIT’s decision. This allowed the contested tariffs to remain in effect pending further review. In its appeal, the Trump administration contended that IEEPA did, in fact, authorize broad regulation of imports as part of the President’s emergency powers and that the CIT applied overly restrictive interpretations of both statutory text and constitutional doctrine, an argument the Federal Circuit court ultimately did not find compelling.

On June 17, 2025, the plaintiffs petitioned the U.S. Supreme Court to fast-track review of the case before the lower courts have ruled, and overturn the tariffs on grounds that the President exceeded his authorities under IEEPA. But on June 20, 2025, the Court rejected that petition and declined the request.

The case first originated from two consolidated lawsuits.  The first was brought by private importer V.O.S. Selections, Inc., along with several other importers and trade associations affected by the tariffs. The second was filed by a coalition of twelve U.S. states, including Oregon, California, and New York, which joined together to challenge the tariffs on constitutional and statutory grounds. Given the overlapping issues, the CIT consolidated the cases into a single proceeding.

At the heart of the litigation are two sets of tariffs, so-called “Liberation Day” tariffs—blanket duties imposed against Mexico, Canada, and China, based on the assertion that these countries are not taking sufficient action to prevent fentanyl flow into the U.S., as well as reciprocal tariffs, which are based on imbalances in trade in goods with virtually every country on the globe. The administration claimed that an “unusual and extraordinary threat” existed for both types of tariffs, citing international narcotics trafficking and illegal immigration-related issues, as well as the U.S. trade imbalance, as justification for the emergency. Plaintiffs argued that these rationales failed to meet IEEPA’s emergency criteria and that the statute could not be used to unilaterally overhaul U.S. trade policy.

Beyond the statutory overreach, the CIT raised significant constitutional issues, particularly concerning separation of powers and the nondelegation doctrine. The court held that the President’s use of IEEPA to set broad tariff policy under the guise of emergency authority amounted to unconstitutional circumvention of Congress’ authority. The court further invoked the “major questions doctrine,” emphasizing that Congress must speak clearly when authorizing the executive branch to make decisions of vast economic and political significance–something it had not done in this context.

Importantly, the ruling does not invalidate tariffs imposed under other statutory authorities, such as Section 232 of the Trade Expansion Act (which concerns national security) or Section 301 of the Trade Act of 1974 (which addresses unfair trade practices). The decision is narrowly focused on the misuse of emergency powers under IEEPA and represents one of the most significant judicial checks on the use of emergency powers in economic policymaking.

In signaling the issues that the Supreme Court will grapple with, the dissent attached to the Federal Circuit Court’s opinion argued that courts are not in the position to question the underlying substance of the President’s decision that an emergency exists. The second fundamental question, a statutory one, is whether IEEPA’s broad grant of authority permits the President to make global changes to the Harmonized Tariff Schedule of the U.S. (HTSUS), which is set by Congress, based on the emergency declaration.

The court notes in both the opinion and in the dissent that IEEPA requires four things: 1) that there be an unusual and extraordinary threat to the national security or foreign policy or economy of the United States; 2) that the threat wholly or substantially has a source outside the U.S.; 3) that the President declares a national emergency with respect that to that threat; and 4) that the authorities granted under IEEPA are exercised to deal with that threat and not for any other purpose. The dissent notes that extreme deference must be granted to the President with regard to any national security determination that he makes, citing Trump v. Hawaii, in which the Roberts Court made clear that it would not look beyond the four corners of the President’s written determinations where national security is concerned. A critical issue for the Roberts Court’s review will be the extent to which it is prepared to examine the fourth prong of IEEPA (i.e., the “any other purpose” provision).

A second issue where the dissent differs with the majority is whether the specific language of IEEPA permits massive re-writing of the HTSUS. The critical language in IEEPA is whether the grant of authority to “regulate… importation” of goods includes the right to redo in its entirety the HTSUS. The Federal Circuit Court’s majority view is that tariffs are directly linked to Congress’ taxation authority, and that absent specific language in IEEPA that addresses “tariffs” or “duties” or similar language, IEEPA cannot be a statutory basis for massive implementation of tariffs (after all, the infamous Smoot-Hawley tariffs are named after Oregon Representative Willis Hawley and Utah Senator Reed Smoot). The dissent argues that implicit in the delegation of authority to “regulate… importation” is the authority to impose tariffs in response to the stated emergency.

Finally, the Major Questions Doctrine, which the Roberts Court has developed and used primarily to limit the authority of the Environmental Protection Agency and former U.S. President Biden’s efforts to use delegated emergency authority to forgive certain educational loans, is cited by the Federal Circuit Court to justify its view on why IEEPA’s failure to use specific language regarding tariffs is critical, particularly given the vast impact and amount of revenue the current Administration projects will be raised by the tariffs. The dissent, however, notes that the Major Questions Doctrine has only been used in the domestic context and is inappropriate when dealing with the President’s emergency authorities in a national security context.

The case has attracted widespread attention from legal scholars, trade experts, and constitutional commentators. A number of amicus briefs have been filed on both sides of the dispute. Supporters of the court’s ruling argue that unchecked presidential use of emergency declarations to impose tariffs undermines congressional trade authority. Opponents warn that hamstringing executive flexibility in economic emergencies could weaken the U.S response to rapidly evolving international threats.

V.O.S. Selections represents a pivotal case in modern separation-of-powers jurisprudence. It raises foundational questions about the scope of executive power under emergency statutes and the role of the judiciary in reviewing such claims. Given the massive amounts of revenue that the Administration claims will be brought in by the tariffs, and the argument that the tariffs in substance represent a major step towards a national consumption tax, a decision upholding the executive action could lead to other creative ways in which the Executive Branch could use emergency powers to impose other revenue generating mechanism without Congressional approval. The case illustrates a striking intersection of constitutional law, administrative law, and international trade regulation—highlighting the judiciary’s increasingly central role in policing the outer boundaries of presidential authority in the name of emergency.

ISSE will be following this litigation closely as it develops.

Photo: United States Court of International Trade building, Manhattan. By Ajay Suresh, CC BY 2.0, via Wikimedia Commons.