CIT Denies TRO Bid in Suit Against IEEPA Tariffs, US Offers 1st Defense of Sprawling Duties

Last week, the companies, led by V.O.S. Selections, filed the application for a TRO and a motion for a preliminary injunction "and/or" summary judgment for a permanent injunction. The U.S. opposed the TRO application, arguing that the companies failed to show they would be "irreparably harmed" without a TRO. The government said none of the companies have paid any of the reciprocal tariffs, nor have they shown that they plan to pay them in the next 14 days, which is the "maximum period for a TRO."

While the court accepted the government's position on these grounds, the U.S. reply brief offered the administration's first legal defense of the reciprocal tariffs and the use of IEEPA to impose tariffs more broadly. The government concurrently defended the use of IEEPA to impose tariffs in a federal case in Montana, brought by four members of the Blackfeet Nation indigenous tribe, which is challenging Trump's use of IEEPA to impose tariffs on Canada to combat the flow of fentanyl into the U.S.

In both cases, the government argued that IEEPA clearly authorizes the president to impose tariffs and that Congress "lawfully delegated" this power to the president (V.O.S. Selections v. Donald J. Trump, CIT # 25-00066) (Susan Webber v. U.S. Department of Homeland Security, D. Mont. # 4:25-00026).

The briefs argued that the president's underlying declaration of a national emergency cannot be challenged, since such declarations are "unreviewable political questions."

The government also said the "major questions doctrine," which is a legal theory adopted by the Supreme Court that the federal government can only regulate on issues of major economic or political significance upon explicit delegation from Congress, doesn't apply here. Even if the doctrine did apply, "Congress spoke clearly when authorizing the imposition of tariffs through IEEPA," alleviating major questions concerns, the brief said.

In both cases, the U.S. also said many of the plaintiffs don't have standing to sue, since they haven't actually paid the tariffs, and that they are unlikely to suffer irreparable harm, because mere economic harm does not rise to the level of irreparable harm.

Substantive Claims

Defending against PI motions in both cases, the U.S. said none of the plaintiffs are likely to succeed on the merits of their claims. The government said that, for starters, IEEPA's "text, context, and history confirm that it authorizes the President to impose tariffs." The statute says the president can "regulate" the "importation" of property in which a foreign national has an interest to deal with a national emergency.

The brief said imposing tariffs "falls within the power to" regulate the importation of foreign goods. "Tariffs are one way of controlling how often, and on what terms, foreign goods enter the United States," the government argued. "That is what 'regulate' means, both now and when IEEPA was enacted."

The U.S. said precedent confirms this "straightforward" reading of IEEPA, citing the seminal Yoshida International v. U.S. decision, which was decided by the precursor court to the U.S. Court of Appeals for the Federal Circuit. In Yoshida, CAFC's predecessor upheld a 10% duty surcharge imposed by President Richard Nixon under the Trading With the Enemy Act, IEEPA's predecessor, explaining that the phrase "regulate importation" let the president impose a duty surcharge.

The government said the U.S. Court of Appeals for the 9th Circuit also upheld this authority when it said TWEA's express delegation to the president "was broad" and that its unambiguous wording "clearly shows that the President's actions [imposing tariffs] were" in line with the "power Congress delegated."

Any attempt to read IEEPA's list as "enumerating discrete powers instead of covering the waterfront would lead to the same conclusion about 'regulation,'" the U.S. added. If each power in IEEPA is "distinct, then 'regulation' of imports must include actions such as tariffs," otherwise it would "mean little if anything other than the power to 'prevent or prohibit' imports -- leaving the term largely superfluous."

The government also said IEEPA's history confirms the power to impose tariffs, since Congress took the statute's language directly from TWEA. "Congress was well aware of Yoshida’s interpretation of TWEA when it chose to use the same language in IEEPA," the brief said. Also, the entire purpose of IEEPA "is to give the President broad and flexible powers to effectively address problems surrounding a national emergency," and this power is confirmed by the president's "independent authority in the foreign-affairs and national security spaces," the brief said.

The U.S. went on to claim that IEEPA is a valid delegation of congressional authority, since the law "involves an area where the President has independent authority" and clearly conveys an "intelligible principle" by which the president can use his discretion. The government buoyed this claim with reference to 9th Circuit jurisprudence sustaining the use of IEEPA.

The major questions-related delegation claims fare no better, since this doctrine "has never been applied to the President’s authority to address national-security interests or other circumstances where the President has independent authority," the brief said. Even if the doctrine "were not categorically inapplicable," it wouldn't matter, since the president acted under "a clear, obviously broad authorization in a principal provision of IEEPA" within his "core competencies," the government argued.

The Blackfeet Nation plaintiffs raised a host of other claims that are unique to its case and not shared by any of the other plaintiffs challenging the IEEPA tariffs across the country. For instance, the Montana plaintiffs claim that the duties violate Native Americans' right to duty-free treatment under the Jay Treaty and that the tariffs are unconstitutionally vague. The U.S. said both of these claims will likely fail, since the Jay Treaty is no longer in effect and the plaintiffs failed to identify any features of the tariffs "that could render them vague."

Standing and Irreparable Harm

While the government's claim at CIT that the five companies suffered irreparable harm won the day at the TRO stage, the U.S. also will have to show that the plaintiffs aren't likely to suffer irreparable harm to similarly defeat the PI motion.

The U.S. said each of the five companies only offered "speculative concerns as to the effects the tariffs may eventually have on aspects of their business." For instance, V.O.S. said it expects to pay the existing 10% tariffs "at some unspecified date," and that a tariff increase will "wipe out" its "profit margin and ultimately make the business inoperable." MicroKits said the tariffs will make it likely to be "unable to order more parts to make its products" and "potentially go out of business," and Terry Cycling said the tariffs will cost the firm around $250,000 by the end of 2025" and $1.2 million in 2026, which is not an amount it can survive.

The government argued that these "generalized and speculative allegations come nowhere close to establishing that plaintiffs are at real and immediate risk of extinction."

In both the CIT and Montana cases, the government also contested many of the plaintiffs' standing to sue. At the trade court, the U.S. said none of the plaintiffs have shown that they actually paid any of the reciprocal tariffs, nor do they sufficiently show that they will suffer "imminent future injury for Article III standing." At the very least, the court should say two of the companies, FishUSA and MicroKits, lack standing, since "they do not even allege that they intend to import articles subject to the tariffs within any particular period of time," the brief said.

The government told a similar story in Montana for three of the four plaintiffs, arguing that they don't have standing, since they aren't direct importers. One of the plaintiffs, state Sen. Susan Webber, "relies solely on her representation of unnamed others who allegedly will import goods from Canada subject to the challenged tariffs." However, an "uninjured state lawmaker lacks third-party standing to sue on her constituents’ behalf," the brief said. As for the other two non-importer plaintiffs, the government noted that it's "purely speculative" whether the harm they will suffer can be "fairly" traced to the tariffs or redressed by enjoining the tariffs.

A hearing is set in Montana for May 1 on the Blackfeet Nation members' injunction motion.