Educational Materials Importer Opposes Transfer of IEEPA Challenge to CIT
Pushing back against a motion to transfer an International Emergency Economic Powers Act challenge to the Court of International Trade, educational materials importers led by Learning Resources said May 7 that the case’s jurisdictional question overlaps with its substantive one -- whether IEEPA actually permits the president to levy tariffs (Learning Resources, Inc. v. Donald J. Trump, D. D.C. # 25-01248).
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“In fact, until the suits challenging the executive orders at issue, the federal government has never sought to transfer an IEEPA case to the CIT,” Learning Resources said in its opposition motion. “For good reason: accepting Defendant’s arguments would lead to arbitrary jurisdictional rules, conflicting precedents, and a startling expansion of the CIT’s exclusive jurisdiction over matters for which it has no expertise.”
It told the U.S. District Court for the District of Columbia that the government, in its transfer motion, “appears to contend that it is sufficient for this case to involve ‘tariffs’ as a general matter.” But this isn’t enough for a transfer to CIT, it said; under Section 1581(i), the disputed law in question has to itself “provide for” either tariffs or tariff administration.
This was true for all of the cases successfully transferred to CIT that the U.S. pointed to in its motion, it said, but not for any of the current cases involving IEEPA.
And the one case CIT heard under the Trading With the Enemy Act decades ago came to the trade court under an earlier jurisdictional statute, it said. So too did several other cases upon which the U.S. was trying to rely -- United States v. Yoshida International, Henry Pollack, Inc. v. Blumenthal and Cornet Stores v. Morton. Those were heard by the trade court under a statute “that was nothing like Section 1581(i) today,” it said.
It disagreed with the recent decision of the U.S. District Court for the District of Montana to transfer its own similar IEEPA challenge to CIT. That court also based its decision on Yoshida International, Henry Pollack and Cornet Stores.
CIT itself has never pronounced jurisdiction over an IEEPA case, it noted. Further, the trade court has never even heard an IEEPA case up until very recently, it claimed.
On the other hand, district courts and regional appeals courts have, it said, with the result that they have “developed a body of case law regarding IEEPA over decades.” For that reason, keeping the current challenge local would both promote uniformity in rulings across jurisdictions and ensure that the presiding court had the best expertise, it said.
Learning Resources also filed again in support of its preliminary injunction (see 2504290057).
It talked more about Yoshida, calling it the evidence on which “the government leans on most heavily” -- more so than even the text of IEEPA itself, it claimed.
In Yoshida, the U.S. Court of Customs and Patent Appeals found that President Richard Nixon did have the power to levy tariffs under the Trading With the Enemies Act. That case doesn’t help the government because, after Yoshida, Congress passed IEEPA to narrow the president’s power to “interfere with international trade in non-emergency, peacetime situations,” it said.
And it emphasized the harms it said the tariffs have already caused it and its fellow plaintiff, Hand2Mind.
It said that it already has lost more than a million dollars in stopped and canceled shipments and has been working to reduce operating expenses by 10% -- which won’t be enough -- since the imposition of the tariffs. In the past, it said, the plaintiffs have lost customers for price increases of only 2%, while the tariffs will require price hikes of 70% or more. And paying the tariffs in 2025 “would result in more than $100 million in cash expenditures,” which was more than the plaintiffs' budget “for every non-salary expense combined,” it said.
Their CEO’s estimation that their year-over-year sales will decline by a quarter to up to a half is “based on these realities, not speculation,” it said.
“Defendants nonetheless make the astonishing argument that the harms from the 145% IEEPA tariffs on China are ‘not sufficient’ because ‘only’ about ‘60% of the products [plaintiffs] sell or consume as components (by costs) are manufactured in China,” it said. “‘Only’?”