California Tells 9th Circuit CIT Lacks Exclusive Jurisdiction Over Its IEEPA Suit
In a reply brief, California said Aug. 18 that the U.S. had conceded the state’s challenge to President Donald Trump’s International Emergency Economic Powers Act tariffs “arises out of” the IEEPA. The government’s following argument, that it also arises from Trump’s recent executive orders modifying the Harmonized Tariff Schedule to implement the tariffs, fails because those orders weren’t authorized by a “law of the United States,” it said (State of California v. Donald J. Trump, 9th Cir. # 25-3493).
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The state is in the U.S. Court of Appeals for the 9th Circuit to appeal the transfer of its case from the U.S. District Court for the Northern District of California to the Court of International Trade (see 2507010048).
In its 9th Circuit reply brief, California again said that Section 1581(i) grants CIT exclusive jurisdiction over actions arising from laws providing for tariffs. But because IEEPA doesn’t actually provide for tariffs, claims arising from it aren’t Section 1581(i) claims, it said.
Neither the HTS nor its modifications via Trump’s executive orders are laws providing for tariffs that would grant CIT that jurisdiction, either, it said.
It said the tariff schedule “only treats as statutory law a ‘modification or change made … under authority of law’” -- but any modifications made by recent executive orders relying on IEEPA weren’t made under “authority of law” because IEEPA doesn’t provide for tariffs.
And if the U.S. was correct that 1581(i) also provides CIT exclusive jurisdiction over actions arising from HTS and related executive orders, it said, that would mean “any case that even relates to tariffs would be limited to the Court of International Trade.” That “would render Section 1581(i) impermissibly broad,” it argued.
It said the Supreme Court case K Mart v. Cartier forbids the government's interpretation. In that case, it said, the Supreme Court ruled that “Congress did not commit to the Court of International Trade’s exclusive jurisdiction every suit against the Government challenging customs-related laws and regulations.”
If the legislature had intended the trade court to hear all customs-related matters, further, it would have written 1581(i) to “much more clearly and simply” grant CIT jurisdiction “over actions ‘arising out of a tariff rate embodied in the HTSUS’ or ‘directly affecting tariffs,’” California said, quoting K Mart.
California also called it unremarkable that the “jurisdictional inquir[y] and the merits” in this are “intertwined.” This is common in certain types of cases, it said. For example, the jurisdiction of actions brought under the Foreign Sovereign Immunities Act is often decided based on “whether property was taken ‘in violation of international law,’” it said.
Finally, it pushed back against the government’s “fallback request” that California’s case be transferred so that the 9th Circuit could defer the jurisdictional issue to CIT. Transfer is only permissible when a court determines it lacks jurisdiction; “mere ‘doubt’ is insufficient,” it said.
“This Court has the ability and responsibility to decide whether jurisdiction lies in district court or the Court of International Trade,” it said. “That the Court of International Trade exercised jurisdiction over some other cases challenging these tariffs does not relieve this Court of its responsibility.”
CIT (see 2506030050) and district courts in Florida (see 2505210027) and Montana (see 2504250063) have ruled that the trade court has exclusive jurisdiction over IEEPA challenges. In contrast, the U.S. District Court for the District of Columbia denied the transfer motion in its case (see 2506030020). Though it has determined repeatedly that it has jurisdiction over the IEEPA cases under 1581(i), CIT ruled in May that the law itself doesn’t grant the president the authority to implement tariffs.