Small US firms sue Trump over “Liberation Day” tariffs, claiming unconstitutional use of executive powers under the IEEPA.

In Short

Several small US businesses are suing President Trump over his “Liberation Day” tariffs, claiming his use of the International Emergency Economic Powers Act is unconstitutional.

The lawsuit argues that the cited emergency is unjustified and seeks to declare Trump’s tariff actions illegal.

Several small US businesses have initiated a lawsuit against President Donald Trump concerning his “Liberation Day” tariffs.

The businesses argue that Trump’s use of the International Emergency Economic Powers Act to enforce these tariffs is unconstitutional. They claim the emergency he cited is unfounded, stating that long-standing trade deficits do not constitute an emergency.

This lawsuit adds to a growing number of legal challenges against Trump’s tariff policies. The International Emergency Economic Powers Act grants the president extensive authority to regulate financial transactions under a declared national emergency.

Extraordinary threat

Trump was the first president to apply this statute for tariffs, launching levies in February to address what he termed as an “extraordinary threat” from undocumented immigrants and illegal drugs crossing US borders.

On April 2, he announced a 10% tariff on all imports during what he called “Liberation Day,” while imposing additional duties on nearly 60 nations. However, he later announced a temporary pause on most new tariffs, simultaneously increasing duties on imports from China.

These tariff measures have unsettled financial markets, spurred recession warnings, and strained international trade relations.

The lawsuit was filed by the Liberty Justice Center, representing five small firms, including a wine distributor and a women’s cycling apparel brand. Previous legal actions against Trump’s tariffs include one filed by a small stationery business and another by a Native American tribe in Montana.