A lawsuit has been filed in the U.S. Court of International Trade challenging President Donald Trump’s tariffs on Canadian goods. Filed on Tuesday by the non-profit Liberty Justice Center on behalf of U.S. food importer Gellert Global Group, the case argues that Trump has exceeded his presidential authority by invoking a trade law dating back to the Great Depression.
In August, Trump invoked Section 338 of the Tariff Act of 1930 to impose tariffs of up to 50% on around $20 billion worth of Canadian goods after trade talks broke down. Canada responded with matching tariffs, adding to tensions between the two longstanding allies. The dispute escalated further last month when Trump announced a ban on nearly $1 billion worth of Canadian products, including alcohol, dairy products and motorcycles.
Since returning to office last year, Trump has pursued a broad protectionist trade agenda centered on raising tariffs on imported goods. A key element of that strategy involved invoking a 1977 statute to declare persistent U.S. trade deficits a national emergency, providing the basis for imposing double-digit tariffs on imports from countries around the world. However, the Supreme Court invalidated those tariffs in February, requiring the administration to refund billions of dollars collected from importers.
Trump has since sought alternative legal grounds for imposing tariffs on imports. He turned to Section 338 to penalize Canada over alleged discrimination against U.S. dairy, automotive and alcoholic beverage products.
Although Section 338 grants the president certain tariff powers, the U.S. Constitution originally assigns the authority to impose tariffs to Congress. Subsequent trade laws narrowed the president’s powers by limiting their use to specific circumstances, such as national security threats and foreign currency crises, while requiring investigations and other procedural steps before tariffs could be imposed.
The Liberty Justice Center argues that these later laws superseded the president’s authority under Section 338, effectively rendering the provision obsolete.
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