The Trump administration is taking its tariff fight to the Supreme Court after a federal appeals court ruled that the President lacks authority to impose sweeping import duties under emergency powers law.

The US Court of Appeals for the Federal Circuit delivered that verdict on August 29, finding that the International Emergency Economic Powers Act, known as IEEPA, simply does not give the President the power to slap tariffs on imports. Fifteen judges across three separate courts, appointed by presidents from both parties, have now reached the same conclusion.

What happened and why it matters

The administration used IEEPA to justify five executive orders imposing tariffs ranging from 10% to 50% on imports from nearly all US trading partners, with Canada, Mexico, and China bearing the heaviest burden.

The case, styled as V.O.S. Selections, Inc. v. Trump, tested whether that creativity holds up in court. The Federal Circuit said it doesn’t. While the court acknowledged IEEPA grants considerable presidential authority, it drew a clear line: the statute does not explicitly empower the executive branch to impose tariffs.

The Department of Justice filed a petition for expedited review with the Supreme Court on September 4, asking the justices to fast-track oral arguments. The Federal Circuit’s ruling has been stayed until October 14, meaning the tariffs remain in effect for now while the legal machinery grinds forward.

That stay is doing a lot of heavy lifting. Without it, the tariffs established through all five executive orders would face immediate disruption, potentially unwinding months of trade policy in a single stroke.

The legal landscape so far

The scorecard is not encouraging for the administration. Fifteen judges across three courts have examined the question of whether IEEPA authorizes tariffs, and every single one has said no. That’s a bipartisan judicial consensus, with appointees from both Republican and Democratic presidents reaching the same conclusion.

The central legal question is straightforward but consequential: does a law about emergency economic powers implicitly include the power to tax imports? The administration argues that tariffs are a form of economic regulation that falls under IEEPA’s broad umbrella. Critics counter that tariffs are a revenue measure, and the Constitution gives Congress, not the President, the power to levy taxes and regulate commerce with foreign nations.

What this means for investors

If the Supreme Court upholds the Federal Circuit’s ruling, all IEEPA-based tariffs could be invalidated. That opens the door to refund opportunities for every duty payment made under these executive orders. Companies that paid 10% to 50% premiums on imports would be entitled to get that money back.

The October 14 stay expiration is the next date to watch. If the Supreme Court agrees to hear the case on an expedited basis, oral arguments could happen before the end of 2025. If it declines expedited review, the tariffs would face a legal limbo that could stretch well into 2026.