Libertarian Group Files 3rd Major Challenge to IEEPA Tariffs at CIT on Behalf of 11 Importers
A third case challenging President Donald Trump's use of the International Emergency Economic Powers Act has been filed at the Court of International Trade by a group of 11 companies, most of which make tabletop games. The companies, led by clothing maker Princess Awesome LLC, argue that the IEEPA doesn't authorize tariffs, Trump's declared national emergencies fail to meet the "statutory requirement of an 'unusual and extraordinary threat'" and IEEPA unconstitutionally transfers legislative power to the president (Princess Awesome v. U.S. Customs and Border Protection, CIT # 25-00078).
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In addition, the complaint said Trump's tariff orders violate the Administrative Procedure Act for unlawfully modifying the Harmonized Tariff Schedule, since they are "either in excess of statutory authority or contrary to constitutional power." Specifically, the 11 companies are only challenging the "reciprocal" IEEPA tariffs and the IEEPA tariffs imposed on China.
The case was brought on behalf of the companies by the Libertarian legal advocacy group Pacific Legal Foundation.
All 11 companies said they import products from abroad and thus already have paid or will pay the newly imposed tariffs. For instance, Princess Awesome said it was invoiced in March by CBP $1,041.40 for imports of girls' dresses from China. Foodservice product importer KingSeal Corp. said it has paid $4,159 in tariffs on one shipment from China and $9,797 on a second shipment. Gaming company Spielcraft Games said it paid $4,335.40 in tariffs on a board-game set from China, and tabletop game maker Rookie Mage Maker said it similarly paid $3,120.80 on games from China in April.
The remaining companies -- Stonemaier, Upward Glance, 300 Below, Mischief, XYZ Game Labs, Tinkerhouse and Reclamation Studio -- said they have incoming shipments and, as a result, will imminently pay the tariffs.
The complaint laid out three primary statutory or constitutional arguments against the tariffs. The first said that the tariffs are being imposed in excess of the president's statutory authority found in IEEPA, since the statute doesn't authorize tariffs. The law only lets the president "regulate" imports, the brief said, adding that this power "does not include the authority to impose tariffs."
The second count argued that Trump's emergency declarations relating to the flow of fentanyl from China and the U.S.'s bilateral trade deficits exceed the president's authority under IEEPA. Neither of these emergencies meets "the statutory requirement of an 'unusual and extraordinary threat,'" the complaint said.
The companies argued that a situation that is "sustained" or "persistent" can't "constitute an emergency based on an 'unusual or extraordinary threat.'" The complaint said the flow of fentanyl is "sustained" and "has been the subject of extended efforts at bilateral dialogue to address it at its 'root source,'" and thus can't be found to be an emergency. Likewise, bilateral trade deficits are "persistent" and can't constitute an emergency under the statute, the brief said.
Lastly, the complaint argued that if IEEPA is found to convey this power, it does so in violation of the Constitution. The word "regulate" has no "intelligible principle," which is ordinarily required when Congress delegates one of its core powers to the executive. The word "regulate" is "undefined as to the scope and meaning of the powers granted to the President," and "is guided by no standards as to the amount, timing, or scope of those tariffs," the companies argued.
IEEPA also fails to provide an intelligible principle on what constitutes an "unusual and extraordinary threat," and "whether or when the President should or should not declare a national emergency with respect to that threat," the brief said.
The Pacific Legal Foundation's case is the third major challenge brought to the trade court and the sixth to be brought against the tariffs in any venue. Three of the challenges were filed in federal district courts, though the U.S. has filed motions to transfer all three to the trade court.