Montana Court Sends IEEPA Case to CIT, Plaintiffs Appeal to 9th Circuit
The U.S. District Court for the District of Montana on April 25 transferred a case filed by four members of the Blackfeet Nation tribe challenging the tariffs on Canada issued under the International Emergency Economic Powers Act to the Court of International Trade. Judge Dana Christensen held that two cases establishing the trade court's exclusive jurisdiction to hear cases arising out of the Trading With the Enemy Act, IEEPA's predecessor, confirm CIT's exclusive jurisdiction to hear cases involving IEEPA, given that IEEPA has the "same operative language as that contained in the TWEA" (Susan Webber v. U.S. Department of Homeland Security, D.Mont. # 4:25-00026).
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Monica Tranel, attorney for the four Blackeet Nation members, immediately filed a notice of appeal of the transfer order to the U.S. Court of Appeals for the 9th Circuit.
The four Blackfeet Nation members filed suit earlier this month, challenging the IEEPA tariffs on Canada, the adjustment to these tariffs by the reciprocal IEEPA duties and President Donald Trump's expansion of the Section 232 steel and aluminum tariffs on Canada (see 2504100039). As an alternative basis for relief, the complaint said the tribal members are entitled to duty-free treatment for their imports under the Jay Treaty.
The U.S. filed a motion to transfer the suit to the trade court, arguing that the court has exclusive jurisdiction to hear the case under Section 1581(i) (see 2504150022). This statute says the court has "exclusive jurisdiction" over "any civil action" arising out of "any law of the United States" that provides for "tariffs, duties, fees or other taxes on the importation of merchandise for reason other than the raising of revenue" or under any law providing for "revenue from imports."
Christensen noted that whether CIT has exclusive jurisdiction over cases on IEEPA tariff action is a "case of first impression." The judge said in resolving the question, two cases "prove instructive" -- Cornet Stores v. Morton and U.S. v. Yoshida, both of which established exclusive jurisdiction at the trade court's predecessor to hear challenges to tariff action airing out of TWEA, IEEPA's predecessor.
While the Blackfeet Nation members "attempt to distinguish the reach" of TWEA by claiming IEEPA has a more limited scope than TWEA, the judge said IEEPA has the "same operative language" as TWEA. This langauge gives the president the power to "regulate" imports. "Plaintiffs fail to establish how the limits placed on the IEEPA’s grant of authority affect the jurisdiction of the Court of International Trade," the court said.
The Blackfeet Nation members also said that since IEEPA doesn't explicitly mention tariffs, it can't stand as a jurisdictional basis to transfer the suit to CIT. Christensen again said this claim is "foreclosed" by the Yoshida decision, which upheld President Richard Nixon's ability to impose a 10% duty surcharge under TWEA.
The plaintiffs additionally argued that the IEEPA tariffs are meant to "raise revenue" and thus are precluded from being considered at CIT, evidenced by various comments made by Trump and his Cabinet officials about how much money the tariffs will bring in. The judge said these statements notwithstanding, the IEEPA tariffs were imposed when the president signed an executive order, "at least in part, to address the 'flow of illicit drugs' across the northern border by imposing duties," and to "address trade deficits." Christensen added that the "prudent thing to do" is transfer the case to CIT so it can "determine the question of its own jurisdiction."
The Blackfeet Nation members' final effort to keep the case in the Montana court rested on its alternative claim regarding the Jay Treaty. Christensen said this claim similarly falls under CIT's "jurisdictional purview," since it "has historically considered similar claims."
Currently, two other cases challenging tariff action taken under IEEPA are sitting before federal district courts and are both facing motions from the U.S. to transfer them to CIT. One is before the U.S. District Court for the Northern District of Florida and was filed by an individual importer, while another sits before the U.S. District Court for the Northern District of California and was filed by the state of California (see 2504180009).