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WASHINGTON (CN) — A Federal Circuit panel ruled that President Donald Trump’s blanket “Liberation Day” tariffs can stand through the summer in a decision released Wednesday, extending a freeze placed on a trade court’s ruling that Trump exceeded his authority.
The 11-judge panel wrote in the per curiam order that pausing the Court of International Trade’s injunction was necessary to avoid placing an undue burden on the Trump administration before the appeals court could reach an ultimate decision on the constitutionality of the tariffs.
Led by Chief Circuit Judge Kimberly Moore, a George W. Bush appointee, the panel said the consolidated cases — brought by a coalition of small businesses and 12 attorneys general — presented issues of “exceptional importance” and thus would be heard by an en banc panel at oral arguments on July 31.
In the order, the panel cited the Supreme Court’s ruling in Trump v. Wilcox — allowing Trump to fire the heads of the National Labor Relations Board and the Merit Systems Protection Board, for now — as part of its reasoning that a stay was justified, but did not provide further explanation.
The Trump administration has maintained that the blanket 10% tariffs and certain reciprocal tariffs are necessary to address the declared economic emergency caused by the nation’s “exploding” trade deficits with its trading partners.
In its motion for the stay, the Justice Department described the tariffs as part of Trump’s effort to “reorient the global economy on an equal footing.”
“The injunction unilaterally disarms the United States in the face of the long-standing predatory trade practices of other countries — who, not withstanding the injunction, remain free to impose punitive tariffs on American products and hobble our economy,” the Justice Department said. “The injunction threatens to unwind months of foreign policy decision-making and sensitive diplomatic negotiations, at the expense of nation’s economic well-being and national security.”
Further, the Court of International Trade’s injunction violated the separation of powers by injecting itself into the country’s foreign policy and stripping the president of a diplomatic tool, the Justice Department said.
The trade court panel had ruled May 28 that Trump exceeded his constitutional authority by declaring an “economic emergency” and invoking the International Emergency Economic Powers Act of 1977 to impose a blanket 10% tariff on 57 countries on April 2.
On top of the 10% tariffs, Trump levied additional rates ranging from 11% to 50% depending on the trade deficit with each country determined by the administration.
The three-judge trade panel unanimously struck down Trump’s tariffs, finding that ruling otherwise would amount to an unconstitutional and “unlimited delegation of tariff authority” from Congress to the White House.
On May 29, U.S. District Judge Rudolph Contreras similarly struck down tariffs that impacted two small educational toy businesses, which manufacture most of their products in China, Taiwan, South Korea, Vietnam, Thailand and India.
“This case is not about tariffs qua tariffs,” Contreras wrote. “It is about whether IEEPA enables the president to unilaterally impose, revoke, pause, reinstate and adjust tariffs to reorder the global economy. The court agrees with plaintiffs that it does not.”
The Trump administration also appealed Contreras’ original decision to the D.C. Circuit, leading the Barack Obama appointee to temporarily lift his order on June 3 following the Federal Circuit’s decision to freeze the trade court’s order.
A three-judge panel made up of D.C. Circuit judges Gregory Katsas, Neomi Rao and Justin Walker — the only Trump appointees on that court — will hear the case, although oral arguments have yet to be scheduled.
While the full Federal Circuit is made up of 19 judges, the en banc panel will not include U.S. Circuit Judge Pauline Newman, who did not participate in the decisions regarding the government’s stay requests.
Newman, a Ronald Regan appointee and the oldest non-senior federal judge at 97, was suspended by the Federal Circuit’s Judicial Council in September 2023 for failing to cooperate with an investigation into her mental fitness.
Newman sued over her suspension, but U.S. District Judge Christopher Cooper dismissed her suit. An appeal is currently pending at the D.C. Circuit.
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