On February 20, 2026, the United States Supreme Court issued its much anticipated decision in Learning Resources, Inc. v. Trump. At issue was whether the International Emergency Economic Powers Act (IEEPA) authorized the President to impose tariffs. In a lengthy 6-3 decision, the Supreme Court ruled that IEEPA did not authorize imposition of tariffs by the President. The Court remanded the matter with instructions to dismiss for lack of jurisdiction. This article briefly addresses key aspects of the majority opinion and Justice Kavanaugh’s dissent, which was joined by Justice Thomas and Justice Alito.
Background
In January 2025, President Trump imposed tariffs on Mexico, Canada, and China. In a fact sheet, President Trump declared that an influx of “poisonous fentanyl” and “the extraordinary threat posed by illegal aliens” had created national emergencies. These emergencies, according to President Trump, authorized him to impose tariffs under IEEPA. IEEPA was passed in 1977 to provide the President with the authority to respond to a declared national emergency using specific powers enumerated in the act. Notably, the term “tariff” is not expressly included in IEEPA. The law is intended, primarily, to deal with “any unusual and extraordinary threat” stemming from a foreign source. However, once the President has declared a national emergency, IEEPA provides the President authority to take certain economic actions. In this case, President Trump relied on statutory language granting the President authority to “regulate . . . importation.” Whether “regulate . . . importation” includes the power to impose tariffs is the central issue of the Court’s decision.
In April 2025, five businesses brought an action before the Court of International Trade (CIT), arguing that IEEPA did not authorize the President to impose tariffs. The CIT agreed with the plaintiffs, holding that IEEPA did not authorize the challenged tariffs because they “exceed any authority granted to the President by IEEPA.” The government appealed that decision to the United States Court of Appeals for the Federal Circuit. The Federal Circuit affirmed the CIT. It did, however, allow the tariffs to remain in place while the matter was appealed to the Supreme Court. For additional background about the lower courts’ decisions, click here.
But the CIT wasn’t the only court to hear a similar challenge. Because in May a group of businesses brought an action before the United States District Court for the District of Columbia. In that case, Learning Resources, Inc. v. Trump, the plaintiffs also argued that IEEPA did not authorize the President to levy tariffs. The district court agreed, holding that IEEPA did not authorize the challenged tariffs because “IEEPA is not a law providing for tariffs.” The district court denied the government’s motion to transfer the case to the CIT and granted the plaintiffs motion for a preliminary injunction to prevent the government from collecting the challenged tariffs.
Both cases were appealed to the Supreme Court and consolidated in the Court’s hearing of Learning Resources, Inc. On appeal, two questions were presented to the Supreme Court. First, whether the IEEPA allows a President to institute tariffs after declaring a national emergency. Second, if IEEPA authorizes the tariffs, whether the statute unconstitutionally delegates legislative authority to the President. Ultimately, the Court found in the negative on the first question, holding that IEEPA did not confer tariff authority to the President. Given the Court’s finding that IEEPA did not grant that authority, the court did not answer the subsequent question of whether such a delegation would have been unconstitutional.
The Supreme Court’s Decision
Citing Article I, Section 8 of the U.S. Constitution, which grants Congress the “power to lay and collect taxes, duties, imposts, and excises”, the Court noted that the President possesses no inherent authority to impose tariffs during peacetime. Further, the Court explained that the Framers “did not vest any part of the taxing power in the Executive branch.” The government generally agreed, conceding that the President holds no “inherent” constitutional authority to impose tariffs. Instead, the government asserted that it was the IEEPA-granted power to “regulate . . . importation” which allowed the President to impose the tariffs at issue.
The Court considered that question in light of the “major questions doctrine.” According to the Court, the “major questions” doctrine requires federal agencies to have clear congressional authorization when acting under statutes of “vast economic or political significance.” In its consideration, it highlighted prior decisions, such as West Virginia v. EPA, where “ambiguous” statutory text led to the government claiming “broad” and “expansive” powers. In considering Congressional intent to delegate that amount of authority, the court considered a broad range of context- “not just other language within the statute, but ‘constitutional structure’ and ‘common sense.’”
The Court determined that the context did not show congressional intent sufficient to authorize the President to impose tariffs. First, the court reasoned that both common sense and congressional practice show that Congress will “clearly” delegate the authority to impose tariffs when it intends to do so. According to the Court, when the “core congressional power of the purse” is at issue, a reasonable interpreter would expect Congress to clearly delegate that power. The Court explained that this “common sense” is supported by congressional practice, because “when Congress has delegated its tariff powers, it has done so in explicit terms, and subject to strict limits.” To the contrary, the Court opined that the government’s reading of IEEPA would allow the President to “unilaterally impose unbounded tariffs” while unchecked by “significant procedural limitations in other tariff statutes.” The Court reasoned that such an interpretation of IEEPA would result in a “transformative expansion” of the President’s authority regarding imposition of tariffs.
The Court pointed out that no President had previously attempted to use IEEPA to impose tariffs. Instead, Presidents have relied on alternate statutes to impose tariffs, none of which “even begin to approach the size or scope” of the tariffs at issue. The Court held that this “lack of historical precedent and the “breadth of authority” claimed by the President demonstrate that imposition of tariffs under IEEPA are beyond the President’s “legitimate reach.”
The Court then pointed out that IEEPA does not expressly mention “tariffs” among the list of powers enumerated in IEEPA. “Had Congress intended to convey the distinct and extraordinary power to impose tariffs,” the Court explained, “it would have done so expressly — as it consistently has in other tariff statutes.”
The Court also discussed the “neighboring words” in IEEPA’s text, noting that “regulate” is one of nine verbs listed in the text of IEEPA when describing the President’s authority regarding importations and exportations. So, the court considered whether words that were included- such as the term “regulate”- could be read to include that authority. Its ruling then outlined the reasons why it cannot. First, the Court noted that “when Congress addresses both the power to regulate and the power to tax, it does separately and expressly.” Further “that Congress did not grant those authorities separately here is strong evidence that ‘regulate’ in IEEPA does not include taxation.”
The Court also opined that each verb, including “regulate” “authorizes a distinct action a President might take in sanctioning foreign actors or controlling domestic actors engaged in foreign commerce.” However, as noted by the Court, IEEPA does not include any authorization for “the distinct and extraordinary power to raise revenue.” The Court concluded that “the fact that no President has ever found such power in IEEPA is strong evidence that it does not exist.” Overall, the Court explained that it would not “set forth the metes and bounds of the President’s authority to ‘regulate . . . importation’ under IEEPA.” Instead, the Court reiterated that its only task was to decide “only whether the power to ‘regulate . . . importation,’ as granted to the President in IEEPA, embraces the power to impose tariffs.” In short, the Court found that IEEPA does not expressly or implicitly give the President authority to impose tariffs.
Next, the Court considered the government’s argument in relation to the Trading with the Enemy Act (TWEA). TWEA is the statute that IEEPA was intended to replace. In 1975, the Court of Customs and Patent Appeals ruled that TWEA authorized tariffs implemented by President Nixon. TWEA, like IEEPA, authorized the President to “regulate . . . importation.” The government contended that Congress intended this same authority when it enacted IEEPA two years later. The Court rejected this argument as well, explaining that it will only incorporate judicial definitions into law when the definition was “well-settled” before the adoption of the definition. The Court noted that “a single, expressly limited opinion from a specialized intermediate appellate court does not clear that hurdle.”
Finally, the government asserted several arguments based on the Court’s wartime precedents. Primarily, the government asserted that the Court’s prior decisions show “an inherent Presidential power to impose tariffs during armed conflict.” According to the government, these wartime precedents were codified by Congress when enacting TWEA and IEEPA. However, the Court noted that regardless of what this may mean for wartime tariffs, “all parties agree that the President has no inherent peacetime authority to impose tariffs.”
For these reasons, the Court held that IEEPA does not authorize the President to impose tariffs. With this holding, the Court affirmed the judgment of the U.S. Court of Appeals for the Federal Circuit and vacated the judgment of the United States District Court for the District of Columbia. On remand, the Court instructed the matter to be dismissed for lack of jurisdiction.
Justice Kavanaugh’s Dissent
In his dissent, Justice Kavanaugh, joined by Justice Thomas and Justice Alito, wrote that “statutory text, history, and precedent” demonstrate that tariffs are a means to “regulate . . . importation” and that tariffs are a “traditional and common” method for regulating importation. In support of this claim, the dissent cited multiple dictionary definitions of “regulate” which Justice Kavanaugh claimed “clearly” indicate tariffs as a means of regulating imports. The dissent further argued that IEEPA is a “broadly worded statute” which “did not exclude tariffs or dictate any specific means of regulating importation.” Justice Kavanaugh also highlighted TWEA, arguing that President Nixon’s tariffs enacted under TWEA “persuasively demonstrate” that Congress and the public would have understood “regulate . . . importation” to include tariffs.
Justice Kavanaugh also discussed potential refunds in the dissent, an issue that was not addressed in the majority opinion. Justice Kavanaugh stated that issuing refunds will create “significant consequences” for the U.S. treasury. The dissent explained that “the Court says nothing today about whether, and if so how, the Government should go about returning the billions of dollars that it has collected from importers.” Justice Kavanaugh also noted that the Court’s decision could create “uncertainty regarding various trade agreements.” Finally, Justice Kavanaugh concluded his dissent by stating that IEEPA tariffs are “clearly lawful” as a matter of “text, history, and precedent.”
Moving Forward
The Court’s decision has clarified the scope of IEEPA as it relates to tariffs, but only with respect to IEEPA. Soon after the Court’s decision was announced President Trump has indicated that the administration will use “other alternatives” to implement additional tariffs. In fact, President Trump has already laid a 10% worldwide tariff under Section 122 of the Trade Act. Under Section 122, the President can lay a “temporary import surcharge” to address international payment problems. The “temporary import surcharge” may not persist longer than 150 days, unless it is extended by Congress. President Trump has stated that he intends to increase this rate to 15%, which is the maximum rate allowed under the statute. Additionally, several lawsuits are currently underway in which plaintiffs seek refunds of tariffs paid pursuant to IEEPA. A recent order from the CIT held that “all importers of record whose entries subject to IEEPA duties are entitled to benefit.” There, the CIT ordered U.S. Customs and Border Protection to begin the “liquidation” process for previously unliquidated IEEPA duties. Liquidation is the final valuation of total tariff amount owed, and the necessary step to begin the process of refunds. However, this order could potentially be appealed by the government, which would further delay the refund process. Additionally, the question remains as to how refunds will potentially be implemented for duties liquidated prior to the Supreme Court’s decision. To stay updated, please sign up for NALC resource “The Feed” to keep track of future developments.