The Supreme Court is being asked by two toy companies to rule on the legal fight over President Trump’s tariffs, giving the nation’s highest court the chance to determine whether the president has the authority to enact some of his most aggressive trade policies.
That key question hangs in the balance after a three-judge panel at the US Court of International Trade (CIT) sided in May with a group of small businesses that argued Trump lacked authority to impose his “Liberation Day” duties under the International Economic Emergency Powers Act (IEEPA).
Trump appealed that decision to the US Court of Appeals for the Federal Circuit in Washington, D.C., which has allowed Trump’s tariffs to stay in force while it considers whether the president has the ultimate legal authority to impose the duties. Oral arguments are scheduled to start on July 31.
But now two toy companies that filed a separate tariff lawsuit against Trump — Learning Resources and Hand2Mind — have asked the Supreme Court to consider their case and put it on a fast track.
In recent terms, this court has allowed prompt review in cases of similarly (or less) far-reaching political and economic Importance.
All of the challengers to Trump’s tariffs are arguing that the administration’s basis for the duties — a national emergency caused by illegal immigration and flows of illegal drugs from overseas — was unauthorized because it did not directly address the stated emergency.
“Whether the President has authority to impose tariffs … is of such imperative importance that it warrants review now,” the toy companies said in their Tuesday filing to the Supreme Court.
The toy companies have already won a victory before US District Judge Rudolph Contreras in Washington, D.C., but the decision was narrow in scope.
Trump appealed it, and now the companies want to skip that battle and go directly to the nation’s highest court.
Read more: 5 ways to tariff-proof your finances
The companies want the Supreme Court to decide on whether to take this case before its summer recess starts near the end of this month, setting up possible arguments in the fall.
They argue in their petition to the court that an analysis by JPMorgan shows the round of Trump tariffs at issue “would hike taxes on Americans by $660 billion a year, the largest tax increase in recent memory by a longshot,” and “cause prices to surge” by “adding 2% to the Consumer Price Index.”
Since the beginning of the year, the tariff onslaught has caused “the nation’s overall average effective tariff rate” to jump from “2.5 percent” to “around 27 percent” — more than a tenfold increase and “the highest for the U.S. in more than a century.”
Legal experts have long predicted that the legality of Trump’s tariff justifications would eventually be taken up by the Supreme Court.
That could mean the Trump administration will have to grapple with the hurdle of the “major questions doctrine,” which limits the authority of federal agencies to take action on issues of “vast economic and political significance” except where Congress has explicitly authorized the action.
Trump’s legal team is looking to former President Richard Nixon as proof that Trump’s global tariffs should be allowed to eventually stand in court.
Roughly five decades ago, 10% duties unilaterally imposed by the 37th president as part of a set of economic measures dubbed the “Nixon shock” were challenged in court in much the same way as Trump’s 2025 tariffs have been.
Nixon’s duties also suffered an initial defeat.
What has emboldened the Trump administration is that the Nixon-era Justice Department eventually won its case on appeal, an outcome the Trump administration has cited in court documents, predicting that its legal saga would likely turn out the same way.
Click here for political news related to business and money policies that will shape tomorrow’s stock prices
Read the latest financial and business news from Yahoo Finance
