Labor & Employment Law Daily Wrap Up, SUPREME COURT NEWS—Court issues decision on Trump’s tariffs, (Feb 20, 2026)

By Brandi O. Brown, J.D.

“We claim only, as we must, the limited role assigned to us by Article III of the Constitution. Fulfilling that role, we hold that IEEPA does not authorize the President to impose tariffs.”

In a 6-3 opinion with a majority penned by Chief Justice Roberts, the U.S. Supreme Court today issued its verdict on President Trump’s tariffs, holding in Learning Resources, Inc. v. Trump that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs.

The decision stems from two legal challenges levied against tariffs declared by the White House as a response to two alleged foreign threats: the influx of illegal drugs from Canada, Mexico, and China; and “large and persistent” trade deficits. Trump declared a national emergency as to both, deeming them “unusual and extraordinary,” and invoked his purported authority under the IEEPA to respond. The lawsuits contended that IEEPA does not authorize the reciprocal or drug trafficking tariffs and resulted, ultimately, in petitions for certiorari. The Court consolidated the cases and issued its decision.

Chief Justice Roberts summarized the controversy: “The President asserts the extraordinary power to unilaterally impose tariffs of unlimited amount, duration, and scope. In light of the breadth, history, and constitutional context of that asserted authority, he must identify clear congressional authorization to exercise it.”

IEEPA doesn’t cut it. Though the government argued that IEEPA allowed the President to exercise similar power, the Court was not persuaded. “IEEPA’s grant of authority to ‘regulate... importation’ falls short. IEEPA contains no reference to tariffs or duties. The Government points to no statute in which Congress used the word ‘regulate’ to authorize taxation. And until now no President has read IEEPA to confer such power.”

“We claim no special competence in matters of economics or foreign affairs,” explained the Court majority. “We claim only, as we must, the limited role assigned to us by Article III of the Constitution. Fulfilling that role, we hold that IEEPA does not authorize the President to impose tariffs.”

Find a different statute? Justice Kavanaugh, whose opinion was joined by Justices Thomas and Alito, dissented, contending that “[s]tatutory text, history, and precedent” demonstrated that, under the IEEPA, tariffs are a means to “regulate... importation.” The dissent cited concerns about the practical implications of the decision, such as whether the U.S. government will have to issue refunds and, if so, how that will look, arguing that “the interim effects of the Court’s decision could be substantial.”

Kavanaugh also provided a potential roadmap that could allow the Trump administration to move forward with tariffs, noting other federal statutes that might justify them. “In essence,” he wrote, “the Court today concludes that the President checked the wrong statutory box by relying on IEEPA rather than another statute to impose these tariffs.”

MainStory: TopStory SupremeCourtNews LitigationNewsTrends EconomicNews GCNNews