A federal judge has blocked the Trump administration from collecting tariffs on two Illinois-based toy importers, marking the second court decision in two days against President Trump’s major trade policy.
What Did the Court Decide?
U.S. District Judge Rudolph Contreras ordered on May 29 that the government cannot collect tariffs from Learning Resources and hand2mind, companies located in Vernon Hills, Illinois, while the case proceeds through the courts. However, he temporarily paused his ruling to allow the government two weeks to file an appeal.
The ruling follows the Court of International Trade’s May 28 decision that overturned Trump’s tariffs imposed on April 2 across many countries.
Judge Contreras wrote clearly that the International Emergency Economic Powers Act (IEEPA) of 1977 does not give the president the authority to impose tariffs as Trump claimed.
About the Companies and Tariffs
Learning Resources and hand2mind import toys such as Spike the Fine Motor Hedgehog, Peekaboo Learning Farm, and Kanoodle from countries including China, Taiwan, Korea, Vietnam, Thailand, and India.
These companies, which employ 500 workers across Illinois, California, and New York, said they survived the challenges of COVID-19 but warned that the tariffs could threaten their survival.
In their lawsuit, they argued that Congress never authorized the president to impose such large tariffs unilaterally.
Government’s Defense
Government lawyers, however, argued that the IEEPA allows the president to regulate imports, including setting tariffs.
During a May 27 hearing, Justice Department lawyer Brett Shumate urged the judge to transfer the case to the Court of International Trade because of its judges’ expertise in trade matters.
Shumate warned that blocking the president’s tariff powers would harm national security and foreign policy, saying, “Granting any relief under IEEPA tariffs would be catastrophic for our national security and foreign policy.”
What Happens Next?
The government has said it will appeal the recent rulings, keeping the legal fight ongoing.