The Liberty Justice Center filed a lawsuit challenging Trump administration tariffs on Canadian goods, arguing the White House exceeded its legal authority and harmed American businesses.
The lawsuit targets a 50% levy imposed on approximately $20 billion in Canadian goods after trade talks between the US and Canada broke down in August. The legal group filed the suit on behalf of Gellert Global Group, a New Jersey-based food business paying the tariffs on Canadian cheese exports. The case seeks to have the levies declared unlawful and to secure refunds with interest for affected importers.
The White House relied on Section 338 of the 1930 Tariff Act to impose duties on Canadian wine, dairy products and hockey sticks. Section 338 targets foreign discrimination against US businesses, but the Liberty Justice Center argues it does not permit the executive branch to "impose sweeping tariffs or import restrictions whenever a trade dispute arises." The lawsuit also challenges the administration's use of Canadian retaliatory tariffs as justification for the US duties.
Section 338 requires a 30-day waiting period before tariffs take effect. The lawsuit notes that the cheese tariff was added to the collection list just one week before collection began, violating that requirement. The legal group contends that Section 338 has been superseded by Section 301 of the Trade Act of 1974 and that the White House has not established legal grounds for the tariffs even if Section 338 still applies.
Thomas Gellert, co-chief executive of the affected firm, said the tariffs disrupted longstanding business relationships overnight and created costs and uncertainty throughout the supply chain. His company faces retaliatory tariffs from Canada on American-made cheese it sells north of the border.
Sara Albrecht, chief executive of the Liberty Justice Center, said the case addresses executive power, not tariffs themselves. "No president should have the power to pull a dormant statute off the shelf and use it to impose sweeping tariffs or import bans without the limits Congress required," she said.
The Liberty Justice Center filed a motion for a preliminary injunction to block tariff collection. This marks the fourth case the group has brought against Trump's tariffs, following a successful February challenge that struck down sweeping tariffs imposed under the International Emergency Economic Powers Act.
Canadian Prime Minister Mark Carney matched the US Section 338 tariffs dollar for dollar last month in response to Trump's duties on vehicles, dairy and alcohol.