2nd federal judge blocks Trump’s tariff orders for 2 US toy companies who import from Asia
'That crushing burden is felt most immediately ... by this country’s small and mid-size businesses,' says lawsuit
HOUSTON, United States
A second federal judge blocked the Trump administration on Thursday from collecting tariffs from two American toy companies that import goods from Asia.
US District Judge Rudolph Contreras ruled that tariffs may not be collected from Learning Resources and hand2mind, both based in the state of Illinois.
"The President cannot act unlawfully and then use the effects of having that action declared unlawful as a putative shield from judicial review," Contreras wrote in his ruling.
The companies manufacture products in China, Taiwan, Korea, Vietnam, Thailand and India, and claim that President Donald Trump's use of the International Emergency Economic Powers Act (IEEPA) to impose sweeping tariffs on imports from those countries violates the law.
"They claim that IEEPA does not authorize the President to impose tariffs; even if it does, it does not authorize the challenged tariffs, the agency actions," the lawsuit said, to which the judge agreed.
"Plaintiffs will not be able to recover lost profits, lost customers, or the 'additional cost(s)' of finding 'replacement(s)' for high-tariff imports," wrote Contreras. "The inability to supply a full line of products may irreparably harm a merchant by shifting purchases to other suppliers" and would cause "at least some degree of irreparable injury."
The judge granted the motion for tariffs not to be collected from the toy companies for two weeks to give the government time to appeal.
The ruling came one day after the US Court of International Trade overturned Trump’s tariffs, which he imposed April 2 on numerous countries, including the US’ biggest trade partners: China, Canada and Mexico. Both courts ruled that the IEEPA "does not authorize the President to impose tariffs."
The toy companies said even though they survived the coronavirus pandemic, the tariffs could destroy their businesses, and argued that Congress never authorized Trump to impose steep tariffs on his own.
"That crushing burden is felt most immediately and acutely by this country’s small and mid-size businesses, including Plaintiffs," said the lawsuit.
