A legal challenge against the tariffs imposed by U.S. President Donald Trump on Canada has been initiated in the United States Court of International Trade. Filed on Tuesday by the non-profit organization Liberty Justice Center on behalf of U.S. food importer Gellert Global Group, the lawsuit contends that Trump’s utilization of Section 338, an old trade statute from the 1930s, surpasses his presidential authority.
Trump employed Section 338 to apply a 50% tariff on various Canadian products following failed trade negotiations in August. Subsequently, the same statute was used to prohibit the import of additional Canadian goods, including motorcycles, alcohol, and dairy items.
The lawsuit argues that the Canadian policies cited by the White House as justifications for the tariffs do not warrant the extensive tariffs imposed by the Trump administration. It highlights that some of these policies, like auto quotas and liquor bans, were in response to Trump’s initial tariff actions. Moreover, it mentions that Canada’s dairy supply management policies were agreed upon under the Canada-U.S.-Mexico Agreement (CUSMA).
The lawsuit stresses the adverse impact of these tariffs on both importers and consumers in both countries, suggesting broader implications due to the historical relationship between the U.S. and Canada. While acknowledging tariffs as a key policy of the Trump administration, Liberty Justice Center CEO Sara Albrecht criticized the implementation of these tariffs, stating that they violate the Constitution.
In response, a Trump administration official defended the President’s actions and reiterated the commitment to supporting American workers, farmers, and businesses through these tariffs. The lawsuit seeks a declaration of the tariffs as unlawful and demands a refund, expressing concerns that unchecked use of Section 338 could lead to unilateral tariff imposition without adequate congressional oversight.
The Gellert Global Group, affected by the trade war, emphasized the disruption caused by these tariffs on its relationships with suppliers and customers. The company pointed out the cascading effects of these tariffs on the entire supply chain, impacting American businesses on multiple fronts. The lawsuit raises fears beyond the Canada-U.S. trade relationship, warning of the potential misuse of Section 338 by future presidents if not kept in check.