Federal Appeals Court Reinstates Trump Tariffs Amid Legal Battle

A federal appeals court has reinstated one of president Donald Trump’s broadest tariff actions, just one day after the US Court of International Trade ruled the move unconstitutional and blocked its implementation—triggering renewed uncertainty across global shipping and supply chains.

On Thursday, the US Court of Appeals for the Federal Circuit issued a temporary stay on the lower court’s decision, allowing the tariffs to remain in place while it considers the Trump administration’s appeal. The plaintiffs, including several small US importers, must respond by June 5, with the government’s response due June 9.

The tariffs—dubbed Liberation Day duties by Trump—target a wide range of goods from nearly all major US trade partners, including steep 25% levies on products from Canada, Mexico, and China. Trump had linked those tariffs to allegations that those countries were enabling fentanyl trafficking into the US. The trade court ruled Wednesday that the tariffs exceeded presidential authority and violated the constitution’s delegation of trade powers to congress.

While the ruling was seen as a temporary win for importers and logistics providers, the appeals court’s stay has thrown the timing and structure of US tariffs back into flux—complicating planning for ocean carriers, freight forwarders, and shippers who rely on stable trade policy for routing, procurement, and contract terms.

The legal battle centers on the International Emergency Economic Powers Act (IEEPA), which Trump invoked to justify the sweeping measures. The trade court ruled the law was not intended for broad tariff policy, but for narrow emergency action—effectively calling into question the legality of using it for routine trade enforcement.

Despite the legal pushback, Trump officials maintain confidence the tariffs will survive the appeal, or will be reimposed under other executive powers. For now, the appeals court stay allows the administration to continue enforcing the tariffs, meaning customs brokers, ports, and cargo operators must continue processing shipments under the higher duty rates.

Markets had initially responded positively to the trade court’s ruling, with many in the logistics and import/export sectors hoping for relief from tariffs that have driven up costs across supply chains.

Certain sector-specific tariffs—particularly those on steel, aluminum, and automotive parts imposed under separate national security provisions—remain unaffected by the legal rulings, further complicating compliance for importers navigating a patchwork of trade restrictions.

Meanwhile, another federal court also ruled Thursday that Trump had overreached by using the IEEPA to impose 10–25% tariffs on a broad range of imports. However, that narrower ruling applied only to a single toy company. The administration has appealed that case as well.

Trump’s tariff actions, coupled with an ongoing global shift toward bilateral trade deals, continue to disrupt international shipping routes and supply chain dynamics. Following market backlash in early April, Trump paused further duties for 90 days, which has led to a leap in container bookings and freight rates. Drewry’s World Container Index has increased 21% in the last three weeks with freight rates from Shanghai to Los Angeles now standing at a highly profitable $3,738 per feu, something that has seen a number of smaller carriers reenter the transpacific trades this month.