SCOTUS Strikes Down Trump's IEEPA Tariffs

Consumers, small businesses, and trade lawyers could all benefit, but the process is complicated

Published on Feb. 21, 2026

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In a 6-3 decision, the Supreme Court ruled that the president does not have the authority to impose tariffs using the International Emergency Economic Powers Act (IEEPA). This ruling has created both winners and losers, with trade lawyers, Trump's political foes, and some businesses expected to benefit, while the U.S. government and certain businesses face challenges.

Why it matters

The SCOTUS decision upends a cornerstone of Trump's economic agenda and could have significant financial implications, with the potential for the government to owe billions in tariff refunds. The ruling also raises questions about the administration's future trade and economic policies.

The details

The Supreme Court ruled that the president cannot use the IEEPA to impose tariffs, invalidating most of the tariffs Trump imposed in 2025. This includes the "reciprocal" tariffs and the 10% baseline duties. However, the court did not explicitly state that the administration must issue refunds, leaving the process uncertain and likely to result in extensive litigation. Trade lawyers are expected to benefit as businesses seek their help to claim tariff refunds, which could amount to 15% of the refund amount. Meanwhile, Trump's political opponents are calling for the administration to immediately refund the tariff payments.

  • On February 21, 2026, the Supreme Court issued its 6-3 ruling striking down the IEEPA tariffs.
  • As of December 10, 2025, over 34 million entries subject to IEEPA duties have been made by over 301,000 importers, amounting to around $129 billion in tariff revenue.
  • On February 24, 2026, President Trump signed a proclamation imposing new 10% tariffs for 150 days under a different statute, the Trade Act of 1974.

The players

Vinson & Elkins

An international trade law firm whose lawyer, Joyce Adetutu, stated that the process of refunding the tariffs will likely be a "heavy lift" and "daunting".

Flexport

A global logistics company whose CEO, Ryan Petersen, said international trade attorneys could charge clients 15% of the tariff refund amount to help them claim it.

Gavin Newsom

The governor of California, who called for President Trump to immediately return the tariff money, which he described as a "vanity play" and "illegal action".

JB Pritzker

The governor of Illinois, who sent an "invoice" to President Trump demanding a refund of $1,700 for every family in Illinois.

Kush Desai

A White House spokesman who previously stated that the administration would find other avenues for Trump's trade and economic agenda, as "Tariffs are here to stay".

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What they’re saying

“Preparing for refunds, potential litigation, and contract interpretations will likely be a heavy lift going forward.”

— Joyce Adetutu, International trade lawyer at Vinson & Elkins

“Donald Trump should return that money immediately. He has an obligation. He took hundreds of billions of dollars from working folks, from the ag community, from small businesses for this vanity play, this illegal action, and he finally was held to account.”

— Gavin Newsom, Governor of California

“On behalf of the people of Illinois, I demand a refund of $1,700 for every family in Illinois.”

— JB Pritzker, Governor of Illinois

What’s next

The judge in the case will decide on Tuesday whether or not to allow the administration to delay issuing tariff refunds.

The takeaway

The SCOTUS decision to strike down the IEEPA tariffs has created a complex situation, with both winners and losers. While consumers and some businesses may see relief, the process of obtaining refunds is likely to be lengthy and burdensome, with trade lawyers expected to play a significant role. The ruling also raises questions about the administration's future trade policies and the potential impact on the 2026 midterm elections.