U.S. food importer sues Trump administration over 50% tariffs on Canadian goods

A New Jersey-based food importer has filed a lawsuit against the Trump administration, challenging the legality of 50 percent tariffs imposed on approximately $20 billion worth of Canadian goods. The Gellert Global Group, a third-generation family business specializing in importing Canadian cheese, brought the case to the U.S. Court of International Trade in New York on Tuesday. The suit argues that President Donald Trump lacked the statutory authority to invoke Section 338 of the Smoot-Hawley Tariff Act of 1930 to mandate these levies. This legal action marks the latest in a series of lawsuits alleging that the executive branch is attempting to implement its trade agenda by exercising taxing powers that constitutionally belong to Congress. The disputed tariffs took effect at the end of August following the collapse of negotiations between Washington and Ottawa. Prior to the breakdown, negotiators had appeared to agree on the broad terms of a preliminary deal intended to lower trade tensions. According to the complaint, the initial 50 percent tariffs applied to a wide array of Canadian products, including dairy, furniture, clothing, wine, and hockey sticks. The administration justified the move by citing alleged Canadian discrimination against American-made cars, alcohol, and dairy products. In September, the administration expanded the scope of the measures, adding more products in response to retaliatory tariffs enacted by Canada. Gellert Global Group contends that the specific provisions of the 1930 law do not apply to the Canadian policies cited by the White House. The lawsuit asserts that two of the discriminatory practices identified by the administration arose specifically in response to the president’s own tariffs, while the third involves Canadian dairy policy governed by the United States-Mexico-Canada Agreement. Furthermore, the plaintiffs question the logic behind taxing Canadian cheese due to disputes centered on alcohol and automobiles. The legal team notes that Section 338 is designed to protect U.S. businesses against foreign discrimination but does not grant the executive branch the power to impose sweeping tariffs or import restrictions whenever a trade dispute emerges. Procedural violations form another pillar of the argument. Section 338 mandates a 30-day waiting period before levies can be imposed. However, the lawsuit points out that the tariff on products such as cheese was added to the list merely one week before tariff collection commenced. The Liberty Justice Center, a libertarian advocacy group representing Gellert, urged the court to find the levies unlawful and to order refunds with interest for affected importers. The center argued that the White House exceeded its authority and caused immediate harm to American businesses. Thomas Gellert, co-chief executive officer of the company, stated that the firm had spent generations building trusted relationships with suppliers, customers, and partners across the food industry. In a press release issued alongside the filing, he described how the tariffs disrupted those relationships overnight, creating costs and uncertainty that rippled through the entire supply chain. The complaint quantifies this financial impact, noting that between September 16 and October 11, Gellert paid more than $520,000 in duties. The company faces additional pressure from retaliatory tariffs imposed by Canada on American-made cheese sold in the northern market. This litigation follows a broader pattern of legal challenges regarding presidential tariff authority. Earlier this year, the Liberty Justice Center successfully challenged previous Trump tariffs, known as "liberation day" import taxes, leading to a Supreme Court ruling that struck down those measures. That decision forced the administration to refund billions of dollars to importers who had paid the invalidated taxes. Since returning to office, the president has sought to construct a comprehensive barrier of protective tariffs around the U.S. economy. Initially, this strategy relied on a 1977 law declaring trade deficits a national emergency, which justified double-digit tariffs on nearly every global trading partner. Following the Supreme Court’s rejection of that framework, the administration turned to other legal authorities. In July, the president imposed tariffs ranging from 10 percent to 12.5 percent on dozens of trading partners, citing insufficient crackdowns on imports produced by forced labor. Those tariffs are currently facing separate legal challenges. The current dispute occurs amidst a strained relationship between the two nations. Last month, the conflict escalated further when the president announced an outright ban on nearly $1 billion worth of Canadian products, including alcoholic beverages, dairy products, and motorcycles. Canadian Prime Minister Mark Carney responded by matching the Section 338 U.S. tariffs dollar for dollar, citing unequal treatment of U.S. industries. Sara Albrecht, chairman and CEO of the Liberty Justice Center, emphasized that the case targets the institutional power of the presidency rather than the individual occupant. She warned that no president should possess the ability to retrieve a dormant statute and use it to impose sweeping tariffs or import bans without adhering to the limitations established by Congress. The White House has been contacted for comment regarding the new lawsuit.