Tariffs 50% on Canadian products spark lawsuit against Trump

The Liberty Justice Center filed a lawsuit Tuesday in the US Court of International Trade challenging the Trump administration's 50% tariffs on Canadian goods, brought on behalf of Gellert Global Group, a New Jersey importer. The organization previously succeeded in getting the Supreme Court to strike down a broad set of the president's levies last year.

Importer Cites $40 Million Annual Cost

Gellert estimates the duties will cost it $40 million annually on cheese imports. The 50% tariffs, which took effect Sept. 9, cover a range of Canadian products including alcohol, hockey sticks and cement, and were imposed in August amid a heated trade dispute with the US' northern neighbor. They stacked on top of existing levies on aluminum, lumber, vehicles and steel. President Trump also banned Canadian alcohol including whiskey, malt beer, sparkling wine, vermouth and cider and other spirits. “Congress empowered the President under Section 338 to offset the burden or disadvantage from discrimination by foreign governments against U.S. commerce in favor of other foreign commerce, including Canada’s continued discrimination against American dairy, alcohol, and auto exports," according to a statement from the White House. "Today’s complaint will not deter President Trump’s commitment to level the playing field for American workers, farmers, and firms, and the Administration will defend vigorously the President’s actions in court.” The complaint targets Section 338 of the Tariff Act of 1930, described by Sara Albrecht, chairman and chief executive of the Liberty Justice Center, as “a dormant statute” that had never been used before now. The group seeks a preliminary injunction to block the 50% tariffs, contending among other arguments that Trump exceeded his authority by imposing them without congressional authorization. Gellert faces hefty taxes on both sides, importing Canadian cheeses to the US and on American dairy products it ships to Canada.

Supply Chain Disruption Warning

“Gellert Global Group has spent generations building trusted relationships with suppliers, customers and partners across the food industry,” said Thomas Gellert, co-chief executive of the company. “These tariffs disrupt those relationships overnight and create costs and uncertainty that ripple through the entire supply chain.” One of Gellert's suppliers, for instance, buys milk from dairy farmers in upstate New York, turns it into brie in Canada and sends the finished cheese back to the States. A $1.7 billion company, Gellert imported $71 million worth of Canadian cheese last year, including goat's milk cheese, brie, mascarpone and camembert. The duties followed Trump's claim that Canada discriminated against US businesses. They were briefly paused while Canada and the White House negotiated trade deals, but rather than reaching an amicable agreement, both sides escalated the conflict, with Canada imposing reciprocal tariffs on US goods. The talks collapsed, with Canadian Prime Minister Mark Carney blaming “last-minute changes in the US proposed terms” that he described as “unfair, uneconomic” and calling “into question the reliability of any deal” for the breakdown.

Prior Supreme Court Victory

The Liberty Justice Center won its first tariff case against the administration in February when the Supreme Court struck down the president's tariffs under the International Emergency Economic Powers Act. The government has been refunding those tariff payments, including interest charges.