Businesses Sue Trump to Halt ‘Liberation Day’ Tariffs

A group of American small businesses is suing President Donald Trump over his tariffs.

These five businesses contend the president overstepped his authority in declaring a national emergency to impose the levies last month, Reuters reported, ahead of a Tuesday (May 13) hearing before the U.S. Court of International Trade in New York.

According to Reuters, the suit was brought by the nonpartisan Liberty Justice Center on behalf of five businesses that import goods from countries targeted by the tariffs, and argues the tariffs are illegal and hinder their ability to operate.

Small businesses are being hurt by the threat of increased costs, as well as “minute by minute changes” that keep them from planning ahead, said Jeffrey Schwab, an attorney representing the plaintiffs.

“Our clients have no certainty on what the tariffs are going to be at any point, and that’s exactly the problem,” Schwab said. “One person shouldn’t have unilateral authority to impose tariffs on every country at any rate, at any time that he wants.”

Reuters notes that the suit is one of seven court challenges to the tariff policies, and the first seeking a ruling to prevent the tariffs from proceeding.

The Court of International Trade had rejected the plaintiffs’ request to temporarily halt the tariffs while their lawsuit went forward, but quickly scheduled Tuesday’s hearing to decide whether to rule against the tariffs or issue a longer-term pause, the report added.

Trump’s wide-ranging tariffs, announced last month during an event the president called “Liberation Day,” had initially included 145% levies on imports from China, though that figure has since come down, at least temporarily, following a recent China/U.S. trade deal.

The White House has said the tariffs are aimed at reducing America’s trade deficit and boosting domestic manufacturing, but they have triggered stock market upheaval and caused strains in U.S. relations with trading partners.

It’s also caused an uptick in pessimism among small businesses, as PYMNTS Intelligence research has found.

Even before “Liberation Day,” the research showed that 72% of small and medium-sized businesses (SMBs) were anticipating higher prices. A third of those companies projected a deterioration in product quality, while 74% said they were worried about shortages.

“And that poses the question as to whether consumers will open their wallets,” PYMNTS wrote. “The same report shows that roughly 45% of consumers see a negative impact on their personal finances from tariffs, and 35% see an equally positive/negative scenario.”