A 1930 law, 50% tariffs and a new lawsuit: Trump faces fresh challenge over Canada duties

The lawsuit asks the US Court of International Trade to decide whether the Trump administration lawfully imposed 50% tariffs on certain Canadian products. Gellert Global Group wants the court to invalidate the duties and halt both their enforcement and collection. The case matters because it tests the limits of presidential power over tariffs.

The company argues that President Trump lacked authority to use Section 338 of the Tariff Act of 1930. It describes that move as using a statute never designed for this purpose to exercise tariff power assigned by the Constitution to Congress. The tariffs cover billions of dollars in Canadian goods.

Gellert also asks for refunds, plus interest, on duties it says were unlawfully collected. A ruling could affect the current Canadian tariffs and other businesses that paid them. The case adds to wider legal challenges against Trump's tariff policies and their legal foundations.

The disputed tariffs impose a 50% duty on certain Canadian products. They cover billions of dollars’ worth of goods, making the policy economically significant even though the article says the affected trade is a relatively small share of total US-Canada bilateral trade. The article does not provide an exact dollar amount or product count.

The targeted list includes hockey sticks, cheese, motorboats and aluminium goods. Road salt and cement have been exempted. Trump has also moved to ban imports of various Canadian alcoholic and dairy products, showing that the measures extend beyond one narrow product category.

The dispute affects both trade and business planning across the border. Because the list has changed over time, the final number of affected product types is not stated. The duties have also prompted Canadian retaliation, adding pressure to an already strained trading relationship.

The legal mechanism is Section 338 of the Tariff Act of 1930. That law was part of the Smoot-Hawley Tariff Act, and the article describes Section 338 as a rarely used provision. The administration relied on it to impose 50% tariffs on certain Canadian products after trade negotiations broke down.

Section 338 is central because the administration used it to build or maintain its tariff regime after legal scrutiny of other tariff authorities. The disputed duties took effect in August. They cover billions of dollars’ worth of Canadian goods, including hockey sticks and other targeted imports.

The provision’s use is now being tested in court. Gellert Global Group argues that Trump could not lawfully invoke it for these duties. The case follows a Supreme Court decision in February that struck down country-specific tariffs, while sector-specific duties remained in place.

Gellert Global Group’s central argument is constitutional. The company says tariff power belongs to Congress, while the administration used Section 338 as though it gave the president broad authority to impose these duties. In its lawsuit, Gellert calls this the administration’s latest attempt to use a statute never designed for that purpose.

The company specifically challenges Trump’s invocation of Section 338 for Canadian products. The provision is part of the 1930 Smoot-Hawley Tariff Act and is rarely used. Gellert argues that its existence does not automatically authorize the president to impose the disputed 50% tariffs.

This question matters beyond one importer. Businesses have challenged Trump’s tariff authority under several US laws. The trade court’s ruling could clarify whether these Canadian duties can continue and may influence how the administration uses other legal mechanisms after the Supreme Court struck down country-specific tariffs.

If the court rules for Gellert Global Group, it could declare the Canadian tariffs unlawful and stop the government from enforcing or collecting them. That would directly affect the 50% duties imposed on certain Canadian products. The ruling could determine whether the tariffs remain in force.

Gellert is also asking for the return of duties it has already paid, together with interest. That request turns the case from a forward-looking challenge into a potential financial recovery claim. The company says those duties were unlawfully collected because the administration lacked authority to impose them.

Other businesses that paid the tariffs may watch the proceedings closely. A favorable ruling could have implications for their own refund claims, although the article does not say that every importer would automatically receive money. The outcome could also shape future presidential use of tariff laws.

Canada responded to the US tariffs with retaliatory measures. The action followed the breakdown of trade negotiations between Washington and Ottawa and turned the dispute into a two-way tariff conflict. Both countries imposed duties affecting goods moving across their shared border.

The US measures cover billions of dollars’ worth of Canadian products. Targeted items include hockey sticks, cheese, motorboats and aluminium goods, while road salt and cement were exempted. Trump also moved to ban various Canadian alcoholic and dairy imports. Canada’s retaliation intensified the economic dispute.

The affected trade represents a relatively small share of total bilateral trade, but the political damage is broader. The measures have strained relations between two of each other’s most important trading partners. Trump’s repeated suggestions that Canada become the 51st US state have added to diplomatic tensions.

A tariff is a government charge placed on goods entering a country. In this case, the US imposed 50% duties on certain Canadian imports. Tariffs can make imported products more expensive, change which suppliers businesses choose, and reduce or redirect trade. The article focuses on their legal authority as well as their economic effects.

For example, the targeted goods include hockey sticks, cheese, motorboats and aluminium products. Some imports, including road salt and cement, were exempted. Canada responded with retaliation, creating a two-way dispute that can affect prices, suppliers and cross-border commerce. The article does not quantify price changes.

Tariffs also raise a power question. Gellert argues that the Constitution assigns tariff power to Congress, while the administration used Section 338 to impose the duties. The lawsuit therefore tests how far a president may act without congressional approval and could influence future tariff policies.