Trump’s Canada tariffs face lawsuit over presidential powers

US President Donald Trump faces a fresh lawsuit over 50% tariffs on about $20 billion of Canadian goods, with a US food business asking the Court of International Trade to declare the duties unlawful and order refunds with interest. BBC News reported on 20 October that the Liberty Justice Center filed the challenge on behalf of New Jersey-based Gellert Global Group.

The duties followed the breakdown of US–Canada trade talks in August. The legal group has also requested a preliminary injunction to stop collection while it challenges the administration’s use of Section 338 of the Tariff Act of 1930.

The plaintiffs allege that the White House went beyond its statutory powers and harmed American businesses. Those claims are the basis of the lawsuit, not findings by the court.

A food business caught between two sets of tariffs

Gellert Global Group, a third-generation family business, pays the 50% US duty on cheese imported from Canada. It also faces Canadian retaliatory duties on American-made cheese that it sells into the Canadian market.

Co-chief executive Thomas Gellert said on Tuesday that the company had built supplier and customer relationships over generations. He said the tariffs abruptly unsettled those relationships and spread additional costs and uncertainty through the supply chain.

The dispute over a 1930 trade law

Section 338 is intended to protect US businesses against discriminatory treatment abroad. The administration used it to impose duties on Canadian products ranging from wine and dairy goods to hockey sticks.

The lawsuit disputes whether the provision permits such broad tariffs in response to a trade disagreement. It also challenges the administration’s reliance on Canada’s retaliatory measures as justification for the US duties.

Trump had cited what he described as unequal treatment of US cars, dairy products and alcohol. In September, Canadian Prime Minister Mark Carney responded to the Section 338 duties with matching countermeasures. Canada had already introduced several rounds of retaliation against US tariffs.

A separate procedural argument concerns notice. The legal group says Section 338 requires a 30-day wait before duties take effect, but that products including cheese were added to the tariff list only a week before collection started.

The plaintiffs further argue that Section 301 of the Trade Act of 1974 superseded the older provision. Alternatively, they contend that even if Section 338 remains available, the White House has not demonstrated the legal grounds necessary for these duties.

Fourth challenge by the legal group

Liberty Justice Center chief executive Sara Albrecht framed the case as a test of presidential authority rather than a personal challenge to Trump. The group says its objection concerns who may impose tariffs and whether the executive complied with limits set by Congress—not opposition to tariffs in principle.

This is the group’s fourth case against Trump’s tariff policies. Its earlier successful challenge targeted the broad duties imposed under the International Emergency Economic Powers Act, which were struck down in February 2026. The new case concerns a different statutory basis: Section 338.