The U.S. Supreme Court rejected a challenge from a manufacturer to tariffs on steel imports that were created by former President Donald Trump and have been kept in place by President Joe Biden.
The justices declined to hear PrimeSource Building Products' appeal of a lower court decision that upheld a 25 percent tariff on imports of steel derivatives.
The court did not explain its decision.
PrimeSource's lawyers did not immediately respond to a request for comment.
President Trump in 2018 signed orders imposing tariffs on imported steel and aluminum, citing the results of an investigation carried out under the Trade Expansion Act. Officials found that the imports "threaten to impair national security" and had recommended action.
The tariffs were adjusted in 2020 to include some steel derivatives, such as nails.
The original orders followed the law because they came after officials found a threat to national security, but the expansion did not because it came years later without a fresh finding of a threat, Texas-based PrimeSource, a nail importer, has argued.
"Two years later, without undertaking any of the statutory procedures, the president imposed tariffs on an assortment of steel derivatives as well," PrimeSource told the Supreme Court.
Tariff Laws
Under the law, the president must decide within 90 days of receiving a report from the secretary of commerce whether he agrees with the recommendations and has another 15 days beyond that to impose tariffs.
Then-Commerce Secretary Wilbur Ross found in a 2018 report that “domestic steel production is important for national security applications” and that steel imports were on track to account for more than 30 percent of domestic consumption. He also determined that “excessive quantities of imports has the effect of weakening the internal economy of the United States, threatening to impair the national security.”
The New York-based U.S. Court of International Trade struck down the steel derivatives tariffs in 2021, saying the White House missed statutory deadlines to impose them.
The expansion "does not comply with the limitation on the President’s authority imposed by the 105-day time limitation" of the law, U.S. trade Judge Timothy Stanceu, appointed under President George W. Bush, said in the ruling.
But the Washington-based U.S. Court of Appeals for the Federal Circuit in February reversed that decision, citing its own 2022 ruling that presidents are authorized to impose "contingency-dependent" tariff increases to fulfill their original national security objectives, if those objectives remain valid.
President Trump created the 2020 tariffs to "close a loophole exploited by steel-derivatives importers ... to address a specific form of circumvention," U.S. Circuit Judge Richard Taranto, appointed under President Barack Obama, wrote in the federal circuit's decision.
PrimeSource was among the companies urging the Supreme Court to review the decision, saying the expansion of the tariffs implicated how Congress delegates power and warranted "special separation of powers scrutiny."
"One might think that courts would strictly construe the statutory conditions on such extraordinary delegations lest the judiciary permit an even greater injury to separation of powers than Congress intended," the company said in a petition to the nation's top court. "But the federal circuit applies the opposite rule, deferring to the executive’s view of the statutory limits on its own authority unless it is clearly wrong."
President Biden's administration defended the tariffs, telling the Supreme Court a review was not necessary because the appeals court decision does not conflict with any decisions from another appeals court.
Government lawyers pointed out that after then-President Dwight Eisenhower adjusted tariffs on oil imports in 1959 after receiving a report from the secretary of commerce, dozens of adjustments to the tariffs were made over the next 16 years without any new reports. The Office of the Attorney General has said in the past that Section 232 of the Trade Expansion Act “contemplate[s] a continuing course of action, with the possibility of future modifications.”
"Section 232’s deadlines do not restrict the president’s power to adopt such amendments," Biden administration attorneys said in a brief to the Supreme Court. "The relevant statutory provisions set deadlines for 'the adoption and initiation of a plan of action or course of action,' not for 'each individual discrete imposition on imports.'"
PrimeSource appealed to the Supreme Court in July. Oman Fasteners, another company challenging the tariffs, filed a separate appeal on Oct. 20 that is currently pending.
The Supreme Court in March turned away a challenge to the 2018 tariffs by a group of U.S.-based steel importers. The justices in 2022 refused to hear a separate challenge by steel companies to President Trump's 2018 decision to double tariffs on steel imports from Turkey, also on national security grounds.
Matthew Vadum and Reuters contributed to this report.
