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The US Supreme Court just told the executive branch to stay in its lane. In a 6-3 decision handed down on February 20, 2026, the court ruled that President Trump exceeded his authority under the International Emergency Economic Powers Act (IEEPA) when he imposed sweeping global tariffs without congressional approval.
The ruling, stemming from the consolidated cases led by V.O.S. Selections, Inc. v. Trump, is a clean win for the Liberty Justice Center, the nonprofit legal organization that filed the initial lawsuits on April 14, 2025, on behalf of small businesses getting crushed by what the administration dubbed its “Liberation Day” tariffs.
What the court actually said
The core of the decision is straightforward: imposing tariffs is Congress’s job. The Constitution gives the legislative branch the power to regulate commerce with foreign nations and to lay duties on imports. The president doesn’t get to bypass that process by declaring an emergency under IEEPA.
Oral arguments took place on November 5, 2025, and the 6-3 split suggests this wasn’t even a particularly close call among the justices.
The practical fallout is significant. Businesses that paid inflated costs under the tariffs may now be eligible for refunds. The Liberty Justice Center has already launched what it calls Project TERRA, a program designed to help affected businesses file refund claims at no cost.
The small businesses at the center of this fight
This case wasn’t brought by multinational corporations with armies of lobbyists. The plaintiffs were small operations. V.O.S. Selections, a wine importer, served as the lead plaintiff. Other businesses caught in the crossfire included a cycling gear company based in Burlington, Vermont.
The fight isn’t over
Here’s the thing: winning at the Supreme Court doesn’t mean the tariff saga is finished. In March 2026, just weeks after the ruling, the Liberty Justice Center filed a new lawsuit challenging reimposed tariffs of between 10% and 15% that the administration attempted to enact under Section 122 of the Trade Act of 1974.
That’s a different legal authority than IEEPA, which means the constitutional questions get relitigated on new terrain. The administration appears to be testing whether a different statutory basis can accomplish what the Supreme Court just said IEEPA cannot.
Whether Section 122 provides sufficient legal cover is now the next battleground. That statute does grant the president some authority to impose temporary tariffs to address balance-of-payments issues, but the scope and duration of any such tariffs are subject to their own legal constraints.
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