Nicolai Haugsted
A major American company is taking Trump to court over his controversial trade policies.
Donald Trump’s aggressive trade policies have once again put the White House on a collision course with American businesses.
The president has repeatedly turned to tariffs as a tool for pressuring foreign governments, even as federal courts have challenged his authority to impose sweeping import duties.
Now, another major part of his trade agenda is facing a legal battle, according to Reuters.
American food importer Gellert Global Group has filed a lawsuit seeking to block the Trump administration’s 50% tariffs on a wide range of Canadian products.
The company argues that the president is once again attempting to exercise powers that the US Constitution reserves for Congress.
And this time, Canadian cheese is among the products at the heart of the dispute.
A 50% tariff sparks a new legal battle
The controversy stems from Trump’s decision to impose a 50% tariff on numerous Canadian imports over the summer.
His administration justified the measures by accusing Canada of discriminating against American-made vehicles, alcoholic beverages, and dairy products.
However, the duties extend far beyond those categories.
Canadian wine, furniture, cement, clothing, fishing rods, hockey equipment, and dairy products are among the goods affected.
For Gellert Global Group, a New Jersey-based food importer with approximately $1.7 billion in annual revenue, the consequences are particularly significant.
The company imports Canadian cheeses that are now subject to the steep tariff.
Rather than simply absorb the additional costs, Gellert has decided to challenge the administration in court.
The lawsuit was filed Tuesday in the US Court of International Trade in New York, with the legal nonprofit Liberty Justice Center representing the company.
Trump turns to a nearly century-old law
One particularly unusual aspect of the dispute is the legal authority Trump has invoked.
The president used Section 338 of the Smoot-Hawley Tariff Act of 1930 to justify the new tariffs.
The provision allows the United States to respond to discriminatory trade practices under certain circumstances.
According to Reuters, Trump’s decision represents the first known use of the provision in its nearly 100-year history.
But the plaintiffs argue that the administration cannot simply revive an obscure statute and use it to impose sweeping duties without respecting congressional limitations.
They contend that subsequent trade legislation has superseded the relevant provisions of the 1930 law.
Sara Albrecht, CEO of the Liberty Justice Center, strongly criticized the administration’s approach.
“No president should have the power to pull a dormant statute off the shelf and use it to impose sweeping tariffs or import bans without the limits Congress required,” Albrecht said.
The lawsuit also accuses Trump of repeatedly changing his legal justifications in an effort to claim broader authority over American trade policy.
At the center of the dispute is a fundamental constitutional question about how much power a president can exercise without congressional approval.
The Supreme Court has already rejected Trump’s tariffs
The latest lawsuit follows several significant legal setbacks for the administration.
In February, the US Supreme Court struck down most of the sweeping tariffs Trump introduced in 2025.
The president subsequently imposed a temporary 10% global tariff under a different legal authority.
However, that measure was also rejected by the US Court of International Trade.
Another legal challenge remains pending over a separate round of global tariffs that the administration introduced as part of its stated effort to combat forced labor in international trade.
The new case involving Canadian imports marks the fourth major legal challenge to a broad tariff policy during Trump’s second term.
Gellert Global Group is also seeking to represent other businesses affected by the same Canadian tariffs.
If the court allows the case to proceed as a class action, its implications could extend well beyond the food importer itself.
The White House did not immediately respond to Reuters’ request for comment.
Trade relations with Canada have deteriorated
The legal dispute comes amid growing tensions between Washington and Ottawa.
Canadian Prime Minister Mark Carney abandoned negotiations over a potential trade agreement on August 22.
Carney blamed what he described as unreasonable last-minute demands from the American side.
Following the breakdown in talks, the Trump administration introduced the disputed tariffs.
Canada responded by announcing retaliatory duties on selected American imports, further escalating the trade confrontation.
The dispute has left businesses on both sides of the border facing additional uncertainty.
No new high-level negotiations have been scheduled since the August breakdown, although officials from the two countries remain in contact.
Canada still hopes for a trade agreement
Despite the continuing tensions, Canadian officials have not abandoned hopes of reaching a deal with Washington.
Dominic LeBlanc, the federal minister leading Canada’s trade negotiations with the United States, confirmed Tuesday that communication between the two governments is continuing.
“We’re going to find a deal with the United States at some point that’s in the interests of the entire Canadian economy,” LeBlanc told reporters.
However, there is no clear indication of when formal negotiations might resume or whether either government is prepared to make concessions.
