A high-stakes legal battle has been initiated against the Trump administration following the enactment of 50% tariffs on a broad spectrum of Canadian goods. The lawsuit, filed in the U.S. Court of International Trade by New Jersey-based food importer Gellert Global Group, challenges the White House’s unprecedented deployment of Section 338 of the Tariff Act of 1930. The legal action seeks to invalidate the import duties, halt their ongoing enforcement, and secure full refunds—with interest—for all duties already remitted to the federal government.

The dispute centers on the administration’s revival of a nearly century-old statutory provision that had previously never been leveraged to enact trade levies. Invoked in July under three presidential proclamations targeting agricultural, alcohol, and automotive sectors, the tariffs took effect in late August after bilateral negotiations between Washington and Ottawa collapsed. In the civil filing, plaintiffs argue that Section 338 represents an obsolete, retaliation-based relic that has been implicitly superseded by modern trade statutes, maintaining that presidential power cannot be stretched beyond boundaries historically established by Congress.

Representing the importer is the Liberty Justice Center, the legal advocacy group that previously won a pivotal Supreme Court victory overturning the administration’s earlier “reciprocal” tariffs—a decision that prompted roughly $166 billion in federally mandated tariff refunds. In the present case, counsel contends that Canadian measures flagged by the executive branch did not constitute unfair trade discrimination, noting that reciprocal duties and existing dairy quota frameworks under the United States-Mexico-Canada Agreement (USMCA) actually provided favorable access relative to global competitors.

For major commercial entities, the financial fallout is mounting swiftly. Gellert Global Group, which reports more than $1.7 billion in annual revenue, imported roughly $71 million in Canadian specialty cheeses in 2025 duty-free under the USMCA. Subject to the newly imposed 50% tariff, the firm faces an estimated $40 million in additional annual expenses. While the company has temporarily absorbed the costs, leadership warned that extended enforcement will force sharp consumer price hikes, erode market share, and trigger significant disruptions throughout cross-border supply chains.

Key Takeaways

• Gellert Global Group has sued the Trump administration in the U.S. Court of International Trade to invalidate 50% tariffs on Canadian imports.
• The lawsuit challenges the historic first-time use of Section 338 of the 1930 Tariff Act, arguing the century-old statute is legally obsolete and improperly applied.
• The legal challenge is spearheaded by the Liberty Justice Center, which previously secured a landmark Supreme Court ruling striking down reciprocal tariffs.

Editor’s Analysis & Impact

This lawsuit represents a critical test of presidential authority concerning trade policy and the limits of statutory emergency powers. By reviving Section 338 of the Tariff Act of 1930, the executive branch sought a novel bypass around standard trade channels. However, following the Supreme Court’s repudiation of reciprocal tariffs, the judiciary is showing heightened skepticism toward expansive interpretations of trade statutes. For businesses operating across North American supply chains, the ongoing friction threatens the stability established by the USMCA. If the Court of International Trade sides with the plaintiffs, it will not only constrain unilateral tariff implementations but also necessitate substantial government refunds, reinforcing constitutional boundaries on executive trade actions.

Frequently Asked Questions

Q: What is Section 338 of the Tariff Act of 1930?
A: Section 338 is a Depression-era statutory provision intended to counter foreign trade discrimination against U.S. commerce. It had never been used to impose tariffs until the Trump administration enacted it against Canadian imports in 2025.

Q: Why is Gellert Global Group challenging the tariffs?
A: As a major food importer bringing in tens of millions of dollars in Canadian cheese annually, Gellert Global faces roughly $40 million per year in extra duty costs, which it argues is unsustainable and based on an unlawful executive action.

Q: What role does the Liberty Justice Center play in this litigation?
A: The Liberty Justice Center is representing Gellert Global Group. The organization previously won a landmark Supreme Court case that struck down the Trump administration's reciprocal tariffs, triggering an estimated $166 billion in refunds.