The U.S. Supreme Court’s recent decision in Learning Resources, Inc., et al. v. Trump has struck down a major portion of the Trump administration’s tariff program, creating fresh uncertainty for manufacturers and importers just as trade conditions were beginning to stabilize.

Background
In its decision, the Court ruled that the Trump administration exceeded its statutory authority under the International Emergency Economic Powers Act (“IEEPA”) when it imposed certain reciprocal tariffs during 2025. The decision invalidates many of the prior levies but does not apply to tariffs enacted under other statutes, such as those on steel and aluminum under Section 232.

Soon after the ruling, President Trump invoked a different law – Section 122 of the Trade Act of 1974 – to impose temporary, across-the-board tariffs of 10 percent on most imported goods, later announcing an increase to 15 percent. These new duties may remain in effect for up to 150 days while the administration reviews potential longer-term measures and considers more targeted actions under other trade authorities.

Business Implications
While some businesses may view the Supreme Court decision as a relief, the rapid replacement of the rolled-back tariffs with new ones means real-world effects may be limited in the near term. Companies that had anticipated immediate cost reductions may instead face a short period of equal or higher duties, followed by potential policy changes again later in the year.

Key implications include:

• Limited refund potential: More than 1,000 companies, including large corporations like Revlon and Costco, filed suit in the U.S. Court of International Trade to preserve their right to reimbursement. Pursuing refunds can be costly and complex, often requiring experienced counsel and sustained litigation. In many cases, the potential recovery may be partially offset by the impact of the new temporary tariffs, requiring careful cost-benefit analysis before proceeding.
• Supply chain impacts: Even temporary tariffs may disrupt supplier pricing and long-term contracts. Vendors may be slow to reduce prices tied to steel, aluminum, or component imports, especially if trade uncertainty persists into 2026. Businesses relying on just-in-time inventories or specialized foreign inputs may see renewed pressure on lead times and working capital.
• Forecasting challenges: Most businesses now assume some level of ongoing protectionist measures. Strategic planning and pricing models should account for continued volatility, including the possibility that temporary tariffs could be followed by more targeted measures or renegotiated trade commitments.
• Financial reporting and compliance: Public companies and larger private manufacturers may need to reassess how they account for tariff-related costs and contingencies in their financial statements. Internal controls, customs classifications, and country-of-origin determinations may also draw closer scrutiny as duties rise and fall across product lines.
• USMCA review ahead: The administration has signaled possible changes to the U.S.-Mexico-Canada Agreement (“USMCA”) this summer. Any revisions to, or withdrawal from, that agreement could significantly affect Pennsylvania-based exporters, particularly those serving Canadian and Mexican markets. For manufacturers in and around Pennsylvania, even modest adjustments to USMCA could ripple through regional supply chains, especially in automotive, metals, industrial equipment, food processing, and consumer products.

Next Steps for Businesses
Companies with substantial import or export exposure should:

• Review current supplier contracts for tariff adjustment, surcharge, and consider whether future agreements should include clearer mechanisms for allocating tariff payment risk. Absent explicit contractual language, courts have generally declined to treat tariff impositions as force majeure events, highlighting the importance of careful contract review and risk allocation.
• Assess internal pricing strategies to ensure sufficient flexibility to respond quickly to changes in tariff rates, including the ability to pass through costs or redesign product offerings.
• Evaluate whether potential refund claims justify legal action, taking into account the size of prior payments, the likelihood of success, the cost of litigation, and the impact of the new temporary tariffs.
• Map critical supply chains to identify products and components most exposed to the 15 percent temporary tariff and to potential USMCA changes, and explore alternative sourcing or production options where feasible.
• Monitor forthcoming federal guidance on the new 15 percent temporary tariff and any structural trade policy shifts following the Supreme Court’s decision, including possible rulemaking, executive orders, or renegotiated trade commitments.
• Coordinate with customs brokers and trade compliance personnel to ensure accurate classifications, valuations, and country-of-origin determinations, which will be increasingly important if tariff lines and rates continue to shift.
• Consider other tariff mitigation strategies, including “first sale” designation.

Barley Snyder will continue to track this issue as further clarification emerges from the administration and trade agencies. For more information or assistance in evaluating how this ruling may affect your company’s operations, please contact Abby Tucker, Hyo Jin (“Jinnie”) Lee, or any member in Barley Snyder’s Transportation, Logistics & Trade Industry Group.