By my count, so far there have been five lawsuits filed in U.S. court related to either the IEEPA fentanyl tariffs or the IEEPA "reciprocal"/universal tariffs:
- Barnes v. U.S., CIT (complaint) (fentanyl tariffs)
- Emily Ley Paper v. Trump, U.S. district court, N.D. Florida (complaint) (fentanyl tariffs)
- Webber v. DHS, U.S. district court, D. Montana (complaint / amended complaint) (reciprocal/universal and fentanyl tariffs, as well as Section 232 steel/aluminum tariffs)
- V.O.S. Selections v. Trump, CIT (complaint) (reciprocal/universal tariffs)
- California v. Trump, U.S. district court, N.D. California (complaint) (reciprocal/universal and fentanyl tariffs)
(There have been motions filed to transfer the California, Florida, and Montana cases to the CIT).
An issue I haven't seen mentioned in any of the lawsuits is Charming Betsy. As a new Harvard International Law Journal online piece by Michael Jacobson and Stephen Finan, entitled "The Charming Betsy Canon: Time to Ride the Tide of Loper Bright," reminds us, "[t]he Charming Betsy canon of interpretation, articulated by the U.S. Supreme Court in 1804, states that '[a]n act of Congress ought never to be construed to violate the law of nations if any other possible construction remains.'"
So how might Charming Betsy apply in the context of these IEEPA lawsuits? The authors don't address that question explicitly, but they do put forward "a three-phase approach that courts should employ when reviewing agency interpretations of statutes where international law is at play":
a. Step 1
First, courts should determine whether a statute is clear. If the statute lacks ambiguity, in particular if Congress expressly declared its intention to legislate in a manner that contradicts an international obligation, courts should apply the statute as written, irrespective of international law. Where Congress has clearly spoken, Charming Betsy is inapplicable.
b. Step 2
Second, if the statute is ambiguous, courts should look to international law to guide their interpretation of the best meaning of the statute. In accordance with Charming Betsy, courts should interpret the domestic statute in a manner that comports with the United States’s international obligation, with the goal of avoiding conflict between domestic law and international law wherever possible. This interpretive exercise should take precedence over agency interpretation of a statute, in accordance with the Supreme Court’s clear directive in Loper Bright that courts should seek the best meaning of a statute, irrespective of agency interpretation. Courts have long applied Charming Betsy as an aid in the statutory interpretation process in this way. Unbridled by Chevron, Charming Betsy should be a primary tool employed to interpret ambiguous statutes where coinciding international obligations exist.
c. Step 3
Third, if applicable international law is too ambiguous to guide the interpretation of an ambiguous statute, only then should courts give agencies’ interpretations “respect” to the extent they have the “power to persuade.” Notably, the Supreme Court in Loper Bright “warmly embraced Skidmore v. Swift & Co., which calls not for deference, but for respectful attention to the views of the relevant agency.” The Court held that interpretations “‘made in pursuance of [an agency’s] official duty’ and ‘based upon . . . specialized experience,’ ‘constitute[d] a body of experience and informed judgment to which courts and litigants [could] properly resort for guidance,’ even on legal questions.”27 Courts should use the Skidmore factors to weigh whether the agency’s interpretation is entitled to such “respect.” Factors for a court to consider include the “thoroughness evident in [the agency’s] consideration, the validity of [the agency’s] reasoning, [the interpretation’s] consistency with earlier and later pronouncements, and all those factors which give it power to persuade, if lacking power to control.” Under this approach, courts can fulfill their duty to interpret statutes, while relying on agencies’ expertise as a guide when both the statute and applicable international law present true ambiguity, in line with the standard established in Loper Bright.
In the IEEPA context, we are not dealing with an agency interpretation, but nevertheless the same principles could apply to the Trump administration's interpretations of the statute.
To illustrate how Charming Betsy might come up in an IEEPA lawsuit, looking at their step 2, there is some uncertainty about whether the IEEPA allows for the imposition of tariffs, which are not explicitly mentioned as a possible government action authorized by the statute. Arguably, then, this ambiguity means that under Charming Betsy, international law -- as articulated through international trade agreements -- should play a role in interpreting this aspect of the statute. Applying Charming Betsy to this interpretive issue, U.S. courts should look for constructions of the IEEPA that avoid a violation of these trade agreements.
If the courts were to find that the fentanyl and reciprocal/universal tariffs are permitted under the statute, that will certainly lead to violations of GATT obligations (e.g. MFN and tariff bindings). Whether these violations are justified under the Article XXI security exception is a more difficult issue, but there are strong arguments that they would not be. As a result, pursuant to Charming Betsy, it could be argued that, in order to avoid a violation of international law, the courts should adopt an interpretation of IEEPA that does not allow the imposition of tariffs.
In addition to issues related to ambiguity in the statute, there is also the question of whether the international law in this area is clear enough to guide the statutory interpretation (their step 3). If the international obligations are ambiguous, more "respect" for the government's interpretation may be required. With regard to the meaning of the relevant international obligations here, how exactly should a U.S. court approach the issue of whether the IEEPA tariffs violate GATT Articles I or II and whether they would be justified under Article XXI? While the violations of Articles I and II are probably clear to everyone, would a court think the text of Article XXI is too ambiguous to reach a conclusion on the security justification? Should WTO panel interpretations in past cases play a role in this consideration by U.S. courts? Should the U.S. courts do the WTO legal analysis themselves, making their own determination of whether the the tariffs are consistent with GATT obligations or justified by the Article XXI exceptions? And then there's the issue of a WTO complaint against the specific IEEPA tariffs at issue. Would a WTO panel ruling that the IEEPA tariffs themselves violate GATT obligations and are not justified by the Article XXI exception make the applicable international law in this case more clear?
None of the complainants have made an argument based on Charming Betsy yet, but despite the uncertainty as to how it would apply in this context, I can see some value in putting it out there for courts to consider.
