This month, the United States Court of Appeals for the Federal Circuit heard arguments in a pair of cases addressing the validity of tariffs imposed by President Trump: V.O.S. Selections Inc. v. Trump and Oregon v. Trump.

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The lawsuits—collectively dubbed “America’s big case” by the president—are now consolidated on appeal after a three-judge panel at the Court of International Trade sided with both sets of plaintiffs in May. The Court concluded that the International Emergency Economic Powers Act (IEEPA), upon which the president relied, does not authorize his imposition of tariffs.

In the decision, the Court addressed the scope of authority that Congress granted to the president through IEEPA, which allows the president to “regulate . . . importation” of property to “deal with an unusual and extraordinary threat” with respect to a “national emergency.” The Court rejected the president’s tariffs on two grounds. First, the Court held that “regulate . . . importation” could not authorize unlimited tariff power claimed by President Trump for his worldwide and retaliatory tariffs without running afoul of the separation of powers, as only Congress has the constitutional authority to set tariffs. Second, the Court concluded that the president’s tariffs targeting fentanyl and immigration did not specifically “deal with” those asserted emergencies, but were instead primarily imposed to create leverage for the president in negotiations.

The government quickly appealed, and the Federal Circuit Court of Appeals paused the Court of International Trade’s order, which means that the tariffs are still in place for now.

On appeal, the government again argued that IEPPA granted the president broad authority to control and adjust imports—even though no previous president used IEPPA to impose tariffs. Indeed, when pressed on how broad IEEPA’s authority should be read, the government asserted that the law’s delegation allows for unbounded authority, meaning there is no limit on the amount of the tariff or its scope and duration. The government claimed this authority did not violate the separation of powers because IEEPA requires an emergency, which Congress has some authority to review.

The challengers countered that the president has not identified any unusual or extraordinary threat that warrants invoking IEEPA. Instead, the president’s own descriptions of the claimed emergencies as “persistent” and “sustained” convey “historical norms” rather than unusual or extraordinary threats. And even if there were a legitimate emergency, or judges were unable to review that question, the word “regulate” in IEEPA does not include the ability to impose tariffs. This is evident not only from the plain language of the statute, V.O.S. argued, but also from the fact that no president has ever before claimed such sweeping tariff power and that the Constitution expressly separates “tariff” power from “regulate commerce” power. V.O.S. also noted that, in contrast to IEEPA, every statute that grants tariff power to the president explicitly references tariffs or duties. If Congress meant to delegate the authority for wholesale revision of the country’s entire tariff regime, it would have been explicit.

Because the case is now being heard “en banc,” meaning that all eleven active judges of the appeals court participate in the decision, it is difficult to predict the outcome. What is clear, however, is that the government is concerned about how the Federal Circuit may rule. Following oral argument, on August 11, the government filed a supplemental authority notice, bringing the court’s attention to trade agreements reached with certain countries. In the letter, the government asserts that a decision affirming the lower court could “eliminate” “millions of jobs,” “force[] [people] from their homes,” and create a “1929-style result” for the country.

As the nation awaits the Federal Circuit’s en banc decision, importers remain subject to the tariffs from Liberation Day, as well as the additional tariffs implemented by the president since. But if the challengers are ultimately successful, importers may be able to seek refunds from the government.

Ashley Levine is an attorney at Pacific Legal Foundation, a public interest law firm that defends Americans’ liberty against government overreach and abuse. Pacific Legal Foundation represents clients in a separate case in front of the Court of International Trade, Princess Awesome v. Customs and Border Patrol, and filed a friend-of-the-court brief in the Federal Circuit in support of V.O.S. and the states on behalf of their clients.