On June 27, 2018, the American Institute for International Steel (AIIS) and two of its members – Sim-Tex LP, a Texas-based importer and wholesaler of steel pipe, and Kurt Orban Parts LLC, a California-based importer of a variety of steel products – filed a complaint with the U.S. Court of International Trade (CIT) regarding Section 232 of the Trade Expansion Act of 1962, which is the basis for the Trump Administration’s tariffs on imports of steel and aluminum products. Unlike a previous appeal (subsequently withdrawn) by affiliates of the Russian steel producer Severstal, the AIIS appeal does not challenge the steel and aluminum tariffs on the grounds that they are not based on national security considerations. Instead, the AIIS appeal charges that Section 232 itself is an unconstitutional delegation of legislative power to the executive branch.

The basis for the constitutional challenge is that Section 232 allows the President “a virtually unlimited range of options if he concludes in his unfettered discretion that imports . . . threaten to impair the national security, as expansively defined” and that this deficiency constitutes an unconstitutional delegation of legislative authority. Further, Section 232 lacks procedural protections that might otherwise limit the unbridled discretion of the President, and it does not have a provision for judicial review of a decision by the President.

In addition to the constitutional challenge to Section 232, the AIIS lawsuit seeks an order from the CIT to enjoin the Administration from enforcing the 25% tariff on steel imports, and it also requests the appointment of a three-judge panel to hear the lawsuit since it raises a constitutional issue. An advantage of a three-judge panel – rather than a solitary judge – hearing the case is that a decision of a three-judge panel may be appealed directly to the U.S. Supreme Court.