“A wrecking ball.” “A bull in a china shop.” This is how fashion brands speaking to Glossy have described the Trump administration’s approach to rolling out tariffs over the last year.
But on Friday, the Supreme Court dealt a significant blow to the administration’s efforts to enact tariffs on imports from nearly every country in the world. The Court’s 6-3 ruling found that tariffs enacted under the International Emergency Economic Powers Act, which covers many but not all of the tariffs, were unlawful and that the president exceeded his authority.
The government is not barred from enacting tariffs, but the decision disincentivizes further tariffs by requiring the government to issue billions of dollars worth of refunds to the U.S. companies that have been affected.
Following Friday’s ruling, Marion Parke, a footwear designer whose business was impacted by the tariffs, said she is “cautiously optimistic” about the future. Her brand is manufactured in Brazil, which has a 50% tariff, and Italy, with a 15% tariff. Parke described the efforts and money her team put into dealing with tariffs and planning out future scenarios that never happened as a “colossal waste of time.”
“I’m hopeful there will be some consideration toward small businesses,” Parke said regarding future U.S. trade policies. “For smaller brands like ours, tariffs represented a huge amount of cash loss, and fashion is already a capital-intensive business.”
Rohit Tripathi, vp of industry strategy and manufacturing at Relex, a supply chain planning platform, told Glossy that the ruling is “clearly positive for American fashion brands.”
“In the near term, unwinding the broad tariffs imposed under the [International] Emergency Economic Powers law should ease pressure on merchandise costs and support margins, and over time, some of that relief is likely to flow through to consumers in the form of more stable pricing,” Tripathi said.
For the brands that have already suffered financially from tariffs, they can pursue refunds from the government, according to the Court of International Trade. However, it will likely require a long and difficult legal process to actually receive the money. Since the tariffs already levied were found to be unlawful, the government is obligated to pay back the tariffs collected. But Blake Harden, managing director and Washington council at the law firm Ernst & Young, emphasized the “cautious” part of “cautiously optimistic.”
“Even with the IEEPA tariffs struck down, this is far from the end of tariffs,” Harden said. “It’s a limit on one specific tool, and the administration has several other tariff authorities it can use. Refunds won’t be simple. They’ll take time, coordination and extensive documentation. Companies should start preparing supporting materials for that process now, while staying alert to which levers the administration pulls next to advance its trade agenda.”
One of the biggest concerns fashion brands have had with tariffs is not just the high costs, but also the unpredictability. With tariff rates changing regularly, many brands found it difficult to make any changes, unsure whether the circumstances would change the next day. Despite the relief that striking down IEEPA tariffs will bring, the unpredictability remains, according to Rachel Kibbe, CEO and founder of American Circular Textiles, a coalition of companies like Reformation, eBay and The RealReal that pushes for strengthening the secondhand and circular apparel market.
“We should expect continued legal activity as businesses seek to recover duties paid under invalid authorities,” Kibbe said. “But the larger issue for fashion and the growing recommerce sector is predictability. Long supply chains and small-business sellers cannot plan, invest or scale when trade rules change overnight.”
Gerard Filitti, a lawyer and constitutional law expert at The Lawfare Project, told Glossy that tariffs under various justifications remain on the table. President Trump, angry about the ruling, has already signed an executive order imposing a limited 150-day global 10% tariff, while vowing to pursue alternative methods to enact his agenda.
“With the Supreme Court unambiguously taking open-ended ’emergency’ tariffs off the table, we can expect noticeable relief on costs, pricing and supply chains,” Filitti said. “But while the era of blanket emergency trade wars is over, targeted trade pressure is not. The Administration still has the power to impose tariffs on specific products, countries and sectors under the Trade Act of 1974. Whether it will choose to do so in a manner that will affect retailers and fashion brands in the long term remains to be seen, but is unlikely.”
