The tariffs will stay, even if Trump loses in court.
A nation's trade architecture, built on emergency powers never designed for such weight, now faces the slow reckoning of constitutional limits. Investment bank Piper Sandler forecasts a unanimous Supreme Court rejection of President Trump's tariff regime by mid-2026, arguing that the International Emergency Economic Powers Act was never meant to hand any president unilateral authority over trade. Yet the deeper paradox is this: even a decisive legal defeat may change little in practice, as the machinery of delay, appeal, and statutory pivot can keep tariffs standing long after the legal ground beneath them has given way.
- Lower courts have already ruled twice against Trump's tariff authority, with judges finding the IEEPA grants no such sweeping power — and the Federal Circuit is set to hear arguments on July 31.
- Piper Sandler forecasts a 9-0 Supreme Court ruling against the administration by mid-2026, a unanimity that would signal rejection across the full ideological spectrum of the bench.
- Even headline-grabbing deals like Japan's $550 billion investment pledge cannot cure the constitutional flaw — Congress alone holds the authority to set tariffs, and no bilateral promise changes that.
- The administration holds powerful tools for delay: administrative stays, appeals across multiple circuits, and the option to pivot to other statutes like Section 232 if the IEEPA falls.
- At least eight lawsuits are already moving through the courts, filed by states, tribes, and small businesses, ensuring that legal uncertainty over U.S. trade policy will stretch across years, not months.
- Global corporations and foreign governments are already pulling back from long-term American investment commitments, unwilling to commit capital into a trade landscape that no one can reliably read.
President Trump's tariff regime rests on shaky legal ground, according to Piper Sandler, one of the country's largest investment banks. In a research note released this week, the firm argues that Trump's use of the International Emergency Economic Powers Act to impose sweeping tariffs far exceeds what Congress ever authorized — and that the Supreme Court will almost certainly agree, likely by mid-2026. The bank's analysts forecast a 9-0 ruling against the administration, a unanimous verdict that would reflect skepticism across ideological lines.
The lower courts have already begun moving in that direction. On May 28, the U.S. Court of International Trade ruled unanimously that Trump's invocation of the IEEPA for tariffs was legally baseless. Three days later, a federal judge in Washington ordered the immediate reversal of certain duties, finding the statute grants no tariff authority to the president at all. Both rulings are under appeal, but the trajectory is clear. The IEEPA, passed in 1977, was designed to give presidents limited emergency economic tools — not a blank check to reshape global trade unilaterally. Even Trump's recent bilateral agreements, including Japan's promised $550 billion investment in the United States, cannot fix the underlying constitutional problem. Congress holds the power over tariffs, and no deal changes whether Trump had the legal right to impose them in the first place.
Yet Piper Sandler's analysis arrives at a disquieting conclusion: Trump will likely lose in court, and the tariffs will likely remain anyway. Administrative stays can keep duties in place while appeals grind forward. If the IEEPA is ultimately struck down, the administration can pivot to other statutes. At least eight lawsuits are already moving through multiple federal circuits, and the legal calendar alone suggests that even a Supreme Court victory for challengers will not quickly restore stability.
That instability is already reshaping behavior. Multinational corporations and foreign governments are hesitant to commit long-term capital to American operations while the legal landscape remains unresolved. The Japanese investment pledge, for all its scale, carries no details about sourcing, allocation, or timeline — a signal of how little confidence even close allies have in the durability of the current trade regime. The years of litigation ahead may prove as consequential as any single ruling.
President Trump's tariff regime is built on quicksand, according to Piper Sandler, one of the nation's largest investment banks. In a research note released this week, the firm declares flatly that Trump's use of the International Emergency Economic Powers Act to impose sweeping tariffs and reshape bilateral trade deals far exceeds what Congress actually authorized—and that the Supreme Court will almost certainly agree, likely by the middle of 2026.
This isn't a new position for Piper Sandler. The bank made the same argument in April, shortly after Trump announced his "Liberation Day" tariffs under the IEEPA. But the firm is circling back now because the legal machinery is accelerating. Oral arguments in tariff cases are scheduled through September, with the Federal Circuit set to hear arguments on July 31 about whether Trump possesses unlimited authority under the statute. Piper Sandler's team—Andy Laperriere, Don Schneider, and Melissa Turner—expects appellate rulings to roll in over the coming months, with a Supreme Court decision likely by mid-2026. The bank forecasts a 9-0 ruling against the administration, a unanimous rejection that would signal deep skepticism across the ideological spectrum.
The lower courts have already begun that work. On May 28, the U.S. Court of International Trade ruled unanimously that Trump's invocation of the IEEPA for tariffs was legally baseless. Three days later, a federal judge in Washington ordered the immediate reversal of certain duties, finding that the statute grants no tariff authority to the president at all. Both decisions are under appeal, but they signal the direction the judiciary is moving. The core issue, Piper Sandler argues, comes down to congressional intent. The IEEPA, passed in 1977, was designed to give presidents certain emergency economic powers—but not a blank check to set tariffs unilaterally. Courts have consistently rejected the idea that the statute contains such sweeping authority. Even Trump's recent bilateral deals, including Japan's promised $550 billion investment in the United States, cannot fix the underlying constitutional flaw. Congress, not the president, holds the power to impose tariffs and approve trade agreements. A deal with Japan changes nothing about whether Trump had the legal right to impose those tariffs in the first place.
Yet here is where the analysis takes a strange turn. Piper Sandler believes Trump will lose—probably decisively, probably soon. And the bank also believes the tariffs will stay in place anyway, at record levels, for many months to come. The reason is the grinding slowness of the judicial process and the tools available to an administration determined to delay. Even as courts rule against him, Trump can keep tariffs in effect through administrative stays while appeals wind through the system. If the Supreme Court eventually strikes down his use of the IEEPA, he can pivot to other statutes, like Section 232, which covers steel, aluminum, and automobiles and carries stricter legal limits but might still be stretched. The result, Piper Sandler warns, is "years of legal battles over tariffs." At least eight lawsuits are already underway, filed by states, tribes, and small businesses. Court dockets now span multiple federal circuits. The legal calendar alone suggests that even a Supreme Court victory for the challengers will not quickly resolve the underlying instability.
That instability is already reshaping how the world does business with America. Major multinational corporations and foreign governments view U.S. trade policy as fundamentally uncertain. They are reluctant to commit capital to American operations or make long-term investments until the legal landscape clarifies. That hesitation may persist for months or years, regardless of what the courts decide. Piper Sandler notes that the $550 billion Japanese investment pledge, for all its headline appeal, comes with no details about where the money will come from, who will allocate it, or over what timeline it will arrive. The promise itself signals how little confidence even America's closest allies have in the durability of Trump's trade regime. The bank's analysts express confidence that the Supreme Court's recent skepticism toward executive overreach will carry into the tariff cases. Both conservative and liberal justices have shown a pattern of rejecting claims that the executive branch can resurrect old statutes to assert sweeping new powers. But Trump's litigious nature and the sheer complexity of the legal calendar ahead mean that instability surrounding trade is likely to persist far longer than any single court ruling.
Notable Quotes
Trump will probably continue to lose in the lower courts, and we believe the Supreme Court is highly unlikely to rule in his favor.— Piper Sandler analysts
Making a deal with another country has no bearing on the legality of Trump's tariffs. If Trump does not have the authority to impose tariffs he is claiming, it doesn't matter whether he makes a deal with Japan or anyone else.— Piper Sandler analysts
The Hearth Conversation Another angle on the story
Why would Piper Sandler predict a 9-0 ruling if they think the tariffs will stay in place anyway?
Because the courts move slowly, and the administration has tools to delay. A Supreme Court loss doesn't instantly erase tariffs already imposed. There are stays, appeals, administrative procedures. By the time the ruling comes down, we could be well into 2026.
So Trump could just ignore a Supreme Court ruling?
Not ignore it, exactly. But he could use other statutes—Section 232, for instance—to achieve similar tariff effects. The legal ground there is firmer, but he might still push it. The point is that even a clear legal defeat doesn't mean tariffs disappear overnight.
What about the companies that have already paid these tariffs? Can they get refunds?
Potentially, yes. If they file claims with the Court of International Trade, they could recover what they paid under tariffs later ruled illegal. But that's another years-long process. The money doesn't flow back immediately.
Why does Piper Sandler think both conservatives and liberals will vote against Trump?
Because the Supreme Court has recently shown a pattern of rejecting executive claims to vast new powers drawn from old statutes. It's not about ideology—it's about the court's view of how the separation of powers should work. Both sides have voted together on this principle.
What's the real damage here—is it the tariffs themselves, or the uncertainty?
Both. But the uncertainty might be the bigger problem. Foreign investors and multinational corporations are holding back on U.S. investments because they don't know what the rules will be next year. That hesitation could last longer than any court case.