Updated at 3:11 p.m.
Siding with a small Vermont cycling company, the U.S. Supreme Court on Friday struck down President Donald Trump’s sweeping tariff scheme that has upended global trade and threatened businesses.
The high court ruled 6-3 in favor of Terry Precision Cycling, a Burlington-based maker of women’s cycling gear, as well as the other small businesses around the country and a dozen states, including Vermont, that sued the Trump administration last year.
The ruling came as a relief to Terry’s CEO, Nik Holm, who has described the tariffs as an existential threat to his business.
“We will have more stable ground going forward,” he said in an interview Friday.
The Supreme Court concluded that Trump does not have the power to enact the tariffs on his own. The president argued that the 1977 International Emergency Economic Powers Act gave him the authority to do so, though no other president had.
A majority of Supreme Court justices, led by Chief Justice John Roberts, ruled that the 1977 law did not authorize such powers.
“The President asserts the extraordinary power to unilaterally impose tariffs of unlimited amount, duration, and scope,” Roberts wrote for the majority. “In light of the breadth, history, and constitutional context of that asserted authority, he must identify clear congressional authorization to exercise it.”
The ruling brings fresh uncertainty to international trade. The president vowed Friday to impose tariffs in the coming days using other provisions in federal law. Meanwhile, American businesses large and small are already petitioning for refunds of the billions of dollars that the duties have cost them. Holm said his cycling company has paid roughly $200,000 in import fees, which is roughly equal to its annual operating income.
Holm will seek to recover those funds.
“It’s a tax refund for improperly collected tax,” he said.
Terry Precision Cycling sells cycling saddles and apparel that is designed for women. The company, which operates out of a small office suite in downtown Burlington, has about 20 employees and sources many of its products overseas. Holm has described the tariffs as an existential threat to the business.
Going forward, he expects the company won’t have to spend time trying to shift production to lower-tariff areas and can instead focus on its own priorities.
“We’re going to have additional time to invest in innovation. We’re going to have additional capital to make a hire, to serve our customers better and grow responsibly here,” he said.
More broadly, tariffs have affected trade and relations between Vermont and its northern neighbors in Quebec.
“This is a win for Vermont families and small businesses who have been impacted by rising costs caused by the President’s unlawful tariffs,” Vermont Attorney General Charity Clark said in a statement. “This is also a win for the rule of law – the Court held that President Trump cannot usurp authority the Constitution vests in Congress.”
Vermont Sen. Peter Welch, a Democrat, joined a chorus of tariff opponents who heralded the court’s break with the president.
“The next step must be doing right by Americans – including small businesses and farmers in Vermont – harmed by Trump’s economic wrongdoings,” he said in a statement.
Holm said he was flying from Plattsburgh, N.Y. to Washington, D.C. when the ruling came down. He saw the news as soon as his plane landed and struggled to contain his excitement as he waited on the tarmac.
“Most people on the flight – there weren’t many – knew something was happening in the middle rows,” he said.
