WASHINGTON, DC (February 20, 2026) - Today, the United States Supreme Court issued its ruling in Learning Resources, Inc. v. Trump, a case challenging the Trump Administration’s use of the International Emergency Economic Powers Act (IEEPA) to impose tariffs on U.S. trading partners.

In a 6–3 decision, the Court affirmed the ruling of the U.S. Court of Appeals for the Federal Circuit, holding that IEEPA does not grant the executive branch authority to unilaterally impose tariffs. The decision effectively invalidates the Trump Administration’s reciprocal tariff program.

The legal challenge was brought last summer by a coalition of state governments and small businesses, which argued that no qualifying national emergency existed to justify invoking IEEPA. The administration had contended that the longstanding U.S. trade deficit constituted such an emergency.

As it relates to premium cigars, Nicaragua was specifically identified as subject to a reciprocal tariff rate of 18 percent when President Trump announced the IEEPA tariff framework. By contrast, the Dominican Republic and Honduras were not explicitly listed and were therefore subject to the baseline reciprocal rate of 10 percent.

Historically, premium cigars imported from all three countries received duty-free treatment under the Central American Free Trade Agreement (CAFTA). In light of the Court’s decision, it remains to be seen whether these countries’ tariff treatment will revert to duty-free status or be adjusted to another rate as the administration considers its next steps.

Looking ahead, questions remain regarding the availability of tariff refunds, as well as how the Trump Administration may respond to the Court’s ruling, including whether it will pursue alternative authorities, such as Section 301 or Section 232, to reimpose tariffs.

CRA’s legal team is actively reviewing the Supreme Court’s decision and will provide additional analysis and guidance on its implications in the near term

Should you have any questions regarding this message, please don't hesitate to contact me at cody.carden@cigarrights.org.