The Supreme Court Considers Presidential Authority

This U.S. Supreme Court Term includes several cases testing how far the president can reshape the economy, whether executive agencies can maintain independence, and when the Court will intervene. Rulings are expected by late June, when the Court finishes its term, though the cases discussed in this article (particularly the challenge to the Trump administration’s tariff regime) could be decided earlier.

The unresolved scope of presidential authority has created business uncertainty regarding pricing, taxes, regulatory tempo, and supply chains. The Court’s decisions could reduce business uncertainty by placing guardrails on that authority, or it could amplify the instability by permitting broad presidential power, even in matters impacting the domestic economy.

Tariffs and Economic Authority

The Roberts Court has been deferential to presidential power in foreign policy but not in economic matters. In recent terms, the Court has pushed back when the president has taken major economic actions by relying on statutes that don’t clearly grant such sweeping authority.

This term, those trends (deference to presidential authority in foreign affairs and skepticism to that power in economic matters) are on a collision course. In Learning Resources, Inc. v. Trump, the Court will decide whether the president can impose a breathtaking range of tariffs on scores of countries. The president likely has no inherent authority to do this; the Constitution assigns the tariff power to Congress. The president has relied on the International Emergency Economic Powers Act (IEEPA), a statute that allows the president to regulate importation and exportation once a national emergency is declared. The question is whether that phrase authorizes the tariff regime.

Oral argument on November 5, 2025, suggested the answer may be no. Three Justices — Sotomayor, Kagan, and Jackson — appeared convinced that the IEEPA doesn’t authorize the tariffs. Chief Justice Roberts and Justices Gorsuch and Barrett were skeptical of the administration’s position but pressed both sides. Only Justices Thomas, Alito, and Kavanaugh seemed inclined to agree with the administration’s reading of the statute.

Regardless of the outcome, the consequences will be profound. If the Court upholds the tariffs, instability in pricing and supply chains will persist and the administration may even implement additional hastily planned measures affecting the economy. If the Court strikes down the tariffs, the government may owe close to $90 billion in refunds — a figure growing daily — and trade negotiations would be upended.

The decision timeline compounds the uncertainty. Currently, a stay is in place allowing tariff collection to continue. Given the urgency of the issue and its impact on ongoing negotiations with foreign governments, the Court may issue a decision in the coming months, well before the end of the term (typically in June). Companies paying tariffs would face lengthy reimbursement processes if the Court strikes down the regime — and the longer tariffs have been collected, the more difficult refunds become. In that event, companies that restructured supply chains at their own expense to avoid tariffs may have absorbed those costs unnecessarily, though they may be able to return to their normal business operations once the Supreme Court issues its decision (unless the administration attempts to reimpose tariffs under alternative statutory authority).

Agency Independence

The Supreme Court is poised to reconsider Humphrey’s Executor v. United States, a 1935 decision that allows Congress to insulate certain agency heads from presidential termination “without cause” (i.e., simply because the president wants someone else in the job, rather than for provable malfeasance). For nearly a century, Humphrey’s Executor has allowed these independent agencies to make policy with an eye on the long view rather than immediate political pressure.

Humphrey’s Executor may not survive this term. President Trump has fired several independent agency heads without cause. The administration has repeatedly asked the Supreme Court to stay lower-court injunctions of those firings — requests the Court has granted, permitting the termination of Federal Trade Commission (FTC), Consumer Product Safety Commission (CPSC), National Labor Relations Board (NLRB), and Merit Systems Protection Board (MSPB) members.

These without-cause removals likely violate Humphrey’s Executor, so the string of stays signals that a majority of the Justices is ready to overrule it. On December 8, 2025, the Court heard arguments on the merits in the Trump v. Slaughter FTC case, and the questioning from a majority of the Justices suggests that Humphrey’s Executor will be overruled or significantly cabined.

If the Court overrules Humphrey’s Executor, key agencies will face more partisan pressure, including the FTC, CPSC, NLRB, MSPB, Securities and Exchange Commission (SEC), Federal Communications Commission (FCC), Commodity Futures Trading Commission (CFTC), Federal Deposit Insurance Corporation (FDIC), and Federal Energy Regulatory Commission (FERC). Regulatory regimes could undergo radical transformation from administration to administration.

Ironically, expanding presidential power in this way threatens to create the same kind of unpredictability the Court cited in 2024 when it overruled the Chevron doctrine, which required courts to defer to reasonable agency interpretations of ambiguous federal statutes. According to the Court, Chevron made it impossible for the business community to know what the law requires because agencies shift interpretations to suit each new administration’s preferences. Eliminating removal protections creates similar volatility by allowing the president to install a new agency head anytime an agency is deemed insufficiently vigorous in advancing administration priorities through regulatory action.

Emergency Docket

The Court is also confronting when to intervene as legal challenges play out in lower courts. This is happening on the emergency docket, where parties request the Court to stay lower-court orders until cases are decided on the merits.

Recently, the emergency docket has become dominated by presidential requests to stay orders preliminarily blocking new policies. The Court has almost always sided with the current Trump administration — in 23 out of 26 cases, the Court has granted the president’s request for a stay, at least in part.

These interim orders usually require the Court to assess merits issues in an abbreviated fashion. Yet some Justices have asserted that these terse orders are themselves precedential. The result not only compounds instability concerning presidential authority but also the state of once-settled law.

For companies, this creates strategic confusion. Preliminary injunctions have never guaranteed that a policy will remain blocked while litigation proceeds, but the Supreme Court’s increased willingness to grant emergency relief means that challenges can reach the Court — and sometimes produce precedential rulings — much earlier in the process. The administration can seek emergency relief — and often receive it within days or weeks — from the Court. Companies must therefore prepare for policy implementation even while litigation continues, maintaining dual compliance strategies and hedging operational commitments.

What This Means for Business Strategy

The convergence of these cases creates multilayered uncertainty regarding the substance and timing of major policy changes.

Tariff Exposure

Companies with significant import operations face high-stakes outcomes on compressed timelines. If the Court upholds the president’s authority to impose tariffs, companies will need to brace for further supply chain instability and additional emergency action by the administration. If the Court strikes down tariffs, companies face lengthy reimbursement processes and must prepare for alternative policy approaches — including reimposition of the tariffs under alternative statutory authority.

Regulatory Volatility

If Humphrey’s Executor falls, once-independent agencies will become more vulnerable to partisan pressure and policy variation from administration to administration. Companies should expect more dramatic shifts in enforcement priorities, rulemaking agendas, and interpretive guidance with each (or even within each) administration.

Emergency Relief Risk

The Court’s willingness to grant emergency stays means lower-court victories are less secure and companies must maintain contingency plans for Supreme Court intervention that could arrive with little notice.

What to Watch

Several developments may clarify the scope of presidential authority.

First, monitor the Learning Resources decision. Watch whether the opinion is narrow (limited to IEEPA’s text) or broad (establishing principles about presidential authority generally). The decision could arrive in the coming months, forcing companies to adjust strategies quickly.

Second, track the Slaughter decision on agency independence. A decision in favor of the president could spur immediate leadership changes, rapid policy shifts, and significant new litigation about which agencies fall within the scope of presidential authority recognized by the Court.

Third, observe emergency docket patterns. If the Court continues granting stays at the recent rate, that suggests it remains comfortable essentially making new law through the emergency docket. If the Court becomes more selective, that suggests it has concerns about establishing precedent through abbreviated proceedings.

Fourth, monitor congressional response. If the Court strikes down major initiatives, watch whether Congress responds with explicit authorizations or other changes to the president’s emergency powers.

To the extent there was a time when high-profile, politically charged Supreme Court cases touched only upon social issues, that is no longer the case. Companies should closely monitor how the Supreme Court resolves these questions of presidential authority. The decisions could change the federal government as we know it and have an enormous impact on the business community.

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Check out the first article in the series, “AI Drug Discovery Tests the Limits of Patent Law,” explore our full collection of insights into legal dynamics disrupting modern business strategy, or subscribe to Forces of Law to receive our latest publications.