On Friday, February 20, 2026, the Supreme Court held 6–3 in Learning Resources, Inc. v. Trump that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs. The ruling invalidates every tariff imposed under IEEPA since early 2025 — including the reciprocal tariffs on virtually all trading partners and the tariffs on Canada, Mexico, and China that have driven up costs on imported steel, aluminum, lumber, equipment, and other construction materials for the past year.

The decision does not end tariff uncertainty for the construction industry. The administration has signaled it will reimpose duties under other statutory authorities (Sections 232, 301, 201, and 122), and existing Section 232 tariffs on steel and aluminum are unaffected. But the ruling has immediate implications for active projects, pending bids, and disputes.

What Construction Stakeholders Should Do Now

• Review existing contracts. If your contract has a material escalation, price adjustment, or force majeure clause triggered by IEEPA tariffs, assess whether today’s ruling changes the analysis — on both sides of the ledger.
• Keep tariff contingencies in new bids and contracts. Replacement tariffs under other authorities are expected. Material escalation provisions remain essential.
• Do not assume immediate price relief. Supplier pricing may be slow to adjust, and reimposition of tariffs under alternative statutes could sustain elevated material costs.
• Evaluate the refund chain. The government collected an estimated $175 billion in IEEPA duties. Refunds will flow to importers of record, not downstream to buyers. Review supply contracts for tariff refund or duty adjustment provisions to determine whether refunds may pass through to you — or whether you may owe them.
• Reassess active disputes. Pending claims, change orders, and damage calculations tied to IEEPA, tariff costs may need to be revisited now that the legal basis for those tariffs has been invalidated.

If you have questions about how the Supreme Court ruling may affect your projects or contracts, please contact the author or any member of the Jones Walker Construction Industry Team.