Federal Judge Denies Request to Pause Litigation Over Trump's Tariff Exemption Policy.

A federal court has denied the US Justice Department's request to pause litigation over President Trump's decision to end a US policy exempting small-value packages from China from tariffs. The case, brought by auto parts distributor Detroit Axle, argues that the administration exceeded its authority and failed to follow the administrative rule-making process required under US law. The court is set to rule in early July on Detroit Axle's request to reinstate the de minimis exception, which would mean the company would exhaust its pre-tariff stockpile and face financial consequences.

A federal court has denied the U.S. Justice Department's request to pause litigation over President Trump's decision to end the U.S. policy exempting small-value packages from China from tariffs. The case, brought by auto parts distributor Detroit Axle, argues that the administration exceeded its authority and failed to follow the administrative rule-making process required under U.S. law. The court is set to rule in early July on Detroit Axle's request to reinstate the de minimis exception, which would mean the company would exhaust its pre-tariff stockpile and face financial consequences [1].

The decision comes amidst escalating U.S.-China trade tensions. In June 2025, President Trump announced a 50% increase in tariffs on steel and aluminum imports, doubling the current rate. This move has put significant pressure on the European steel industry, according to the German steel association WV Stahl [2]. The U.S. administration's erratic trade policy, characterized by arbitrary tariff increases, is raising concerns among trading partners about the stability of potential deals with the U.S. [1].

The U.S.-China trade war has also impacted e-commerce platforms like Temu. Daily U.S. users of PDD Holdings' Temu platform fell by 48% in May compared to March, according to market intelligence firm Sensor Tower. This decline is attributed to the end of the "de minimis" practice, which allowed tariff-free shipping of low-value packages to the U.S. [3]. Temu's sales growth and customer acquisition rates have significantly decreased since the announcement of sweeping trade tariffs by the U.S. administration [4].

The U.S. Justice Department's refusal to pause the litigation adds another layer of uncertainty to the already volatile trade landscape. If Detroit Axle's request to reinstate the de minimis exception is denied, the company will face financial challenges, potentially impacting its operations and the broader U.S. economy [1].

References:
[1] https://www.fxstreet.com/news/us-the-sky-seems-to-be-the-limit-for-us-tariffs-commerzbank-202506021117
[2] https://gmk.center/en/news/doubling-of-us-tariffs-on-steel-imports-will-put-pressure-on-european-steel-industry-wv-stahl/
[3] https://www.usatoday.com/story/money/retail/2025/06/04/temu-user-base-plunges-tariffs/84028372007/
[4] https://www.retailnews.asia/retailer-temus-daily-us-users-halve-following-end-of-de-minimis-loophole/