Welcome to the Q1 2026 quarterly Supply Chain & Tariff Update, presented by Steptoe & Johnson Member and Supply Chain Team Leader, Randy Whitlatch.
(organized by month)
Seagate Tech. LLC v. NHK Spring Co., 163 F.4th 1272, 1276 (9th Cir. Jan. 8, 2026)
On appeal from a grant of partial summary judgment, the Ninth Circuit held that Seagate plausibly satisfied the Foreign Trade Antitrust Improvements Act’s (FTAIA) domestic-effects exception. Applying the statutory requirement that the challenged conduct have a direct, substantial, and reasonably foreseeable domestic effect that in turn gives rise to the plaintiff’s claim, the court held that Seagate’s theory was viable because its U.S.-based entity negotiated quarterly RFQs and supply agreements that set pricing parameters for suspension assemblies purchased throughout Seagate’s global manufacturing chain. The court emphasized that Seagate’s foreign affiliates lacked independent authority over price, quantity, or timing and instead were required to purchase at the U.S.-negotiated prices, which allegedly incorporated collusive price-fixed terms.
Takeaway: Where a U.S.-based sourcing team centrally negotiates pricing that governs purchases throughout a multinational supply chain, the FTAIA’s domestic-effects exception may reach foreign transactions if plaintiffs can show the domestic pricing mechanism directly dictated the foreign overcharge.
Webasto Roof Sys. v. Meteor Sealing Sys., LLC, No. 26-10141, 2026 U.S. Dist. LEXIS 9380, at *5 (E.D. Mich. Jan. 16, 2026)
On Webasto’s emergency motion for a temporary restraining order, the court granted relief, holding that Webasto showed a likelihood of success on its breach and anticipatory repudiation theories. Applying Michigan law distinguishing requirements contracts from release-by-release arrangements, the court held that the purchase order’s commitment that Webasto would purchase “65%-100%” of its requirements from Meteor supplied a sufficiently definite quantity term to create an enforceable requirements contract. The court stressed the supply chain context: Meteor was allegedly the sole-source Tier 2 supplier of parts essential to Webasto’s sunroof and convertible systems, and a supply interruption would halt Webasto’s Tier 1 production lines and likely trigger immediate disruption at OEM customers, including Ford, GM, Stellantis, and Audi. The court found irreparable harm in the imminent line-down risk, loss of customer goodwill, and cascading consequences across the automotive chain.
Takeaway: Courts will move quickly to preserve the status quo in automotive line-down disputes where a sole-source supplier uses price pressure or threatened nonperformance to disrupt a tightly integrated just-in-time supply chain.
Kōloa Rum Co. v. Noem, Civil Action No. 25-554 (JEB), 2026 U.S. Dist. LEXIS 10139, at *1 (D.D.C. Jan. 20, 2026)
On dispositive motions challenging the Jones Act (the Act), the court upheld the statute against port preference clause and due process attacks. Applying rational-basis review, the court held that the Act is facially neutral and operates uniformly across states, with any heightened burden on Hawaii resulting from geography rather than an unconstitutional preference for mainland ports. The court further held that the Act bears a rational relationship to legitimate governmental interests in maintaining a merchant marine for commerce and national security. In practical terms, the opinion reflects judicial willingness to sustain federal laws that materially shape domestic transportation networks and supply chain logistics even when they create disproportionate cost pressure in certain markets.
Takeaway: Facial neutrality remains a powerful defense for statutes affecting transportation and logistics networks, even where the real-world cost of compliance falls unevenly across particular supply chain geographies.
Red Rock Sourcing, LLC v. JGX, LLC, 2026 U.S. Dist. LEXIS 11206, at *1 (S.D.N.Y. Jan. 21, 2026)
On post-discovery motions in a Lanham Act dispute, the court found liability arising from a coordinated distribution chain involving the manufacture and resale of hand sanitizer bearing a modified version of the Urbane mark. The evidence showed that Tropicosmeticos manufactured sanitizer in Mexico using the altered branding, Triple Five acquired and resold the product, JGX distributed it further, and Rigz was positioned downstream in the chain. The court treated the arrangement as an integrated infringement scheme rather than a series of isolated transactions, particularly given the coordinated rebranding and downstream sales efforts after regulatory complications arose. The supply chain structure was thus central to liability because the alleged infringement depended on coordinated upstream manufacture and downstream movement of the product through multiple entities.
Takeaway: In trademark cases, courts will look across the full chain of manufacture and distribution and may impose liability broadly where multiple entities work in concert to move allegedly infringing products through the market.
Kassim v. Cargill, Inc., 2026 D.C. Super. LEXIS 1, at *1 (D.C. Jan. 21, 2026)
On a motion to dismiss under the D.C. Consumer Protection Procedures Act, the court held that plaintiffs plausibly alleged actionable misrepresentations concerning child labor monitoring and remediation systems in defendants’ cocoa supply chains. The court reasoned that statements about monitoring systems, remediation practices, and related sustainability controls were capable of objective verification and therefore were not insulated as mere corporate aspiration or opinion. It further rejected a First Amendment defense at the pleading stage because the alleged statements communicated concrete claims about how the companies were policing labor conditions in their sourcing networks. The supply chain significance of the case lies in the court’s treatment of public statements about upstream due diligence and remediation as factual operational claims, not just brand messaging.
Takeaway: Companies should assume that public descriptions of supply chain auditing, remediation, and labor-monitoring systems will be treated as verifiable factual representations if they are specific enough to imply real operational controls.
Ind. Pub. Ret. Sys. v. Rivian Auto., Inc., No. 2:24-cv-4566-CBM-JPR, 2026 U.S. Dist. LEXIS 15497, at *1 (C.D. Cal. Jan. 22, 2026)
On defendants’ motion to dismiss, the court held that plaintiffs plausibly alleged materially misleading statements under Section 10(b) and Rule 10b-5. The court focused on the disconnect between defendants’ positive statements regarding demand and their decision to stop publicly reporting preorder backlog while allegedly continuing to rely on backlog-driven demand narratives. According to the complaint, Rivian was dealing with supply chain and production constraints in the background, and those constraints potentially rendered its demand messaging misleading by obscuring the relationship between orders, fulfillment capacity, and actual market strength. The court concluded that generalized risk disclosures did not eliminate falsity where the alleged operational constraints had already materialized.
Takeaway: Once supply chain or production constraints have already affected fulfillment capacity, companies face increased securities risk if they continue to make positive demand statements without clarifying the operational limits behind those statements.
Gemini Techs., Inc. v. Smith & Wesson Sales Co., No. 1:18-cv-00035-REP, 2026 U.S. Dist. LEXIS 13103, at *1 (D. Idaho Jan. 23, 2026)
On cross-motions for summary judgment, the court held that genuine disputes of material fact precluded judgment on claims centered on bad-faith conduct affecting an earnout. The court rejected an implied-covenant theory where the agreement expressly addressed the relevant good-faith obligations, and it dismissed fraud theories based on future-oriented statements or puffery. But the court found triable factual disputes where defendants allegedly dismantled or constrained the acquired business in a way that suppressed earnout performance while attributing those decisions to supply chain problems. The opinion thus turns on whether asserted operational pressures reflected legitimate business judgment or were a pretext for conduct designed to defeat contingent consideration.
Takeaway: In post-closing earnout disputes, courts are likely to scrutinize supply chain justifications closely when operational changes disproportionately affect the acquired business’ earnout metrics.
Prof’l Compounding Ctrs. of Am., Inc. v. Sodergren, No. 2:25-cv-02799-JAM-CSK, 2026 U.S. Dist. LEXIS 14091, at *1 (E.D. Cal. Jan. 23, 2026)
On a motion for preliminary injunction challenging new disclosure rules, the court denied relief and upheld requirements that pharmaceutical ingredient suppliers identify original manufacturers on certificates of analysis. Applying Zauderer, the court held that the compelled disclosure was factual and noncontroversial, served the substantial governmental interest in patient safety, and did not prevent suppliers from explaining their own role in the production chain. The court treated upstream sourcing information as a legitimate subject of compelled disclosure because traceability within the pharmaceutical supply chain directly bears on quality control, risk management, and regulatory oversight.
Takeaway: Traceability obligations directed at upstream sourcing are likely to survive First Amendment attack when courts view the required disclosure as factual, narrow, and tied to safety within regulated supply chains.
Tapp Mfg., Inc. v. Speed UTV, LLC, No. 1:24-CV-944, 2026 U.S. Dist. LEXIS 14377, at *1 (M.D.N.C. Jan. 27, 2026)
On plaintiff’s motion for a preliminary injunction, the court granted relief, holding that Tapp established a likelihood of success on infringement and irreparable harm. The court found that the parties’ course of dealing created an implied license but that the license terminated when Tapp filed suit. It further held that irreparable harm was established because Tapp and Speed were the only two entities manufacturing replacement clutches practicing the patent, making the loss of market share and downstream channel position especially acute. In that concentrated replacement-parts supply chain, the court found that concerns about the continuity of supply did not outweigh the competitive harm from the continued unauthorized manufacture.
Takeaway: In concentrated aftermarket or replacement-parts supply chains, courts may prioritize IP exclusivity and market position over continuity arguments where unauthorized production threatens lasting competitive displacement.
Sterling Serv. Grp., Inc. v. Sub-Zero, Inc., No. 25-cv-281-jdp, 2026 U.S. Dist. LEXIS 16231, at *1 (W.D. Wis. Jan. 28, 2026)
On defendants’ motion to dismiss, the court dismissed breach of contract theories predicated on agreements that expressly allowed termination without cause, holding that the covenant of good faith and fair dealing cannot override clear contractual termination rights. The court nevertheless allowed a promissory estoppel claim to proceed as to one territory because defendants allegedly made a clear promise that plaintiffs would serve Brooklyn, inducing plaintiffs to invest resources in anticipation of that role within the service and distribution network. By contrast, broader statements about multiyear contracts were too indefinite to support reliance. The case thus highlights the distinction between contractual supply chain rights and extracontractual assurances about territory, channel position, or market role.
Takeaway: Even where formal contracts preserve broad termination rights, companies can still create exposure through specific precontract or side-channel assurances about territories, channel assignments, or operational roles in the distribution chain.
Constr. Laborers Pension Tr. of Greater St. Louis v. Funko Inc., 166 F.4th 805, 812 (9th Cir. Feb. 4, 2026)
On appeal from dismissal of a securities fraud complaint, the Ninth Circuit affirmed in part and reversed in part, drawing a line between nonactionable puffery and potentially actionable half-truths. The court held that statements describing the Buckeye distribution center as “up and running” were not demonstrably false on the pleadings, but it found that risk disclosures suggesting inventory management problems might occur in the future could be misleading if such problems were already unfolding. The court emphasized that inventory management and related technology systems were core operational functions for Funko, making it plausible under the core-operations doctrine that senior executives knew of significant dysfunction affecting fulfillment and logistics. The supply chain importance of the case lies in its recognition that warehousing, inventory visibility, and systems integration are not ancillary issues; they are central operational facts that can make “risk factor” language misleading if the breakdown is already underway.
Takeaway: Companies should be cautious about using hypothetical supply chain risk language once warehouse, inventory, or systems failures have already materialized, particularly where those functions sit at the core of the business.
Int’l Rts. Advocs., Inc. v. Nestle USA, Inc., Civil Action No. 25-cv-2603 (BAH), 2026 U.S. Dist. LEXIS 24606, at *1 (D.D.C. Feb. 5, 2026)
On plaintiff’s motion to remand, the court returned the case to D.C. Superior Court, holding that Nestlé had not established the amount in controversy required for diversity jurisdiction. The complaint alleged that Nestlé’s advertisements falsely represented that its cocoa products were not produced with child or forced labor and sought only injunctive relief, not damages or classwide monetary recovery. Nestlé relied on projected compliance costs and attorneys fees to meet the jurisdictional threshold, but the court found the showing insufficient under the governing nonaggregation and either-viewpoint principles while also concluding that removal was not objectively unreasonable. The underlying theory reflects continuing litigation pressure around representations concerning labor conditions deep in commodity sourcing chains.
Takeaway: Supply chain ESG cases framed as injunctive consumer-protection suits may remain in state court where defendants cannot concretely quantify compliance or implementation costs to satisfy federal jurisdictional thresholds.
Webasto Roof Sys. v. Meteor Sealing Sys., LLC, No. 26-10141, 2026 U.S. Dist. LEXIS 24342, at *1 (E.D. Mich. Feb. 5, 2026)
On Webasto’s motion for a preliminary injunction, the court converted its earlier emergency relief into broader injunctive relief and required Meteor to continue supplying parts under the existing contractual terms. Applying Michigan law and relying on Kamax, the court again held that the “65%-100%” quantity term created a binding requirements contract and rejected Meteor’s arguments that it could reject releases or terminate without reasonable notice. The court found irreparable harm based on the disruption to Webasto’s role as a Tier 1 supplier, the risk of OEM plant shutdowns, and the reputational damage that would follow from failure to maintain supply continuity in the automotive chain. It also found the public interest favored enforcing contractual commitments and avoiding avoidable breakdowns in an already interdependent just-in-time manufacturing environment.
Takeaway: Once a court finds a likely requirements contract in a sole-source automotive relationship, it is prepared to compel ongoing performance where nonsupply threatens cascading shutdowns and reputational harm throughout the OEM chain.
Osdoby v. Handi-Foil Corp., No. 22-cv-4199 (NG) (JMW), 2026 U.S. Dist. LEXIS 29494, at *1 (E.D.N.Y. Feb. 11, 2026)
On defendant’s motion for summary judgment, the court dismissed plaintiff’s labeling claims, distinguishing Article III standing from the separate requirement of proving actual economic injury under the New York General Business Law. The court held that plaintiff’s allegations regarding systematic use of foreign-derived aluminum in products marketed with “Made in USA” themes were sufficient for constitutional standing but not enough to prove injury because plaintiff offered only speculative testimony about price and no documentary evidence of a measurable price premium. Although internal emails about the marketing importance of domestic-origin labeling could support causation in the abstract, they did not establish that plaintiff actually paid more because of the alleged supply chain misrepresentation. The court therefore granted summary judgment and denied class certification as moot.
Takeaway: Supply chain origin claims may survive standing challenges more easily than statutory injury challenges; plaintiffs still need concrete proof that the sourcing representation translated into real economic harm.
State v. Sandoz, Inc., No. 3:20-cv-00802-MPS, 2026 U.S. Dist. LEXIS 29811, at *1 (D. Conn. Feb. 12, 2026)
On partial summary judgment addressing remedies, the court granted the motion in part and denied it in part in a wide-ranging generic-drug antitrust case involving dozens of defendants and more than 80 dermatological drugs. The court described a pharmaceutical chain in which manufacturers generally sold into layers of intermediaries, such as wholesalers and pharmacy chains, before drugs reached consumers or state payers, with pass-through rates varying significantly across transactions and markets. That chain mattered because the defendants argued the presence of intermediaries broke causation or limited the available monetary relief, while the states contended that the challenged overcharges moved through the distribution chain in economically meaningful ways. The court’s treatment of remedies reflects the difficulty of fitting antitrust injury, disgorgement, penalties, and damages into a distribution network where pricing decisions occur upstream but costs are often borne downstream by consumers, plans, and state-funded programs.
Takeaway: In pharmaceutical antitrust cases, courts will scrutinize how overcharges move through intermediary-heavy distribution chains, but the presence of multiple downstream actors will not necessarily defeat causation or monetary remedies.
Jiggy Puzzles, LLC v. Steelhead Acquisition EE, Inc., No. N24C-10-212, 2026 Del. Super. LEXIS 77, at *1 (Super. Ct. Feb. 18, 2026)
On dispositive motions, the court distinguished between express contractual duties and discretionary operational decisions in the earnout context. It held that earnout provisions lacking efforts covenants do not, standing alone, impose affirmative operational obligations, but it recognized that evidence of bad-faith conduct can still support an implied-covenant theory where a buyer exercises discretion to undermine the earnout. The court also rejected fraud theories based on post-closing hindsight and applied Delaware’s bootstrap doctrine to prevent repackaging contract claims as tort claims. Although the summary is not supply chain specific on its face, the opinion is important for transactions involving post-closing decisions about sourcing, inventory, production, or channel strategy because those operational changes may affect earnout performance without necessarily breaching an express contractual duty.
Takeaway: Buyers retain broad post-closing discretion absent explicit efforts language, but supply chain or operational decisions that appear designed to suppress earnout performance can still create bad-faith exposure.
Farooq Khan v. ChargePoint Holdings, Inc., No. 23-cv-06172-NW, 2026 U.S. Dist. LEXIS 35748, at *1 (N.D. Cal. Feb. 20, 2026)
On defendants’ motion to dismiss, the court dismissed the securities fraud complaint, holding that plaintiffs failed to plead falsity with the required specificity. Plaintiffs alleged that ChargePoint concealed persistent supply chain constraints while reporting strong revenue, but the court found the pleading too general because it referenced COVID-19-era plant closures in Italy and Mexico without explaining what constraints continued into the class period or how they contradicted specific statements about having managed past supply issues. The court also found the complaint internally inconsistent because it alleged both that ChargePoint was severely supply constrained and that it simultaneously pushed excess inventory through unsustainable sales practices. In the court’s view, those contradictory theories undermined the plausibility of the alleged scheme and prevented the complaint from adequately tying operational disruption to any particular misstatement.
Takeaway: Securities claims premised on supply chain disruption need precise, internally consistent allegations connecting specific operational constraints to specific public statements during the relevant period.
United States v. Garcia, No. 24-cr-00106-NYW-1, 2026 U.S. Dist. LEXIS 41454, at *1 (D. Colo. Feb. 27, 2026)
On the government’s motion to exclude expert testimony, the court granted the motion in part and denied it in part, allowing testimony about factual background, general COVID-19-era supply chain disruptions, and specific shortages of materials or production capacity while excluding legal conclusions, state-of-mind opinions, and unsupported assertions. The court drew a line between permissible industry-context testimony and impermissible attempts to interpret contracts, opine on intent, or simply repeat a party’s narrative. The ruling is notable because it recognizes that supply chain disruption can be a legitimate subject of expert proof when tied to concrete shortages or production realities but not when used as a loose substitute for case-specific causation or legal analysis.
Takeaway: Courts will permit expert testimony about real supply chain conditions when grounded in industry facts, but they will not allow “supply chain” to become a catchall explanation for legal conclusions or disputed intent.
Emco Corp. v. Armor Mach. & Mfg., No. 25-1635, 2026 U.S. App. LEXIS 7566, at *1 (6th Cir. Mar. 13, 2026)
On appeal from summary judgment, the Sixth Circuit affirmed judgment for the seller, holding that delivery dates expressly identified as estimates and changeable at the seller’s discretion did not create fixed performance deadlines. The court also emphasized that buyer-requested machine modifications materially affected feasibility of earlier delivery and undercut the buyer’s claim of substantial breach. When the buyer later refused delivery, the court rejected the argument that the seller’s remedies were limited to a restocking fee because the parties had not agreed that such a charge would be the exclusive remedy. The opinion is a useful reminder that in equipment and machinery transactions, scheduling flexibility and downstream design changes are part of the supply chain reality the contract allocates.
Takeaway: Courts will enforce contractual flexibility around delivery timing where production schedules are affected by buyer-driven changes, especially in customized manufacturing contexts.
Steamfitters Local 449 Pension v. Extreme Networks, Inc., No. 24-cv-05102-TLT, 2026 U.S. Dist. LEXIS 65348, at *1 (N.D. Cal. Mar. 23, 2026)
On defendants’ motion to dismiss, the court held that plaintiffs adequately pleaded securities fraud claims based on particularized allegations of channel stuffing and related distribution practices. The complaint anchored the alleged misconduct to March 2022 meetings, identified affected distributors and dollar amounts, cited corroborating former employees with personal knowledge, and described executive access to real-time databases and warnings. The court found that this level of detail plausibly tied revenue reporting to supply chain and channel-management practices rather than merely offering hindsight criticism of sales weaknesses. In doing so, the court underscored that distribution-channel manipulation can be a sufficiently concrete operational theory to satisfy the PSLRA when the allegations are specific and internally coherent.
Takeaway: Detailed allegations that inventory was pushed through distribution channels to mask weaknesses can survive dismissal when plaintiffs tie the practice to specific meetings, data access, and executive knowledge.
Anthropic PBC v. U.S. Dep’t of War, No. 26-cv-01996-RFL, 2026 U.S. Dist. LEXIS 65155, at *1 (N.D. Cal. Mar. 26, 2026)
On plaintiff’s motion for a preliminary injunction, the court enjoined multiple government actions, including a presidential directive, a contracting restriction, and a formal supply-chain-risk designation. The court found that Anthropic was likely to succeed on claims that the government’s actions were arbitrary and capricious, procedurally defective, and inconsistent with statutory limits, emphasizing record evidence that the asserted supply-chain-risk rationale appeared rushed and pretextual. The opinion highlighted that the designation followed a dispute over Anthropic’s willingness to permit certain military uses of its AI products and that the administrative record did not square with the government’s stated explanation. By treating the supply-chain-risk label as a potentially unlawful blacklist rather than a substantiated security determination, the court showed that supply-chain-risk authorities remain subject to meaningful judicial review.
Takeaway: Courts may closely scrutinize government use of “supply-chain-risk” designations where the record suggests the label is being used as a pretext for broader commercial or policy retaliation.
Kloster v. Lilium N.V., No. 24-81428-CIV-SMITH, 2026 U.S. Dist. LEXIS 66075, at *1 (S.D. Fla. Mar. 27, 2026)
On defendants’ motion to dismiss, the court dismissed the complaint in full but granted limited leave to amend as to one omission theory concerning insolvency without German loans. Applying the PSLRA’s falsity and scienter requirements, the court held that meaningful cautionary language protected forward-looking statements and that plaintiffs failed to plead with particularity that management knew certain insolvency triggers had already been met when challenged statements were made. The opinion distinguished between broad going-concern warnings and specific undisclosed insolvency conditions, rejecting conclusory allegations that management simply “must have known.” While not a classic supply chain case, the decision is relevant to manufacturing and industrial businesses that rely on complex financing, vendor support, and production ramp assumptions because it shows how hard it remains to convert operational strain into securities fraud without highly specific internal facts.
Takeaway: Courts will continue to protect forward-looking operational and financing statements where cautionary language is meaningful and plaintiffs cannot tie management to specific undisclosed triggers with particularized facts.
Stone Point Advisory, LLC v. S&P Glob. Mkt. Intell., Inc., No. 25-CV-773 (RA), 2026 U.S. Dist. LEXIS 68350, at *1 (S.D.N.Y. Mar. 30, 2026)
On defendants’ motion to dismiss, the court dismissed most trade secret theories, holding that plaintiff’s allegations about proprietary compilations and processes were too general to identify a protectable secret with adequate specificity. The court distinguished between a true compilation trade secret and information that is merely difficult or costly to assemble from public sources. It also held that login warnings were sufficient to provide written notice under the parties’ market-data agreement and that the nonsignatory parent could not be bound absent a properly pleaded liability theory. The opinion is useful for companies whose value depends on data-driven information chains, research pipelines, or analytic workflows because it requires plaintiffs to describe exactly how their claimed process differs from an ordinary aggregation of market information.
Takeaway: Businesses alleging misappropriation of data-based processes should define their claimed information workflow with precision; courts will not infer trade-secret status from general assertions that the process is hard to replicate.
Ledbetter v. Cloud 9 Online Smoke & Vape, LLC, Civil Action No. 1:24-cv-00538-SDG, 2026 U.S. Dist. LEXIS 71720, at *1 (N.D. Ga. Mar. 31, 2026)
On multiple motions to dismiss, the court dismissed the federal RICO claims with prejudice, granted most personal-jurisdiction motions, granted certain subject-matter-jurisdiction motions, and closed the case. The court emphasized that RICO is not a generalized consumer-protection tool and held that plaintiff’s allegations described ordinary commercial relationships and legitimate supply chain transactions, not the kind of coordinated criminal enterprise required for racketeering liability. The court further held that defendant-specific contacts were required for personal jurisdiction and that plaintiff had not adequately established federal jurisdiction over certain defendants. The ruling is significant because it refuses to let ordinary upstream and downstream product movement be recast as organized criminal conduct absent concrete allegations of unlawful enterprise behavior.
Takeaway: Courts are unlikely to transform ordinary supply chain relationships into RICO enterprises without detailed facts showing criminal coordination beyond standard commercial distribution activity.
In re Nike, Inc. Sec. Litig., No. 3:24-cv-00974-AN, 2026 U.S. Dist. LEXIS 69270, at *1 (D. Or. Mar. 31, 2026)
On defendants’ motion to dismiss, the court dismissed the complaint, holding that most of the challenged statements were either literally true, inactionable puffery, or protected forward-looking statements accompanied by adequate cautionary language. For the limited statements the court found potentially false, scienter was not sufficiently pleaded because confidential witness allegations were too attenuated and the alleged component failures were not so central to Nike’s operations as to make executive ignorance absurd under the core-operations theory. The case is instructive for product companies facing allegations tied to defects, component quality, or manufacturing issues because it reinforces that plaintiffs must connect the specific operational problem to particular executive knowledge at the time of the statements.
Takeaway: Supply chain or component-quality allegations do not by themselves establish scienter; plaintiffs still need specific facts showing that senior executives knew the challenged statements were contradicted by the operational record.
Coll. Ret. Equities Fund v. Boeing Co., No. 22 CV 3845, 2026 U.S. Dist. LEXIS 69620, at *1 (N.D. Ill. Mar. 31, 2026)
On defendants’ motion to dismiss, the court parsed challenged statements one by one and distinguished actionable factual representations from generalized corporate optimism. It held that scienter was adequately alleged only in narrow circumstances where plaintiffs pleaded that executives possessed specific information contradicting what they said publicly, while rejecting broader theories that relied on generalized assertions about safety issues and management awareness. Although the claims were framed around safety rather than supply chain continuity, the opinion is relevant to complex industrial businesses because it requires a tight linkage between known operational problems and the specific executive statements at issue. In that sense, it mirrors other recent cases holding that large-scale operational complexity alone does not substitute for particularized knowledge allegations.
Takeaway: In operational-risk securities cases, courts continue to require precise allegations tying known internal facts to specific public statements and specific decision-makers rather than relying on the sheer scale or importance of the underlying business function.
On January 14, President Donald Trump issued a Section 232 proclamation addressing imports of processed critical minerals and their derivative products, finding that these materials — used across defense, energy, electronics, and advanced manufacturing supply chains — pose a national security risk due to import dependence and price volatility. The proclamation directs the Department of Commerce and USTR to pursue agreements with trading partners to mitigate supply vulnerabilities and signals that additional measures, including minimum import prices or tariffs, may be implemented if negotiations fail to produce sufficient resilience. Covered materials include rare earth elements, battery inputs, and other upstream mineral products that feed downstream industrial production. Moving forward, companies should expect continued federal intervention in upstream sourcing decisions and should reassess their reliance on concentrated foreign mineral supply chains. (whitehouse.gov)
Also on January 14, Trump issued a parallel Section 232 proclamation targeting semiconductors, semiconductor manufacturing equipment, and derivative products, linking foreign dependence in these sectors to supply chain vulnerability and national security concerns. The measure contemplates tariffs on certain advanced chips and derivative products, subject to carve-outs for uses tied to domestic data infrastructure, R&D, and manufacturing expansion, and establishes a framework for additional trade actions tied to domestic investment incentives. Covered products span upstream fabrication equipment and downstream chip-integrated goods, directly affecting electronics, automotive, and defense supply chains. Companies should evaluate sourcing strategies, product classifications, and end-use positioning, particularly where tariff treatment may depend on whether imports support U.S. supply chain buildout. (whitehouse.gov)
On January 21, NOAA finalized revisions to its deep seabed mining regulations governing exploration licenses and commercial recovery permits under the Deep Seabed Hard Mineral Resources Act, including the introduction of a consolidated application process intended to streamline permitting. The rule is designed to improve efficiency and predictability for companies seeking access to offshore mineral resources, which are critical inputs for downstream manufacturing and energy supply chains. While not a tariff measure, the regulation directly affects upstream supply availability and domestic access to strategic raw materials. Companies engaged in mineral sourcing should view this as part of a broader federal push to expand and diversify upstream supply channels. (federalregister.gov)
On February 20, Trump issued a proclamation imposing a temporary import surcharge under Section 122 of the Trade Act of 1974 to address international payments imbalances. The measure establishes a 10% ad valorem duty on most imported goods for up to 150 days, subject to limited exceptions for certain critical minerals, bullion, and select energy-related products. Because the surcharge applies broadly across industries, it directly increases baseline landed costs and interacts with existing tariff regimes, including Section 232 and Section 301 duties. Companies should immediately reassess pricing, sourcing, and customs strategies to account for the additional duty layer and its impact on short-term procurement decisions. (whitehouse.gov)
On February 20, Trump issued an executive order continuing the suspension of duty-free de minimis treatment for all countries, eliminating the availability of low-value import exemptions regardless of shipment value, origin, or transportation mode. The order requires formal customs entry and duty collection for covered shipments and imposes additional reporting obligations, including country-of-origin and valuation disclosures for postal imports. The measure has immediate operational implications for e-commerce, spare parts, warranty shipments, and low-value direct-to-consumer flows that previously relied on de minimis entry. Companies should expect increased compliance costs and should reevaluate logistics models that depend on high-volume, low-value shipments. (whitehouse.gov)
Also on February 20, Trump issued an executive order ending certain IEEPA-based tariff actions while expressly preserving other major tariff programs, including Section 232 and Section 301 duties, as well as the newly imposed import surcharge and de minimis restrictions. The order clarifies the continuing tariff framework following the rollback of select emergency measures and reinforces that multiple duty layers remain in effect for most imports. Companies should not assume overall tariff exposure has decreased and should instead evaluate how the remaining tariff stack applies to their specific product categories and sourcing structures. (whitehouse.gov)
On February 26, USTR issued a request for public comment on the design of a plurilateral agreement on trade in critical minerals and related policy actions to strengthen supply chain resilience. The notice seeks input on mechanisms to reduce dependency on nonmarket economies, including potential tariffs, pricing frameworks, and investment incentives tied to allied sourcing. The initiative reflects a shift toward coordinated trade and industrial policy aimed at restructuring upstream mineral supply chains and securing downstream manufacturing inputs. Companies involved in mining, processing, and mineral-dependent manufacturing should view this as an opportunity to shape emerging trade rules and anticipate new sourcing requirements tied to allied production networks. (ustr.gov)
On March 11, USTR initiated Section 301 investigations into structural excess capacity and production in key industrial sectors, citing nonmarket policies and practices that distort global supply chains and pricing. The investigations focus on how excess capacity in foreign markets can depress prices, displace domestic production, and create long-term supply chain vulnerabilities. While no tariffs were imposed in March, the investigations create a pathway for future trade remedies, including tariffs or quotas targeting affected sectors and inputs. Companies should monitor these proceedings closely, as they may result in new sourcing constraints and cost pressures across globally traded industrial supply chains. (ustr.gov)
On March 19, USTR announced the U.S.-Japan Action Plan on Critical Minerals, aimed at strengthening cooperation on sourcing, processing, and trade policy for strategic mineral inputs. The framework is intended to reduce the countries’ reliance on concentrated supply sources and promote aligned production and investment across allied markets, including potential coordination on trade measures and supply chain safeguards. The initiative targets materials used in batteries, semiconductors, and advanced manufacturing and signals a continued shift toward allied sourcing strategies. Companies should evaluate opportunities to realign sourcing toward partner-country supply chains and anticipate future trade incentives tied to such alignment. (ustr.gov)
Entering 2026, Canada implemented changes to its customs valuation framework that narrow the availability of multistep transaction pricing and consignment structures for determining the “sale for export” standard; it also is applying a 25% surtax to certain steel derivative products, including fasteners, wire products, and structural components. These changes increase scrutiny on transfer pricing and import valuation methodologies while raising landed costs for downstream manufacturing inputs that rely on steel-intensive components. Companies operating through Canadian procurement structures or importing intermediate goods into Canada should reassess valuation practices and confirm whether affected products fall within the expanded surtax scope. (canada.ca/en)
Effective in early 2026, Mexico implemented tariff increases of up to 35% on a range of industrial inputs — including auto parts, steel, plastics, and textiles — and up to 50% on certain vehicles imported from countries without free trade agreements. The measure is intended to shift sourcing toward USMCA-compliant and domestic supply chains and to reduce reliance on imports from nonaligned markets. These tariff increases directly affect companies using Mexico as a manufacturing base, particularly where inputs are sourced from Asia or other non-FTA jurisdictions. Companies should reassess supplier mix, cost structures, and rules-of-origin compliance strategies to maintain preferential treatment under USMCA and avoid higher duties. (dof.gob.mx)
During Q1 2026, the United States, Canada, and Mexico began preliminary engagement in advance of the upcoming USMCA joint review, with early discussions focusing on strengthening rules of origin, reinforcing regional content requirements, and reducing dependency on nonregional inputs. While no formal amendments were adopted during the quarter, officials from all three countries signaled interest in tightening compliance and strengthening North American supply chain integration. This process is likely to influence sourcing strategies across automotive, electronics, and advanced manufacturing sectors as the review progresses. Companies should begin evaluating current rules-of-origin compliance and prepare for the potential tightening of regional-content requirements. (ustr.gov)
Congressional Activity
In January 2026, bipartisan lawmakers introduced legislation to establish a federal strategic reserve of critical minerals, including rare earth elements and battery inputs, to stabilize supply and mitigate price volatility. The proposal would position the federal government as a direct participant in upstream commodity markets and could influence pricing dynamics and procurement strategies across affected industries. Companies should monitor this development closely as it may reshape supply availability and long-term sourcing strategies. (reuters.com)
On February 11, the House passed H.R. 3617, directing the Department of Energy to assess vulnerabilities in critical mineral supply chains and develop strategies to reduce reliance on foreign sources. The bill targets risks across extraction, processing, and manufacturing stages and reflects increasing congressional alignment around treating critical mineral supply chains as a national security priority. Companies should expect continued legislative momentum toward domestic sourcing incentives and coordinated federal oversight. (energycommerce.house.gov)
In March 2026, the House passed legislation requiring alignment between Department of Energy and U.S. Geological Survey critical mineral lists, standardizing classification across federal programs. This change is intended to reduce regulatory fragmentation and ensure the consistent application of incentives and permitting requirements tied to critical minerals. Companies should anticipate more predictable eligibility standards across federal supply chain initiatives. (eenews.net)
European Union
On February 24, the European Union adopted Directive (EU) 2026/470, postponing certain reporting requirements under the Corporate Sustainability Reporting Directive (CSRD) for companies scheduled to begin reporting in 2025 and 2026. The adjustment is intended to balance ESG compliance burdens with the operational realities faced by companies and their supply chains, particularly smaller suppliers subject to indirect reporting obligations. Because CSRD reporting extends across value chains, the delay affects the timing and scope of sustainability data collection and due diligence requirements. Companies should use the additional time to align internal systems and supplier networks with forthcoming ESG reporting obligations. (eur-lex.europa.eu)
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