The Road to SCOTUS
Beginning in February 2025, President Trump imposed new tariffs on imported goods through a series of executive orders, relying on the International Emergency Economic Powers Act (IEEPA) as the claimed authority for imposing tariffs. In time, the new tariffs affected imported goods from nearly all countries. Legal challenges followed.
In V.O.S. Selections, Inc. v. United States, the Court of International Trade (CIT) enjoined the enforcement of the tariffs against the plaintiff, and the Federal Circuit affirmed. In Learning Resources, Inc. v. Trump, the U.S. District Court for the District of Columbia held that IEEPA does not authorize tariffs. The U.S. Supreme Court granted certiorari in both cases, and on February 20, 2026, issued its opinion holding that IEEPA does not authorize the President to impose tariffs. Two days later, U.S. Customs and Border Protection (CBP) announced that it would no longer collect IEEPA tariffs effective February 24, 2026.
The Refund Process: Atmus, Euro-Nations, and the CAPE System
On March 4, 2026, CIT ordered CBP to liquidate all unliquidated entries subject to IEEPA tariffs and reliquidate entries for which liquidation was not yet final “without regard to IEEPA duties” in Atmus Filtration v. United States (“Atmus”). In other words, CIT ordered refunds to importers who paid IEEPA tariffs. Atmus became the lead case for IEEPA refunds, with other cases stayed pending an outcome in Atmus. In a March 6, 2026 declaration filed in Atmus, CBP told the court that CBP could not immediately comply with the refund order due to the volume of affected entries and CBP’s technical limitations. Yet CBP also stated that it was building a new process to handle IEEPA tariff refunds and would provide guidance once the system was operational. CIT suspended its order for immediate refunds and ordered CBP to continue building its system and provide updates to the court. CBP’s new system is now known as the Consolidated Administration and Processing of Entries (CAPE) system.
Atmus was replaced as the lead case by Euro-Nations Florida v. U.S. Customs and Border Protection (“Euro-Nations”) after the plaintiff in Atmus filed a notice of dismissal on April 6, 2026. CIT issued an order in Euro-Nations similar to that in Atmus, effectively ordering CBP to issue refunds to importers. However, the dismissal of Atmus and its replacement by Euro-Nations as the lead case also restarted the clock for the government to file any appeal of the order to liquidate or reliquidate entries without regard to IEEPA tariffs. The deadline to appeal is now approximately June 6, 2026. While the litigation continues, CBP launched Phase 1 of CAPE on April 20, 2026, and importers and their Customs brokers—as defined in 19 U.S.C. § 1484—are working to gather documentation to submit refund requests. Only the Customs broker or the importer can file for refunds through CAPE.
The day of the Supreme Court’s ruling on IEEPA tariffs, President Trump issued Proclamation No. 11012, imposing yet another set of new tariffs pursuant to a different authority—Section 122 of the Trade Act of 1974. These tariffs were challenged in two companion cases, The State of Oregon v. United States and Burlap and Barrel, Inc. v. United States. On May 7, 2026, CIT issued an Opinion and Order in that litigation granting summary judgment for the private plaintiffs and entering a permanent injunction for importer plaintiffs. CIT determined that Proclamation 11012 is invalid, and the tariffs it imposes are unauthorized. Given this holding, importers may be eligible for refunds for tariffs paid pursuant to Proclamation 11012, although the mechanism for these refunds is yet to be determined.
A New Front: Consumer Class Actions
Meanwhile, a new set of cases stemming from IEEPA litigation is emerging in the trial courts. These are class actions filed by consumers, primarily against retailers and shipping companies. The consumers allege that, given that companies may now be eligible for refunds after having “passed through” the costs associated with IEEPA tariffs to consumers in the form of higher prices, the plaintiffs are entitled to have the refunds passed through to them as well.
While still in the early stages of litigation, these cases typically include common-law claims for unjust enrichment, money had and received, as well as claims under various state consumer protection statutes such as California’s Unfair Competition Law. Some cases also assert declaratory judgment and breach of contract claims. Cases against shipping companies such as FedEx Corporation and United Parcel Services Inc. tend to principally assert claims for breach of contract and unjust enrichment because the reasons for their higher pricing due to tariffs typically arose from higher shipping costs, likely making deceptive or unfair practice claims more difficult to satisfy.
Likely defenses will include standing and ripeness considerations, contractual defenses based on class waiver and arbitration provisions, the voluntary payment doctrine, defenses based on equitable concerns such as no entitlement to restitution where plaintiffs received the exchange expected, policy concerns such as feasibility of refunds, and leeway in pricing practices for companies. More specific defenses will need to be explored for the consumer protection claims under each jurisdiction’s statutes.
Action Items for Importers
Importers should review the applicable contracts for variable pricing or cost pass-through provisions, class action waivers, and arbitration clauses, as well as any statements made with respect to the refunds to consumers.
The Husch Blackwell team is monitoring developments in these cases. The first telling indicators of their progress will be the courts’ rulings on any motions to dismiss that are likely forthcoming.