After losing his fight at the Supreme Court over his emergency tariffs, Donald Trump faces a legal battle that could require his administration to refund all importers who paid those tariffs, not just those who sued.
On Tuesday, lawyers representing more than 330,000 importers of record asked the U.S. Court of International Trade to issue a relief order to refund all the money the government has collected under the International Emergency Economic Powers Act (IEEPA), Fortune reported. The total would add up to some $166 billion in refunds. The case, Freestyle World, Inc. v. United States, was certified as a class action on Oct. 8.
The class’s lawyers told Fortune that issuing such an order would provide U.S. Customs and Border Protection (CBP) with the authority that the agency says it needs to pay full refunds, including interest, to all importers, including “small businesses who lack the resources to bring their own cases.”
The Supreme Court ruled in February that Trump’s tariffs under IEEPA went beyond the powers he had. As of August, CBP had refunded more than $115 billion, but thousands of importers are still waiting for their money back. These importers include small businesses as well as individuals who bought tariffed goods online. Some importers ran into technical issues, others didn’t have a lawyer or the appropriate paperwork to request a refund, while some bought their goods from a third-party importer.
Fortune reported that such refunds would help alleviate pressure on companies that increased their prices in the wake of the tariffs and war with Iran, making it more likely that consumers would be able to get refunds as well.
Trump’s administration has said it only wants to refund importers who brought lawsuits. Judge Richard Eaton, who handles all the tariff refund cases, ruled in March that all importers who paid the tariffs were entitled to refunds and issued a universal refund order in April. The Trump administration appealed that order in June, claiming Eaton had overstepped his authority.
“CBP has no authority to reliquidate or refund money without a court order,” the Department of Justice said in a filing.
The Trump administration successfully argued before the Supreme Court in order to narrow the scope of a nationwide block of Trump’s executive order to limit birthright citizenship. But Eaton has argued that the Supreme Court’s limits don’t apply to his court, which has exclusive jurisdiction over trade-related cases.
Trump’s tariffs also became a flashpoint in the affordability crisis that ended up costing the Republicans in this month’s midterms, Fortune reported.
Sen. Elizabeth Warren (D-Mass.) accused Trump’s administration of having “slow-walked the refund process” in a letter to CBP in June. Sen. Ron Wyden (D-Ore.), who is likely to become the next chairman of the Senate Finance Committee, is leading a Democratic push to repeal specific tariffs, starting with Canada.
Every day that Trump insists on keeping his tariffs, Wyden told CNBC, “he digs a deeper hole for Republicans enabling his tariff spree.”
The Department of Justice has until Friday to respond to the class action complaint and until Dec. 9 to respond to the motion for relief.
