Judge rules companies are entitled to refunds for Trump tariffs overturned by the Supreme Court

Federal Judge Orders Tariff Refunds for Companies After Supreme Court Ruling

A federal judge in New York has ordered companies to receive refunds for Trump-era tariffs that were invalidated by the Supreme Court. The ruling, delivered on Wednesday, follows the court’s decision last month to strike down the sweeping double-digit import taxes imposed by President Donald Trump under the 1977 International Emergency Economic Powers Act (IEEPA).

Supreme Court Finds Tariffs Unconstitutional

Judge Richard Eaton of the U.S. Court of International Trade emphasized that all importers of record should benefit from the Supreme Court’s decision. The ruling declared the tariffs unconstitutional, as the president could not unilaterally set and change import duties without congressional authority. The majority opinion highlighted that the emergency powers law grants the president limited authority, not the full power of taxation.

“This is a great decision for importers and consumers who paid,” said Barry Appleton, a law professor and co-director of New York Law School’s Center for International Law. “It will make customs brokers busy. It should make things easier for the courts — and get a process underway for those importers who paid within the last 180 days.”

The judge stated he would be the sole authority to handle refund cases related to IEEPA duties. This decision provides clearer guidelines for the tariff refund process, something the Supreme Court did not address in its February 20 ruling.

Refund Process and Financial Impact

The federal government collected over $130 billion in the now-defunct tariffs through mid-December, and could face refunds totaling $175 billion, according to the Penn Wharton Budget Model. The case was specifically brought by Atmus Filtration, a Nashville-based company that produces filtration products, which claimed a right to a refund.

Under U.S. Customs procedures, all goods undergo a process called “liquidation,” where the agency finalizes the amount owed. Importers have 180 days to contest duties after this step. Once liquidated, the amount is legally binding. Eaton directed Customs to halt the collection of IEEPA tariffs for goods in the liquidation process and recalculate duties for those already processed.

On Monday, another federal court dismissed the Trump administration’s attempt to delay the refund process. The U.S. Court of Appeals for the Federal Circuit initiated the next phase by forwarding the matter to a New York trade court. Now, Customs must develop a system to manage the refunds, which it has not been designed for, according to trade lawyer Alexis Early of Bryan Cave Leighton Paisner.

“Customs routinely refunds tariffs when there’s been some kind of error, but its system was ‘not designed for a mass refund,’” Early said. “The devil will be in the details of the administrative process.”