The Trump administration said it will appeal a judge's authority to order across-the-board refunds of all tariffs ruled illegal by the US Supreme Court, potentially injecting legal chaos into a claims process that's already underway. The Justice Department filed notice on Friday that it will appeal a court order compelling customs authorities to recalculate all import taxes that the administration collected under President Donald Trump's use of a 1970s-era emergency powers law.
US Customs and Border Protection launched a new online portal to process refund claims on April 20, signaling that it intended to repay at least some of the approximately $166 billion in levies struck down by the Supreme Court earlier this year.
But even as the administration has moved forward with that plan, the Justice Department declined to concede that a judge could exercise nationwide power to order CBP to reprocess entries that had already finalized via a process called liquidation, leaving open the possibility of another legal fight.
"CBP has no authority to reliquidate or refund money without a court order," the Justice Department said in the court filing Friday. At the heart of the dispute is whether the judge has authority to order refunds nationwide for all importers who paid tariffs issued under the International Emergency Economic Powers Act, or IEEPA, even if they did not file suit in the trade court.
The US has suggested that the government need only refund importers who sue, and that the judge's order is effectively a nationwide injunction that is barred by a recent Supreme Court ruling in the fight over birthright citizenship.
The government's disclosure about its intent to appeal was included in an objection to a judge's order that CBP Commissioner Rodney Scott appear in-person for a June 9 hearing.
The Justice Department argued that the situation failed to present the type of "extraordinary circumstances" required to compel a high-level official to testify, and said it would appeal on that issue as well if the judge refused to change his mind.
Judge Richard Eaton swiftly denied the government's request, writing that he needed Scott's testimony to understand if the administration intended to fully refund all of the tariffs it had collected to all importers who paid them, "large and small."
"There is $166 billion involved," he wrote. The White House didn't immediately respond to a request for comment. One law firm that is advising companies said importers should hold off for now on making filings to the Court of International Trade.
"We continue to recommend importers wait and see before making any filings at the CIT as the statute of limitations will not run until February 2027," law firm Faegre Drinker Biddle & Reath LLP said in an emailed alert to clients.
In a 6-3 decision in February, the Supreme Court held that Trump's use of the IEEPA to impose sweeping global tariffs was unlawful. They were silent on the question of refunds, however, sending the litigation back to the US Court of International Trade in Manhattan to determine next steps.
Eaton was assigned to preside over thousands of lawsuits importers filed seeking to recoup the taxes they had paid before the Supreme Court ruled. He ordered the customs agency to recalculate tariff amounts for all importers who paid the contested levies, not just the companies that had sued. The government also committed to paying interest on any refunds.
Uncertainty has loomed about whether officials would oppose repaying the full amount. Eaton has mostly held non-public court hearings to discuss the government's progress, but he indicated in a public order there was disagreement about how to handle tariffs that became final, a process that happens automatically on a rolling basis.
A customs official had also disclosed in court filings that the first phase of the refund portal roll-out wouldn't be able to handle a significant proportion of the import entries at issue, and didn't provide a concrete schedule for expanding the system's capabilities to deal with more complicated claims.
Trump, meanwhile, lambasted the Supreme Court's decision and suggested that companies that didn't seek refunds could reap political benefits in the future, saying that he would "remember them."
The issue raised in Friday's filing by the government appears to be headed for resolution by an appeals court, according to Valerie Sorensen-Clark, who served as CBP's counsel on the case until last month and is now a partner at law firm GDLSK LLP in New York.
"That question now appears headed for appellate resolution," Sorensen-Clark wrote in a LinkedIn post following the DOJ's filing. "Regardless of where the courts ultimately land, additional clarity on the issue will benefit importers, CBP, and the trade community alike."
Separate from the IEEPA legal wrangling, the Trump administration is before the trade court defending a new round of global tariffs that the president imposed under a different law shortly after he lost in the Supreme Court.
A three-judge panel declared the policy unlawful. But a federal appeals court temporarily paused that ruling while it weighs the government's request for a longer-term order allowing customs authorities to continue collecting the levies as the court fight proceeds.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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