IEEPA Tariff Refunds and Follow-On Litigation: ‘How Would This Work? It Seems to Me Like This Could Be a Mess’*

At a Glance

• On November 5, 2025, the Supreme Court of the United States held oral argument on whether the president exceeded his authority by imposing tariffs pursuant to the International Economic Emergency Powers Act (IEEPA).
• If the Supreme Court upholds the lower courts’ rulings that the IEEPA tariffs are invalid, the prospect of duty refunds remains uncertain.
• Multiple follow-on lawsuits have been filed amid speculation that relief would be granted only for the named plaintiffs in the lead suit and refunds may not be available for imports that are administratively finalized (i.e., “liquidated”) from the perspective of U.S. Customs and Border Protection (CBP).
• Notably, while administratively finalized from CBP’s perspective, liquidation need not be the last stage in the life cycle of an import whether through timely administrative protest before the agency or if the courts or legislature subsequently determine otherwise. Nonetheless, it remains unclear what course of action, if any, importers must take at this stage — i.e., to challenge liquidation administratively through protests and/or through litigation.
• The government will likely oppose requests for injunctions against liquidation and request a stay of all new cases in the event follow-up lawsuits are filed. The government was successful on both fronts in earlier follow-on litigation at the U.S. Court of International Trade (CIT).
• However, in follow-on suits, plaintiffs may receive a stipulation from the government to grant relief for liquidated entries. The government has stipulated on these legal points in earlier pending follow-on litigation.
• Until important issues regarding jurisdiction are resolved in the courts, importers may take steps to preserve their rights to refunds by filing administrative protests with CBP for liquidated entries (within 180 days of liquidation), rather than filing a follow-on lawsuit at the CIT against the federal government at this stage.

On November 5, 2025, the Supreme Court of the United States held oral argument in Learning Resources, Inc. v. Trump and Trump v. V.O.S. Selections, Inc., cases collectively challenging the “trafficking” tariffs on Canada, China, and Mexico and “reciprocal” tariffs on nearly all U.S. trading partners (collectively, Challenged Tariffs) that President Trump imposed pursuant to the International Emergency Economic Powers Act (IEEPA).

Below is a recap of the arguments on the merits and administrative issues presented to the Supreme Court and our current analysis regarding the following questions:

1. What happened at oral argument?

2. When will the Supreme Court issue its decision?

3. Will refunds be available if the Challenged Tariffs are invalidated?

4. Do I need to file my own lawsuit right away to preserve my rights to a potential refund?

5. What can I do to try and preserve my rights while these issues are resolved if I do not want to file my own lawsuit at this point?

As detailed below, if the Supreme Court ultimately does strike down the Challenged Tariffs, the prospects and scope for refunds is unclear — thus incentivizing importers to prepare for multiple potential avenues for relief. Parties seeking importer-specific assurances from the government that reliquidation may be available might consider filing their own follow-on suit. A follow-on lawsuit likely will not result in an importer-specific injunction in the near term, and the government has made statements in prior follow-on liquidation that appear to acknowledge the court’s authority to order reliquidation. Nevertheless, it is possible that the government might provide an individualized stipulation in any additional follow-on suit filed. However, those reluctant to file suit against the government at this juncture can take steps at the administrative level to preserve rights and closely watch how the recent spate of follow-on suits are handled pending issuance of the Supreme Court’s opinion.

1. What happened at oral argument?

At oral argument, the Justices asked pointed questions of both sides on important issues going to the merits of the case, including whether IEEPA’s grant of authority for the president to “regulate” trade includes the power to impose tariffs and, if so, whether Congress’s delegation of that authority would be unconstitutional. The Justices also asked questions about practical issues, including whether refunds would be available to all importers if the IEEPA tariffs were found unlawful and, if so, how the refund process would be administered.

Overall, it appears from the oral argument that several Justices were skeptical of the president’s application of his powers under IEEPA. However, there appears to be a lack of consensus on how this case should be decided, and it is unclear whether there were enough to command a majority, at least on the basic interpretation of the statute. A majority of the Justices can agree on the same rationale; or, alternatively, a “plurality” of the Justices can reach the same result through concurrence in a judgment based on differing rationales.

While in theory the Court could offer differing opinions on each of the respective IEEPA tariffs imposed, the Justices’ questions indicate that the Court is considering the president’s statutory authority as a whole and are uninterested in parsing the nature of the declared emergencies or the relationship of those emergencies to the tariffs at hand (a focus of the lower courts). Therefore, we believe that the opinion is likely to focus on the legal arguments regarding whether IEEPA permits the president to impose tariffs of any kind. While this may result in a binary “up or down” decision on the merits, as we discuss below, how the courts will resolve the question of remedy (i.e., refunds), if the respondents, the importers and states challenging the tariffs prevail, remains unclear.

2. When will the Supreme Court issue its decision?

Briefing and argument proceeded on an accelerated schedule before the Supreme Court and an opinion could be issued in advance of the normal timeline of the end of the Court’s term in June of 2026. If the Court agrees with the lower courts’ holdings that the IEEPA tariffs are unsupportable under the law, the next step likely will be a remand to the trial court found to have jurisdiction (either the U.S. District Court for the District of Columbia or the Court of International Trade) on the issue of remedy.

3. Will refunds be available if the Challenged Tariffs are invalidated?

This is an open question. It is possible that the Supreme Court will rule that the president’s invocation of IEEPA to impose the Challenged Tariffs was invalid but that refunds are not the appropriate remedy.

For example, Justice Alito raised the possibility of statutory alternatives to IEEPA for purposes of imposing immediate tariffs. Specifically, Justice Alito noted a possible scenario where the Court invalidates the tariffs under IEEPA, and the president then reissues the executive orders and cites, for example, Section 338 of the Tariff Act of 1930 to impose the same tariffs.¹ Justice Alito suggested that under this scenario, the government would continue to collect the tariffs and importers would likely initiate another legal challenge, resulting in continued economic uncertainty. Accordingly, Justice Alito asked whether it is more sensible for the Court to address Section 338 now as a possible alternative justification for the tariffs rather than prolonging the uncertainty surrounding the president’s tariff authority.

The private respondents stated that the government, having never raised the argument of alternative statutory authority for the imposition of the IEEPA tariffs, has waived the issue. The private respondents also suggested that relief could be granted on a prospective basis only.

If the Court invalidates the Challenged Tariffs on statutory or constitutional grounds (and if the Court does not say that relief is prospective-only or adopts Justice Alito’s suggestion of affirming on the basis of an alternative statute), a final resolution on the issue of refunds may require additional litigation. Specifically, the Supreme Court could remand the case to the lower courts to determine potential remedies, both with respect to injunctive relief for future importations as well as importations for which the Challenged Tariffs have already been paid.²

4. Do I need to file my own lawsuit right away to preserve my rights to a potential refund?

The issue of how any refunds would be administered is also unresolved. During oral argument, Justice Barrett posed a series of questions to the respondents’ counsel on the question of how the government might administer a refund process, suggesting that it may be a “complete mess” to undo the tariffs already collected.³

Counsel for the respondents raised the notions of filing administrative protests under 19 U.S.C. § 1514, filing separate lawsuits (with individual relief stipulated under each suit), or to a refund process that occurred following a decision by the Supreme Court in United States v. United States Shoe Corp., 523 U.S. 360 (1998), which struck down a harbor maintenance tax on exports. The Justices did not appear to endorse any of these methods, and there was no discussion as to how the administrative liquidation process might potentially limit the courts’ ability to order relief for entries that liquidate.

While the government through the Department of Justice (DOJ) has indicated in public statements in other follow-on litigation that refunds will be available if the Challenged Tariffs are invalidated, it has not provided specifics on how the process would be administered. Nor has the government indicated whether it would contest claims for refunds of entries that have liquidated pending the appeals process where it has not specifically stipulated that refunds would be available. The DOJ’s apparent legal position also stands at odds with some of the administration’s other public statements on the issue.

The uncertainty regarding a potential administrative process for relief has resulted in multiple follow-on lawsuits being filed contemporaneously with the Court’s oral argument. Our review of these suits indicates that follow-on litigation at this juncture may not serve the aim of obtaining an importer-specific injunction preventing liquidation given the unique posture of this case.

While the most conservative approach for attempting to preserve rights to refunds would be to file a follow-on lawsuit prior to liquidation to seek individual assurances from the government, many companies may be reluctant at this juncture to take the step of suing the administration to reverse a marquee policy initiative. Moreover, we believe that Federal Circuit precedent and the two-year statute of limitations for the jurisdictional provision under which V.O.S. Selections was brought in the Court of International Trade (CIT) provide further support for the proposition that the courts have authority to provide post-liquidation relief.⁴

Moreover, the decision to file a lawsuit would require anticipating how the Supreme Court will resolve the question of whether the CIT or the district court has jurisdiction to hear the cases. To this end, we note that, on the evening before the argument, the New Civil Liberties Alliance (a conservative nonprofit organization) filed a class action complaint in the U.S. District Court for the District of Columbia.⁵

Specifically, the complaint asks the district court to identify two classes: (1) the “China Tariff Class,” which covers all companies or individuals who have paid or become obligated to pay IEEPA tariffs because they have or are about to import products from China; and (2) the “European Union Tariff Class,” which covers all companies who have paid or become obligated to pay IEEPA tariffs because they have or are about to import products from the European Union.” It is possible that this class action suit could protect the defined purported class of importers that are not direct parties to the Supreme Court cases. However, it is too early at this point to determine whether the class will be certified. It is also impossible to predict whether this lawsuit would be successful and the scope of relief that could be provided (i.e., whether it would cover only prospective relief or could serve as a vehicle for obtaining refunds).

We also note that the prospect of universal relief without having to file a follow-on lawsuit (in the CIT or otherwise) remains within the realm of possibility. In V.O.S. Selections, the CIT previously issued a “universal” permanent injunction against the government, preventing the government from collecting the Challenged Tariffs against all importers (not just the parties to the lawsuit) and instructing the government to issue “necessary administrative order to effect the permanent injunction” within 10 days.⁶

Although the Federal Circuit affirmed the CIT’s holding that the IEEPA tariffs are illegal, it vacated the CIT’s injunction based on a recent Supreme Court precedent invalidating most “universal” injunctions.⁷ So, if the Supreme Court remands this case to the Federal Circuit, the Federal Circuit will, at a minimum, need to remand to the CIT with instructions for the CIT to determine the scope of any relief, including whether a universal injunction against enforcement of the tariffs against nonparties would be permitted.

As a conservative approach, parties comfortable with the concept of filing suit at this juncture may consider joining this effort by filing their own appeals in an effort to seek individualized assurances that relief will be available for liquidated entries. The government likely will oppose any injunction sought and will seek to stay any additional follow-on litigation, as it has successfully done in at least one prior follow-on case.⁸

However, the government appears to have stipulated in the prior follow-on litigation that the court may order reliquidation of entries if the duties are, in a final and unappealable decision, found to have been unlawfully collected.⁹ It is uncertain at this point whether this stipulation would apply to all parties. Nor is it clear whether the government would stipulate to reliquidation of entries that liquidated prior to a lawsuit being filed. Therefore, filing a separate suit could potentially be one vehicle for seeking an affirmative statement from the government that liquidation will not be a bar to relief.

5. What can I do to try and preserve my rights while these issues are resolved if I do not want to file my own lawsuit at this point?

As discussed in further detail in our previous client alert, given the uncertainties involved regarding possible refunds, we continue to recommend that importers monitor liquidation and file protective protests for any entries that liquidate.

Liquidation typically occurs approximately 314 days after entry but may occur earlier in certain circumstances. An importer must file an administrative protest within 180 days of liquidation. If CBP denies the protest (either affirmatively or via a deemed denial), the importer’s right to seek judicial review at the CIT (via the filing of a summons within 180 days after protest denial) may preserve the right to challenge liquidation of these entries that included the assessment of the Challenged Tariffs.

In other words, just as a separate suit could be one vehicle for relief, a wait-and-see approach in conjunction with protests is also an attractive option for importers looking to stay out of the spotlight.

For More Information

Faegre Drinker’s customs and international trade team is monitoring and analyzing new developments. For further information you may contact the authors.