Importers Move Closer to $166 Billion in Universal Tariff Rebates

By Marcus Bennett

Importers of record are one step closer to claiming the full $166 billion in tariff refunds after class counsel filed a motion on Tuesday asking the U.S. Court of International Trade to enter a universal relief order. The filing covers more than 330,000 importers of record, whether or not they filed individual lawsuits against the administration. The Trump administration, by contrast, argues that only importers who sued should be paid.

The case, Freestyle World, Inc. v. United States, builds on the Supreme Court's February ruling that tariffs imposed under the International Emergency Economic Powers Act (IEEPA) exceeded the president's powers. That decision opened the door to hundreds of billions of dollars in refunds for importers who footed the bill for the levies.

What does the proposed order change?

The motion would route money to all class members, not only the thousands of companies that filed their own suits. Class counsel co-leads Lawrence Friedman of Barnes, Richardson & Colburn, and Elizabeth Cabraser and Nicholas Diamand of Lieff Cabraser Heimann & Bernstein, said in a statement: "The proposed order would give the agency the authority it says it needs to provide full refunds with interest to all class members, including the tens of thousands of small businesses who lack the resources to bring their own cases."

They added: "We will continue working closely with the Court and the government to make sure all importers who paid these unlawful tariffs receive the refunds they are owed as quickly as possible."

How much money has already gone out?

More than $115 billion has been disbursed back to American companies as of August through Customs and Border Protection's Consolidated Administration and Processing of Entries (CAPE) system, Treasury data show. Thousands of importers remain unpaid, however. Small businesses, individuals who bought tariffed items online, and firms that used a larger third-party importer of record have run into technical errors in CAPE submissions, missing paperwork, or a lack of legal resources compared with larger importers.

The Court of International Trade certified the case as a class action on Oct. 8. The Department of Justice, representing the government, faces a Nov. 13 deadline to answer the initial complaint and until Dec. 9 to respond to the relief motion. The DOJ did not respond to a request for comment.

Why is the administration pushing back?

Judge Richard Eaton, who presides over all tariff refund cases, ruled in March that every importer who paid IEEPA tariffs was entitled to a refund and issued a universal refund order in April. Because he is the sole judge hearing these cases, Eaton signalled he would keep ruling the same way each time.

The administration appealed in June, arguing Eaton exceeded his authority and that the government cannot refund importers who have not sued. "CBP has no authority to reliquidate or refund money without a court order," the Justice Department said in its filing.

The dispute echoes the administration's successful bid last June to narrow a universal injunction blocking Trump's birthright citizenship executive order, when the Supreme Court required future orders to apply only to named plaintiffs. Eaton has countered that limits on universal injunctions do not bind the Court of International Trade, which holds exclusive subject-matter jurisdiction over trade issues and does not operate like a typical district court.

What could the midterms change?

Newly emboldened Democratic legislators may gain leverage to pressure CBP on refund speed. Sen. Elizabeth Warren (D-Mass.) wrote to the agency in June demanding faster processing. "Instead, it has slow-walked the refund process while searching for new ways to keep money that never belonged to the government in the first place," Warren wrote, referring to the administration's response.

Democrats also plan legislative repeal of specific levies, starting with Canada tariffs, led by Sen. Ron Wyden (D-Ore.), the likely next head of the Senate Finance Committee. "Every day Trump insists on his indiscriminate taxes on so many of the products Americans need, he digs a deeper hole for Republicans enabling his tariff spree," Wyden told CNBC after the election.

For finance teams, the stakes run beyond recovery of duties paid. Refunds with interest would ease margin pressure on companies that raised prices to offset tariff- and war-driven inflation, and raise the odds that consumers see their own share returned through payments from those companies.