The federal judiciary has ordered the Trump administration to start a multi-step process to refund billions tied to tariffs the Supreme Court recently struck down, laying out how Customs should recalculate duties and declaring one judge will oversee the refunds. This ruling follows litigation by importers and centers on the use of the International Emergency Economic Powers Act, the Supreme Court’s 6-3 decision that limited the president’s tariff authority, and both judicial caution and practical questions about how to handle mass refunds.
Judge Richard Eaton, an appointee of Bill Clinton, issued a short but consequential order estimating the refund effort could total roughly $130 billion. Eaton directed that U.S. Customs and Border Protection should figure out what importers would have owed if those now-invalid duties had never been applied, which starts the long path toward getting money back into private hands.
Eaton also made clear he would have exclusive control over how those refunds are handled, writing directly about the court’s structure and his role. “The Chief Judge has indicated that I am the only judge who will hear cases pertaining to the refund of [International Emergency Economic Powers Act] duties,” Eaton wrote. “So there is no danger that another Judge, even one in this Court, will reach any contrary conclusions.”
The lawsuit at the center of the order was brought by Atmus Filtration, Inc., which paid tariffs President Trump imposed under IEEPA during an emergency declaration. That legal challenge represents a larger universe of importers who paid the duties and now seek redress after the Supreme Court concluded the statute did not clearly give the executive branch authority to impose tariffs of that kind.
The IEEPA, passed in 1977, lets the president regulate or block certain economic transactions after declaring a national emergency tied to foreign threats, including sanctions or restrictions on trade. The Supreme Court’s majority held in February that IEEPA does not plainly authorize a tariff regime, even with an emergency declaration, because Congress did not clearly hand that power to the executive branch.
The majority decision left the practical question of refunds to lower courts, and that unresolved patchwork is exactly what Eaton is now trying to manage in a single, orderly process. Eaton told parties to treat affected imports as if the invalid tariffs never applied, which is the key procedural move that will let refunds flow once CBP completes its calculations and the court issues the necessary directives.
Justice Brett Kavanaugh warned of the scale and complexity of the refund effort in his dissent, voicing concerns about how to return huge sums without creating unintended damage. “The United States may be required to refund billions of dollars to importers who paid the IEEPA tariffs, even though some importers may have already passed on costs to consumers or others,” Kavanaugh wrote. “As was acknowledged at oral argument, the refund process is likely to be a ‘mess.’”
Eaton pushed back on the idea that refunds would spell chaos, arguing during a hearing that the mechanics are straightforward and manageable under established refund frameworks. “There is nothing particularly novel about the provision of refunds. … I believe that there will be no chaos associated with the provision of these refunds and that it will not result in a mess,” Eaton said, according to .
The administration signaled it is likely to pursue an appeal to delay Eaton’s directive from taking effect, which means the legal fight over how quickly and broadly refunds are distributed is far from over. Eaton plans a closed-door conference with the parties to the case on Friday to map out next steps and timelines as importers, banks, and government agencies brace for a complex reconciliation process.
https://x.com/joshgerstein/status/2029356736155435497?s=20
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