As Trump's IEEPA Tariffs Head to SCOTUS, Importers Should Start Preserving Refund Rights

The Federal Circuit Court of Appeals affirmed the Court of International Trade’s decision that the tariffs imposed by President Trump under the International Emergency Economic Powers Act (IEEPA) are unlawful.[1] This week, the Supreme Court is set to consider whether the IEEPA authorizes the tariffs imposed by President Donald Trump and if so, whether the statute unconstitutionally delegates legislative authority to the president.[2]

Although the Federal Circuit affirmed the Court of International Trade’s decision, it vacated the permanent injunction, meaning the IEEPA tariffs continue to be collected. Therefore, until the Supreme Court issues its decision, importers who have paid and continue to pay IEEPA tariffs face uncertainty about their entitlement to refunds. Although the government petitioned the Supreme Court for an expedited ruling, its decision could come as late as June 2026. In the interim, importers should take steps to preserve their right to a potential refund.

Below we analyze the Federal Circuit’s decision and the legal basis for recovering IEEPA tariffs collected.

V.O.S. Selections, Inc. v. Trump

Since taking office, President Trump has declared several national emergencies. In response to these declared emergencies, he has imposed varying tariffs of unlimited duration on imports of nearly all goods from nearly every country with which the US conducts trade. Lawsuits were then filed by individuals, companies, and states challenging the president’s authority to impose the tariffs. The Court of International Trade determined that the IEEPA does not authorize the tariffs at issue, and the Government appealed that decision. In a 7-4 decision, the Federal Circuit agreed that IEEPA’s grant of presidential authority to “regulate” imports does not authorize the tariffs imposed and affirmed the Court of International Trade’s decision.

The Majority Opinion

The seven majority judges first noted that the IEEPA authorizes the president to take certain actions in response to a declared national emergency but none of the authorized actions “explicitly include the power to impose tariffs, duties, or the like, or the power to tax.” The majority then rejected the government’s argument that the words “regulate . . . importation” in the IEEPA authorized the president to impose the tariffs, stating that “it is far from plain that ‘regulate . . . importation,’ in this context, includes the power to impose the tariffs at issue.” The court reasoned that Congress did not use the term “tariff” or any of its synonyms, like “duty” or “tax,” and none of the numerous statutes that delegate to the president the power to impose tariffs use the broad term “regulate” without also separately and explicitly granting the president the authority to impose tariffs. It therefore concluded that when Congress delegates its core power to impose taxes, it does so clearly and unambiguously, either by using unequivocal terms like tariff and duty, or via an overall structure which makes clear that Congress is referring to tariffs. The majority further rejected the government’s argument that the mere authorization to “regulate” implies the authority to impose tariffs, observing that the power to “regulate” has long been understood to be distinct from the power to “tax” and noting that the Constitution vests these authorities in Congress separately.

The court also held that the government’s interpretation of the IEEPA as providing the president power to impose unlimited tariffs runs afoul of the major questions doctrine. When the major questions doctrine is implicated, the government must point to “clear congressional authorization” for that asserted power. The court discerned no clear congressional authorization in the IEEPA for tariffs at issue, concluding that reading the phrase “regulate . . . importation” to include imposing the tariffs is “a wafer-thin reed on which to rest such sweeping power.”

The government also argued that Congress intended to include in the IEEPA the power to impose tariffs because it enacted the statute with knowledge of existing judicial precedent, Yoshida International v. United States, which upheld tariffs under the Trading with the Enemy Act, the predecessor statute to the IEEPA that contained the identical “regulate . . . importation” language. The majority determined that, even assuming Congress ratified Yoshida’s conclusion that “regulate . . . importation” could include the power to impose tariffs, the challenged tariffs exceed the authority provided by that interpretation of IEEPA. That is, the Yoshida court did not hold that the TWEA created unlimited authority to impose tariffs, but only that the limited temporary authority to impose tariffs that would not exceed congressionally approved tariff rates. The court concluded that the tariffs at issue, unbounded in scope, amount, and duration, extend beyond the express limitations of Yoshida’s holding and therefore are beyond the authority delegated to the president by the IEEPA.

As for the Court of International Trade’s permanent injunction, the Federal Circuit vacated the injunction and remanded the case back to the Court of International Trade for it to consider how broadly its ruling should apply and whether its grant of a universal injunction comports with the standards outlined by the Supreme Court in Trump v. CASA.

“Additional Views” Concurrence

Four judges wrote separately to express their view that IEEPA does not authorize the President to impose any tariffs, not just the tariffs at issue.

The concurring judges concluded that the government’s expansive interpretation of “regulate” is not supported by the plain text of the IEEPA. They reasoned that the government’s broad interpretation of “regulate” as encompassing every possible method and mode of adjustment of the quantity of importation, including taxation, faces three textual problems. First, the government’s interpretation of “regulate” would require “regulate” to have multiple meanings within the very provision on which the government relies. For example, the IEEPA provision permits the president to “regulate . . . exportation,” and reading “regulate” to include the ability to reduce exportation by taxing it would render the provision unconstitutional. Second, the government’s broad interpretation renders the other listed powers in IEEPA surplusage. And third, it violates the proposition that Congress must speak clearly when authorizing taxation.

The concurring judges then stated that the government’s reliance on the ratification of Yoshida does not overcome the statute’s plain meaning. They clarified that the ratification doctrine applies only when Congress simply reenacts a statute without change and when there is a judicial consensus so broad and unquestioned that we must presume Congress knew of and endorsed it and that neither requirement is met.

Lastly, the concurring judges determined that the government’s understanding of the scope of authority granted by the IEEPA would render it an unconstitutional delegation. Because taxation authority constitutionally rests with Congress, any delegation of that authority to the president must set out an intelligible principle that includes both the general policy that the president must pursue and the boundaries of its delegated authority. They found the government’s interpretation would leave neither quantitative nor qualitative restrictions on how much money the executive branch could raise without Congressional authorization and therefore would be a functionally limitless delegation of Congressional taxation authority.

The Dissenting Opinion

Four judges dissented to express their view that the IEEPA authorizes tariffs to regulate importation and that the plaintiffs had not met their summary judgment burden.

The dissenting judges stated that IEEPA’s language and history support a broad grant of emergency authority to the president, including the power to impose tariffs as a means of regulating importation. They contended that the statutory limits imposed by IEEPA, including the requirement of a declared national emergency and congressional reporting, provide sufficient safeguards. The dissent rejected the majority’s position that any tariffs authorized under IEEPA must be subject to limitations in time, scope, and amount, stating that there is no textual support in the IEEPA for these constraints or other sound basis for adopting such constraints. And disagreeing with the Court of International Trade, the dissent concluded that section 122 of the Trade Act does not displace IEEPA authority because they do not contradict each other and there is no clear, manifest intent to displace the emergency authority provided by the IEEPA.

As for the major questions doctrine, the dissent contended that it does not preclude presidential actions in the foreign affairs context. The dissent stated that Congress made “an eyes-open congressional choice” to confer on the president “broad authority” to choose tools to restrict importation so long as IEEPA’s section 202 standards are met. The dissent also rejected the argument that IEEPA constitutes an unconstitutional delegation of legislative authority to the president, claiming Congress has great leeway to delegate authority to the president in foreign affairs matters.

Addressing the sufficiency of the “unusual and extraordinary threat” to the national security, foreign policy, or US economy justifying the reciprocal tariffs, the dissent concluded that plaintiffs have not shown on summary judgment that there is no “unusual and extraordinary threat,” noting that the court is required to give the president considerable deference. As for the tariffs imposed to address the purported illicit drug national emergency, the dissent rejected the arguments that the tariffs had to address only imports that are the source of threat and that the IEEPA required a “direct link” to the threat. Instead, the dissent contended that the IEEPA allows the president to use tariffs as leverage in negotiating with foreign nations to solve the identified threat.

Steps to Preserve Rights to Recover IEEPA Tariffs

Because the Federal Circuit vacated the Court of International Trade’s permanent injunction, the IEEPA tariffs continue to be collected. If the Supreme Court likewise determines that the IEEPA tariffs are unlawful, there is a legal basis for importers to recover tariffs previously collected. Tariffs collected without statutory authority are an illegal exaction. Therefore, when tariffs are paid but later invalidated, courts typically recognize that the government cannot lawfully retain the amounts paid. But after certain statutory deadlines have run, Customs and Border Protection (CBP) may avoid paying refunds unless an importer files a timely protest or the court expressly orders reliquidation of all affected entries. Under the customs duties statutes, CBP decisions and “the legality of all orders and findings entering into the same” as to “the classification and rate and amount of duties chargeable” become “final and conclusive” unless timely protested.[3] Importers should therefore begin to comply with statutory deadlines and administrative procedures to preserve their right to a potential refund.

If the Supreme Court determines that the IEEPA tariffs are unlawful, importers will not automatically receive refunds. Instead, they will need to affirmatively seek refunds through established administrative procedures, and the action to be taken depends on the liquidation status of affected entries. The methods to secure a refund will be post correction summaries for unliquidated entries and protests for liquidated entries. Both methods were recently suggested as remedies in CBP guidance addressing refunds related to stacking certain tariffs.[4]

When importing goods into the US, generally, an importer must deposit the estimated duties owed and file entry paperwork that permits CBP to confirm the duties paid. The importing process is not complete until the entry has been liquidated by the CBP. CBP must liquidate an entry within one year of the date of entry (or other applicable actions),[5] and most entries liquidate within 314 days of entry. This period can be extended, suspended, or shortened. At liquidation, CBP assesses and confirms the correct amount of duties owed. If the amount deposited is correct, CBP takes no further action. If incorrect, CBP will either refund any overpayment to the importer or issue a bill for any underpayment. Under the statute, CBP’s determination of the correct amount of duties becomes final after 180 days unless a protest is filed.

Entries that have been imported but not liquidated may be adjusted through CBP’s administrative processes. Post correction summaries are corrections electronically filed by an importer to amend the entry summary before liquidation (and may be used to correct the declared duty rate). Therefore, if an entry is unliquidated when the IEEPA tariffs are invalidated, importers could file a post correction summary to correct the duty rate and exclude the unlawful IEEPA tariff. CBP would then liquidate the entry without the additional IEEPA tariff, which would trigger a refund of any excess duties that were previously deposited. A post correction summary generally must be filed within 300 days of entry and no later than 15 days before the liquidation.

Keeping entries in an unliquidated state will provide importers the flexibility to correct entries and avoid protests, but importers should be mindful of the above liquidation deadlines. Entries not liquidated within the applicable timeframe are automatically liquidated at the duty rate, value, and quantity declared by the importer with no formal notice. Importers may consider requesting an extension of the liquidation period to allow for continued flexibility while we wait for the Supreme Court to determine the legality of the IEEPA tariffs.

Entries that have been liquidated with the IEEPA tariff included may be adjusted through filing an administrative protest. A protest is essentially an objection requesting CBP to review and overturn its decision regarding a particular entry. Importers can file a protest within 180 days of liquidation relating to classification, value, duty treatment, and other issues. Here, protests could be filed arguing that the duties are not required by law and therefore refundable under § 1520(a). Importers filing protests may also consider requesting CBP to reserve ruling on the protest until after the Supreme Court issues its ruling.

If any protests are denied by CBP, importers can file a lawsuit in the Court of International Trade. The Court of International Trade has exclusive jurisdiction to review protest denials and can order refunds due and reliquidation of entries.

For now, we all continue the waiting game. Once hearings conclude at the Supreme Court, it could take weeks to months for the Court to issue a ruling. In the meantime, importers would be wise to take whatever steps they need to track potential refunds, file administrative protests, or continue to revise their supply chains.

FOOTNOTES

1. V.O.S. Selections, Inc. v. Trump, 149 F.4th 1312 (Fed. Cir. 2025) (per curiam), cert. granted, No. 25-250, 2025 WL 2601020 (U.S. Sept. 9, 2025).
2. The Court also granted an earlier filed petition for a writ of certiorari before judgment in Learning Resources, Inc. v. Trump, No. 24-1287, and consolidated the cases.
3. 19 U.S.C. § 1514(a).
4. See Notice of Implementation of Addressing Certain Tariffs on Imported Articles Pursuant to the President’s Executive Order 14289, 90 Fed. Reg. 21487, 21488 (May 20, 2025).
5. 19 U.S.C. § 1504(a).