The Trump administration isn’t taking the Court of International Trade’s (CIT) order to issue $166 billion in tariff refunds lying down.
The Department of Justice filed notice on Friday that it plans to appeal the New York-based court’s March 4 ruling that it begin dispensing tariff refunds on the now-defunct International Emergency Economic Powers Act duties, which were invalidated by the Supreme Court in late February.
An update from Customs and Border Protection (CBP) executive director of trade programs Brandon Lord last week indicated that about $85 billion in potential and certified refunds have been accepted for processing. Of that figure, $20.6 billion was sent to the U.S. Treasury for disbursement as of May 22.
The administration’s forthcoming appeal could throw a wrench in the machinery of the already complex refund process, which necessitated the formation of a new electronic system by CBP. The phased rollout of the tool, which allows importers to file and manage refund requests, is still underway.
The DOJ plans to challenge the CIT’s so-called “universal injunction,” which stipulated that all importers that paid into the illegal tariff scheme should be refunded—not just the handful of small business plaintiffs and state attorneys general whose case prevailed in the Supreme Court. The federal government wrote that “ordering CBP to reliquidate final entries including entries made by importers who have not sued in this Court… exceeds the Court’s jurisdiction and equitable authority.”
It pointed to a previous Supreme Court case, Trump v. Casa, Inc., in which the high court ruled that federal district courts don’t have the power to issue universal injunctions that apply to parties beyond the plaintiffs in a case.
The notice of appeal also said that CBP doesn’t possess the authority to issue refunds on entries that have already been liquidated unless the importer filed a lawsuit to recover the tariffs it paid. CBP has estimated that about 330,000 importers are potentially eligible for refunds under the IEEPA decision.
The government has until June 7 to issue its formal appeal. In addition to notifying the CIT of its intention to dispute its decision, it also requested that the court amend a May 27 order requiring CBP Commissioner Rodney S. Scott to appear for live testimony, saying that high-ranking government officials can only be compelled to testify under “extraordinary circumstances” where there are no alternative witnesses.
The filing requested that Lord or Susan Thomas, CBP’s Executive Assistant Commissioner for Trade, appear in his stead.
