Implications of recent US court decisions regarding tariffs for importers and supply chains
Gavin C. Grusd
USA
by Gavin C. Grusd
On 20 February 2026, the US Supreme Court, in Learning Resources, Inc. v. Trump and V.O.S. Selections v. United States, held that the International Emergency Economic Powers Act (IEEPA) does not authorise the President to impose tariffs. As a result, effective 24 February 2026, the collection of IEEPA‑based tariffs – including reciprocal, fentanyl‑related, and country‑specific tariffs – was halted through an executive action implementing the Court’s decision, and related US Customs and Border Protection (CBP) guidance.
On 04 March 2026, the US Court of International Trade (CIT) issued an order in Atmus Filtration, Inc. v. United States broadly applying the Supreme Court’s ruling and signalling that refunds of invalidated IEEPA tariffs should be administered through CBP processes.
Although Atmus was later dismissed, on 16 April 2026 the CIT issued a substantively identical order in Euro‑Notions Florida, Inc. v. U.S. Customs and Border Protection. That order directs CBP to liquidate unliquidated entries and reliquidate previously liquidated entries without regard to IEEPA tariffs. This creates a refund framework based on existing liquidation and reliquidation mechanisms rather than a fully automated refund system. Tariffs imposed under other authorities – including Section 122 (temporary emergency tariffs), Section 232 (national security), and Section 301 (unfair trade practices) – remain unaffected.
In April 2026, CBP implemented Phase 1 of its Consolidated Administration and Processing of Entries (CAPE) functionality within the Automated Commercial Environment (ACE). CAPE provides an administrative mechanism for importers to seek refunds of IEEPA duties. Phase 1 applies to a limited population of entries, including certain unliquidated entries and entries liquidated within an administratively defined window. More complex situations (such as entries subject to reconciliation, drawback, open or suspended protests, or certain antidumping and countervailing duty measures) are expected to be addressed in later phases.
CAPE permits consolidated filing through a single declaration covering multiple entries, and allows refunds, where appropriate, to include statutory interest. Before CAPE, refund options depended on whether entries were unliquidated or liquidated, and generally required entry‑specific mechanisms such as liquidation, reliquidation, or protests.
“Liquidation” refers to CBP’s final computation of duties owed on an entry. Estimated duties are paid at entry, but the entry remains open while CBP reviews classification, valuation, and other issues. Liquidation finalises the duty amount and typically starts a 180‑day protest period.
Importers seeking refunds of IEEPA tariffs should consider the following:
Review liquidation status and CAPE eligibility in ACE, and file CAPE declarations where available;
Avoid using Post‑Summary Corrections (PSCs) to initiate IEEPA refund claims, as CBP has indicated PSCs are not valid for that purpose;
Confirm that IEEPA duties were paid, and identify entries excluded from Phase 1;
File or preserve protests for liquidated entries not eligible for CAPE to protect refund rights;
Monitor CBP guidance on future CAPE phases; and
Ensure enrolment in Automated Clearing House (ACH), as CBP issues refunds electronically.
The refund framework remains evolving, and claims may be subject to verification, offsets, and potential appellate developments.
In appropriate cases, importers may also consider protective litigation in the CIT to preserve claims where entries have liquidated, protests are pending or denied, or uncertainty remains regarding administrative refund procedures.
XLNC member firm Ruskin Moscou Faltischek P.C.New York, NY, USAT: +1 516 663 6600
Legal
Gavin C. Grusd is a partner at Ruskin Moscou Faltischek P.C., a member of the firm’s corporate & securities department, and co-chair of the International Practice Group. Gavin counsels businesses and their owners in mergers and acquisitions, capital markets transactions, commercial relationships, and all other material aspects of their business lives, ranging from early-stage through growth and maturity to exit.Contact Gavin.
