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Supreme Court Decision: Learning Resources Inc. v. Trump
International Emergency Economic Powers Act (IEEPA) does not authorize the President of the United States to impose tariffs. While the Court struck down the tariff authority as unconstitutional, it did not address the remedy for importers who had already paid the unconstitutional tariffs imposed under IEEPA. As a result, the issue of refund was left to be resolved in subsequent litigation.
Court of International Trade Ruling on Tariff Refunds
Atmus Filtration, Inc. v. United States
In a ruling on March 4, 2026 (amended March 5), Judge Gary S. Katzmann Eaton of the U.S. Court of International Trade (“CIT”) who is overseeing the Atmus Filtration, Inc. v. United States of America, addressed the question left open by the Supreme Court.
Judge Eaton ruled that:
“[a]ll importers of record whose entries were subject to IEEPA duties are entitled to the benefit of the Learning Resources decision.”
The court further noted that the CIT has exclusive and nationwide jurisdiction over disputes of this kind. Judge Eaton will serve as the sole judge handling claims for refunds under the IEEPA.
Scope of Refund Eligibility and Liquidation Instructions
Judge Eaton’s order directs U.S. Customs and Border Protection (“CBP”) to take the following actions:
- Unliquidated entries subject to the IEEPA duties imposed by the Executive Orders must be liquidated without regard to those duties.
- Liquidated entries that are not final must be reliquidated without IEEPA duties.
- Liquidated entries for which liquidation is final must also be reliquidated without regard to the IEEPA duties.
The amended order clarifies that its scope applies broadly to “any and all” IEEPA duties, not solely those specifically addressed in the Learning Resources Supreme Court decision. The order states that it does not address issues related to duty-free de minimis treatment under 19 U.S.C. § 1321, which remain before the CIT in Axle of Dearborn, Inc. v. Department of Commerce et al. (1:25-cv-00091-3JP).
Suspension of Immediate Compliance and CBP Reporting Obligations
Although Judge Eaton initially ordered immediate compliance in the March 5 order, that requirement was last rescinded. The court has continued to suspend enforcement of immediate liquidation and refund obligations to allow CBP time to implement a compliant processing mechanism.
CBP has been ordered to make reports describing progress toward issuance of tariff refunds through implementing a new process in the Automated Commercial Environment (“ACE”) system as outlined in a declaration submitted by Brandon Lord, the CBP Executive Director, Trade Programs Directorate. Updated reports have already been filed, with the next report due later in April 2026.
CBP’s New Refund Process: CAPE
Consolidated Administration and Processing of Entries
In the initial declaration submitted by the CBP on March 6, the estimated process of implementing the new functionality was 45 days. The process should be designed to require “minimal submission from importers.” The new claims portal functionality, per the most recent declaration submitted will be called CAPE (Consolidated Administration and Processing of Entries).
What Importers and Brokers Should Do Now
Importers, custom brokers, and their counsel should:
- Identify affected entries subject to IEEP duties.
- Monitor Judge Eaton’s rulings in the Atmus Filtration
- Track CBP updates regarding the rollout of CAPE.
Conclusion
The legal pathway for refunds of unconstitutional IEEPA tariffs is now firmly established, but administrative implementation remains ongoing. While the Court of International Trade has confirmed refund entitlement for all affected importers nationwide, CBP’s rollout of the CAPE system will determine the timing and mechanics of repayment.
Until CAPE becomes operational, stakeholders should remain engaged, informed, and prepared to act once the refund process formally opens.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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