The question of whether a court overstepped its authority has arisen in the context of U.S. Customs and Border Patrol tariff refunds. This legal contention involves a judge’s decision to mandate refunds to all companies affected by tariffs deemed illegal, irrespective of their participation in a lawsuit.
Dispute Over Refunds
Government attorneys argue that a Court of International Trade judge exceeded his bounds by directing the U.S. Customs and Border Patrol (CBP) to refund tariffs to all companies, including those that did not initiate legal action. This decision has been challenged by the government, which appealed to the U.S. Court of Appeals for the Federal Circuit in June, with an official brief filed recently.
The crux of the government’s argument is anchored in a decision from a Supreme Court case on birthright citizenship, which restricted the use of universal injunctions. These injunctions extend a court’s ruling beyond the parties involved to all affected entities. Judge Richard Eaton, overseeing the tariff case, contends that such restrictions do not apply here, an assertion the government disputes.
Legal Arguments and Implications
In their legal brief, government lawyers stated, “The CIT’s universal injunctions, requiring the government to refund IEEPA duties for all importers (including non-party importers), cannot possibly be squared with CASA,” referring to the precedent-setting case.
While a majority of tariff refunds, amounting to $100 billion, have already been processed, the government highlights that companies whose tariffs were finalized through customs are unable to reprocess these payments. Such companies are, however, permitted to pursue lawsuits to reclaim their funds, according to the government.
“The Court of International Trade (CIT) has already entered hundreds of such orders in suits brought by importers seeking that relief, and importers who have not yet brought such suits are free to do so within the statute of limitations,” the brief further explained.
Barry Appleton, a law professor and co-director of New York Law School’s Center for International Law, expressed concerns over the impact on businesses: “The government took this money under a law the Supreme Court said never authorized (tariffs). Getting it back should not turn on whether a business could afford to sue.”
Appleton criticized the notion of litigation as a prerequisite for refunds, stating, “Refunding an unlawful tariff should not be a reward for litigating. … You cannot really ask a small company to sue for money it does not know it is owed, on a deadline it has never heard of.”
