Government Appeals Trade Judge's Tariff Refund Order

Government lawyers are contesting a Court of International Trade judge's directive that mandates the U.S. Customs and Border Protection (CBP) to issue refunds for tariffs deemed illegal in February. The core of the government's argument, detailed in an appeal filed with the U.S. Court of Appeals for the Federal Circuit in June and further elaborated in an opening brief submitted on Monday, is that the judge exceeded his authority by extending the refund order to all companies that paid the tariffs, irrespective of whether they initiated a lawsuit. This broad application, known as a universal injunction, is the central point of contention.

In their appeal, government lawyers cite a Supreme Court decision from June 2025 concerning birthright citizenship, which placed limitations on the use of universal injunctions. The Supreme Court's ruling stipulated that such injunctions, which apply a court's decision to all affected individuals or entities rather than just the parties directly involved in the litigation, should be used sparingly. Judge Richard Eaton, presiding over the tariff-related lawsuits at the Court of International Trade, has asserted that these limitations do not apply to the current case. However, the government strongly disagrees, stating in its brief that the CIT's universal injunctions, compelling the government to refund duties for all importers, including those not party to the suits, are incompatible with the precedent set by the Supreme Court case, referred to as "CASA."

The majority of tariff refunds have already been disbursed. The CBP has confirmed processing and certifying approximately $100 billion in refunds. The dispute specifically concerns companies that paid tariffs as part of the standard customs process, where entries have already been finalized. A Congressional rule prevents the CBP from reprocessing tariffs for which the administrative refund process is no longer available. For these companies, the government contends, the avenue for recovery lies in filing individual lawsuits to reclaim the funds. Government lawyers emphasized in their brief that the Court of International Trade has already issued hundreds of such orders in cases brought by importers seeking this specific relief, and that importers who have not yet filed suit are still able to do so, provided they meet the statute of limitations.

Barry Appleton, a law professor and co-director of New York Law School’s Center for International Law, offered commentary on the legal intricacies, though his full statement was not detailed in the provided text. The government's legal strategy hinges on demonstrating that Judge Eaton's order constitutes an improper use of judicial power, particularly in light of the Supreme Court's recent guidance on universal injunctions, aiming to restrict the scope of the refund order to only those importers who actively pursued legal action.