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Judge Richard Eaton of the US Court of International Trade ruled on Wednesday that “all importers of record” are entitled to refunds of tariffs collected under the International Emergency Economic Powers Act. Customs and Border Protection must report to the court on Friday with a plan. More than 300,000 businesses are waiting.
The ruling is three pages long. Its implications are not. In a case brought by Atmus Filtration, a Nashville-based manufacturer that paid roughly $11 million in tariffs the Supreme Court subsequently declared illegal, Judge Eaton established two things. First, that every importer subjected to the IEEPA tariffs — not just those who have filed lawsuits — is entitled to benefit from the February 20 Supreme Court decision. Second, that he alone will oversee the refund process. “The Chief Judge has indicated that I am the only judge who will hear cases pertaining to the refund of IEEPA duties,” Eaton wrote. “So there is no danger that another Judge, even one in this Court, will reach any contrary conclusions.”
That language is unusually direct for a federal judge. It is also, given the scale of what follows, necessary.
The Numbers
US Customs and Border Protection data shows the federal government collected approximately $134 billion in IEEPA duties through the end of 2025, per CBS News reporting. The Penn Wharton Budget Model estimates the total liability, including duties collected in January and February 2026 before the Supreme Court ruling, could reach $175 billion. Penn Wharton’s data shows IEEPA revenue accelerating through 2025, from $810 million in February to $20.8 billion in January 2026 alone, by which point IEEPA tariffs accounted for more than half of all US customs duties.
Roughly 2,000 lawsuits have been filed in the Court of International Trade seeking refunds. But Eaton’s ruling extends beyond those cases. According to Common Dreams, more than 300,000 importers paid the tariffs, the vast majority of them small businesses. The judge made clear during Wednesday’s hearing that the scope is universal: “Every single cent of IEEPA duties that was imposed must be refunded,” he said, per PYMNTS reporting of the Wall Street Journal’s account of the proceedings.
The government acknowledged in a court filing on Wednesday that if refunds are required, it will pay interest on the amounts owed. That concession, buried in the procedural filings, is significant. It means the liability is not static. It grows every day the refunds remain unprocessed.
The Process Problem
The Supreme Court’s February 20 decision struck down the IEEPA tariffs but said nothing about refunds. That silence created a procedural vacuum. Justice Brett Kavanaugh, in his dissent, warned that the refund process was “likely to be a mess.” Eaton disagreed. “There is nothing particularly novel about the provision of refunds,” he said during the hearing, per Politico. “I believe that there will be no chaos associated with the provision of these refunds and that it will not result in a mess.”
Trade lawyers are less confident. Alexis Early, a partner at Bryan Cave Leighton Paisner, told CBS News that CBP’s existing system was “not designed for a mass refund” of this scale. Ryan Majerus, a former senior Commerce Department official now at King & Spalding, told NBC News he expects the government to “appeal or seek a stay to buy more time for US Customs to comply.” The three-page order requires CBP to recalculate what importers would have owed without the IEEPA tariffs and to report to the court at a hearing on Friday, March 6 — today.
Among the companies that have filed suit are Bausch & Lomb, Dyson, FedEx, and L’Oreal, per CBS News. But the order’s reach extends to every business that paid the duties, whether or not it has retained legal counsel. For small importers who lack the resources to file individual claims, the question is whether CBP will create an automated refund mechanism or force each of the 300,000-plus affected businesses to navigate the process individually.
The Administration’s Position
The Trump administration has been resisting the refund process since the Supreme Court ruling. A federal appeals court on Monday declined the administration’s request to delay implementation of the decision, clearing the path for Eaton’s order. The administration is expected to appeal this ruling as well, though Eaton’s consolidation of all refund cases under his sole jurisdiction limits the avenues for procedural delay.
Treasury Secretary Scott Bessent offered a parallel message this week. “It’s my strong belief that the tariff rates will be back to their old rate within five months,” he told reporters, per Yahoo Finance, referring to the administration’s plans to use Section 301 investigations and other statutory authorities to reimpose tariffs after the Section 122 regime expires on July 24. That timeline is ambitious. The refund obligation, by contrast, is immediate.
The administration faces a contradiction it has not publicly resolved. It owes $130 billion or more in refunds on tariffs the Supreme Court declared illegal. It simultaneously claims it will restore equivalent tariff rates within months using different legal authorities. If it succeeds, it will be collecting new tariffs while still processing refunds on the old ones. If it fails, the fiscal hole left by the IEEPA revenue — which Penn Wharton estimates at half of all customs duties — becomes permanent.
What Friday’s Hearing Will Reveal
CBP officials are due to appear before Judge Eaton on Friday to present their plan for processing the refunds. The hearing will establish whether Customs intends to comply with an across-the-board refund methodology or attempt to narrow the scope through administrative interpretation. Majerus noted that Eaton’s language “strongly suggests an across-the-board approach that importers are entitled to IEEPA refunds, full stop.”
A coalition of states has separately filed a legal challenge to the new Section 122 tariffs, arguing the administration lacks authority to impose them. If that challenge succeeds, the government would face a second wave of refund claims on top of the first. The constitutional principle established by the Supreme Court — that the power to impose tariffs belongs to Congress, not the executive — is working its way through the system with a speed and fiscal consequence that few in Washington appear to have anticipated.
Eaton’s order is dated March 4. The refund liability began accumulating in February 2025. Thirteen months of illegal taxation, 300,000 affected businesses, and a government that has yet to write a single refund cheque. The judge has now told them to start. Whether they will — or whether another appeal buys another month of delay — is what Friday’s hearing is for.
