Tariff-refund seekers flock to a little-known US court with big-case experience

Importers File Lawsuits Seeking Billions in US Tariff Refunds

Surge in Lawsuits and Legal Challenges Over Tariff Refunds

March 3 (Reuters) - Importers seeking their share of more than $130 billion in tariff refunds are flocking to a little-known U.S. trade court, which must now figure out how to deal with what is expected to be an explosion of cases.

Major Corporations and Small Businesses Join Legal Battle

Multinationals such as FedEx and L'Oreal and hundreds of smaller companies have filed around 2,000 lawsuits at the U.S. Court of International Trade in Manhattan, seeking refunds for tariffs imposed last year by President Donald Trump, according to court records. The cases could be the tip of an iceberg - the tariffs that were ruled illegal by the Supreme Court on February 20 were levied on more than 300,000 importers.

The number of filings represents a dramatic increase from 2024, when only 252 new cases were filed in the court, according to court data.

Supreme Court Ruling and Its Aftermath

The Supreme Court did not address refunds, leaving that to customs officials and the eight active judges on the trade court, which typically handles disputes over anti-dumping measures and import classifications on everything from window shades to pig fat. 

The Supreme Court cases, which were brought by toy company Learning Resources, spirits importer VOS Selections and other importers, are now back at the trade court. 

Test Cases and Legal Strategies

Lawyers for five of the plaintiffs suggested in a February 24 court filing that their lawsuits should serve as test cases to determine how the refunds will be calculated and issued.

In the meantime, other cases would be put on hold.

Concerns Among Smaller Importers

Not everyone wants to wait.

Smaller importers, which make up the vast majority of companies that paid tariffs, want to bypass the process of bringing a lawsuit, which can cost thousands of dollars in legal fees.

They are hoping Customs and Border Protection will establish a simple, low-cost process for refunds, such as a dedicated web portal for entering basic information to generate a reimbursement.

Administrative Hurdles and Uncertainties

Trade lawyers said CBP could require importers to go through its established administrative process that requires filing official protests. Complicating the process, refunds on tariffs paid early in 2025 might be treated differently than tariffs paid more recently.

The process, according to John Peterson, a trade lawyer who has filed cases in the current wave of tariff-refund claims, is "the mega-question." 

CBP did not respond to a request for comment.

Historical Precedents and Proposed Solutions

SIMILAR APPROACH 

In their February 24 filing, the importers' lawyers reminded the trade court that it has experience organizing thousands of refund lawsuits, albeit involving many fewer potential claimants and much less money. 

A wave of refund litigation similar to the current demands for tariff reimbursements kicked off following a 1998 U.S. Supreme Court decision that struck down a tax that had been collected from exporters for 11 years.

The Harbor Maintenance Fee Case

"This court employed a similar approach with respect to the challenges to the Harbor Maintenance Fee," the court filing said.

Rather than oversee thousands of cases simultaneously, the trade court paused the lawsuits and set up a steering committee of plaintiffs' lawyers specializing in trade who then oversaw the one case that proceeded. The test case was used to litigate questions such as interest on refunds and deadlines to sue. Orders entered in the test case applied to all lawsuits. 

Less than six months after the Supreme Court struck down that tax, the court approved a refund process. It required each claimant to sue individually and then send a claim form to the CBP. If the importer and CBP disagreed or legal questions surfaced, the parties could ask the court to review the claim.

Within about 2-1/2 years of the Supreme Court order striking down the harbor tax, about $730 million was paid out to as many as 100,000 claimants, according to a paper about the case published on the trade court's website. 

Applying Past Models to Current Tariff Refunds

The legal team for VOS Selections and the four other plaintiffs in the current litigation urged the trade court to basically follow that model, letting their cases proceed to establish a refund process that could be applied to everyone.

While the harbor-tax litigation provides a framework, nothing compares to the sheer volume of tariff payments that need to be unwound. As of December 10, the illegal tariffs were collected on about 34 million shipments, according to a government court filing. 

Future Litigation and Unresolved Issues

"There's still a lot of questions that are going to need to be answered, and whenever you have $133 billion at stake, there's going to be disputes," said Daniel Pickard, a trade attorney, who has not filed tariff-refund cases. "So you've got to think that there's going to be a whole bunch more litigation before this is all over."

(Reporting by Tom Hals in Wilmington, Delaware, and David Thomas in Chicago; Additional reporting by Mike Scarcella; Editing by Noeleen Walder, Amy Stevens and Ethan Smith)