Last week, the Court of International Trade ruled that President Trump’s use of IEEPA to impose tariffs was unlawful. The orders are currently stayed pending appeal. The details were summarized well by CBP in a Cargo Systems Messaging Service notice, quoted below:
CSMS #65201384 — Court of International Trade (CIT) Judgment — International Emergency Economic Powers Act (IEEPA) Tariffs
On May 28, 2025, the United States Court of International Trade (CIT) issued judgment in V.O.S. Selections, Inc. et al. v. United States et al., Court No. 25-00066, and Oregon et al. v. Dep’t of Homeland Security et al., Court No. 25-00077, concerning the tariffs imposed by the following Executive Orders (the Challenged Tariff Orders), including all modifications and amendments thereto:
Executive Order 14193, Imposing Duties To Address the Flow of Illicit Drugs Across Our Northern Border, 90 Fed. Reg. 9113 (Feb. 1, 2025); Executive Order 14194, Imposing Duties To Address the Situation at Our Southern Border, 90 Fed. Reg. 9117 (Feb. 1, 2025); Executive Order 14195, Imposing Duties To Address the Synthetic Opioid Supply Chain in the People’s Republic of China, 90 Fed. Reg. 9121 (Feb. 1, 2025); Executive Order 14257, Regulating Imports with a Reciprocal Tariff to Rectify Trade Practices that Contribute to Large and Persistent Annual United States Goods Trade Deficits, 90 Fed. Reg. 15041 (Apr. 2, 2025).
The CIT enjoined “the operations of the Challenged Tariff Orders” including all modifications and amendments. The United States appealed the CIT’s decision and the U.S. Court of Appeals for the Federal Circuit temporarily stayed the CIT’s decision while the Federal Circuit considers the Government’s Motion to Stay pending appeal.
In addition, on May 29, 2025, the U.S. District Court for the District of Columbia issued a decision in Learning Resources, Inc. et al. v. Trump et al., Court No. 25-1248 (RC), which the United States has also appealed.
What the CIT Actually Held
The CIT’s ruling, issued by a three-judge panel, held that President Trump exceeded his statutory authority under IEEPA in imposing both the reciprocal tariffs and the fentanyl/trafficking tariffs. The court found that the 10% universal tariff on all countries was not permissible under IEEPA — the statute is not designed to address trade imbalances, and a more specific statute exists for balance of payments issues. It further found that the 25% tariffs on Canada, Mexico, and China, imposed in response to a declared fentanyl emergency, lacked sufficient direct connection to the drug threat cited. The court permanently enjoined enforcement and ordered CBP to provide guidance on processing entries without the IEEPA tariffs by June 7, 2025. The government appealed the same day, and the Federal Circuit stayed the injunction — meaning the tariffs remained in effect and importers continued paying them while the legal challenge worked through the courts.
The D.C. District Court’s ruling in Learning Resources went further, concluding more broadly that IEEPA does not authorize tariffs at all and identifying additional violations of the Administrative Procedure Act.
What This Means for Importers While the Stay Is in Effect
The practical situation as of the date of this post: the tariffs are enjoined as a legal matter but stayed as a practical matter, meaning you are still required to pay them. CBP is still collecting. If you stop paying and the appeal goes the government’s way, you face significant back-duty liability. The right approach is to pay the tariffs as assessed while carefully documenting every entry — if the courts ultimately strike down the tariffs, the ability to recover refunds will depend on being able to demonstrate exactly what was paid and when.
Critically, these rulings do not affect tariffs imposed under separate statutory authorities. Section 301 tariffs on Chinese goods, Section 232 tariffs on steel, aluminum, and autos, and antidumping and countervailing duties are all unaffected by the IEEPA litigation regardless of how it resolves.
Update: Federal Circuit Affirms — August 29, 2025
On August 29, 2025, the U.S. Court of Appeals for the Federal Circuit, sitting en banc, affirmed the CIT’s ruling in a 7-4 decision. The Federal Circuit held that while IEEPA grants the President authority to “regulate” foreign commerce, that authority does not include imposing sweeping tariffs without limits on scope, amount, or duration. The court vacated the universal injunction — meaning it did not reinstate the CIT’s order blocking the tariffs — and remanded the case for the CIT to fashion more limited relief. The stay remained in place, so the tariffs continued to be collected. The government petitioned the Supreme Court for expedited review on September 4, 2025.
Update: Supreme Court Rules IEEPA Tariffs Unlawful — February 20, 2026
On February 20, 2026, the Supreme Court issued its decision in the consolidated cases of Learning Resources, Inc. v. Trump and V.O.S. Selections v. United States, ruling 6-3 that IEEPA does not authorize the President to impose tariffs. Chief Justice Roberts, writing for the majority and joined by Justices Sotomayor, Kagan, Gorsuch, Barrett, and Jackson, held that IEEPA’s grant of authority to “regulate importation” does not include the power to impose tariffs. The opinion noted that when Congress has delegated tariff powers to the President, it has done so in explicit terms subject to strict limits — and IEEPA contains no such explicit grant. The fact that IEEPA was never used to impose tariffs from its enactment in 1977 until 2025 was described as “telling.”
The ruling means the Liberation Day reciprocal tariffs, the Canada and Mexico fentanyl tariffs, and the China IEEPA tariffs are unlawful. The Section 232 tariffs on steel, aluminum, and autos remain fully in effect and are not affected by this decision.
What Happens Now: Refunds
The Supreme Court’s decision has been remanded to the CIT to address refunds. The government collected an estimated $160 billion or more in IEEPA tariff payments from U.S. importers through the date of the ruling. The CIT has confirmed it has authority to order refunds through reliquidation, and the government has stipulated it will not prevent reliquidation if the tariffs are found unlawful — which they now have been. The CIT is expected to move quickly once it lifts the stay on the refund cases and issues implementation orders, including instructions to CBP on how to process reliquidations.
Importers who paid IEEPA tariffs and want to preserve their refund rights should be working with customs counsel now to understand their options, confirm which entries are at issue, and determine whether any protective filings are needed at the CIT. For importers whose entries have already liquidated, the path to refunds runs through the CIT’s reliquidation process. For entries not yet liquidated, the process may be more straightforward once CBP issues guidance.
IEEPA Tariff Questions?
Do you have questions about the IEEPA tariffs, the Supreme Court ruling, or potential refunds? Great Lakes Customs Law has been advising importers for more than 15 years. Call us at (734) 855-4999, send a text message, or reach us on WhatsApp.