Today, the Supreme Court heard lengthy oral arguments from attorneys representing both the government and the importers that had challenged the tariffs imposed by the President under the International Emergency Economic Powers Act (IEEPA).  Those arguments focused extensively on two primary issues.  First, does the language of the IEEPA—in particular the phrase “regulate importation”—authorize the President to impose tariffs?  Second, would interpreting the IEEPA to authorize tariffs violate the “major questions” or “nondelegation” doctrines, which draw lines between the powers of Congress and of the President?

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Based upon questions asked or comments made by the Justices, it appeared that at least five of the Justices (Sotomayor, Kagan, Gorsuch, Barrett, and Jackson) are likely to conclude, under one theory or the other, that the IEEPA tariffs were imposed unlawfully.  Questions asked by Justice Kavanaugh suggest that he was searching for a way to uphold the tariffs.  The remaining Justices (Roberts, Thomas, and Alito) did not ask questions or offer comments that strongly suggest how they might vote.

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Only one brief exchange addressed the refund process that might play out if the Supreme Court rules that the IEEPA tariffs were imposed unlawfully.  That exchange demonstrated why we believe that filing a case in the Court of International Trade (CIT) is preferrable to administrative protests.  Here is that exchange in full:

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JUSTICE BARRETT: Okay. And then if you win, tell me how the reimbursement process would work. Would it be a complete mess? I mean, you're saying before the government promised reimbursement. And -- and now you're saying, you know, well, that's rich, but how would this work? It seems to me like it could be a mess.

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MR. KATYAL [lawyer for the importers]: So the first thing I would say is that just underscores how major a question this is, the very fact that you are dealing with this with quotas, there's no refund process of --to the tunes of billions of dollars or embargoes, but there is here. But for our case, the way it would work is, in this case the government's stipulated for the five plaintiffs that they would get their refunds. So for us that's how it would work.
 

Your question, I take it, is about everyone else. We don't have a class action or anything like that. With respect to everyone else, there's a whole specialized body of trade law. And 19 U.S.C. 1514 outlines all these administrative procedures. It's a very complicated thing. There's got to be an administrative protest. There was a Harbor Management case earlier that this Court was involved with in United States Shoe in which you know, the refund process took a long time. There were any number of claims and equitable relief and –

 

JUSTICE BARRETT: So a mess.

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The key point of this exchange is that the companies that brought the case now before the Court will get refunds – the government has already promised that.  But any company that did not join that case will be thrown into the “mess” of administrative protests, which will likely take “a long time.”

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How to avoid that?  Became a party to a lawsuit that mirrors the one now before the Supreme Court.  By doing that, if the Supreme Court rules that IEEPA tariffs have been imposed unlawfully, you will be the same position as the companies that initiated the case now before the Supreme Court, and are likely to get your refund expeditiously.  This is why we recommend that importers who have large potential refund claims should file their own lawsuits in the CIT now.