On Wednesday, March 4, 2026, a judge from the U.S. Court of International Trade ruled in favor of companies that had previously paid tariffs imposed by former President Donald Trump, which were later deemed unconstitutional by the U.S. Supreme Court. In a significant 6-3 ruling issued the previous month, the Supreme Court determined it was illegal for Trump to invoke the International Emergency Economic Powers Act (IEEPA) to impose wide-ranging tariffs on goods from Canada, Mexico, and China, particularly relating to a so-called "Liberation Day" initiative.
The ruling emphasized that the U.S. Constitution clearly assigns Congress the exclusive authority over taxation and tariffs. However, the Supreme Court did not decide on the issue of refunds for tariffs collected under the IEEPA, prompting affected companies to consider legal action against the federal government for reimbursement.
Judge Richard Eaton's decision specifically addressed a case involving Atmus Filtration, a Tennessee-based company. He stated that all importers who paid tariffs under the IEEPA are entitled to refunds based on the Supreme Court's ruling. Eaton was assigned the sole responsibility for all refund-related cases, streamlining the process for affected businesses.
In his order, Judge Eaton mandated that the Trump administration complete import documentation without the IEEPA tariffs, and if products had already gone through that process, U.S. Customs and Border Protection was instructed to recalculate tariffs accordingly. The Liberty Justice Center, which represented several small businesses who opposed the tariffs, declared the decision as a crucial step towards ensuring financial recovery for businesses that had been adversely affected by illegal tariffs.
A coalition of over 1,000 small businesses hailed the ruling as a victory and urged the Trump administration to implement the refund process quickly. Dan Anthony, executive director of the We Pay the Tariffs coalition, expressed concerns over potential delays, emphasizing that small businesses have been waiting long enough for their owed refunds. He insisted that a prompt and straightforward refund process was necessary.
As of the report, the White House had not issued a response regarding the judge's order. Speculation remained about whether the Trump administration would appeal the ruling or take steps to delay the refund process. Trump previously warned that the Supreme Court's decision could incur severe consequences for the nation, expressing skepticism about the speed of resolving refund issues.
According to the Penn Wharton Budget Model, the government had collected more than $130 billion from these tariffs by mid-December. In a court filing prior to Judge Eaton's decision, a senior official from U.S. Customs and Border Protection indicated that if refunds were enacted, they would also include accrued interest. However, Brandon Lord cautioned that the refund process could take time due to the need for thorough reviews to ensure compliance with other customs laws.
While some Canadian businesses awaited refunds, they were largely insulated from the IEEPA tariffs due to exemptions under the Canada-U.S.-Mexico Agreement (CUSMA). Trump had declared a national emergency at the northern border concerning fentanyl trafficking last year, resulting in 35% tariffs for imports from Canada. These tariffs were not applicable to goods compliant with CUSMA.
Notably, the Trump administration had shifted from IEEPA tariffs to a 10% worldwide tariff under Section 122 of the 1974 Trade Act, a move that has its own expiration conditions and limitations. This new global tariff also does not affect CUSMA-compliant goods. Nonetheless, Canada continues to face challenges from sector-specific tariffs imposed by the Trump administration, which affect industries such as steel, aluminum, automobiles, lumber, and cabinets.
