In a motion filed yesterday, the Trump Administration indicated their intent to appeal the US Court of International Trade’s order requiring payment of refunds to all those businesses who paid illegal tariffs imposed by Trump using the the International Emergency Economic Powers Act of 1977 (IEEPA). The IEEPA tariffs were invalidated by the Supreme Court, in a case I helped bring and litigate (along with the Liberty Justice Center, and others).
When Judge Eaton of the Court of International Trade (CIT) issued his order in March, I thought the administration might appeal on the grounds that it is inconsistent with the Supreme Court’s ill-advised strictures against universal injunctions in Trump v. CASA, Inc. (decided last year). But, in the intervening nearly three-month period, the administration did not appeal, and indeed even set up a tariff refund system that has begun issuing payments to businesses victimized by the illegal tariffs. Victor Schwartz, owner of V.O.S. Selections, the lead client in our case, is one of those who have already gotten a refund.
The administration now plans to argue that only those businesses who filed lawsuits are entitled to recovery. To my mind, this situation illustrates why we need universal injunctions in some types of cases. We have many thousands of businesses and other importers who were forced to pay over $166 billion in illegal tariffs. Requiring each of them to file their own lawsuits would be a huge waste of time and money, and major burden for smaller, less well-funded organizations. It would also significantly delay some of the payments, leaving taxpayers on the hook for interest payments when the refunds are finally issued.
In a previous post about the refund issue, I noted additional reasons why Judge Eaton was right to issue a universal injunction here, most notably that Trump v. CASA only applies to injunctions issued under the Judiciary Act of 1789 and its successors, not to the separate 1980 jurisdictional statute from which the Court of International Trade gets its authority.
As I have also noted in previous posts, even complete refunds for illegally collected tariffs cannot fully remedy the harm they cause. Among other things, they cannot compensate consumers who had to pay higher prices, or businesses who lost sales or suffered from diminished investment and disrupted relationships with suppliers. These factors argue against staying injunctions against the collection of illegal tariffs, as the courts mistakenly did in our case (but the CIT recently ruled the other way in the ongoing Section 122 tariff case).
The government’s demonstrated unwillingness to issue complete refunds to all the victims is another reason not to stay injunctions against the Section 122 tariffs, or any other illegal tariffs the executive might try to impose.
