The litigation over the now-invalidated IEEPA tariffs continues to move at a remarkable pace. Just two weeks after the U.S. Supreme Court struck down the tariffs in Learning Resources and V.O.S. Selections, and only days after the Court of Appeals for the Federal Circuit returned jurisdiction to the Court of International Trade (CIT) to address the mechanics of relief, the CIT has taken a significant step toward determining how refunds will be handled. At a March 4, 2026, hearing before Judge Richard K. Eaton, the court ordered U.S. Customs and Border Protection (CBP) to halt liquidation of IEEPA duties and begin unwinding duties already assessed. The order, issued in Atmus Filtration, Inc. v. United States, is notable not only for its speed but also for its breadth: the court indicated that the relief it is contemplating may extend to all importers of record, including those that did not file their own refund actions.
The decision marks a major development in the post-IEEPA landscape and signals that the CIT intends to move quickly toward establishing a framework for tariff refunds. At the same time, the order is almost certain to be appealed and leaves several significant questions unresolved, including whether the CIT has authority to grant such broad relief to parties not before the court — particularly with respect to entries that have already liquidated and may even be final (i.e., past the deadline to protest liquidation). To help address these issues, we summarize the ruling, outline the current status of the IEEPA refund litigation, and discuss steps importers that paid IEEPA tariffs should consider to protect their interests.
What Happened
On Wednesday, March 4, 2026, the CIT ordered U.S. Customs and Border Protection (CBP) to stop liquidating duties collected pursuant to the International Emergency Economic Powers Act (IEEPA duties or IEEPA tariffs) and to reliquidate previously liquidated IEEPA duties where possible. The decision applies to “[a]ll importers of record,” including both those that filed suit in the CIT seeking IEEPA tariff refunds and those that did not. “To find otherwise,” Judge Richard K. Eaton wrote, would “deny [filing importers] the efficient resolution of their claims, and [non-filing importers] the benefit of the Learning Resources decision,” referring to the February 20, 2026, U.S. Supreme Court ruling striking down President Donald Trump’s IEEPA tariffs as unlawful. The court stopped short of ordering CBP to issue refunds immediately, but Judge Eaton scheduled a status conference for Friday, March 6, 2026, at 10:00 a.m. ET to discuss the mechanics of the refund process.
Although the CIT had been expected to begin addressing IEEPA tariff refunds after the Court of Appeals for the Federal Circuit (CAFC) issued its March 2, 2026, mandate returning jurisdiction to the CIT, the court’s action was both faster and broader than many observers anticipated. The ruling also arose in an unexpected case, Atmus Filtration, Inc. v. United States, during what had been scheduled as a routine hearing on a motion to restrain CBP from liquidating the IEEPA duties paid by Atmus Filtration, a U.S. filtration systems manufacturer. The case was filed only a week earlier and was initially stayed, but after Judge Eaton was assigned to it, the court ordered the parties to appear in person for a March 4, 2026, hearing, lifted the administrative stay, and directed the parties to address questions regarding CBP’s collection of IEEPA duties.
In effect, Judge Eaton appears to have used the first available opportunity to move quickly on the question of how IEEPA tariff refunds should be handled, with Atmus Filtration becoming the vehicle for addressing the issue. During the hearing, Judge Eaton stated that the Chief Judge of the CIT had assigned all 2,000+ IEEPA tariff cases to him and indicated that he would likely treat Atmus as the lead case for resolving refund issues, rather than V.O.S. Selections v. United States, the case decided by the Supreme Court in Learning Resources and previously viewed as the bellwether for refund litigation.
What Was the Ruling?
The Judge made his ruling from the bench and immediately thereafter issued a short written order directing the following:
- CBP must stop liquidating IEEPA duties.
- CBP must reliquidate previously liquidated IEEPA duties, except where liquidation has already become final.
- The order applies to all importers of record that paid IEEPA duties, regardless of whether the importer filed a lawsuit in the CIT.
Notably, when the DOJ lawyer requested a stay of the ruling (presumably to allow time to appeal to the CAFC), Judge Eaton immediately denied the motion.
What Were Some Notable Aspects of the Ruling?
Several aspects of the hearing provide insight into how the CIT may approach the IEEPA refund issue going forward.
- The fact that the ruling came from an unexpected case shows Judge Eaton is looking for the quickest possible resolution. Until now, the principal litigation vehicles had been Learning Resources (the main IEEPA case, consolidated with V.O.S. Selections before the Supreme Court) and AGS Company Automotive Solutions v. United States, one of the leading § 1581(i) refund cases. Few observers expected the newly filed Atmus Filtration case to become the vehicle for broad relief. Indeed, government counsel noted during the hearing that the United States had a brief due in V.O.S. Selections in two weeks in which it expected to outline its position on refunds. The fact that Judge Eaton was not willing to wait even two weeks for the briefing on the issue and instead announced that he intended to resolve key issues in Atmus shows that he does not view there to be anyissues that require briefing, as he stated at one point in the hearing.
- The scope of relief expanded dramatically during the hearing. What had been scheduled as a routine hearing on a temporary restraining order (TRO) evolved into something much broader. The parties had anticipated that the TRO issue would be resolved by a government stipulation not to oppose reliquidation if ordered by the court. Plaintiffs even attempted to withdraw their TRO request. Judge Eaton denied that motion and instead granted relief far beyond what had been requested, signaling that he viewed the hearing as an opportunity to address the core refund issues immediately, even without briefing.
- Judge Eaton rejected the government’s efforts to narrow or delay the refund process. During the hearing, the government raised a series of arguments aimed at limiting or postponing relief. Judge Eaton rejected each of them:
- On the legality of the tariffs: Judge Eaton emphasized that the Supreme Court had already resolved the central issue, stating: “The Supreme Court has told us that the collection of these duties was unlawful from the first moment they were imposed… all of this money was collected unlawfully and… must go back to the importers.” Judge Eaton was impatient with any suggestion that CBP could in any way narrow who gets refunds.
- On whether importers must file their own lawsuits: Government counsel argued that importers with liquidated entries “absolutely have to come to the court.” Judge Eaton indicated that this question would be addressed at a follow-up status conference on March 6, 2026, leaving the issue unresolved but highlighting the importance of protective filings for importers with significant exposure.
- On whether further briefing is needed on refunds issues: When the government argued that it needed additional time to brief the merits, Judge Eaton responded bluntly: “There are no merits. The duties were unlawful from the first moment they were imposed.”
- On whether CBP needs time to develop its “position” on anything other than the mechanism to refund the IEEPA duties: When government counsel stated that it needed time to finalize its “position” on refunds, Judge Eaton replied: “Your position is clear. The Supreme Court told you what your position is. Your position is you are going to refund this money.”
- On whether issues relating to how “hard” it is to issue refunds matter: The government suggested refunds would require manual review of individual entries. Judge Eaton rejected this argument, noting: “We live in the age of computers. It must be possible for the Customs Service to program its computer so it doesn’t need a manual review to refund the IEEPA duties.”
- On the speed of relief: Judge Eaton denied the government’s request for additional written submissions and also denied a motion to stay the order, though he stated he would be open to reviewing a declaration from CBP explaining the practical challenges of issuing refunds.
Should Importers That Have Not Filed § 1581(i) Actions Consider Filing Now?
Judge Eaton’s unexpected order raises an immediate question: How should companies that have not filed § 1581(i) actions respond? We continue to believe that companies with significant IEEPA exposure should consider maintaining or pursuing individual actions for several reasons.
- First, the government has already indicated that it believes individual lawsuits are required for certain refunds. During the hearing, Department of Justice counsel argued that importers must file their own lawsuits to obtain refunds for entries that have already liquidated. The government is therefore highly likely to appeal on this basis. Importers that have already filed individual actions are positioned to avoid being caught up in this dispute.
- Second, the Federal Circuit has previously rejected attempts by the CIT to issue relief that extends broadly to non-parties. In V.O.S. Selections, the Court of Appeals for the Federal Circuit vacated the CIT’s earlier order in part because it functioned like a universal injunction, applying to parties not before the court. The government is likely to rely on this precedent in any appeal. Even if the Federal Circuit ultimately narrows the scope of the Atmus order, that reasoning would not affect importers that are already parties to individual § 1581(i) actions.
- Third, the CIT itself has indicated that additional issues remain for companies that have not filed suit. Judge Eaton scheduled a further status conference to address questions affecting non-filing importers. The fact that Judge Eaton, who is trying to move full-speed ahead on the refunds issues, thought further consideration is required for non-filing importers underscores that importers who have filed their own 1581(i) actions are in a different, and likely judicially favorable, position.
- Fourth, given the Federal Circuit’s earlier rejection of nationwide relief, additional procedural complications may arise for companies that are not currently before the court. Any narrowing of the scope of the Judge Eaton order is most likely to occur to cut back on the ability of the CIT to order broad relief to parties that are not before the CIT, especially with regard to entries that are liquidated and final.
- Fifth, companies that are parties to the litigation will have standing to enforce any refund order. If disputes arise regarding how CBP implements refunds — including the scope of eligible entries, the calculation of duties, or the timing of refunds — only parties to the litigation will have the ability to return to the CIT to seek enforcement or clarification. Companies that are not parties may have limited ability to challenge CBP’s implementation.
- Sixth, parties to the litigation may be better positioned if refunds proceed on a staged or prioritized basis. If CBP ultimately processes refunds over time, rather than all at once, importers with pending litigation may be prioritized or may have clearer avenues to challenge delays. Companies that have not filed suit could find themselves dependent on CBP’s administrative processes without a direct judicial forum.
In short, being a plaintiff before the CIT likely provides a quicker and cleaner path to refunds than relying on the resolution of the many issues likely to arise in the broader IEEPA refund proceedings — and certainly a faster route than the government’s apparent preference for channeling disputes into the traditional (and often lengthy) protest process. Filing suit helps ensure that importers remain at the front of the line for refunds.
Importers that have filed suit also avoid the legal uncertainty surrounding the scope of relief available to non-parties. Counsel for the U.S. defendants in Atmus indicated that the government intends to argue that refunds should be limited to importers that filed actions in the CIT. Similarly, if the government appeals the Atmus order on the grounds that the CIT cannot issue relief resembling a universal injunction — an argument the Federal Circuit relied on when staying the CIT’s May 2025 injunction in V.O.S. Selections — that reasoning would not apply to importers that are already parties to individual § 1581(i) actions.
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In short, Judge Eaton’s order is an important and welcome development, and companies that have already filed § 1581(i) actions should take comfort that these cases now appear likely to be centralized before Judge Eaton. At the same time, the order is far from the final word on IEEPA tariff refunds. Key questions remain regarding the treatment of non-filing importers, the handling of entries that have already liquidated and become final, and how the Federal Circuit will respond to what is almost certain to be a government appeal.
If you have questions about these matters, please reach out to the authors or your Foley & Larder relationship attorney.
Please note that, as of the publication of this article, U.S. defendants in the Atmus case have recently filed a proposed framework for carrying out Judge Eaton’s order stopping the liquidation of IEEPA duties. We will soon provide analysis regarding the same.
