Importers Begin Receiving CAPE Refund Payments; CIT Says Section 122 Tariffs Illegal
Importers Begin Receiving CAPE Refund Payments; CIT Says Section 122 Tariffs Illegal
By John H. Kester
Importers who paid tariffs illegally based in the International Emergency Economic Powers Act (“IEEPA”) and whose entries were eligible for the first phase of Customs and Border Protection’s (“CBP’s”) Consolidated Administration and Processing of Entries (“CAPE”) tool have begun receiving refund payments. Last month, in an April 28, 2026 Order in Euro-Notions Florida, Inc. Senior Judge Richard K. Eaton had telegraphed that CBP “anticipate[d] issuing the first refund on or about May 11, 2026” (yesterday).
These payments will come as welcome news to importers, who have waited months to recover the funds even after the Supreme Court ruled IEEPA did not give the President authority to tariff. Given CAPE’s Phase 1 parameters limiting filings to unliquidated entries or those that have been liquidated for 80 days or fewer, these payments also will leave some of those same importers eager for expansion of CAPE’s parameters to encompass other entries on which illegal tariffs were imposed. GKG Law will monitor whether and when that occurs.
Although updates regarding CAPE have been issued via Euro-Notions Florida, Inc., which took over for Atmus Filtration, Inc. as the lead tariff refund case, development of the CAPE tool reflects the aggregate effect of thousands of complaints filed by importers with the Court of International Trade (“CIT”), including numerous such importers represented by GKG Law. Speaking to government attorney Claudia Burke in a hearing in Atmus Filtration on March 4, 2026, the Senior Judge stated, “We have 2,000 cases…if I’m assigned those 2,000 cases, and if I lift the stay, you [the government] are going to have to answer 2,000 cases within 60 days, and I am going to have to hear 2,000 cases. We don’t want that to be the result.”
As for the stopgap 10-percent tariff the Trump Administration implemented following the Supreme Court’s IEEPA tariff ruling, the CIT in a Judgment in The State of Oregon, et al., v. United States, et al. / Burlap and Barrel, Inc., et al. v. United States, et al. on May 7, 2026 ordered that that tariff too was illegal. The “global tariff,” also referred to as a “temporary import surcharge,” had been implemented ostensibly under Section 122 of the Trade Act of 1974 and claiming that the United States has a “large and serious balance-of-payments deficit.” The related Opinion and Order stated, “Nowhere does Proclamation No. 11012 [(pursuant to which the global tariff was imposed)] identify balance-of-payments deficits within the meaning of Section 122 as it was enacted in 1974.” The Department of Justice filed a notice of appeal from the Opinion and Judgment on the following day, May 8, 2026.
John H. Kester is a Customs attorney with GKG Law. He additionally passed Customs and Border Protection’s rigorous Customs Broker License Exam and his application for a Customs Broker License is pending. He is reachable at jkester@gkglaw.com.
Brendan Collins and Oliver M. Krischik, Principals with GKG Law, have participated in the firm’s numerous filings in opposition to the Section 301 and IEEPA tariffs. They are reachable at bcollins@gkglaw.com and okrischik@gkglaw.com respectively.
